Sahil Bloom: How Entrepreneurs Build Real Wealth Beyond Money | Entrepreneurship | YAPLive

23:25Energy is the finite resource that we need to be aware of. Because you may have 24 hours in a day, or you may have 16 hours while you're awake. The reality is that you don't have that much energy. You're not just even energy throughout the day. And the things that you deploy your energy into, especially the things that create energy for you, where you feel really drawn to them, those are the things that create the incredible 10x, 100x, 1000x outcomes in your life. We all know this in our own experience. The times when we have generated incredible outputs and incredible results, it has always been when we felt pulled towards something.

23:58When we were able to put our head down and not even realize, time was just disappearing. You lost yourself in the thing you were doing. We need to tune into that more. Because when you lean into things that are creating energy in your life in that way, relationships or business endeavors, that is what creates the most incredible outcomes in your life. And so in the book, actually, I have an exercise that I love people to walk through to actually identify the things that are creating energy in your life. I call it the energy calendar. And all you have to do is at the end of a weekday, take a Monday, at the end of a Monday, color code your calendar according to whether the activity created energy, meaning you felt lifted up by it, mark it green.

24:39It was neutral, mark it yellow. And if it was draining, if you felt physically drained by it, mark it red. At the end of a week, if you do that every day, you have a very clear picture of the types of activities and the types of people who are creating energy in your life versus draining energy in your life. After you have that insight, You can slowly reposition your calendar to be focused more on energy creators than energy drainers. That will change your entire life because you'll be spending more of your time on things that are lifting you up, on things you are pulled towards, and less on things that are killing you.

25:13That will lead to better outcomes. It'll lead to better relationships. It'll lead to an improved business. All of the outcomes we want in life will follow as a result of leaning into those energy creators. And for the entrepreneurs out there, we've got control over it. And if you're still working a nine to five, what do you suggest? You have more control than you think, even in a nine to five. I'll give you an example. I did that exercise for the first time when I was still working my 80 to 100 hour a week finance job. The biggest energy drainer I found on my calendar was phone calls and Zoom meetings.

25:44And while I could not just start saying no to those, I was an associate at the time, like I was still pretty junior, I could slightly tweak the way that I was doing them in order to make them more energy creating by doing some of them while out on a walk. So what I noticed about myself was that sitting at my desk doing a phone call or a Zoom is about as energy draining as I can get. But doing that same phone call or Zoom while walking was very energy creating for me. I love being outside. I'm more present because you can't multitask when you're on a phone call on a walk. And so as a result, I actually show up better on those calls.

26:19Like if you and I were doing one, you would notice I felt more present. And I feel much better after doing them. So I took half of my calls, the ones that I was able to, and put them into walk-in calls. Now, suddenly, at the end of a week, I feel way, way different. I feel way more uplifted by the entire week. I show up better on those calls. The outcomes are better. That compounds in your life. And so, the insight there is that's one example of a way where you would say, oh, I have no control. I'm working a nine-to-five, a normal job. But you have more control than you think. You just have to be willing to scrutinize a little bit some of the activities and ask, can I do these a little bit differently than I currently am?

26:56Yeah, I love that. Energy calendar is such a great hack. Okay, so let's talk about your entrepreneurship. You have a media business, and I want to stick there for a little bit. You started off with this newsletter. Talk to us about how you first became an entrepreneur. What was the first thing you did as an entrepreneur? Yeah, I laugh about this a lot because my most entrepreneurial friends, and I'm lucky to have some incredible friends out there, when you go ask them what their journey with entrepreneurship was, most of them will be like, well, when I was eight years old, I started this lemonade stand.

27:27And then it was a lemonade enterprise across multiple towns. I just dicked around when I was a kid. I played baseball. I was just screwing around. I didn't have an entrepreneurial bone in my body. My dad is a professor, the least entrepreneurial track you can follow. And so we didn't have it in our blood in any way. So when I was thinking about leaving my old job to pursue this entrepreneurial path, That was weird. There was not, I didn't have like a supportive family around that telling me, oh, you should definitely do that. My wife was very supportive. But to be honest, I didn't know if I could do it.

27:57I didn't even know what entrepreneurship really meant. And if I can do it, anyone can do it. Because I was not wired for this. It wasn't like I was a great risk taker. I'm very risk averse. The insight I have around this is you can't plan entrepreneurship. leadership like the whole idea in business school you went to business school the whole idea of creating a business plan is sort of a joke like you don't need to create a business plan to go launch your first thing you need to create evidence you need to create evidence that you can do it which is just done by taking a little bit of action you have to go and do the thing you can't talk about the thing or brainstorm the thing you have to go do the thing and that was all I did I started writing the newsletter um in May of 2021 and um there was no monetization plan there was no strategy to it.

28:45I just started writing it. And by the end of that month, I had 15 ,000 or so subscribers. And I sent a text to a founder of a startup that I knew and asked if he would want to sponsor one. And he said, sure. And I think he gave me$500 to put out the first sponsorship. And that was this little bit of evidence that I created that I was like, oh man, okay, so I'm sending one a week and it's making me$500. What if I send two a week? Now it's going to be$1 ,000 a week,$4 ,000 a month. I was like, man, this newsletter could be like, if I scale it, if I grow the news, like I started to see a path. And I don't know if you know the ancient poet Rumi once said, as you start to walk on the way, the way appears.

29:28As you start to walk on the way, the way appears. And I love that because what it reminds you, especially as an entrepreneur, is that you cannot figure it out standing still. You start to walk and then the path becomes clear. And so that was really the story for me of like with anything that I've done, it's been, I start moving, I start doing something, whatever bad version of it looks like. And then the answers start to become clear to me. Yeah, I love that. So it goes back to following your energy. You followed your energy, you found the evidence, you tried to replicate what was working and then you felt more comfortable.

30:02You probably got more motivated because you saw some success and it gave you some more motivation to kind of just keep going and going. Motivation is a byproduct of movement. Yeah. Your energy that you put out into the world literally creates it. So the whole idea of you need to be motivated to act is actually the inverse. You need to act and then you become motivated. So you mentioned that you're not naturally an entrepreneur. We're opposites. I'm the type of person who is like, you know, creating businesses at four years old. I'm jealous. I'm jealous. I've always been an entrepreneur. So not being naturally an entrepreneur, and I'm sure there's plenty of people listening in that want to be entrepreneurs, but feel like I just have always worked a regular job.

30:42I've never even thought about being an entrepreneur, but I want the freedom. What do you think the hardest obstacles are going to be for them? And how did you overcome your hardest obstacles? The single greatest obstacle I have faced, and that I think most people face when they dive into the entrepreneurial journey is they overcomplicate what it means to be an entrepreneur. All it means is that you are going to solve problems for people. You are going to create value for people via solving their problems. And you will get paid. You will receive value in return. And overcomplicating that, turning it into like, you know, thinking about all of these things around structure and business plans and all of these big questions that you can get bombarded by on social media is actually losing sight of the most important thing.

31:27And the most important thing is just figure out how to create value for other people. And if you do that, you'll receive value in return. All it comes down to is that. It is identify a problem, create a solution, and then scale that solution. The more scalable the solution, the more money you will make. And if you distill it down to that and deconstruct it down to that, it actually feels quite simple. Because then it's one of those three things that you need to be thinking about. when you're starting and you're trying to find your journey and what you might be interested in, all you need to focus on is identifying problems.

31:57Literally take out a notepad, walk around for a week, and just write down every problem you perceive of the people around you that you're interacting with. That's literally the first place I would start if I wanted to go create a new business and I didn't know what to do. Just identify problems. Then once you've done that, start to think about solutions. How might you be able to solve that problem for that person, whether it's with a service or a product or something you can put out? And then think about how you would scale that solution. How would you reach more people? How would you make the solution more scalable through the internet, through social, through whatever it is, whatever means.

32:27But that's what it all comes down to. And that is what like stalls a lot of people is they overcomplicate it. So then they do nothing. Yeah. Once you have your business idea, it's all about focus and consistency, putting in the reps, getting the work done. When you work a nine to five, you've got a boss telling you, these are the priorities, is spend your time this way. You kind of know what to do. You might even be taking over a job from somebody else who does you exactly what you need to do. As an entrepreneur, you need to create your day job. How do you recommend that people go about that when they're used to so much structure?

33:00You have to create your own structure. That is, I think what you've hit on there is actually the biggest challenge for most people when they actually do start, when they do take the leap and they're diving into it is you've known historically exactly what you had to do at all times of the day. You knew what meetings, what work you had to do, what emails you had to send. And now no one is telling you what to do. I think the first activity I would go through is to actually create a clear routine and structure to your day. And I do that straight into the calendar because I think that your energy will really flow with what you put onto your calendar.

33:33Your priorities are really just an outflow from your calendar. I think Keith Raboy, the famous investor, said, don't tell me your priorities, show me your calendar. And I love that quote because it's true. It's like you can't say your priorities are building a business and then your calendar is a whole bunch of like busy work meetings. You need to have time on there structured to actually work on the things that matter. So structure your day. Like become a disciplined routine person for a period of time where you really break down your day according to the type of activity that you're going to be doing during that window.

34:04It's called time blocking. It works really well. It doesn't need to be down to the minute, but like have windows of time. So if you know, for example, that you are very creative early in the morning, wake up and have a block of time for creative work. So if part of your business is going to be creating content to drive the top of funnel like it is for us, and you're most creative in the morning, you should probably have a window of time in the morning when you are focused on creating content, creating things that are going to drive that top of funnel. Have a window of time when you're going to be processing emails and doing basic management tasks like invoices or meetings, whatever those might be.

34:38But have real structure on a daily basis, and then you won't feel that sort of anxiety and aimlessness that naturally happens. I've written this before that stress and anxiety feed on idleness. When you take action, when you have movement, you literally starve them of the oxygen they need to breathe. So when in doubt, you just have to act. You have to have that clear structure so that you know you are doing something throughout the day. Hello, young and profiters. Running my own business has been one of the most rewarding things I've ever done. But I won't lie to you. In those early days of setting it up, I feel like I was jumping on a cliff with no parachute.

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39:32Again, that's Huel.com slash profiting. You got to use the code profiting at checkout to get that 15 % off for new customers only. And thank you so much to Huel for partnering and supporting our show. I feel like time blocking on your calendar is just such a life hack. I've now scaled this to my team. So you're probably familiar with Leila Hermosi. she's got this thing called Monday Hour and Chill. Monday Hour, One Hour and Chill or something like this. And they have like an SOP online if you guys want to find it. And basically it's like for one hour a week, you sit down with your team and everybody time blocks their calendar, color codes it based on the activity, and then, you know, shares it with their manager.

40:12And it helps me see like, okay, why are you working on this for three hours? You shouldn't do this or you need to take a break. You know, like you have no breaks in your day or you've got too many calls. And it kind of just helps you see what everybody is working on. Because to your point, you can have to-do lists and project management tools. What's not on your calendar doesn't reflect that you're not getting what you need to do done. So I feel like it's like such a great hack. Yeah, that works well. So it's the start of the year. And I learned that you have this annual tradition of asking people for advice.

40:44And it's around, I think your birthday just came up. So talk to us about this tradition. How did you get started with it? And how has it evolved over time? I have always been someone that is rather reflective. I try to accumulate insights and wisdom from people who I feel have a lot of it. And I've been very fortunate to have a number of mentors and people in my life, many of whom are significantly older, some of whom are just a little bit older, but who have unique experiences and have, you know, taken the plunge in different ways in their life. And I like to, on an annual basis, create a reflection exercise where I go and ask them what advice would they give to their younger self at whatever age I'm at.

41:25So like, you know, I kind of started when I was around 30 and I asked a whole bunch of people what advice they would give to their 30 year old self. Like, what do they wish they knew then that they know now. And it ends up creating this incredible map of how to live a life and a beautiful life. And so I share some of it in the book in this upfront section, especially from this one year on my 30th birthday when I did it with all people that were 80 and 90 years old, actually one 100 year old. And it created this incredible, clear vision in my mind of what matters and what doesn't. Like the things that I was stressing over and how I need to just be able to look through those and see the bigger picture, see the real true north of what we were all trying to drive towards.

42:14Yeah. And how did it end up influencing you to write this book? It was a huge part of creating this idea of the five types of wealth, of thinking about the fact that money was an enabler to a lot of the ends, but it was not an end in and of itself. In other words, money is a tool, but not the goal. And it brought to light the fact that there were really four things that kept coming up for everyone. It was time, people, purpose, and health. Those were the four things that everyone really focused on. And again, money was an enabler to some of those, but it wasn't really an end in and of itself. And that sort of ended up creating and being the early structure and skeleton of this idea of the five types of wealth.

42:55Financial wealth is one of the five types of wealth. It is very important. But these other four of time wealth, of social wealth, and of mental wealth and physical wealth are how that all got rounded out into this new scoreboard for your life. So I want to stick on one of the types of wealth, time wealth, because I feel like that's one that I haven't really heard of. And so I'd love for you to like break that down. And how do we build it? Yeah. Time wealth is the freedom to choose. It is all about having the freedom to choose how you spend your time, who you spend it with, where you spend it, when you trade it for other things.

43:32And it all starts with what we were talking about earlier, which is an awareness of time as your most precious asset. I often ask young people, would you trade lives with Warren Buffett? Think about it. Would you trade lives with Warren Buffett? He's worth$130 billion. He has access to anyone in the world. He flies around on Boeing business jets. He has houses all over the place. He reads and learns for a living. But you wouldn't trade lives with him because he's 95 years old. You would never trade the time you have left for$130 billion. So you know your time has incalculable value. And yet, on a daily basis, how much time are you really wasting?

44:10Spending, you know, scrolling on TikTok, flipping around on your phone, and comparing yourself to other people, you know, worrying about little busy work tasks, urgent things that don't really matter, that aren't driving you forward. We all do that. And so creating an awareness of just how important your time is, just how precious it is, is what allows you to then say, okay, I'm going to take this really seriously. I'm going to deploy my precious attention and energy into the few things and into the few relationships that really matter, that are really creating those outcomes in my life that I want.

44:41That is what time wealth is all about. It's about deploying your attention and energy into the few things that really move you forward that really matter. I love that. Is there any sort of activity that you recommend to figure out like what our priorities are? Yeah, there's a few. And a few are shared in the book. The energy calendar is a great start for figuring out where am I getting my energy from so that I can focus in. There's another one that actually comes from Warren Buffett, where he asks you to create a list of your 25 priorities in life. Go write down all of your priorities. And then he says, okay, now you have to circle only five of them.

45:16And you have to go and try to figure out on this long list of things you've just written down, what are the five things that actually matter? So now you have a list of five things circled and 20 things that you didn't circle. And what he says is the five things you circled are your true priorities. Those are the things that you need to put energy towards. The other 20 things are your avoid at all costs list. because every single ounce or energy that you put towards those is just a distraction. All of those things are just a distraction pulling you away from the things that are really going to drive the outcomes, the things that really matter.

45:49And so it's a critical exercise for thinking about that exact thing of what does really matter and where do I need to avoid the distraction in life? Because that's where we really get lost on these journeys is we get pulled by the little shiny object that's floating over here when the thing right in front of us is the thing we need to hammer in on. Yeah. And I love that because it just goes to show that there's things that you might want to do that seem really exciting that you would love to do if you had the time, but you've got to be able to say no, even if it's something that you kind of want to do.

46:20And as entrepreneurs and as ambitious people in particular, we have a bad, bad tendency to take on too much. And when you take on too much, you aren't actually getting more done. You are getting less done because you're pulling yourself away from the thing that's really going to create the incredible outcomes. And so there's a moment in every entrepreneur's life, anyone who has achieved extraordinary success, when they realized that actually they figured out what the one thing was that really mattered and they were going to put all their energy into that one thing and just keep chipping away at it over a long period of time.

46:53The whole idea of like, I'm going to have 15 income streams is a little bit of a farce because every single one of those is like, you're going to have a little bit of attention on each one of those rather than, okay, I'm going to have a lot of attention on two or three things that could be the really big one. So social wealth is another one of your elements when it comes to the new scoreboard that you're putting out in your book. And as entrepreneurs, we can really suffer with our relationships. I remember when I first started my company, Yap Media, I worked for four years straight. I lost a lot of close friendships.

47:25We're friends again, but like I wasn't talking to my best friends. I was with somebody for 10 years and we broke up and like just a lot of, you know, relationship shambles that I had to take a lot of time to like proactively rebuild in the last like two years, right? And I had to basically start from scratch. So talk to us about relationships and in the context of entrepreneurship, what we need to keep in mind. There are going to be long periods of loneliness on your entrepreneurial journey. And that's okay. That is a necessary cost of entry to the personal transformation that you are trying to create in your life.

48:04Because literally what happens is you start changing and growing as you were with the things you were building, the things you were focusing on, and your environment that you previously existed in has not changed. And so there comes to a moment when it feels like you are actually speaking a different language than the people that you used to be close to. And they will not understand the way you are living and the things you are doing. And they may belittle you. They may tell you to be realistic. They may laugh at your ambitions. Taylor Swift once said, the worst people in the world are the ones who make you feel bad for being excited about something.

48:39I think about that all the time. There are people that have done that on your journey. We know who they are. So that period of loneliness before you have attracted new people because you haven't quite gotten to the place where you're going. You haven't attracted your new environment yet is long and sometimes really painful. But understanding that it is the cost of entry for building the life you want allows you to sort of feel empowered on that journey. Understand this is normal. This loneliness is actually a normal part of my entrepreneurial journey. That's an important mindset shift that I have had to have and that I've shared with people along this path.

49:15All of that being said, the understanding that your life has seasons is critical here. You actually articulated it really well in describing your own journey, which is you went through this really focused part, this focused season as you were building the foundation for the rest of your life, building the foundation with your business, which you've now done. And you are now in a season where you can rekindle these new relationships and build this incredible social wealth. That is exactly how life works. Your 20s, early 30s, maybe into your 40s are really spent building this foundation. And that's okay for social wealth to sort of exist on the back burner during those times.

49:50It doesn't mean you want it to completely shut off. It would still be great for you to be able to cultivate family relationships or one or two close friends during those periods, still send the text, still do the one annual trip, do the little thing, the tiny little investment that compounds. But you don't need it to be the primary focus of your life at all times. The important realization there is that the exact same way we know that investing a little bit in financial wealth compounds into the future, the exact same principle holds for social wealth. You can invest a little bit in social wealth and still have it compound into the future.

50:25The little texts that you send, the one coffee that you get with the old friend, the birthday with the parents, all of those things are tiny little time investments that really do keep those relationships flowing in a healthy way into the future. You don't need to be the social butterfly life of the party during those years when you're head down. It's just true. And that's okay. You can feel liberated by that idea of these seasons coming and going. Yeah. One of the things that really impresses me about you is your huge network, right? We were talking offline before this interview. You just had dinner with Cody Sanchez yesterday, and you always meet all these awesome people.

51:01What is your idea around mentorship and community with other entrepreneurs? I think networking is dead. The concept of networking implies a transaction that is not conducive to building genuine relationships. What you are really seeking to do is build genuine connection with people. If you go into a new interaction with someone trying to get something out of it, you will never build a real relationship with that person, especially if that person is ahead of you, if it's someone that has achieved the things that you're looking to achieve, because everyone can pick up on that. It is very blindingly obvious when you interact with someone that just has their hand out.

51:44They just want something from you. Now you experience that on the other end of it. We've been that way in our own lives. It is such an important idea to say, as you go into an interaction with someone for the first time, how would I interact with this person if I assumed that I was going to know them for the next 50 years? Think about that in your mind. How would I interact with them? I would not be transactional with that person because I'm going to have to spend time with them for the next 50 years, I will probably really start to listen. I will really lean into understanding who they are as a person, creating a map in my mind of the type of things they're excited about, the values that they hold.

52:18Those would be the things I would focus on. I would try to create value for them so that they felt connected to me in some way. Approaching relationships in that way, where you are really genuinely seeking to give with no expectation of return, that is when you end up getting the best returns, which is the funny paradox of relationships. When you give with no expectation of return, you get the best returns in life. And I have found that time and time again. I mean, some of my mentors that have provided extraordinary value in my life are people that I didn't even know they were impressive when we first met.

52:53I didn't know, I just wanted to be friends with different people. I was trying to learn from the people that were around me. And it ended up sparking these incredible relationships because there was no networking in mind. It had nothing to do with a transaction. It was just, I genuinely want to get to know people. Yeah. And like you said, people can feel that, right? Immediately, especially people who are very successful because again, it's very lonely at the top. They are used to just having people come with a handout. And so if you want to stand out to those people and if you want to build those connections, you have to be the opposite.

53:23You have to be the person that comes with the thing. You're providing the value. It's the same as like, you know, when people are trying to do cold outreach to get a job or to connect with someone. Come with some value. And it's not that hard to figure out how to create value. I mean, like, I could probably spend, if I was trying to meet you, I could probably spend an hour doing some research about you and identifying a couple of areas that I know from you talking about it on podcasts are trying to focus on and build in your business. I could do a little bit of research, figure that out, and then I could try to work on some sort of proposal or solution to that problem that you were facing.

54:02Maybe you're saying like you're trying to build your podcast network and you're trying to reach new potential podcasters. I could reach out to some of them, create some sort of connection there, recognize that I could make an intro, and now I would come to you with some level of value. You would take me so much more seriously than if I just came being like, hey, I'd love to meet you. Pick your brain, right? Totally. This reminds me of, so do you know who Jordan Harbinger is? So Jordan Harbinger was my early podcast mentor. And when I first started podcasting, he was like top of the food chain.

54:33He knew everything about growing pot. He knew so much more than me. And I really wanted him to be my mentor. And so I remember I would just like every once in a while message him on Instagram. He came on my podcast. We kind of stayed in touch. And I would just give him growth strategies. He's like, hey, like I just tested this new platform and I got I paid this much per subscriber and it retained this much. And I would just like give him all this like little information. And then finally, he was just like, you really know what you're talking about. And you keep giving me really good advice. Like, let's hop on a call.

55:04And then one day he was like, Hala, my script writer bailed on me. I think you're really good at this stuff. Can you write me my ad? And I was like, sure, I'll write you your ad. I didn't say, oh, it's going to cost this much. I'm going to I need this or that. I just did it. you know, sent it to him. Before I knew it, we were taking calls. He was my mentor. And that was that, you know, we're like the closest industry friends. So you really do, like you said, like have to try to provide some value and, you know, try to actually connect with people. Yeah. And that is something that in hindsight, people will call you lucky.

55:37Like, oh, you're so lucky for having Jordan Harbinger be your mentor and be a connection that you have. There's no luck involved in that. You were hustling for a year. And I say this, I'm like, you are one year of focus away from people calling you lucky. You putting in focused daily effort for a year led to the luck that other people see on the surface. It's just the truth. So you continue to put forward the effort. You continue to put forward the hustle, the energy, the motion. And now the lucky thing happens. Yeah. But then when you do secure the mentor, it can help you speed along so far. Because then once you trusted me and was like, okay, you help me, I'm going to start giving you some insights of how to rank your podcast, how to do this, how to do that.

56:17Really helped me. So you talk about something called a brain trust. What's that? Similar idea. Basically, the idea is that mentorship is a fading or dying concept. And it's funny, we just talked about mentorship. I would argue what we're really talking about is more the brain trust. So mentor, in the traditional sense of the word, is the idea that you would identify a single person who was going to be your mentor. And they were going to help you navigate all of the challenges in your professional career that you were going to face and maybe your personal life as well. That is a crazy concept because it implies that there is a single person out there who has all of the answers that can help you navigate the terrain that you are facing, that their map will match your terrain.

57:04And it implies a really high level of commitment on that person's part, to be willing to do that. It sounds like a big burden. If you go ask someone, will you be my mentor? Oh, that sounds like a lot of work, especially if it's someone high up that has a demanding job or demanding path. I think of the concept of the brain trust as sort of the 21st century alternative to the 20th century idea of mentorship. A brain trust is a group of people from different backgrounds and experience sets that you can call upon for advice or guidance about different areas of your life. They are people that have ideally domain expertise in these different areas that you can turn to at different inflection points in your own life and journey.

57:45The origin of the concept is from Pixar. They do a brain trust for every movie that they're creating. It's a bunch of people that aren't involved in the creation of the movie that pressure test and help sort of make the movie better along the way. They make sure that the storyline is good and that they're tugging on heartstrings the right way, all of those things. You can develop a brain trust for your own life. It doesn't need to be formal. No one needs to know they're even a part of your brain trust. But they're people that you go and call upon whenever you're facing whatever challenge who have that unique set of insights, who have that perspective, and who are willing to tell you the truth, give you the hard feedback along the way.

58:22And you know what's funny? Like, psychologically, people love to give advice. And so if you don't overstep this, if you're not asking somebody a question every day, but it's somebody that you respect, that you want to have in your life, and you're asking them some advice, you connect with them. And that actually probably strengthens your bond over time and make sure that your network is warm and all the people that you want to keep warm stay warm. Yeah, absolutely. It also is just, it's an easy way to naturally stay in touch with people that you want to stay in touch with. Like someone that you have connected with once or twice, and you want to continue to kind of foster the connection, the relationship, the same way you did with Jordan.

59:00It's an easy way to say like, hey, this thing came up. Have you ever faced anything like this. And you kind of create a natural touch point. And it could end up being like once a quarter or once every six months. It doesn't need to be so often because they're not your only person. So you can turn to other people along the way. But it's been a great practice for me. And the people that I would consider to be on my brain trust, I've just gotten so much value from them over the years. Let's move on to financial wealth. So we talked about your business ecosystem a little bit. You've got a media business.

59:32You've got a holding company. You've got fund, right? So talk to us about the different elements of your business and how you prioritize them. Yeah. So the media business I think of as existing sort of over the top of everything. It's a little bit of a halo in that it provides value to all the other businesses. It is a self-sustaining business that is profitable. And as we all know, media businesses can be very profitable and very high margin. The media business functionally today is newsletter and book. There are a few other things that exist in there, and there will be more things that get added there post the book.

1:00:07But it's really just been those to date. The holding company is a number of partially owned businesses that have CEOs that are running them. And these are businesses that I am sort of involved in at a board or strategic level, but not on an operational level on a day-to-day basis. The entire idea there was to create businesses around things that I could naturally drive value to via my media platform. So things that I have sort of a unique set of experiences in that I can naturally drive leads towards. So it would be like newsletter businesses or design development businesses, other things within those spaces.

1:00:46Those all have profitable sort of financial profiles. So none of them have been like, you know, money losing venture-like investments. They're all profitable from day one, largely bootstrapped. A couple of them have been things that we've seeded, but generally speaking, bootstrapped. And they shoot off distributions every single month and their cash flow straight up back to the holding company, which is great because then you can reinvest across different things. And then the venture fund, I raised that in 2022. I had worked in the world of investing for the first seven years of my career, mostly later stage private equity stuff.

1:01:21This is all early stage technology companies. So I raised a$10 million venture fund from a whole bunch of LPs and investors and have been investing out of that, have made 50 or so investments and will likely raise a second fund here in the next year or so. So cool. I really want to dig deep on the holding company. It's really interesting to me. Something that I learned that you do is you tend to use like vendors that you actually use that you might like actually pay. You try to turn those cost centers into profit centers. And I just thought that was so smart. So walk us through, like, how you actually invest in these companies.

1:01:56Do they exist already? Are you creating these companies? What does it typically – like, what's the structure typically look like? I remember coming across the case study of Amazon Web Services in maybe like 2018, 2019. And for those who aren't familiar with that story, basically, Bezos, as they were building Amazon, the bookstore and the e-commerce platform, had to build an extraordinarily large platform of compute power, basically, on the back end to power the entire e-commerce business that they were doing. And so they built this whole back end thing that was a huge cost center for the business.

1:02:35And what they realized was that there were a lot of people, as the kind of technology ecosystem grew, that needed that type of enormous compute power. And so they started renting it out, effectively charging people to use this extraordinary compute power that they had created. That became an enormous profit center for Amazon now in the hundreds of billions of dollars. That is a separate company called Amazon Web Services. That idea sparked in me whether there was a micro, micro, micro version of that same thing that I could adopt in my own world. where things I was spending money on, on an ongoing monthly basis as a creator and as a business person could be things that I could turn into profit centers for my business.

1:03:15So turn my cost centers into profit centers. And that has been an overarching mental model of how we've approached our different businesses that we've launched. The first example of that was a newsletter business where I was paying a team to manage the back end of my newsletter. So I decided All I want to do is write the newsletter. I don't want to deal with lead magnets. I don't want to deal with paid ads. I don't want to deal with segmentation funnels, any of those things. I'm just not good at that, and I don't really care. So I'm going to pay someone to do it. That team turned out to be really good at doing that.

1:03:46And so I went and partnered with them and a friend of mine who is a founder of a business called Kit, which is a newsletter sending platform. Yeah, ConvertKit. And we partnered to launch this as a business. I continue to pay them every single month to do the back end of my newsletter. And now it is also a massively profitable business. I shouldn't say massively. It is a very profitable business where we serve the back end of newsletters for some of the largest newsletter writers out there in the world, turning a cost center for me into a profit center for me. Similar versions of that across different areas of my business have materialized over the last two or three years.

1:04:25you know, content agency business, design development business, video businesses, embedded talent business that does sort of like, if you need to hire offshore talent into your business, we'll do that. And it has become a really cool way of like coming up with the ideas for the things because I can see them on my own P &L. Looking at my P &L, I can see what I'm spending money on and thinking, okay, is there a way where I can actually own the business rather than just having this be a cash outflow every month. Yeah. I feel like entrepreneurs that come from the private equity space, like you and Cody Sanchez, you've got such an advantage over everyone because you really know how to like buy companies.

1:05:04So just walk us through like the process of like how you're actually doing this. Like how are you, are you just investing in these companies or just buying these companies? Are you creating some of these companies? It could be any of those. So it depends where you catch them in the life cycle. In the case of the newsletter one, That was a brand new business. That was a guy I was friends with who was just doing this on the back end for me as a consultant. And he was just an independent freelance consultant doing it. And I said, we should productize this and make it into a service and a real business.

1:05:35And so we founded that from the ground up. But there are examples now of businesses like the design development business where you can make an investment both in cash and then also in the form of your platform. So when I say that, what I mean is like I can drive a lot of leads to these businesses via my platform. That is a form of investment in this person's business that they've already started. And so you can do a combination kind of structure of cash plus my energy, my platform, audience, distribution, if you will, that you can kind of invest in it. The third way that you could do it is just go buy a business.

1:06:12And Cody obviously does that. I will do more of that in the years to come at the holding company level that will sort of use holding company cash flows to go buy bigger businesses. and we can raise quite easily probably anything up to like$50 million to go and buy a bigger business if we saw something that was really exciting where we felt like we could really bring unique value add to the table. If somebody wants to learn more about how to buy companies, what do you suggest? There's a lot of resources out there now for learning about buying businesses. I would definitely go and read a bunch of the books that kind of exist about private equity on the more traditional versions of private equity.

1:06:53There's a great book called King of Capital about Steve Schwartzman, who was kind of the first person within private equity world that really built Blackstone, which is a huge private equity fund. Cody obviously has a new book out about buying smaller businesses and sort of main street businesses, which is a great resource. But there's plenty of free online resources that you can go and look at and find about investing in buying businesses. And again, the thing to think about is, are there creative ways that you can do it? And if you have a platform or if you have built some unique distribution or some unique strategic perspective, or if you have a unique SEO capability or unique paid marketing capability, there's a way where you can actually invest via your energy rather than cash.

1:07:38So the art of the deal, if you will, is really about identifying what is that sort of unique edge that you might have to make this business bigger than it is today, where you can sort of invest that into the business in addition to or instead of any upfront capital. Yeah. And I love that you take the approach of like being a customer first. So you really can see like how well the company performs, if they're really good, and then you invest. So I just think that's so smart. It kind of opened my eyes of like, oh, maybe I can invest in XYZ vendor. Yeah. I mean, you probably have, I bet there are 10 businesses that you'll think of over the next month now that you have this in mind that you'll see and say, oh, I could probably actually invest in this or be a part of it and drive business into it.

1:08:18That, as just an idea, comes from Peter Lynch, is this very famous Wall Street legend who wrote this book. I think it's called One Up on Wall Street. One of the best investing books of all time. It's sort of a legendary one. And one of his best investments of his career was he invested in Hanes, the underwear company. and he invested in it because his wife came home from like CVS or something and she had picked up a pair of like Hanes pantyhose and he she was raving about it to him and so he was like oh I'm gonna go pick up some shares of that company she was raving about this like tiny little company and he ended up making like a 100x return on this public market investment and so the idea there was like invest in things you love if you uniquely love an experience or a product it's probably going to be something that ends up being profitable.

1:09:06Yeah. So speaking of investments, you've got this barbell strategy when it comes to your investments. Can you tell us about that? Yeah. The barbell strategy as a model says that on a risk spectrum, if you think about the most risky things on one end and the least risky things on the other end, that you want to be weighted on both of those ends. So I basically want to have a handful of things that are highly risky. And for me, the highly risky things are investments in myself and in my own businesses. And then on the other end, it's going to be super boring basic stuff. For me, stock market index funds.

1:09:42I don't want things in between that I don't really understand. My whole goal is like, I really only want to invest in things that I can really touch and feel and understand. And so the riskiest stuff is always going to be creating your own businesses. And the fun thing about that as risky is that you actually control it to an extent. So like versus me investing in, let's take another really risky thing like crypto. I don't control the price of Bitcoin or Ethereum or whatever. I don't control. And so yes, it might be a great investment, but I have no ability to influence the outcomes. I have a high degree of ability to influence the outcomes of my own businesses, things that I am actually driving.

1:10:22And so I would prefer to invest my time and energy into things that I have some degree of control over. And if I don't have a degree of control over them, I want them to be super safe and basic and boring. And so that's why I would, like for me, the best plan is that. It's the personal things that I do that I have control over on the riskier end. And then like I'm putting money into the Vanguard, you know, S &P 500 index fund on the other side. Yeah. So let's go back to your five types of wealth. There's a lot of balancing that needs to go on. And I learned that you used to drink a lot, right?

1:10:56You decided to kind of cut back on your drinking, but you're not totally cutting drinking off. Like you still actually drink in some social situations. So you are basically balancing your physical wealth with your social wealth and doing trade-offs sometimes. So maybe talk to us about some examples of kind of trade-offs between the different types and how we can think about balance. All of life is about deciding the price you are willing to pay for the things that you want. And what I would argue is that to perfectly optimize any one area of this, you would need to completely shut off every other area.

1:11:38And some people do that. And most people that do that do it to perfectly optimize financial wealth at the expense of every other area of their life. They lose all their relationships, their health goes to hell, they have no clarity of mind, they're stressed all the time, they have no time, freedom, and they make a lot of money, but at an extraordinarily high cost to these other areas. What I try to find is what is the place where I'm able to build across all of these things, where I'm able to build great big businesses, but not at the expense of not being able to spend time with my wife and son, not at the expense of not having time to work on my body or take care of myself or have the freedom to, you know, take my son in the pool at 1 p.m.

1:12:20on a Wednesday. I've written that before, that the wealthiest I ever feel is when I'm able to take my son swimming at 1 p.m. on a Wednesday. Because it implies that I have the freedom to do that, that I have a business that's big enough that's working where I'm able to have free time. I don't have calls all of a sudden in the middle of the day. I can go do that. You are always going to face these tradeoffs. and what you need to decide is what trade-offs are you willing to make. Not the ones that people tell you you should make, not the ones that the normal path says are the ones that matter, but what you truly care about.

1:12:50If all you care about is building an enormous business, that's great. I'm happy for you and you should build your life around that. But the point in the book and the point that I'm trying to get across with everything that I do is you get to decide. You get to define what matters to you in your own life and you have to ask these questions and then take action to build your life around those things. It's no one else's job to tell you what matters to you. You get to decide. And that, I think, is the really important critical message in all of this. It's just I want people to identify and really think about what matters to them and then go build their life around those things.

1:13:27Yeah. I love this conversation. The last thing I want to touch on on your book is mental wealth. I know that a lot of entrepreneurs struggle with their mental health. Actually, on average, we're more likely to suffer from depression, loneliness, ADHD. You know, there's a lot of mental health issues in entrepreneurship. It's just an uncertain, risky thing to do. And it's very stressful. So what advice do you have for entrepreneurs in terms of building their mental wealth? Create more space in your life. Create deliberate practices around space. The idea of space comes from Viktor Frankl, who is the famous Holocaust survivor, the author of Man's Search for Meaning.

1:14:04And he has a quote where he says that our power exists in the space that we can create between stimulus and response. Entrepreneurs in particular live in this constant loop where stimulus is coming in and they're immediately responding to it at all hours of the day, at all times. That is a very dangerous place to be because it makes you reactive. Everything in your life becomes a reaction. There's just things coming in and you're immediately shooting things out. You find incredible power and presence if you can just create a little bit of space between the two. That can be found through a five-minute walk in between meetings or a 15-minute walk after lunch or taking one day per month to just zoom out and go journal for a few hours at a coffee shop or just making sure you give yourself one evening a week where you're not going to work.

1:14:52Creating a little bit of space in your life has dramatic, dramatic effects. but you have to be deliberate in how you structure it into your life. It can't be something that's floating in the back of your mind. To the point earlier on time blocking and structuring, put it on your calendar. Actually have a window where you're going to create space. You cannot be on your phone scrolling during that time. It needs to be truly shut off and just give yourself that freedom to just turn off for a short window of time and you'll experience incredible benefits. How do you do that? What's your schedule like?

1:15:24Five-minute walks in between meetings. So if you have a bunch of 30-minute meetings on your calendar, make them all 25 minutes. This is actually scientifically proven. So Microsoft did a study where they put EEGs on people's heads and had them go through a set of back-to-back meetings or a set of meetings where they had a five-minute break in between each. The people that went through back-to-back meetings saw stress build up steadily across the meetings and performance deteriorated across the meetings. The people that had a five-minute break, zero stress buildup, and consistent performance. It makes an enormous difference with a tiny intervention.

1:15:58So 25-minute meetings instead of 30, honestly, all that happens is you remove the banter about the weather that meetings start with. You just can get rid of that. You'll be more efficient. You'll get it done. And then the second practice, which I walk through in the book, is once a month or once a quarter at a minimum, do what I call a think day, where you give yourself a four - to eight-hour window to step out of your normal ecosystem, go into a new environment, whether it's at a coffee shop or rent an Airbnb or go to a hotel or go to a spa, do something. Bring a journal, bring a pen and walk through.

1:16:32I have eight question prompts in the book. Walk through some of those question prompts that force you to zoom out and just look at the bigger picture of the things you're doing professionally and personally. That will naturally create this incredible ritual for space in your life. So if you do the micro level of the five minute breaks, and if you do the macro level of a think day once a month or once a quarter, you'll get a ton of benefit. And I find when I step back and do like a strategy day, you call it a think day, I call it a strategy day. My stress and anxiety as an entrepreneur just like melts away.

1:17:04Because like suddenly it's like all these open loops, all these things, should I do this? Should I do that? You make decisions, you have your roadmap, and you could just like action on it instead of worrying about things so much. Yeah. I've always thought that you have stress when there's a gap between your present reality and your expectations, but in particular when you don't have a plan to bridge that gap. And that strategy day or that think day allows you to create that plan for bridging the gap. And then it just becomes about execution. And you're an entrepreneur. You know you can execute.

1:17:35You know you can show up and be disciplined and do the thing every day, do the hard thing. So it just allows you to create enough space to create that plan. And the stress, as you said, melts away. This is a perfect way to close out. We can bring it up right from the beginning. We were talking about waking up and doing hard things. Talk to us about your morning routine and how it structures your day. Yeah, I'm an early riser. I have like a 90-year-old man schedule. So I go to bed at about 8, 15, 8, 30, and I wake up at 4. I love the early morning hours partially because it's the only time of day I get when there's no stimulus.

1:18:08There's nothing coming in. My kid's not awake yet. I have a two-and-a-half-year-old. He's not up. You're not getting emails. No one's texting you at four in the morning. And so I get this two - or three-hour block just to myself. I, first thing out of bed, get into the cold plunge. I have no idea if it has any health benefits, but it definitely has cognitive benefits for me. I get an incredible energy boost from it and definitely a mood improvement from it. The dopamine, I think, really does impact me. I get out of the cold plunge, and I'm usually at my desk by about 445 or so. I always do a writing block to start the day.

1:18:41That's when I feel most creative. So this book got written from about 5 a.m. to 8 a.m. over the course of two or three years. And after that, my son is awake. We do breakfast with the whole family. And then I sort of go into my workouts from somewhere between 9.30 and 11.30. Amazing. It's working really well for you. We'll see. Okay, so I end my show with two questions. I ask all my guests. It doesn't have to be related to what we talked about today. What is one actionable thing our young and profiters can do today to become more profitable tomorrow? I would create an evening three to five minute journaling ritual.

1:19:18This reflection, I think, really helps you make more money, allowing yourself to just pause and reflect a bit. And the thing I do is I call it my one, one, one method. So you write down one win from the day. That's something that you feel good about that went well. One point of stress, tension, or anxiety. something that was bugging you that you need to get off your brain and onto the paper, and then one point of gratitude, something you felt grateful for during the day. It takes three to five minutes max, and it forces you to recognize a win and just feel better before going to bed at the end of the day.

1:19:49I love that. And what would you say your secret to profiting in life is? And it doesn't have to be financial. My relationship with my wife and son, for sure. I get more joy out of seeing him grow and the relationship that he and my wife have than just about anything else in the world. That's so sweet. And where can everybody learn more about you and everything that you do? Well, you can find the book anywhere books are sold and more information at the5typesofwealth.com. And then I'm at Sahil Bloom on every major platform. Awesome. Sahil, it was such a pleasure. Thank you so much for joining us on Young and Profiting Podcast.

1:20:23Thank you.