Sam Parr: How to Build An $18M Business From Scratch l Trailblazers Podcast Episode 60

0:00Erica Wenger: Today on the show, I am so excited to be joined by Sam Parr. Sam is an entrepreneur, investor, and co-host of My First Million, the most popular business podcast in the world. He's best known for founding The Hustle, the business and tech media company whose daily newsletter grew to millions of readers, a bet he made back when most people still thought newsletters were a dumb business. Turns out they weren't. Sam bootstrapped The Hustle into a multi-million dollar company without taking venture money and then sold it to HubSpot in 2021. Today, he's the co-founder of Hampton, a private community where founders and CEOs talk candidly about business, money, and life.

0:30Erica Wenger: Before any of it, he cut his teeth on a hot dog chain. He branded Wieners as big as a baby's arm, an online liquor store, and a cross-country trip on a motorbike that convinced him to build a media company in the first place. Sam writes and talks about business, media, and investing, and just about anything else he finds interesting. And he believes in being shallant, caring about things, trying hard, and not pretending otherwise. But none of it matters to him as much as his family and being a great husband and dad. Let's welcome Sam Parr. i do like to start every show with an icebreaker question which you may already know this if you listen to the pod uh and i have a feeling i know what you're gonna say but what has been the hardest moment in your life up to this date the moment that almost broke you and it can be personal

1:11Sam Parr: or professional um i used to drink a lot and so i got sober that was probably the hardest that was what i was gonna guess yeah it was the biggest leverage move i've ever done in my life giving up alcohol without a doubt and what prompted it uh i got arrested a few times and i went to jail uh a few times and it was miserable and i was in san francisco and i remember laying down and i was like i'm either gonna like be a bum for the rest of my life or i can like really leverage my ability and like take action and make something happen and so i went to basically like a homeless clinic at south in south market in san francisco it was like me and like drug addicts which i guess i was and uh i just like i'm gonna make this happen so i worked with the doctor and i locked myself in a

1:53Erica Wenger: room for three weeks and made it happen and you've not gone back since there's been no real because

1:57Sam Parr: that happens a lot people fall back i i tried to stop once and i fell back but no like i feel like i got hypnotized like if i there's been times where i drank someone's orange juice and it was like a mimosa and like i tasted it and i like i immediately spit it out and it feels like i'm hit like it's like i was hypnotized like i don't know i don't feel the urge at all that's really

2:16Erica Wenger: incredible yeah um obviously a lot of young people there's like two things i want to ask one a lot of young people don't drink i'm one of the people i just don't drink because i don't like it um but a lot of people feel like they need to drink to be cool and to to get girls i feel like you've mentioned

2:30Sam Parr: that like i felt that way that was my biggest concern ever was like can i be a girl what's the

2:34Erica Wenger: advice like you're a young person and you want to drink to be comfortable so i'll give crude advice

2:39Sam Parr: to young men basically when you have a little bit of quirkiness or you have some messed up pass or something some women find that attractive and i would say use that to your advantage so i used to think if i tell a woman that i messed up they would be repulsed and that was not the case i also did a good job of telling my friend group and if they made fun of me in a good way like where they're my buddies and they were teasing me but they're very accepting then i would they were still my friends if they pressured me i would i would they're they're excommunicated they're no longer my buddies so like i was very communicative to my friends and the people i wanted to go out with um also like i i drink a lot of non-alcoholic beer so kind of still felt that way but i was very transparent and open with everyone about it and that made life so much easier i love that do you

3:24Erica Wenger: were you this transparent and open about because i feel like even now as a human you're very like open and friendly and you say everything how it is were you like that before when you were drinking or and that's like a core personality trait or is this kind of like a newer version of sam no i was

3:37Sam Parr: I was like that, but way more obnoxious. I was not a very good drunk. So no, I was super obnoxious. But, and I would say things that felt like transparent and honesty and blunt, but it was not the truth.

3:51Erica Wenger: I hear you. How was the career going at that point?

3:54Sam Parr: So I quit drinking in maybe 2014 and it wasn't going that good, to be honest. It was going bad. And then I remember distinctly like six or eight weeks after I quit, I felt I saw the world differently where I could actually feel different emotions. I mean, I was pretty much intoxicated every single day for like two or three years. And so I felt like different emotions and I was like, oh, my God, this is a rush. And so like it was definitely like a different type of like addiction, like of like feeling conflict and stuff like that. That was exciting kind of. and like i was single and i was 23 or 24 and like walking up to a girl sober and like try to talk to her i was like oh my god that was so i was so scared that was such a rush and so it was awesome i felt addicted to it it was really wonderful yeah but it's a better addiction you know it's yeah for sure you know it's healthy yeah and so my career was not going good i would say and then it took about a year and then it started taking off and then talk to me about like the

4:48Erica Wenger: takeoff so like i even feel like and correct me if i'm wrong but the hustle wasn't like a quick thing it was very much like a side that you're figuring out how do you think about that early

4:57Sam Parr: it depends how you think about it yeah so i started blogging in maybe 2009 or 2010 and i still have a personal blog i don't even share it i just blog and but i would get traffic via search and then i started this conference called hustle con i think that was in uh 14 or 15 2014 or 15. and that first one i made like 60 or 40 grand or something like that in six weeks and then i would basically do that and then i would like take my motorcycle on a trip or something and then i would host it again when i needed money and after doing that for like 18 or 18 months maybe uh i wanted to start a media company and that's what the hustle was and the first year i think we did 500 000 the second year 2.2 million in revenue the third year like between five and seven i don't remember year four something like 12 million and then the year we sold we were probably going to do 18 million And so I guess looking back, it kind of took off.

5:53Sam Parr: It didn't feel like it every single day, but...

5:57Erica Wenger: That's definitely the definition of taking off. I mean, those numbers, like you're two to five X-ing every year. That's awesome.

6:03Sam Parr: No, not two to five X-ing. Is that...

6:05Erica Wenger: Yeah. I mean, you said 500K, then 2 million. That's like a four. But then it was two, four. And then it was three X with 12.

6:14Sam Parr: Well, I think it went from seven to 12. Oh, seven to 12. Something like that. Ballpark numbers. I don't remember.

6:19Erica Wenger: You threw a bunch of numbers at me.

6:20Sam Parr: Yeah, it was like, I think it was$500 ,000 ,000 ,000 ,000, maybe$5 ,000 ,000 ,000,$7 ,000 ,000,$12 ,000 ,000,$18 ,000. Yeah. But we didn't, we sold earlier in the year. We weren't actually, we didn't do$18 ,000. We potentially were going to, but yeah, it doesn't feel like you're taking off when you're, like, it feels horrible.

6:37Erica Wenger: Yeah, not great.

6:38Sam Parr: No, it feels awful. It felt awful while I was building it.

6:42Erica Wenger: So Emma Greed has this line. She's like, when you're a founder, a third of the days are great, a third of the days are meh, and a third of the days are just really bad. Like what is your, Wait, what was it?

6:49Sam Parr: Great, Matt and Bad? Great, Matt and Bad.

6:51Erica Wenger: You know, like, what is your percentages?

6:54Sam Parr: 90 % was horrible. Uh, 5 % was okay. And then whatever percent left was, was okay. Just a little bit better than okay. No, it was really hard. I, I, we, we mostly bootstrapped it and that was hard. I didn't know what I was doing. Dude, I didn't know the difference between revenue and cashflow until we had done like 8 million in revenue. Like I was really uneducated when it came to a lot of this stuff. and I was, I think, I was in my early 20s when I started. I didn't know anything. And so I, and also I was in San Francisco and I was bootstrapping a media company, which is very strange. Like this whole idea of newsletters and podcasts and stuff, that wasn't popular.

7:31Sam Parr: Everyone was doing, like it was Airbnb had just started, Coinbase, Uber. So I thought we were like way behind. I was like, why am I doing this? And so, no, it didn't feel good at all.

7:44Erica Wenger: How was the ego during that time? because i mean i feel like i mean you obviously now you had a great exit from it way more by the way than a lot of venture-backed founders who scale it all the way through series def or whatever and they sell you got more money for for the hustle what was your ego like were you struggling

7:59Sam Parr: a lot or were yes yeah like i was really lucky that i was dating my wife right when we started and then we moved in together like a year or something into the business and i was so fortunate to have a very emotionally stable woman because almost every night i would go home and like lay on my kitchen floor. I'm like, Oh, this sucks. I can't do this. And she's like, Okay, stop being a little bitch. You got this. Like it was like it was like that conversation like almost daily. So no, I would not say I would say that I'm better emotionally now. But in terms of I would say I'm like a nine out of 10 in terms of neuroticism.

8:31Sam Parr: I'm a very neurotic person. So no, I was not feeling good doing it. And I had a very pretty low ego.

8:39Erica Wenger: At what point did you start to feel a little more confident. Was it like when you hit 5 million, when you hit seven or was it just never?

8:44Sam Parr: It never happened. When you sold? There was a time when I sold where I remember being on a call with HubSpot, the buyer, and there was, they probably had eight or seven lawyers, eight or so accountants and like two HubSpot representatives. And they were grilling me, asking me all these questions. And I remember thinking like, I'm about to sell this potentially for a life-changing amount of money, whatever. I should feel good, but I don't. I felt horrible. And they're asking us all these questions about who's this freelancer to do this logo? Did he sign an NDA? I'm like, you mean like bballer69?

9:19Sam Parr: I met him on fiverr.com and he made a logo for five bucks. Am I supposed to have this person sign an NDA? There were so many times where I was balancing this high-low of high being I'm supposed to be running a business that's starting to become very legitimate and low versus like, dude, this is all duct taped together. I don't know. What's what are you talking about? You're asking for five year projections. I don't even know, like what we're doing tomorrow. So no, I don't think it ever happened.

9:44Erica Wenger: But it's so refreshing, honestly, because you know how much of our world is so pretentious. And so like everything needs to be, you know, instead of getting the like$5 logo, you need the$15 ,000 branding agency to do this whole like it's there's something very humbling and very just like refreshing about your approach.

10:00Sam Parr: I think that there's a lot of people who play business and i think it's silly so i my one of our first offices for the hustle was this little rinky dink apartment in inner sunset at ninth and judah and when we moved in there was a plaque where it basically said that craigslist started there so craigslist was started by this guy named craig newark and he like had this company that was doing like 600 million dollars a year in revenue when we moved in so we he moved out we moved in and it was a two or three thousand dollar a month office and he was doing 600 million dollars a year in revenue and his desk which ended up become my desk was a kitchen table that was too heavy they couldn't move it out they just left it there and i remember thinking i'm like this guy does not do any of this nonsense that people talk about and yet he's crushing it harder than everyone else you just don't need to do most of this other fancy stuff when you have a company sometimes you can do it because it's fun or it's awesome or you think it's awesome but it's most everything is is non-existent uh in terms of like yeah it's just not important like with hampton we had a million dollars in revenue and cash in the bank before we had a website um with the hustle it was just email i i don't know if there's a way you can look back but we didn't even maybe we had it but we didn't post we didn't have instagram we didn't have social media it was just every day grow this newsletter by three percent every single week did we do it this week or did we not do it what did we do let's keep doing that what where did it fail let's figure out and so that's all we cared about and so it was it's kind of been like nice to learn about all these entrepreneurs who aren't fancy and that's kind of what we did and it was

11:34Erica Wenger: very effective yeah i think though what is difficult is there's this huge wave of like business creators i feel like you're kind of at the forefront of that where you like talk about business maybe you've built big businesses but a lot of the times you haven't like i find that there are a lot of conferences especially lately i've been seeing there was one a couple weeks ago where it's a lot of people playing business yeah talking about business not doing the thing and how do we get around that because i do think like right now society really rewards the hype and the marketing and the followers and the creators who want to build something less so the people who've actually built the thing and it kind of drives me off the wall because i'm like why are we so excited about the vc that is really hypey and has the name but does shitty deals not the vcs who like do great deals and maybe a little more low-key how do you think about that and like

12:18Sam Parr: Well, I know a huge percentage of the popular people on the internet and aren't in my little tiny world. And most are broke. And then I could give you tons and tons of people who probably don't have social media or they're not popular and they just are crushing it and they're happy. And so I think that it's really easy to sound smart, but it's quite boring to do the same thing over and over and over again, every single day. And not to say that I don't do that. I'm, I'm, I'm a high boy as well. Every once in a while. Oh, so am I, I get it. So like, I'm not like throwing stones here because I'm guilty as well.

12:51Sam Parr: But I think that, you know, like with the hustle, you know, we had millions in revenue before, like the MFM, the year we started it or Sean started it and I joined him, we were doing close to 10 million in revenue. And like people talk about how like everyone's on someone will make fun of me online saying the hustle worked partially because I got popular on the internet. No, the business was big. And then I got more popular after the business got big. and so i just think that it helps also to come from the midwest and not come from a lot of money and like have to pay rent and like have to pay bills and that was like hugely beneficial to kind

13:26Erica Wenger: of like having that broke mindset and not letting the ego get the best of you because you could also very easily change like i think that's a lot of it too people come from the midwest they come from humble beginnings and then you know they get a few strokes of luck or a few wins and it's like

13:39Sam Parr: a different person well i just think that if you are an entrepreneur oftentimes your income can be really lumpy. And so I know, like, I hang out with a lot of like small business folks. And the idea that it can go away is always there. I just interviewed this guy named David Rubenstein from, he started Carlisle Group.

13:58Erica Wenger: Insane.

13:58Sam Parr: Yeah, he's worth, I don't know, 10 billion or five, whatever, a lot. And I was like, wouldn't you feel financially secure? He was like, yesterday. And he's being hyperbolic a little bit. And one could like mock him for not feeling secure when you're obviously secure. But I just think that there's this like trauma potentially that exists when you're younger, where you always feel broke. His parents were postal workers. And so I just, I typically I have found that if you were raised in humble environments, that doesn't particularly go away.

14:24Erica Wenger: Yeah, it's, it's pretty wild that David is sort of like the penultimate example.

14:29Sam Parr: And like, yeah, or another guy is Lloyd Blankfein from Goldman, the CEO of Goldman. He was really fun to talk to his parents, coincidentally, also were postal workers. and he was raised in Brooklyn in a very, I don't know if he would say poor, but like, you know, normal, I guess, background. And he was like, dude, I still have the cheap version of Netflix because I feel bad paying the extra money for the ads. And sometimes that like money scarcity mindset, it doesn't go away even though it's kind of toxic.

14:56Erica Wenger: That's wild. Well, so much of wealth, and I feel like you talk about this a lot. It's not just about how much you make, it's how much you save. And it's like, you know, if you're spending all of your salary, you're not actually getting wealthy. That's a lot of people.

15:06Sam Parr: so many people in new york that makes so much money we're talking millions of dollars that live paycheck to paycheck because they buy dumb shit and they and they do stupid stuff that they can't truly afford um i think some like this is like a famous like buddhist thing i don't you know someone's gonna laugh at me because i don't know the the origin but it's like um wanting is uh uh torture or have you heard that phrase yeah uh i mean i understand i forget the i forget the exact terminology someone will make fun of me but um uh like just want less stuff and and and you'll definitely be happier but everyone's obsessed with status like that's so

15:42Erica Wenger: much of it it's it's signaling and i think in our world now where a lot of especially i'll speak to like venture like a lot of stuff is hype it is made up it is signaling it is borrowing credibility from other people yeah well venture is the ultimate signal game because it's sort of like i'll take your money if you're cool correct which is why i'm not a venture capitalist it sounds too hard it's that's a hard game you're like i have to always stay cool that's yeah you have to like

16:03Sam Parr: be mysterious or you gotta like say dumb shit it's hard no so i don't envy you for doing that

16:08Erica Wenger: it seems very challenging you know but it's also yeah it is challenging in some ways but it also it's part of the fun because i can do it my way which is i don't play into that in a lot of ways but does it work like the like does it work returns will tell but like i think being real

16:21Sam Parr: and being different in my industry stands out i have a somewhat strange opinion i think I think authenticity is bad. I think that like the idea of wearing a mask and pretending to be something you're not is incredibly effective. And oftentimes people are losers and they say, like someone will say, well, just be yourself. It's like, dude, yourself sucks. Don't be yourself. Change who you are.

16:47Erica Wenger: Be different. Be different.

16:49Sam Parr: Or become better or just pretend. Like if you want to be effective, pretend. And that's totally fine. Like that's what we do when we dress up every day, right? We're trying to like put on like some...

16:59Erica Wenger: Our like better shirt and our whole makeup.

17:01Sam Parr: Yeah, don't be authentic unless you rock, which you probably don't.

17:04Erica Wenger: Then the question's like, how do you know if you rock? You know, I think a lot of people think they rock and they don't rock.

17:08Sam Parr: Just assume you don't.

17:09Erica Wenger: Yeah, most people. It's like most things in life are a bell curve, you know? Very few actually are.

17:13Sam Parr: No, I gave this... I was thinking about this the other day. I was thinking about the word nonchalant. And I like had to give this talk and they wanted me to do it on business. And I was like, I don't want to talk about business. I want to talk about why you should be chalant.

17:25Erica Wenger: Yeah, what is chalant? Chalant, yeah.

17:27Sam Parr: So enthusiasm, I define enthusiasm as like the physical representation of showing your passion. And what I have noticed in my life when I was a kid, I was like 16 years old. I had this huge Afro. If you Google, you could find this photo. It's the worst. And I wanted to meet a girlfriend so bad. And so I read every like book you can imagine on how to meet a girlfriend. And I remember distinctly like, well, my takeaway is like to be cool, which is not what those books were saying. But for some reason, that's what my takeaway was. And then it didn't work. obviously i did not get any girls at all when i was 16 and then when i moved to san francisco i started like pitching people to join my startup as an employee or to raise money or whatever and i was like i was like a comedian where i would like test different bits and i'm like dude i've noticed if i dial up my enthusiasm and show like some weirdness and show how passionate i am even about the dumbest thing ever which was a newsletter people get bought in so much more and then when i I met my wife when I met her for our first date.

18:25Sam Parr: I was like, hey, there's this like, I have a weird hobby. I love denim. And I was like, I can see this. Yeah, can you see?

18:31Erica Wenger: I mean, this is, I don't think people see this pants, but like we're going all denim.

18:34Sam Parr: And I was like, hey, do you want to go to a denim swap meet this Saturday? The reason it's cool is because denim is a quintessential American clothing. And oftentimes, sometimes, or oftentimes you could find these rare denim that can sell for$1 ,000 that you buy for 30 bucks. And we can go and we can go treasure hunt. You want to come? And it works so good.

18:53Erica Wenger: She was like, who are you? And where did you come from?

18:55Sam Parr: Yeah, it was like unique. And I just remember thinking like, if I dial up the enthusiasm on anything, I can like attract more people. And to attract, to accomplish anything, you have to attract people to do work for you or help you or bind your cause or whatever, or like you or whatever. And so I just, I don't even remember where this question was, but I just think that like dialing up the enthusiasm is like a secret weapon to getting people to do what you want them to do.

19:21Erica Wenger: I so agree with you. and it reminds like when you first walked in people obviously didn't see this or maybe we'll add this clip in but like we were talking about motorcycles because you came in with this helmet and my fiance literally like one of our first dates was just like you with denim was like so I have to tell you about this like new toy I got and I love motorcycles and still to this day like he smiles larger when he is on a scooter than he is when he is hugging me like yeah it's awesome yeah I know you think that because you guys share that love but like let me tell you this if someone

19:45Sam Parr: came up to you yeah and you were like what's your hobby and they were like you know right now I'm obsessed with seeing if I could break the world record for how fast I can do the Rubik's Cube. Like, that's not like, cool. But the fact that someone's obsessed with something, even if it's trivial, I find that to be very cool and attractive. Not necessarily. Obsessed with anything. Yeah. I'm just like, that's awesome. And so it's this idea of like, I am here. That's where I'm going. Get on or get off. Like this concept. I love, I love that concept.

20:16Erica Wenger: Well, it's a real confidence vibe too, of just sort of like, I don't really care that I love denim i don't really care they love motorcycles like this is my thing yeah rock with it it actually it's funny because you were joking like i think being authentic is bad but actually i almost view this as like the ultimate expression of authenticity like i think your denim obsession josh's motorcycle obsession this random person's rubik's cube obsession like that is so authentically them i love musical theater like to a point where it's just like embarrassing but i love it i love

20:44Sam Parr: it i love it and that's very authentic yeah i think you just got to get into that stuff and

20:47Erica Wenger: like show it people dig yeah they dig and you dial up you dial up the excitement that's the inauthentic part for some people but i think you should try it okay um i want to ask you about your hot take around events businesses so i saw do i have a hot take on that i mean you i think you think they're great businesses i think like my i think they can be and i think that they're and i've done a bunch of events and they pretty much always break even you have yeah a bunch like

21:09Sam Parr: i started a conference back in the day what was it called it was called own it okay let's put it

21:13Erica Wenger: back in college what was the revenue uh it wasn't really like we were selling tickets i mean i guess we did sell tickets we had a lot of sponsorships from companies i think it was like 100 grand i want to say for like a 1 000 person conference and we had a bunch of like corporate sponsors in

21:26Sam Parr: college okay oh in college yeah i did this when i was like 19 that's amazing i just it just like

21:31Erica Wenger: threw a one-day conference that's amazing um but it was like very much like an insane amount of work we broke even and granted this wasn't my full-time gig and like you could make the argument that if I'd really tried to blow it up. I could have, but on the whole, even like I throw dinners, they all, everything breaks even. It's like, what's your take on why events are great?

21:47Sam Parr: They can be awesome. Tell me. It'd be huge. Okay. I'll give you an example. There's this guy named Matt Weiner. Look up Google. Do you Google on there? Yeah. Is that how you use it? Google it right now. You want to look it up? Yeah. Sure. Sure. Look up, or maybe, maybe you don't need to Google, but have you heard of shop? Oh, sorry. Money 2020.

22:01Erica Wenger: Yeah, of course.

22:02Sam Parr: Have you heard of shop talk?

22:03Erica Wenger: Yeah. I've heard of it.

22:04Sam Parr: have you heard of this new thing called uh it's called health but it's spelled like hlt yeah yeah

22:08Erica Wenger: yeah yeah okay it's in vegas i think it's like a healthcare thing this guy is an example he used to

22:14Sam Parr: work at google like he had a tech company that he sold to google or something like that and uh i forget his first event but it might have been called grocery talk okay and he built that up and he sold it for like 100 million dollars then he started shop talk built it up sold it for 100 million dollars. Then he built up Money 2020, sold that as well. Now he's got health, which is bigger than all of them. And I met this guy. He's very inspiring. And event businesses can be awesome, which is an example. He's an example. The key to an event business is you have to figure out what type of event that you are.

22:49Sam Parr: And the big money is made when your event business is like a marketplace, meaning people are going to make deals. So I can justify sending an employee there for$2 ,000 to $4 ,000 plus travel and hotel because when they go there, they're going to meet someone or whether they're going to transact in some capacity. And so they can be awesome. The event businesses that suck, which is often the ones I did, is when it's more entertainment or more like inspiration or whatever. Typically, to have a good events business, you need to be able to charge enough money for the sponsor and the attendee to where it's a no-brainer because the transactional value that you can get out of it is like a drop in the bucket you know what i'm saying a hundred percent so they can be awesome and i and i i know a bunch of events businesses that kill it um they can be huge like there's this company called informa have you heard of informa no their market cap you'll have to check me on this one can you look up their market cap what's

23:46Erica Wenger: what's informa's market cap let me look i'll type it in informa market cap 11.

23:53Sam Parr: 11 billion dollars so they are a trade show business okay um they probably own i'm just guessing i think 150 trade shows um and so this idea of like media meaning you have like a website or some type of content and then you monetize the v in an event can be awesome awesome awesome the issue is a lot of people don't think this out the equation of value that you could potentially make is like buying power multiplied by the influence you have over them multiplied by the quantity of them does that make sense 100 and that is like equals value and so you have to if your goal is to make a lot of

24:26Erica Wenger: money you have to optimize that equation i love it and i also think for a lot of these sponsors too like they have a set cac and so they know that they can convert three people five people eight people like it's worthwhile for them if it's yeah you know a very high caliber audience because it sounds like all people you're mentioning too like i know shop talk i know health like money 2020 like these are like high caliber people.

24:46Sam Parr: So yeah, like you could have like a 500 or fuck. You could have a 200 person event for people who are parts buyers at Boeing or big, you know, where they're like buying like, you know, they're placing like a billion dollar, a hundred million dollar order. You could have a 200 event with them, 200 % event with them and make way more money than having like, you know, 10 ,000 concert goers or whatever come to your event. Does that make sense?

25:09Erica Wenger: So how about qualified, qualified audiences? Well, I'd love your take two on newsletter businesses. So I hear you on events. i think that's really interesting and i think that guy matt's an amazing example uh newsletter businesses how can they be lucrative i just had tyler do you know tyler beehive tyler yeah i like tyler he's the best so he just came on also beehive sponsors the pod shut up yeah i invested in beehive's competitor oh which one kit uh but no i do love tyler and i'm sure beehive is wonderful for uh certain people shut up beehive yes they're great yeah but not for me because i'm a stakeholder

25:38Sam Parr: no i like tyler i think he's uh building his company in a really cool way it's awesome

25:43Erica Wenger: he's so wonderful like he's truly amazing um wait what was that what we were just talking about before we're talking about newsletters oh yeah so one of the things he was saying that was so wild is like he has this crazy newsletter i don't know if you know about it's like big desk something it's awesome 150 000 people he makes he doesn't make as much money from like ads on the newsletter which is what i think most people think the obvious business model is but he does this founder mastermind where he sends like you know what is it eight to ten founders or something and they pay him a crazy amount of money he makes more money from that than he does from the whole like ads business so i think newsletters are interesting because you can charge for other things but newsletters themselves are kind of hard tell me your take am i right or wrong i don't think newsletters are hard hard to make money off of no they don't have to be i think

26:23Sam Parr: that um okay so when we had our newsletter business the math that when we started it i was I think this can get to 100 million. And I did the math and I was like, the way it gets to 100 million, and my math was off on some parts, not off on other parts, was you can get three, I have to do this mental math in my headache, but I'm going to get it off.

26:43Erica Wenger: We're doing a lot of math today.

26:44Sam Parr: Yes, but that's how I think. I'm a very basic arithmetic person, but it works. If you have like 3 million subscribers and you get a CPM of like$50 per send and you have like 100 % ad fill rate and you send six days a week, you are now reaching you're getting that means you're getting like 26 million impressions a month at that cpm like it could be great um the problem with the newsletters most people don't take it seriously to where they're like to send a daily newsletter you got that's your job and 3 million subscribers is no joke yeah but the tam was big so it was like people who are interested in tech and business like this huge tam but you can get there in a variety of ways so what we decided to do was to make that huge and then we were going to launch other products we only launched one product before we sold what morning brew did also was effective and my way would have worked by the way my way would have gotten us there we definitely would have got we would have gotten to 80 million i think uh morning brew what they did was they just they launched multiple newsletters and they are nearing 100 million in revenue and so they had multiple newsletters they had their main big one and they had multiple um b2b ones um there's industry dive if i had a guess they're in the 170 million dollar a year range um and they what they did is they it's called industry dive and they have different industries.

28:00Sam Parr: They do the restaurant industry. I think they do the trash industry. They do a bunch of like stuff that's, I don't even know all of them, but there's a bunch of ways to make a newsletter business big. Now what Tyler's doing is he's running this sort of as a side business or a hobby or something. Yeah, yeah, of course. And he's killing it at that. But if your decision is to go hard and spend 40 hours a week on it, within one year, you 100 % can be at a million dollars a year run rate if you choose the right audience and your content's good. There's no doubt about that.

28:27Erica Wenger: And how do you grow a newsletter? What's your best advice there?

28:30Sam Parr: Well, the way that we grew it was we got the first 100 ,000 or maybe 70 ,000 subscribers. I would write or we and me would write organic, like just articles that would go viral. And then we had a really funny pop up and we would just add like 8 or 10 ,000 subscribers a month. But there's a bunch of ways you could lead magnets are like the easiest way. I mean, the way to grow a newsletter is just like boring stuff done well. So like lead magnets do great. So at Hampton, we have this amazing lead magnet where we've gotten 50 high net worth people to reveal all their finances. So their personal spend, their income, their portfolios, and it crushes for us.

29:06Sam Parr: So you grow via lead magnets. We didn't actually particularly use social. We used Reddit. We would post, I would write articles that could get popular on certain subreddits that had the audience that made sense for us. And so I would just work backwards. Like what could get popular on this subreddit? Now you could ask yourself like what video could get popular on YouTube. We didn't do that because I don't, I wasn't good at video.

29:30Erica Wenger: But you've been getting better. You're doing a lot of video now.

29:33Sam Parr: Yeah, better. It doesn't come natural. I was, I was writing was way easier for me. Now Twitter exists, but I don't actually don't, if I had a bet, Twitter probably doesn't drive that much in newsletters growth. But the goal is you have to steal the audience from somewhere else. So you have to find out where the audience exists and what can I make to get popular on that platform and siphon them to me. And then after 100 ,000 subscribers, we started buying ads on Google, Meta, other newsletters, because we knew that for every newsletter we had, we could spend roughly$1.50 to$2.50, something like that.

30:09Sam Parr: And we can make like$10 a year off of them. So then it just became an equation. Just pouring it, yeah. Yeah.

30:16Erica Wenger: See, that's the beauty. Once a business starts to kind of work a little bit, once you get the math to math,

30:20Sam Parr: then you're just off to the races yeah and back back then it was like impossible to figure that out now there's beehive there's kit there's all these things that make it easier to like understand that math but it was like freaking hard back then yeah well that's what is your advantage and that's why you won which is awesome yeah people laughed at us by the way like like when we started i was like i told my friend dave nemitz who is found in bleacher reports a huge media company i was like why does it matter if you're on safari chrome or in your thing or in your email inbox on your phone It doesn't matter.

30:49Sam Parr: And he was like, there's no way an email can make more than a million dollars a year. There's no way. I was like, it doesn't matter. If the attention's there, who gives a shit?

30:57Erica Wenger: Yeah.

30:58Sam Parr: And no one bought into that. Now, companies have like newsletter, when they're creating their marketing budgets, they have like a newsletter, like line item. Back then they did not. I had to convince all these people. It was really hard. But now it's way easier in some ways.

31:13Erica Wenger: And with Beehive, as an example, like it kind of is a blurry line between like your newsletter and your blog. like you know it's because it lives forever dude blogs are dead which sucks blogging was

31:21Sam Parr: how you're 29 yeah okay when i was uh growing up on the internet blogs were like the best community ever so when i was like 18 to like maybe 28 uh it was like the greatest thing ever yeah but they're dead it's very sad yeah i think well we find community in other places well i just like text-based like articles and stuff i i still think it has a place it's weird with search i don't know what's going to happen with search um but like yeah i i mean i i read tons of newsletters still

31:54Erica Wenger: tons like x articles are great like i feel like that's been like an interesting yeah the problem

31:57Sam Parr: is that it's so like um it goes away what's it ephemeral like it's like it's there for like a minute and then it goes away like i could write like a really good article that would like provide

32:06Erica Wenger: value to our business for like three years which sucks yeah yeah yeah there's a long tail's gone um i want to talk to you about your obsession with money transparency so like you talk a little bit about these like lead magnets where hampton founders will like reveal everything i know

32:20Sam Parr: you started money wise and now someone else hosts it yeah uh daniel who used to work yeah yeah um

32:25Erica Wenger: where does that obsession with like understanding and when i say money transparency for people who don't know like this isn't like oh like how much did you sell your business for this is like you are having people peel back literally monthly expenses it's stuff i would have literally never

32:38Sam Parr: guessed people would do i still tell me about it like tell me about money wise tell me about like your obsession with it's called money wise the podcast is basically a high net worth personal finance podcast and we try to do it in a very non-douchey way where we where people reveal their numbers and the reason we did that was when i was a kid i wanted to not be poor i just wanted freedom and so i would read these books like biographies or articles or whatever on people and i would make timelines of like what they had and i would adjust it to modern day money and i found it to be a really clear path i'm like okay here's what's possible it was very it was it was awesome it was like you know having a friend that like went from being fat to like being like a meathead like buff dude and you're like dude i just saw this whole thing all you did was you ate this many calories and this much protein and it was really hard but like it's cool to see the path that was awesome you just inspired me now i know how to do it so i was obsessed with that and so we came up with this podcast because in hampton people would talk about this stuff they're like i just came into money or like my company's doing well but i'm still like relatively broke like show me like is there like a like what how is everyone else doing this and we so we're like let's make those conversations public and when i was hosting it a lot of the guests were anonymous now they aren't there's this strange group of people that will reveal and they do that for the same reason i'm explaining is that it like helps other people and so it's pretty wild that that exists how often do

33:56Erica Wenger: you feel like it's they want to help versus they want to flex because the thing is well first of i don't care yeah you don't care but other people care like it's like an ego thing like a lot of the people that are well known on the internet are broke as we were saying earlier but you it's interesting like if someone actually is really rich maybe they kind of want people to know like oh yeah no i've done well with my life and there's nobody you know what i mean and now like look at me it's my moment i've never thought about that about how often because i kind of look at it

34:21Sam Parr: sometimes because i'm just like i don't care as long as i get someone who could like show me i

34:25Erica Wenger: know but like i i've seen like there's one person in particular i won't name names can you say their

34:29Sam Parr: and you'll bleep it out.

34:31Erica Wenger: Whisper it to me. Okay.

34:36Sam Parr: Yes, yes, yes, yes.

34:37Erica Wenger: Okay.

34:37Sam Parr: And I think she's, fuck. Doing that. I think that person is totally legit and is doing it to feel, to help people. You do? I do. That particular person, I think they're doing it.

34:51Erica Wenger: But that's not how I have perceived that person. Yeah, I perceive a little more peacocking. um i don't it's like we already get it we already get it like i think it's pretty obvious that that person has done well but i feel like it's a little bit maybe it's my own stuff i don't perceive it

35:08Sam Parr: that way really most people i know who are really successful they are that way because they were losers as kids and it feels good to be like fuck yeah i made it dude i still post on facebook all the time so old girlfriends will see that i'm kicking ass so they're like the old girlfriend's bomb yeah like yeah like yeah i want them to know that like there was a glow up yeah yeah yeah yeah we're doing good we're doing good like rage is a very useful emotion yeah but i think it's

35:34Erica Wenger: impressive that you've gotten all these people to do it i mean it sounds like it's just because it's starting to take off now you're able to just get higher profile people yeah but the best people

35:41Sam Parr: particularly on mfm and on money wise uh are like not high profile people yeah you had oh my god

35:47Erica Wenger: what's your most popular episode i wish i knew who's this guy's name on mfm he's like the indian

35:52Sam Parr: yeah warren buffett uh manish uh what's it pabrai i mean manish yes um like he's someone who i

35:59Erica Wenger: somehow did not know i literally did not know he is insane he's cool yeah he he hits every time

36:05Sam Parr: um sean and him are like have gotten really tight and uh he hits every time because he's got this like all shucks like you just do this you just do that and and i think um he's a great storyteller too and those people don't realize how smart they are uh yeah like warren buffett's like this guy where you're like oh he's just a guy from the middle of nowhere and he just did it it's like dude he's a fucking prodigy like when he was four like he like tested out of like all the math classes um but no those those episodes are great where they have that energy but the best ones are people that no one has ever heard of did you have you seen the episode of my mother-in-law no my mother-in-law is a haitian immigrant came here when she was 14 or something like that and when she was in her early or mid 50s one day she asked to drive me to the airport i was like why why like that's like an hour and a half and she was like just let me drive you so she she's like hey i want

36:56Erica Wenger: to start a business and was sarah with you or you know just me okay uh but we were dating long enough

37:00Sam Parr: that it was you know we were family and she was like i want to start this business i i love sewing i'm good at sewing i want to start a business where i'm going to sew throw pillows like fancy couch cushion pillows i was like people buy that she's like yeah just shut up just tell me how to do it and i was like well i don't really know too much about e-com but like there's this thing called shopify and like i told her the most basic stuff that anyone could find on a youtube video and two weeks later she sends me her website and i'm like smithy someone with your name just copied your idea what the hell and she's like no no i did what you i did what you suggested i flew down to north carolina i bought all the fabrics i went to my house and i set up a studio i took photos of the pillows that i'm gonna make and then i created this etsy page and i was like are you kidding me and she's like yeah i and i even got five of my friends to buy them so they can give me a good review and now her business is doing millions a year in revenue and she has like five or six or seven full-time employees in new jersey sewing these pillows and she's a very lovely like sophisticated woman she works um like three days a week because one day a week she's with my kids the other day a week she's with her other uh grandkids and that story was the best story on my first million in my opinion i mean you're a little biased i am biased but if you look at the the it was one of the most listened uh it was a top one i don't know how high it was but uh the and then sean interviewed this lady named sarah moore who uh she had like drug and alcohol problems as well and like i think she went to jail and then like pulled herself up by her bootstrap kind of story and got into harvard business school and then convinced a bunch of friends to help her raise money and she bought a company that makes egg cartons that does i think tens of millions in revenue and like you you've never heard of her company you've never heard of this lady i think we're the only podcast she's ever done but those are the best stories the ones are people who like you don't care who they are but like their story is amazing and they also people trust you to grab

38:54Erica Wenger: those people i think that's so much of it yeah they're really hard to find how do you find them

38:58Sam Parr: that's the question like well they're hidden i mean obviously sarah's mom's easy you just talk to a lot of people i don't know it's it's we get like a ton of emails and we'll like occasionally only like read them uh it's hard you usually just find it by like kind of being a rat and just sifting through like and just like talking to people and being like hey you're interesting

39:17Erica Wenger: can i can you want to come on but what's the question you ask is it like someone who has an interesting business story who's like built something massive that maybe people don't know like what's the ask for people because you do have quite famous people on and then you have

39:27Sam Parr: people like sarah more yeah we do like we call i i it's like a barbell like we'll have like like big shot ballers, like Ray Dalio. And then we'll have like my mother-in-law and my mother-in-law, I think has more, they got more downloads or they're like really close. What's the ask? It's just cool. I think that what people like and what I like is that it's just really exciting to see people who said, here's the rules of the game that I'm gonna play and I'm playing it really hard and I'm winning. And the definition of winning or your definition of a rich life could be huge business. It could be small business.

40:04Sam Parr: It doesn't matter. But like seeing people live a rich life is really cool.

40:07Erica Wenger: So you talk a lot about rich life. And I saw you literally tweeted this like yesterday or something. You were like, I did not coin this term, but I think Rumi did. What is a rich life and why does it matter?

40:16Sam Parr: So we do this thing. We're doing this thing at Hampton and I've always done it called A, B, Z. Z is where you define like what is your rich life and you get super detailed. So I'll give you an example. When I met my wife, we were only dating for six months, but it was clear that like we're probably going to marry or like it's turning that way. And we, I was like, okay, I want you to write down exactly the life that you want to have in five years. And then as well as in 20 years, like kids, uh, how do you want to raise them? What type of home do you want to live in? Where do you want to live? Um, what values do you want to use?

40:49Sam Parr: Like all that, like be as detailed, as specific as possible on your perfect day. And then I did the same. And then we like met and we're like, okay, let's see where there's overlap. And we said, what are you willing to give up to get that and what are you unwilling to give up and let's make sure that we can compromise on certain things and if we can't compromise on certain things then that's potentially a deal breaker and i firmly believe that people should do that for all facets of their life my business partner and i did it um i've done it for myself where i'm like okay in five or ten years where do i want to be and then that's z and then a is where am i starting now and b is the next step everything in between ignore it's not important you'll figure it out when you get there but like this idea of like here's where i want to go here that's what success looks like i've defined the the winning the game a is where i am let's create some rules to this game now let's not think about any other level just the next level and we'll get there and then we'll figure out you know what i mean and so we do i do this all the time it's like a very effective way to like uh decide what you

41:47Erica Wenger: want i love that and i love it too for making decisions with a partner who like you guys might have some differing points of view i mean i would imagine over time you two have gotten more similar and have seen kind of more of the same future. But I love that too, to kind of like bridge the gaps. Yeah, there's so many times in life

42:02Sam Parr: when you're like doing something with a partner or like another person, you're like, but I thought we were gonna do this. And you're like, but I thought this. It's like, you guys didn't like have this conversation. And it's cool, by the way, the outcome, what you want changes. But like, it's nice to like say like explicitly, here's what I'm about. What are you about? And no surprises.

42:20Erica Wenger: Okay, so I have to ask you just quickly because we're talking about your family. Your wife's amazing. She's such a badass. How do you know? uh because i talked to her oh okay you can't get us no like i could just imagine no it'd be an

42:31Sam Parr: email or do you guys do a phone call okay yeah yeah she's cool she's she's sick and we met in

42:35Erica Wenger: person like forever ago like five years ago or something where at hubspot at a hampton thing like before it was hampton yeah this was like i don't know if you remember this it was like sf

42:43Sam Parr: no la oh yeah yeah yeah on the beach on the beach yeah yeah actually i don't know if she came to

42:49Erica Wenger: that i think i maybe met her at another la hampton thing um whatever anyway she's lovely um you are like the quintessential like husband and dad you like cheer on your wife you love being a dad like i even was reading like your bio and you're like but nothing matters more than like being a husband and dad yeah what is your advice for people who like want to have an incredible partnership an incredible family while they're also super entrepreneurial how do they find the right person and like how do they prioritize that when silicon valley makes you feel like you have to hustle every single day every single hour all the time well i don't want to act like my relationship

43:23Sam Parr: is perfect like everything we're always trying to like improve but um i did grind and hustle so what i said was what are we willing to give up what are we on like we kind of we gave up our i gave up my 20s so i did uh give everything up um and i did hustle really hard i don't now i work very normal like 40 hour week work weeks but like that we did give that up um um what was the

43:51Erica Wenger: question it was just like for people that are really entrepreneurial and want what you have now what's your advice for them like you know you talk about the path you know you like eat this good you work out this much you lose the weight like let's say there's someone who's like single entrepreneurial they want the family they want the the great partner that they really respect what's your advice to them to find that is it just like hustle and then once you you know get there you find them

44:13Sam Parr: i don't think that's your advice i i i have a bunch of like single women who work at my office and it's fun hearing their dating. I'm always voyeuristic. I'm like, tell me how to go. And there's this common thing where people say, I'm focused on my career. I can't date. And I'm like, well, you're dating the wrong people. You're just dating losers or you're dating someone who's not aligned with you. Because if you want to focus on this, that doesn't mean you can't do this other thing. It just means that when you get that person, you just are aligned on what the rule is. I think that having a partner, a significant other is like the greatest life hack it's not about finances but like if there's a good financial life hack i can tell someone's like marry a good woman or marry a good man it's the best um so i think that's awesome i definitely think you should like for sure do that i have a funny joke but it's not entirely a joke where i say you should settle people talk about like oh this person's not like perfect i'm like there is no perfect person there's billions of people on earth you probably will be equally happy with a bunch of them.

45:15Sam Parr: If this person mostly fits all of your requirements, you just commit and you make sacrifices and you say, we are committed no matter what, and we will work with each other to make this amazing. And I think that's like the right move, particularly in New York, where there's so many options. People like say like this, like I have this friend who's like, he's a smoke show. He's wealthy. Everything about him, his personality is great. And he dates these amazing women. He would have these one women, this one woman who I thought was perfect for him. She was beautiful, driven nice everything was perfect but he was like she was eating candy in bed and like like like you know like they were watching a movie and i'm like and he's like that was disgusting and i was like what are you talking about dude like that is so not important you just you it's mostly great and that's good and so i think i'm a big fan of that i have a friend named logan who's got a book

46:07Erica Wenger: called how not to die alone and she's got she's the hinge she was the hinge dating yeah she's my

46:11Sam Parr: best friend she's amazing oh that's a small world yeah she's awesome i love logan and she's got this chapter in her book uh where it's titled like the spark where like people are like you have to feel sparks right away and frankly i did feel that with my wife so it was i didn't have to the spark but like it's just it's this idea of like you can learn to love someone if they're mostly like check all the boxes and i think that's that's usually i think the right answer that's great advice i feel

46:36Erica Wenger: like we need like a poster of like all your like one-liners like please settle authenticity sucks like you just have these things where you're like yeah everyone's gonna go that way how this

46:47Sam Parr: let's go that way it's just easier to succeed when you're different i mean that's like the

46:51Erica Wenger: definition of our world right it's like be contrarian be contrarian um i love it i have one final question for you i want to hear like what's next is this over already yeah it's basically over i mean we're like we're even like a little bit over um we're like a minute over i was late sorry that's okay um like what's next for you obviously hampton you're doing that you've been building that for a bit my first million was it 870 episodes something crazy yeah uh you're here doing this like well how do you think about it is it just like taking on projects you like are you gonna do more businesses no investing what's your plan i'm not starting anything new

47:23Sam Parr: okay hampton is a great company i'm gonna do that for the next five or ten or twenty years and just have my heads down hampton is one of those businesses where people will be shocked at how great it can be and i would every once in a while i get uh frustrated i'm like i'm selling uh but my end goal is i would like to have the equivalent of like hearst corporation or something like a huge company that's family owned or family run by my partner and i and we have the capabilities to launch new stuff and have a really cool team that can if they have dreams we could they launch with them so no i we're going to keep going for a long time um thanks for coming thank you this was fun

48:06Erica Wenger: thanks for listening to trailblazers if you found this conversation viable follow the show share it with a friend and leave a review most of all please subscribe to our channel it helps more contrarian builders find us to learn more about this podcast you can visit trailblazerspod.com To learn more about our venture capital firm, you can visit parkrangerscap.com or just follow along on socials at Erica underscore Wenger. Until next time, keep trailblazing.