The Nathan Barry Show

Sam: I find it quite addicting to come up with an idea and turn it into reality. Then the other half is just like proving every like high school bully and girlfriend who dumped me wrong.

Rachel: That’s a very honest answer.

Attention is power, and creators harness it better than anyone else. But they're not using that attention to create the biggest impact possible and are vastly under monetized.

Hi, I'm Rachel Rodgers. My co-host, Nathan Barry, and I believe you can be a billion dollar creator. Sound impossible? Over the last ten years, we followed each other on our own quest to build billion dollar companies. We've studied creators and seen how entrepreneurs build traditional audiences and use them as a launching pad for a massive business. It got us thinking, if it can happen for them, it can happen for us. If it can happen for us, then why not you?

Billion Dollar Creator is a show teaching creators how to capture attention and turn it into real wealth. We will deep dive into brands, celebrities, and entrepreneurs who have done it before and show you how you can apply it to your business as an everyday creator.

Join us weekly as we learn from both the wild successes and the missed opportunities, the grand gestures and the integral mistakes. Through that, help you become an expert at building your audience on your journey as a billion dollar creator.

Nathan: We're all just having a chat and talking through things and like oh, we're supposed to go up. We're having a good time. But I think a lot of things with the podcast and the idea for is like if we just have a good time and then we bring people on that we're going to have a fun conversation with then that's the whole thing for the show. So you guys get to participate in that. So thank you for coming out.

Rachel: That was our trick to get ourselves to do it consistently because we're not good at being consistent. But we are now.

Nathan: We are now.

Sam: Nathan wanted an excuse to fly private, which he's doing. I’ll brag on his behalf. I can't believe you're doing that.

Nathan: You didn't have to bring that up. But if you're on.

Sam: Well, no. I was joking with your coworker. Like, here's the thing, you are so far on the spectrum of a wonderful person that you're able to do a lot of douchey stuff and still be a wonderful person. Like you've built up enough goodwill that you could get away with a lot.

Nathan: Yeah, I could see that. So as my new head of PR.

Rachel: Wait a minute, is flying private exclusively douchey?

Sam: No, but if you brag about it, which if he ever wants to do, he's got it built up. He's allowed to do it.

Nathan: Okay, so is this official permission that I can brag about douchey things?

Sam: Yeah. You've built up so much goodwill that it’s okay.

Rachel: Okay, well, he doesn't just fly private, if we're going to talk about it. He actually owns a plane. So.

Nathan: That I fly myself.

Rachel: That he flies himself. So there you go.

Nathan: I was not expecting that this is how we're going to start the podcast, but it is talking about billion dollar creators. If anyone wants to know, we did charter plane to come down here. Then I'm actually having my flight instructor bring my plane, which is a much smaller plane, to LA, and I gotta fly that back to Boise.

Sam: See, it doesn’t sound lame when you say it.

Nathan: What part of it would sound lame normally? All right, so with this show, we're talking about the idea of a billion dollar creator is taking an audience, which is insanely valuable. Many people don't monetize it in the best way. Or they monetize it in a fantastic way, but then don't realize how much more valuable that is.

So Sam, one of the reasons that I wanted to have you on, in addition to your rugged good looks and your ability to start a conversation with somehow roasting and complimenting me simultaneously, is I think with The Hustle, you built an incredible business in a very traditional way.

Then in selling it to HubSpot, they're actually playing that billion dollar creator playbook where they realize this audience is insanely valuable to them because of the lifetime value and the enterprise value of HubSpot as a business. So each subscriber to The Hustle is worth significantly more to them than it was to you as a media business, I believe. I'm curious what you think about that.

Sam: Yeah. So I'll give you guys a little bit of background. I started this thing called The Hustle. I originally started it as a conference. It was called Hustle Con. It was an event. It was a TED Talk, but we would have the founders of Casper and Away Travel or whatever startups were really big and cool in 2014 to 2016. In order to make that popular, I created an email list.

In 2016, I was one of my best friends, Neville, wherever he is, he was always bragging about how awesome newsletters were. I was doing the math, and I was like look, if we get a million people to subscribe to this, and we sent daily news, I think we can make, I don't know, 20 or $30 million a year. I was just doing the math. So we launched The Hustle.

I sold it in year four. My goal was to get to 100 million in revenue. I sold it before we got there because I was, I didn't have a lot of money when I started the company, and I had a chance to have financial security. So I was I should just take it. We sold for many tens of millions of dollars. I was given a bunch of HubSpot stock. The HubSpot stock tripled in price in six months, which very meaningfully changed the deal, but then it went way back down. So the target that we sold for was a bit moving, but it was mid-eight figures.

When we started, I thought advertising was a cool business. It's not, it sucks. It's a shit business. It can do well. One of my best friends now is this guy named Austin Rief who founded this company called Morning Brew, and he only sold a portion of his company recently. He didn't sell the whole thing so he's still running it. They're doing 80 million in revenue. So the economics were such that we kind of got there.

I think The Hustle, and you're one, we got 150,000 subscribers, and we were emailing six days a week. Year two, I think we were at 500. Year three was a million. Four when I sold it was 1.8 or something. Now it's has, I think the last I heard it was 3.7 million subscribers. The open rate is still 50. When I ran it, it was 50%, but I think Apple changed a bunch of stuff.

Nathan: Yeah, it's confusing now.

Sam: Now it's 60%. So I don't know how that compares to when I ran it what it was. So I guess if you do the math, that's what one point, maybe close to 2 million people a day opening it. Maybe at 3.5 million subscribers, I forget, what could we do in revenue on that? Maybe 50 or 40, maybe 40 million?

Nathan: With that because it's not just about the number of subscribers, it's how often you're emailing. Those total impressions, there's a lot of them.

Sam: Yeah, so it was a lot. I think when I sold it we were sending, I think it was 70 or 80 million emails a month. So anyway, my whole vision for the business was let's build up this huge audience and make them love us. Then we'll create stuff and sell to them.

The first iteration of that was this thing called Trends. Trends.co. It's kind of funny. I was doing all this research on what stuff to make to sell to them. My research, some of my friends thought it was pretty good. They go just sell that.

I was really stupid because I did that, but I charged $300 a year when I should have charged probably $30,000 a year and sold it to companies. Because the same amount of work that we were putting in for this $300 a year thing is the same amount of work that a lot of people are doing for $20,000 a year. So I really screwed that up. That was a dumb mistake.

That worked really well within ten months, maybe, I think we were doing $500,000 a month in subscription revenue. So we were on a $6 million run rate. I think it was only ten months old when we sold. You can go back and find all this, but the plan would have worked.

Now HubSpot bought us, and they were the first company to really go all in on this idea. Dharmesh and Nathan are good buddies. They went on this idea of let's own these brands. Because basically, HubSpot has many millions of people coming to their blog every month. They were like, we're probably, I don't know if this is true, but they're we own everyone searching for anything related to what you would buy, what you would look for before you bought HubSpot. They're like we've just got own this damn thing. That's why they bought us. They were the first to do it.

I know a little bit about the numbers. I don't know too much. I haven't worked there in a couple years. Their plan worked. It worked really well. What they bought us for, in my opinion, was a steal. If you look at the revenue that they've made from it and how much I think they're valued anywhere from eight to 20 times revenue, they got a hell of a deal. I think now, I think, I don't know for a fact. I'm pretty sure they only have four people running The Hustle.

Rachel: Yeah. One question I have for you is it sounds like you were thinking a billion dollar creator when you created Hustle. Was that your first business, The Hustle?

Sam: So, I owned hotdog stands in Nashville. So I had that.

Rachel: I love this.

Sam: Then I had a roommate matching app before that. It was Tinder but for roommates. That's really stupid. I should have done Tinder for Tinder. Because when we launched it, Tinder wasn't even popular. It was swiping for roommates. I think I made 100 grand when I sold that. Then I started Hustle Con. Then I did The Hustle.

Rachel: Okay, so you were thinking like let me build a really big business from jump.

Sam: What I wanted to do was I wanted to have financial security by the age of 30 because I didn't have a lot of money. I wanted to have, I had a scarcity mindset, and I was always afraid of being homeless.

Rachel: Yes. So what was financial security to you?

Sam: $20 million by the age of 30. That was my number. I met a rich person, and they told me that they spent $60,000 a month. In my head, I was like 4% would be 20 or $25 million.

Rachel: You did your fire math.

Sam: Yeah. So I just made up that number when I was 21. That's what I wanted to do.

Rachel: Yeah. Awesome. Okay. Why do you think so many people start out building really small businesses instead of going for the big idea?

Sam: Well, it's just intimidating. It's intimidating. You typically if you're like, I live in San Francisco, and it was awesome because I got to meet all these people that were working on Bitcoin in 2013. Even though it felt silly. It felt some grand idea. Or I had people that were helping make Airbnb huge.

But if you live in St. Louis, where I'm from, or maybe Boise a handful of years ago, you don't know that many ballers who are reaching big. I think that's the reason why. Even though oftentimes, it takes similar amounts of work. To be really huge, typically, I do think you often have to raise money if you want to do it in a fast way. I think there's a lot of stress that comes with that, but I still think you could build a pretty big bootstrap business fairly quickly.

It helps to have a role model who you're friends with. You're oh wow, you're not that much better than me, but you're so much more successful than I am. Now I have faith and confidence in myself. That takes being around other people.

Rachel: Yeah, I agree. That's one of the reasons why we started this podcast is because we want people to dream bigger and think about this, I agree with you. I love that you said that. That it takes the same amount of effort. I know for a fact that I worked way harder when my business was making $250,000 a year than I do now. It's an eight figure business, you know?

Sam: We did this survey. I have this new thing called Hampton. It's a peer group for CEOs. We asked them what their net worth was. It ranged from your business has to do $2 million a year in revenue in order to get it. So whatever you'd value that all the way up to there's a bunch of people in the $800 million range. The app, the median, the medium hours per week was the same for all categories of net worth.

Rachel: Wow.

Nathan: What was it?

Sam: In fact, we had a category of 100 to 100 plus, we're going to publish this in the next handful of days. The 100 million dollar plus people who had the net worth, they, on average, were working 40 hours, and then the one to $ten million dollar people were actually working a bit higher, in the 55 hour range.

Rachel: That sounds right.

Sam: But it was like it was very close to the amount of time worked.

Rachel: Yes.

Nathan: What do you see in that of, I mean, you can't trend the data over time. Later on, you will be able to as you do the survey year after year, I imagine. But do you think that's the trend where when someone's building that company from say one to ten million a year in revenue, they're having to work a whole ton. Then as they get to scale, they're able to back off? Correlation causation?

Sam: Yeah, a little bit. But also in order to get big, you need to hire really high quality people and delegate. If you don't do that, you work harder, and you don't get big. So the confidence issue that I had that I don't have as much anymore was I'm embarrassed to hire someone who's older and better than me. So a lot of times, I would hire someone who's like younger and worse than me because I'm like, I'm like, I'm like, why would this person listen to me? You know what I mean? Like, what the hell do I know?

Rachel: Because you're paying, and, I mean, they agreed to take the job.

Sam: You sound very emotionally stable. Congratulations. That's not an attribute I rank high in if we were a video game. Emotional stability would be a four out of 10.

Nathan: I mean, I relate to that, especially starting in business really young. I remember going to my first chamber of commerce events when I was 18 running a web design freelance business. Then all the way along, I was just always the youngest person in the room. You talk to people, and you're like wait, you want a job here? But then I would tell you like okay, you could tell me what to do. That's fine. It's a real thing to have to get over.

Sam: Yeah, it took me forever.

Rachel: That’s interesting. I did not have a problem.

Nathan: You don’t have that?

Rachel: Not at all. I don't know why, but I did not.

Sam: You sound like you have very healthy parents. I mean, I don't know what to say. You've done well.

Rachel: Well, I don't know how healthy my parents were, but I went to law school. Maybe that has something to do with it. I was building a law practice first. Then I got overwhelmed with work so I hired an admin to help me and then I hired another lawyer.

Also it might have had to do with my first job out of being done with college and law school was clerking for a judge. They just give you a ton of responsibility, and you just graduated. I'm like, I'm telling these lawyers who have been practicing for 30 years what to do because I work for the judge. I was like why are they letting me do this? So maybe that's actually where I learned how to delegate and manage people, even if they were more experienced.

Nathan: How to be in charge.

Rachel: Yeah, I guess so.

Sam: I used to do these events. We had this thing called Hustle Con we did for four or five years. I remember I used to, I had a lie that I would tell people. I would say, you're speaking at three, but you’ve got to come at noon for the mic check. Just like this event there is no mic check. Mic checks at conferences, they work, okay.

But we had a green room, and it was just my opportunity to hang out with these amazing people. So I would get to hang out with the founders of Grammarly or back then when we thought WeWork was awesome. The founders of WeWork. I said Casper and Away Travel and all these multibillion dollar companies. I got to hang out with them.

What I noticed was that they would be maybe ten or 100 times more successful than I am. They would freak out still. For example, Sam Yagan. He's the guy who started OKCupid. He was the CEO of I think, Match, and now the company that owns Match. I forget. It starts with an I. IAC. Yeah, IAC. He was pacing back and forth in the greenroom. I was like hey, man, do you need something? Can I get you some water?

He like snapped at me and was like just leave me alone. I was like hey, look Sam, I can help you. You seem really nervous. He was like, I'm sorry. I'm just nervous to speak in front of these people. I was like but why? You have 20,000 or 10,000 or something employees. It gave me so much confidence that the people that I admirer that were ballers, they were freaking out all the time.

I remember when I hung out with this other company, and they had just raised a thing of funding. They were in the New York Times, and they're like, this woman was the it girl. She was like so cool and successful, whatever. She was telling me that she didn't fire this one person for the past 12 months even though this person was imperfect for the role because she was just afraid of the conflict. I was like what? Really? I admire you so much and yet you're.

So it was almost as if I had bad eyesight. I finally was putting on eyeglasses and could like see. I was like oh, this is awesome. Like I could be like fairly uncertain and not brave about certain things, but as long as I do it anyway, I'll be okay. So that gave me so much confidence. Because there was very few people that I met that were like ten times smarter than me. There were a few. That does exist.

But like for example, the founder of Grammarly, when I was hanging out with this guy I was like oh, we just don't have the same amount of horsepower. There's nothing I can do that I can keep up with you, but there was many others where I'm like we're in the same ballpark.

Rachel: Yes. Working in the government did that for me. I worked for Hillary Clinton for a time and seeing what a hot mess the office was. Every Senate office and if you go to any of the congressional buildings and see how the setup is and what a mess it is, it will make you be like okay. I see, first of all, why this is a mess. Then also, it makes you feel you can kind of do anything because it's important people doing important stuff, and there's mess everywhere. So thinking that you have to do it without the mess is all wrong.

Sam: It's awesome to see your heroes screw up and be insecure and stuff.

Rachel: Yes. And be regular. They're just normal people with their own stuff. Yes, I met a podcaster recently that has an enormous following, millions and millions, tens of millions. This person has a lot of social anxiety and won't do public speaking and won't go on other people's podcasts even though they have this super successful podcast. So it's interesting. We all have our quirks. We all have things that are challenges for us.

Nathan: Do you try to design around those quirks? Or do you try to go straight through them and say I'm going to overcome these?

Rachel: Yeah. Oh, so I'm definitely of the mindset that I'm going to double down on what I'm great at and do absolutely none of what I'm bad at as much as humanly possible. So I hire for the things that I'm terrible at. Like I'm not good at organization or building processes and systems. I know I want a system, but I don't know how to build that system or what the steps are. So I have a lot of operations people on my team because I suck at that. I literally have worked myself out of every part of my job that is not what I'm good at.

Nathan: I heard that you don't log into Slack anymore, like the company Slack. I think I overheard this the other day. So you're just not in the day to day anymore at all.

Rachel: Yeah, well, I took it off my phone. Here's the hilarious thing. So I took it off my phone because I was trying to stop. I have a president of my company who runs the day to day, but I kept meddling. I was like I'm not going to be involved. It's fine. I'm just going to let you do it. But then I would see stuff, and I'd be like don't do that. Do it this way, or whatever. I kept inserting myself.

Then when I’d look back I'm like they didn't need that note on that graphic. Just shut up. But I can't trust myself to not intervene. So in order to like let her do it, I had to take myself off of Slack. So I just took it off of my phone. Then I tried to log in on my laptop today just to see what was going on, and I literally couldn't get it to load because I haven't been in there for so many days. There's so many messages every day that like it was having.

Nathan: Or your assistant changed your password.

Rachel: It was struggling to load. So I was like this is my sign to just keep minding my business. But this is the thing that I want y'all to understand. At an eight figure business level, I don't need to be there every day for the business to run, for people to have success, for clients to get results. I don't need to be involved. Not only have I outsource the task, but also the decision making.

Even my husband who's the CFO tried to come to me today with an important decision that needed to be made. I was like that sounds a financial decision. I'm like that sounds like it's in your department. I'm going to go shopping. Talk to you later. Let me know what you do.

Nathan: This is a different kind of financial decision.

Rachel: But one of the things I will say that has been great for me, and I think this is where you're at. You're post-revenue. Well, at least that's how I think of you.

Sam: Wait, what's that word?

Rachel: Post-revenue or post worrying about money because.

Nathan: Post-economic.

Rachel: Yeah, post-economic. That's the phrase that I was looking for. But I think part of my freedom comes from my lifestyle is of a size that I don't actually have to worry about the revenue of the business to just take care of myself. That actually allows me to take some of the pressure off and not worry so much about growth.

There was a couple of years, we went from two to five million and five million to ten in a two year period, which was very stressful. We had to scale the team very fast all those things. I think I'm just in this phase where I'm like I'm no worried about it. We don't have to grow. We don't have to double revenue every year because it was all ego. Part of it is impact. Part of it is wanting to serve as many people as possible. But if I have to go so fast, it was somewhat ego driven.

So therapy helps. Being ambitious, but also being able to wait for the results and not feeling like, it's actually much more abundant to say I'm going to get there and it doesn't have to happen tomorrow. If you're so desperate that it has to happen tomorrow or the next week, that's actually not thinking abundantly. That's scarcity. There's not enough time. The opportunity is going to go away. There will always be another opportunity. So anyway, therapy is the point.

Nathan: Sam, I'm curious for your side. Are you the person who sees like what you're great at, or any of those?

Sam: Yeah, I only got good at that recently.

Nathan: Okay.

Sam: In like the last two years. I tend to, the things that I suck at, I actually try my hardest to learn how it's done and what excellence looks like even though I can't exactly execute it. For example, the year we did 12 million in revenue, I didn't know the difference between cash flow and revenue which is a huge deal. That's really bad not to know.

Nathan: I just saw Jay here in the front row put his head down.

Sam: Yeah. It’s like a massive issue. I didn't know the difference between the two. I didn't know the difference between a lot of different things were. So actually Kat, my friend Kat, she told me to take this thing called the Four Day MBA. Has anyone with Keith Cunningham? Yeah, it's awesome. It's an accounting class.

So I try to learn, even though I can't actually do the accounting on my own, but I actually try to learn how to do it. I'm something I'm very good at. I'm really bad at a lot of stuff. I know how to hire really well. I know how to get them going and doing the right shit. So I hire wonderful people. Then I just like I know enough hopefully about many things that I can kind of know that I'm not being like stolen from them or something. You know what I mean? Like it's really important for me to understand that.

Nathan: Yeah. I think that I have been in the model of whatever I don't know or whatever I'm not good at, like that's a skill that I'm going to hone and improve. Because early in my career, I was trying to be a designer, a developer.

Sam: You're a great designer. Do you guys know how Nathan is he had this book called Authority in 2013? Or was it?

Nathan: Yeah, that's it.

Sam: 13. I went and saw him speak at the Gumroad office in San Francisco in 2012 or 13. That is how I knew you because you were designing icons, I think, right?

Nathan: Yeah, iOS apps and all of that.

Sam: I thought you were great at design.

Nathan: Well, thank you. This makes up for the comments earlier. So what I always had that approach of trying to overcome all of the things that I wasn't good at. Now I think I'm starting to make that shift where I'm saying I don't know if it's like I'm stopping growing in those areas. I'm like I'm going to hire other people. Or the growth that I actually need to do is to say this has to go beyond, much more beyond my skills. So the growth to say you do that. I'm not going to be involved.

Sam: Yeah, just stay in your lane. I also wonder if you have to, I've had people say that to me before. Like I need to know what the team member needs to do every day in order for to manage them. I'm like no you don't. Why do you need to know? I don't know crap about design. I can't even log into Photoshop. I don't.

Sam: Well, I like to understand a little bit because I want to know like can I push them harder? What's reasonable? What's like on the far edge of reasonable? Because like when you run a company, there's times when it's like all right, I'm going to push them super hard to they're going to be borderline quitting. Then next month, it's okay to chill. Like I know that we're executing a bit slowly. I have to feel that pulse. But I always try to study that shit so I know like all right, this is unreasonable. Let's go there.

Rachel: Okay, so two things that I do. One is just KPIs. You just track. Every team member needs to have KPIs that they're tracking for. So that's one thing. But the other thing is hire two. So like you can think, you might hire one person, and you think they're amazing. This happened to me in my law firm. I hired my first attorney. I thought she was the bee's knees. I just liked her, you know.

Then she also was executing. She was very smart. But she also like pushed back on everything and disagreed with me on everything, was very slow to get work done a lot of times. Then I hired my second attorney. I was like the first one sucks. You know what I mean? But I didn't know that until I hired the second one.

The second one is crushing it and executing so much more, so much easier to manage. I'm like oh. Actually, this employee thing is not that hard if you hire the right person. So that was advice that I got from an older lawyer who's running this multimillion dollar practice. He's like you need to hire two of everything. When you hire the second one, that's how whether the first one is good.

Nathan: This is something that I had not heard before. I was talking to the guys who run sales for Ramp, the credit card company.

Sam: Yeah, they kill it.

Nathan: They're very, very good.

Sam: The guy who started that company, that’s going to be a big ass company. That guy's amazing.

Nathan: That's awesome. So it was three different sales leaders in the company. I think it was the Chief of Staff and two sales leaders that I was talking to. It was asking them how they structure their team, how they commission, all of those things, and the different roles they have in their sales pipeline. They were also trying to convince ConvertKit to switch to Ramp. So I was trying to extract as much information from them as I could.

But in that I said something about our migrations and implementations team for ConvertKit. How we have one person run that. She's amazing. They're like hold on, that sentence doesn't work. I was like what do you mean? We have one person that runs it, and she's amazing. I truly believe she's amazing at her job.

They're like you can't know that she's amazing if you only have one person doing it. They're like have a second person, compare them against each other. They each have their KPIs, and then you'll know if it's actually amazing. So they're saying that in a revenue organization, so sales, implementations, account management, they're like you always have to hire two people. I hadn't heard that before. Now I've heard it twice in two weeks. So.

Rachel: Now that's your new focus there.

Nathan: There you go. Actually, I'm just going to talk to my chief revenue officer.

Rachel: But that's the other thing too is if you hire two, they push each other, right? They motivate each other. They also have like a work partner that they can connect with, bounce ideas off of. Also, I think healthy competition is good. So you have some competition of like okay, I'm going to push because this person is really good. Now I want to get on their level.

Nathan: Yeah, I like it. I'm also interested in this idea that you have of finding where the edge is for the team. Because I think a lot of people, not that you want to push people to burnout, but you also want to help.

Sam: Sometimes.

Nathan: Okay.

Sam: Sometimes you do. They always say it's, people are like it's a marathon, not a sprint. You ever tried to run at World Record marathon pace? It'll feel a sprint to a lot of people who aren't good. You know what I mean?

Nathan: What I've heard is it's a marathon, not a sprint, but professionals run marathons at four and a half minute miles.

Sam: Yeah, it's really fast. So like sometimes you do, but then there's also chill time a company. The energy will ebb and flow, and you have to be good enough to understand that.

Nathan: But I think there is a balance of trying for yourself and the team that you've built and helping each person individually know what they're capable of, and building that resilience. Fitness is an interesting example for it. Because if we were all to go out and say okay, we're going to run a seven minute mile. I’d be like oh god, I don't know.

But if someone said hey, a year from now. We're going to build up to this point. Whatever this fitness goal is, we're going to train towards it, and build that resilience. Then absolutely you get to a point where it's like okay that, that is easy because we worked up to it.

So having people on the team who know what they're capable of now, and they, as individuals, want that bar to be higher. They're saying hey, I'm not going to get there tomorrow and absolutely kill myself in the process, but I'm going to see where the goal is and methodically work towards that. That's a really good team.

Rachel: I think that's very true. I find that most people, especially A players. They want to get better at their job, and they want to be able to produce more and have wins. So I think giving them that feedback and pushing them to do more is good. They want that. I think people will leave if they get bored in their job.

Sam: Does everyone here work remote? Does anyone here go? Raise your hand if you work in office. That's wild, right?

Nathan: We have two people, three people.

Sam: Three people. I am nervous that people, because I feel like I slack off so much working remotely. I'm very curious about, this is the first fully remote company I've had. I'm very curious as to how like you figure out the limit and shit from like being remotely. I feel a bum working from home. I'm going to go back to the office.

Rachel: I've had a remote team for a long time. I can tell when someone's slacking off. Because you just.

Sam: I can't tell yet.

Rachel: You can tell. There's a sense and a vibe, and you're not seeing the output of their work.

Sam: It's just lame is what it is working remote. I hate it. Just super lame. I feel such a bum. I thought it was amazing. In many regards, there's so many awesome stuff about it. But I just I feel disgusting. I'll wear gym shorts half the time. I'm like I have to put something nice on. I have to comb my hair. I've got to do something to feel special.

Like I'm a simple man. My wife, we live in New York. She goes to the office. She's like I love getting dressed up nice. I love walking around the street. I love looking at people and being seen and all this stuff. So this is the first time in this whole post-COVID world where I'm like yeah, I need an office. I'm wondering how that's going to impact our productivity. WeWork. I like WeWork. I don't know if that's going to be a thing. I like WeWork.

But yeah, I loved remote at first. Now particularly for men, I'll go two weeks without seeing another person in real life. You know what I mean? I'm lucky that one of my best friends, Neville, lives two doors up, but I won't see another human being for two weeks because I'll just be in my room the whole time. Sorry, I don't know how we got on this.

Rachel: I'm going to leave it to you to decide where we go from here.

Nathan: I'm a big fan of remote work, but I do run into those things where I will say oh, other than taking the kids to school, I have not left the house in three days or something. But I think that, I don't know. There's tradeoffs in that. I like honestly the deep work at home for a long period of time and then batching things like this travel.

Rachel: Yeah. I agree. When you have school aged kids, you leave the house every day because you got to get them to school.

Sam: Yeah, there's been two weeks where I just haven't left the house, and I literally have 600 steps.

Nathan: You launch the health app, and it just says no man. No.

Rachel: Maybe just go for a walk in the morning To start your day just to get outside.

Nathan: Neville, you need to help this man. I know you're trying, but try harder.

Sam: You want to talk about, one of the prompts was which brands that are doing the billion dollar crater thing that you like. Because I had asked you are there any good B2B ones? Did you have any answers?

Nathan: Well, I, not to put it back on you, but I think you're doing it really, really well with Hampton. We'll talk about other creators.

Sam: I need you. You asked me for an example.

Nathan: Okay, so it's just wonderful bromance that we have going.

Rachel: I'm stuck up here with these two.

Nathan: I'm sorry, Rachel. We’ll get a better guest in LA. I apologize. So with Hampton, I think, is interesting one, and we'll brainstorm some other creators in a second. But what you've done of taking the audience that you have from The Hustle and then from My First Million. Obviously, it's monetized through ads and these other things, but then you've said kay, this attention that I have, I'm going to bring it together into a community of entrepreneurs. You're basically building YPO or Vistage for the current generation of entrepreneurs. Is that the right way to put it?

Sam: Yeah, so I'll give you guys background. So my new company is called Hampton. It's about a year old. I screwed up trends. It was this research thing. It was $300 a year. Like the day before I launched it, or we launched it, I created a Facebook group, and people loved that Facebook group. But $300 stinks because I couldn't make enough profit to provide a really high quality service. The P&L didn't work out. P&L, you see? Keep coming up.

Nathan: Getting those accounting terms in there.

Rachel: That accounting class is paying off.

Sam: So I studied this company called YPO. Has anyone here heard of Vistage? So it's not very popular. Some people have, but it's not very popular. But it's a company where it's mostly middle America, but it's basically someone who owns an $8 million a year plumbing or HVAC company or something that. You may not have a lot of peers who are doing that. So you meet once a month with other people in the services industry or whatever industry you're in. It's business group therapy. You talk about your challenges.

I saw that they were acquired for about $2 billion, I think, two years ago, and I was already ruminating this idea of I wanted to do trends but the right way. I called the banker who, Gridiron Capital I think bought it. I found the phone number of the banker.

I go hey man, I'm going to sound really blunt and rude here, but I just want to let you know I mean it with nothing but respect. But I'm going to build a company that is going to compete with you. I think it's going to be really successful. I think it'd be wise of you if we became friends now. I know that sounds really douchey, but I just think that that's what will happen. Would you be willing to talk to me? He did.

Nathan: That's awesome.

Sam: Yeah. We became friends. He kind of told me how the business works a little bit. I told him my plans. He started listening to the podcast. He's like okay, I think you might be able to do it. Can we just buy you before you launch? I was like no, but I told you, we were going to become friends. So he explained to me how the business worked.

So with The Hustle, the my biggest weakness was that we had all of these customers, but we made such little revenue off of what I felt was the impact that we had. Basically, like, in my mind, media is an equation. It's the number of people that you reach multiplied by the amount of influence you have over them multiplied by the spending dollars.

So, for example, let's say you're BuzzFeed, and you reach just most all of America. It's just an article that they're reading. It's news. So like you're not exactly going to influence them that much, but you are reaching a lot of people. They're not going to buy that much stuff.

Versus you have a newsletter or a podcast or something that talks to a thousand people who make decisions for Boeing or some other plane company on which product to buy for manufacturing the plane. You only need to influence 30 or 50 of them, and they'll make decisions worth tens or hundreds of millions of dollars. So you have to find that equation.

I was doing the equation in my head of how many people I impact, what I could influence people to do. I was like I need to create something so valuable that I can charge someone more than $300 a year. So I loved the idea have community and peer groups.

When I started The Hustle, I told, I won't say his name, but I'll tell you guys privately when we're not on the record. But there was a CEO of this media company that you guys all know who they are. I pitched him the company I was starting because I really admired this guy. He was my hero. I really looked up to him, and he took the time to talk to me, and I was so thankful.

He goes you know, look. This is never going to make more than $2 million a year, probably only $1 million a year. It hurt my feelings so much that I was oh my God, dude. You are my hero, and you just insulted me. I'm worth nothing.

So anyway, I just made all these mistakes with media that I wanted to create something really, really good with community, and that's when we launched Hampton. My podcast My First Million, we have between two and three million downloads a month now. When we launched Hampton, we got roughly 5,000 applicants in the first 30 days maybe.

Now that's cool and all. Not all those guys are going to convert. Not all of them are even qualified to join, but it was a lot of people that went to this really long application. So hypothetically, that's, what, $50 million of pipeline? That's not realistic, but you get the idea. It was like quite good. So that's what I was thinking about.

So my opinion is it's not a matter of if. It's just a matter of when. When we're going to get 10,000 people spending $10,000 a year, or maybe it's going to be 7,000 people, $15,000. I'm not sure how that equation is going to work. But with this business, I have 100% confidence that it will get there. It's just a matter of is it going to happen in year six or year 15?

Rachel: One thing I wanted to point out. So you said you call this guy, your competitor for this new business that you're starting.

Sam: We're not exactly competitors, but sort of. Hampton is for a tech enabled company, which means like you could be a D2C company. It's not quite a tech company, but that's who our customers. This is just more blue collar companies.

Rachel: Yes. The reason why I wanted to mention it is I did something, I did the same thing. I don't think it was douchey but.

Sam: Well, you could come off an idiot. I was like what I'm going to say is going to make me sound stupid. I promise you, I only mean it with the utmost respect. I'm trying to be straightforward.

Rachel: Yeah. Well, I didn't necessarily say I'm going to be your competitor, and you're going to have trouble. But what I did was when I started my law practice, I wanted to start a virtual law office, which was brand new back then. It was like not a thing. There were a few lawyers who were doing it.

So I just called them. I just cold call them and said hey, can you tell me how you're doing this? Is it working for you? I basically was just doing market research. They were all willing to talk to me. Some of them spent an hour on the phone with me giving me the whole rundown.

Sam: Yeah, particularly if you're younger than them, and they're like you're a serious person. They'll be like oh, that's so cool that you care enough to like. They'll spill the beans.

Rachel: They really will. So anyway, pro tip. Just call people who are already doing the thing that you want to do. Surprisingly, they will be willing to often talk to you and help you out. So it's a way to shortcut the journey.

Nathan: I actually had this experience with Ben Chestnut from MailChimp.

Sam: Is he a good guy? I can't tell.

Nathan: I think I've only talked to him once.

Sam: I've only read about him.

Nathan: Yeah, he seemed a great guy.

Sam: Really? He seems quirky. I like that.

Nathan: Yeah. I think he's definitely quirky. Creators, entrepreneurs, it’s pretty much a given.

Sam: Yeah. It seems like he had the good type of weird.

Nathan: Yeah.

Sam: But I wasn't sure if it was the good type only.

Nathan: TBD. We'll see.

Sam: I'm not saying he does. I just.

Nathan: It's an open question.

Sam: Yeah.

Nathan: So they were Inc. Magazine’s Company of the Year. We were at the Inc. 5000 event that year. I saw that he was speaking. So I emailed them and was like hey, I'm going to be there. I'd love to get coffee. I said a little bit about ConvertKit. He was oh, I know ConvertKit. Like you guys are doing great things. I don't know. We'll see. I followed up. He said like follow up during the event, and we'll see.

I sent him a note halfway through and was like hey, your talk was great whatever. If you have a chance to meet up. He just said like yep, I'll be in the hotel lobby. I'm checking out this time. My flight’s an hour later. So I'll be in the lobby at this time if you want to meet for a bit. He was fantastic. Like he started to break down. We were thinking about launching a free plan. So I was like hey when you launched a free plan, what was the landscape?

Sam: What’d he say? Don't do that.

Nathan: No, he said that that was absolutely amazing for them.

Sam: Really?

Nathan: He talked about all aspects of it where they launched it at a time where there wasn't another free plan. One thing that I didn't realize is how small they were when, ten years in, they were still a pretty small business.

Sam: How big?

Nathan: Three, four million dollars a year in revenue. I mean, they.

Sam: How big were they when they sold recently?

Nathan: They were a billion ARR.

Sam: God damn.

Rachel: Wow. Wow.

Sam: Was it totally bootstrapped?

Nathan: It was 100% bootstrapped.

Rachel: Amazing.

Sam: That's going to be a top 30 biggest bootstrapped software company. Top ten maybe.

Nathan: I think so.

Sam: Bloomberg would be up there. Something like that.

Nathan: Yeah, I mean, they exited for I think 12 billion.

Sam: God damn.

Nathan: So there were so many things. First, I learned so there's actually three co-founders, not two. They I had someone who they were running an agency, and they built this MailChimp thing, and they were running both. They had a bit of a disagreement of like should we build the software product where people just buy credits to send emails? Or should we keep going with the agency? They ended up going their separate ways. Two of them went with the little software thing, and one of them went with the agency.

Rachel: Oh man. I feel sorry for him.

Nathan: But it took a long time. They launched MailChimp in I think 2001. I think when they launched their free plan in 2008, 2009, they were making single digit millions of dollars a year. So one thing that I realized, like okay, stick with it for a long, long time.

Rachel: When did they exit? In 2020?

Sam: A few years ago?

Nathan: 2021 I think.

Rachel: 2021. So 20 years, it took them.

Nathan: Yeah, I think it was 20 or 21 years that it took them to.

Rachel: But that's a nice. If you think about like, if I think about my parents and what they did for 20 years, that's a nice exit to show for your 20 years of effort.

Sam: Ben was probably, you know them more than I do. I bet they were making nine figures a year in income or net cash flow.

Nathan: Yeah, they did very, very well. But one thing that was interesting about the dynamic with Ben is he was totally willing to talk through anything. Then at one point, the editor in chief for Inc. Magazine comes up. He's like hey Ben, just want to say hi. I worked on your article and all of that. They talked for minute.

He was like oh by the way, do you know Nathan? He's trying to kill my company. He's said this with a big smile on his face. Like they laughed. He was like no, but seriously, you should do a story on ConvertKit. I was like okay, that's awesome.

Rachel: That's pretty awesome.

Nathan: So maybe that answers your question about what kind of person Ben is.

Sam: I was only joking. I only read two articles about a him, and he seems awesome.

Nathan: Yeah. So anyway, I think the takeaway from that is whether it's competitors or whoever else. Actually another competitor story, there's a company in the crypto space called Flodesk that does email marketing in a similar industry. They're also bootstrapped.

I was speaking at a conference in Chicago, where Rebecca, the co-founder and head of product for Flodesk was also speaking. I just shot her a note and was like hey, do you want to? I can't remember even what I said. Like something like hey, I'd love to say hi at the event. She was like yeah, let's grab breakfast beforehand. We had a great conversation.

The way that I left it was like hey, if you're ever going to sell this company, make sure you call me first. She was like yeah, I can do that. So just that idea of hanging out with your competitors, the people you want to learn from. So many people are willing to share. All these companies are run by great people.

Sam: Another person as an example of this billion dollar creator thing. Have you guys ever heard of More Plates More Dates? Raise your hand if you've heard of this person. A lot of people, that's crazy. It's all men.

Rachel: I was like I've got nothing.

Sam: So have you heard of this person?

Rachel: No.

Sam: His name's Derek. We had him on the podcast recently. He does a really good balance of being like bro science where he makes a dick joke, but he's also, like he comes off quite serious. He's well read and well researched. He does a really good job of balancing that being silly and dumb and being not dumb.

He only has 2 million subscribers on YouTube. That's a lot, but that's not that much for he came on the pod. More Plates More Dates is a fitness-ish YouTube where he talks about steroids, and he would like here's Brad Pitt in this movie. Here's him in this other movie. Here's what I think the supplements he was taking.

Then he would get a little bit more into men, you're losing your hair. Here's some ways that science has shown that you could help yourself. Then he eventually launched a supplement brand, but he also launched a men's health clinic. He came on our pod and had 1.9 million subscribers I think he had. He said he is doing around $8 million dollars a month in sales at the moment.

Rachel: What's the main driver of the revenue?

Sam: So he has three.

Rachel: Supplements?

Sam: Yeah, he has three or four. One brand is a pre-workout slash protein, which is a very common thing. The second one is a men's clinic which means if you want to get hormone therapy, so testosterone, or if you want to get other types of therapies that you need a doctor to give you. He has a team of doctors. So you can go to and you pay anywhere from 100 to probably $500 a month, I guess depending on what you get.

Now he's actually creating fragrances, perfumes, clones because a lot of young men are I want to be more handsome. I want to attract more women. I guess, I don't know how that. He somehow decided that this thing where he's going to do cologne. So he has a fragrance company coming out.

It's one of the more impressive, I think he's only, he said on the podcast, I think, 30 years old. These businesses collectively are doing about 8 million a month. It's growing a weed. It’s one of the more impressive content turned commerce business that I've ever seen.

Nathan: So I mean so just to be there, 8 million a month is just shy of 100 million a year. He would need 8.3 million a month to get to 100 million a year. That's absolutely mind blowing to do off of a YouTube audience of 2 million.

Sam: Yeah. Which isn't that crazy. I mean, if you're really talented and you're good and you give it four or six years, it's conceivable that you could be in that ballpark after a bit of time.

Nathan: To get there. So maybe if we look at a couple other YouTubers. Ali Abdullah is a friend of mine. He's talked publicly about a bunch of his numbers. He's got two and a half, 3 million followers on YouTube, maybe even more. A lot in the like productivity, somewhat in the business space and all that. He shared his numbers publicly. He's making about $6 million a year, which is an amazing business, absolutely mind blowing business. But then when you think about like the scale.

Sam: Yeah, because it's that equation of what I was saying earlier. You really need to figure out how you can boost those numbers if your goal is to maximize that revenue. So another example is Doug DeMuro. Does anyone know who Doug DeMuro is? Like his whole shtick is that he's a geeky, nerdy, funny, lovable guy. But he reviews cars, but he does it. Like, he'll review a super fancy $2 million car, but also a minivan. He's very lovable, and you like watching him.

So he created a business called Cars&Bids. It's sort of eBay Motors. It's a car auction website for car enthusiasts. That's his tagline. So there's cars from the 80s and 90s and early 2000s that aren't particularly valuable. 40 grand or something, or even 30 grand all the way up to millions. That people who are car enthusiasts are oh, I used to see my uncle had one when I was a kid. I totally want to get one of those. That's the type of car that you would see there. I bought my car off of it.

There was another business in the space called Bring a Trailer. Bring a Trailer recently exited for rumors around $600 million. It was a similar style business. I think they were selling close to seven or $800 million of cars worth a year.

So anyway, Doug started Cars & Bids. I remember before he started it. We started talking about it on the pod. I was like Shaan, this guy, I think he's going to launch something, and it's going to be great. I found out because I stalked him on LinkedIn. I saw that he was hiring for this thing. So this guy is going to launch something. It's going to be the best. Then he launches it, and we're like it's going to work.

Then after only a year and a half or two years, he sold a portion of the business to TCG, the Chernin Group. He told us in the pod how much money he made, but it was he sold the portion of the business at around, I think, an $80 million valuation. I think that give it, marketplaces are one of the harder businesses to start. But once they work, they're one of the hardest businesses to destroy. Hence Craigslist or eBay, which still crush.

I think that his business will be a potentially a billion dollar outcome in the next ten years. I think that's a really good example of someone. His audience when he launched it wasn't particularly big either. It was big, but not.

Nathan: Well, I think there's something to being adjacent to an expensive transaction or dealing with a high value clientele that matters a lot. Where if you're taking a small cut of $100,000 transaction or a $50,000 transaction, that matters a lot. There's one that I came across recently. There's this YouTuber named Mike Patey, who he's out of Utah. He maybe 15 years ago got into aviation. So he learned to fly. He's a machinist and understands. I think he's an engineer.

So then he started like modifying planes and then building his own planes. Now he holds a whole bunch of World Records for like they call it short takeoff and landing. Like have you ever seen a plane like roll down like maybe 20 feet and be in the air flying, but it's a plane that holds multiple people. That's what it is.

Or if you saw the Red Bull where Red Bull landed the plane on that little helipad. It's that kind of thing. So he is in this world. He's got 300,000 subscribers on YouTube, very much into aviation doing these crazy things. He started his other company called Best Tugs, which is a weird.

Sam: T-U-G?

Nathan: T-U-G-S.

Sam: All right. Boats, right?

Nathan: Yeah, not quite. So there's the thing with a plane where if you've ever been, if you're at the airport, you see that car that comes out to push the plane around, the big airliner.

Sam: Oh, that’s called a tug?

Nathan: That's called a tug. So at the very smallest planes, you come up and you have this little tow bar that you like hook on to the front wheel, and you just push the plane around, like a little Cessna. The big planes have a car that pushes it around. But you get these like small to medium sized planes that it's too big to move around by yourself, but it's not big enough to move.

So off their YouTube audience, they made this product that is basically a little motorized thing. You just walk behind it and hook it up. This thing cost $6,000. I know because I just bought one for my airplane. If someone's spending $500,000 or a million dollars on a plane, right, a $6,000 transaction is very, very cheap.

So he here is selling this product that they can sell for a huge amount of money off of the YouTube audience. Another friend who's a pilot came over. We were flying together. He was like oh, you've got one of Mike Patey’s tugs. Oh, that's amazing. So they've built this epic business off the YouTube channel because they're adjacent to a very high dollar amount transaction.

Sam: There's one downside to this whole creator turn billion dollar thing. I mean, it's the creator still has to do the work. So like I'm on a content treadmill at the moment. I took a three week break these last few days. That was the first time I've had in a long time. But does anyone know this person named Craig Fuller? Do you know Craig Fuller?

Nathan: Oh, FreightWaves.

Sam: FreightWaves. So you guys should check this person out. He's a real low key. He never brags about himself. But it's this guy named Craig Fuller. He started this thing called FreightWaves. For some reason, I have no idea why, they reveal all of the revenue and all of the profit, just like you. But I don't know why they do it, but they treat their company they're publicly traded. So you just Google FreightWaves. It’s a software and media company.

But his side hobby that this guy has done is he bought this, he calls it a magazine. I guess it is still literally a magazine, he bought flying.com, which is a very small niche website for flying enthusiast. Then he bought, I think, 80 acres of land in.

Nathan: I think it’s a lot more than that.

Sam: Is it 800? Did I get it by a factor of ten?

Nathan: To fit a runway on it, it's got to be big.

Sam: I forget the number. But whatever the number is, I think he spent mid seven figures, I believe, on buying this land. He was like I'm going all in. This is a big deal for me. What he's doing is he's creating basically, you know how there's communities where there's houses around a golf course? His whole thing is he's doing it around an airline, like a strip.

Rachel: Oh, I think I heard about this.

Sam: And an airplane hangar. He's creating a flying club. So if you're Nathan, and you're like I would love a home that has a strip. This is what I'm going to do. He's using flying.com, his audience now, which I don't think it's very big. I would imagine it's 300 to 800,000 monthly uniques, if I had to guess.

Nathan: Yeah, maybe even less than that.

Sam: Maybe less. He put the money down for the land, which was a big deal. Then he pre-sold plots of land and now has made his money back, and he's selling it to the flying.com audience. Now, recently, I think he went and bought how many more titles did he buy? Like another five or ten?

Nathan: They bought a bunch of stuff.

Sam: So they bought more. So they bought like the flying.com of the trucking industry. They bought the flying.com of the yacht industry.

Nathan: The yacht industry.

Sam: So I.

Rachel: The trucking industry would be what? You drive your truck in to?

Sam: I don’t know.

Rachel: You want to park your truck at your house?

Sam: I don't know what the scheme's going to be on that one. But he bought a bunch of them. So what he does is he makes profit. So if I had to guess, he buys them for four to eight times EBITDA. He makes a profit to hope to pay back the money it cost to purchase the titles, and he runs the company.

Then he'll either raise money, which he did in this last deal, to buy either property. So the yacht one, or the marine one, that's a very easy one to make. We’re going to build homes around a nice marina. But that's his whole plan at the moment, and I think it is going to work wonderfully.
Rachel: That’s interesting.

Sam: I think he's going to, his name's Craig Fuller. F-U-L-L-E-R. He talks about it, but he has a pretty small following.

Nathan: Yeah, I think a couple thousand followers on Twitter. It's not.

Sam: 100% going to work, I think.

Rachel: Horses would be another good one. That's where, my ranch was purchased from a community that was supposed to be built around equestrians. So like it was all these plots of land. It has a room for a stable so that if you are a horse enthusiast, you want to have your horse at your home instead of.

Sam: It’s 1,000 times better than selling a $20 t-shirt. You know what I mean?

Rachel: It can be, but this was actually a failed community. It didn't work. So.

Sam: Oh yeah, the risk is huge. Yeah.

Rachel: So then basically the people who owned my property before I bought it bought five of the plots and put them all together and then turned it into this 50 acre property.

Nathan: Well, so I wonder what distribution the failed one had? Did they have?

Rachel: They didn't have a community. They didn't have a YouTube channel for horse enthusiasts, right?

Nathan: Or they didn’t own the biggest flying magazine, which is a pretty small niche still. But I think it's fascinating going in and buying flying magazine and saying okay, here's a business. Let's evaluate it at face value. Okay, we've got advertising. Yep, this is cashflow positive.

Sam: You don’t need that many people to spot trends. I remember when The Hustle, Zoom, the company Zoom, advertised with us before the company went public. I saw how many clicks we drove them. I was doing the math, and I was like a lot of people must be buying this stuff. This is insane. I bought some of their stock right when IPO’d. At the time, I think we only had 500,000 people. You don't need that many people to start seeing really interesting trends where people are buying this. This is wild. That was a big learning for me.

Rachel: One of the things that's interesting for some of the examples, not necessarily the flying one. But it doesn't actually have to be this really unique thing. Hampton is not that unique.

Sam: It’s not unique at all.

Rachel: Even ConvertKit is not that unique. What I'm doing is not that unique either. So I think sometimes people think like in order to come up with that billion dollar idea, it has to be some idea that comes down to your head from God. It's like sometimes it's just oh, I see a version out there. Like basically my business was because I went to conferences where everybody who was speaking was a white guy, and I was annoyed that there were no women and there were no people of color on the stage.

I went a couple of years, and then I finally decided okay, I'm going to stop being pissed and just create the competitor that's better. That has diversity and inclusivity at the center of it. So I just created my version of it which has taken off because it was a need in the marketplace.

So it actually, it's the same business that so many people have, but just the one unique insight or the one unique perspective is what helps it to take off. So you don't have to come up with the most amazing idea. You can just see what's out there and see like how can I do that a little bit better? Or just come up with an offer. In Ali's case, he's a productivity expert. So like he just needs to come up with either a software or planner or something. When he does, that's going to take off too.

Nathan: Sometimes people stick with it for a long time before they find the thing. Does anyone drink LMNT? Like L-M-N-T. So Robb Wolf was one of the pioneers of the Paleo movement, maybe the main pioneer of it, right. He did a bunch of different businesses over time. He tried a lot of different things. They've been working on LMNT for five, six years now. It is now really, really taking off. That's a fantastic business.

Also, a little side note, Joe Runyon and I were nerding out about this. But if you think about different brands and the pros and cons of it, we have Liquid Death here up on stage. This is a very expensive product to ship. We're shipping water around. This is very expensive to move. But if you think about LMNT as a business, we're shipping little tiny packets of salt. These are electrolytes. There's no shelf life. It's very, very stable. It ships very cheaply. So there's a lot of these attributes.

I guess the first point I was making is somebody that can take a long time to find the right business, but that will eventually pay off. Then the second thing is there's a lot of these attributes that really do matter. It's easy to say oh, this person did this and it worked. But you really pay attention and find the trends of okay, what actually made something a good business instead of a tough business? This business is very challenging with margins when you're shipping it, but if it's sold in stores okay, all of a sudden, it's a really solid business.

Rachel: Supplements seem to be huge. I was saying earlier about Necole Kane, who is she used to have a blog called Necole Bitchie, which was a gossip rag. Has anybody heard of it who's here? No? Okay. Well, anyway, it was a celebrity gossip blog. It was extremely popular. She sold advertising, made a ton of money. Then she decided she didn't want to be associated with gossip about celebrities.

So she changed the model. She just closed that and created a new media site called xoNecole, which is wellness and lifestyle media company. Just creating content and geared towards, I think, mainly women of color. That did really well. She sold it, I don't know exactly how much she sold it for.

But now she's created a supplement business called My Happy Flo. It's all about hormones for women and basically managing your period so that it's less painful and less stressful, whatever. All these benefits to the supplement. Anyway, that business seems to have taken off, and it's a subscription model too. So you get it delivered. She works two hours a day she told me. She's got somebody who ships it out, a company that does that part. It's very low effort, and she makes a lot of money from it.

Nathan: One thing you touched on of it being a subscription business, almost all of these that you see are businesses that have a recurring or a repeat purchase. There are exceptions, right? The airplane tug, you're going to hopefully buy that one time. It should last for a very long time. It says the best tug. So.

Rachel: Or buying a plot of land fly in. Although you could repeat that in different locations.

Nathan: Yeah, and there's different things you could do there. But another example of someone who's doing this right now. We've talked on the show about Paleo Kitchen. They had this big exit blog to consumer products company. But someone doing it right now is Susie Bulloch who has a blog called Hey Grill, Hey. So she is doing all these recipes, barbecue, grilling, built a massive blog making over a million dollars a year off the blog.

Then now she is building her own line of barbecue sauces and rubs and getting distribution in stores. I don't know her revenue. If I had to guess I'd say it's mid-single digit millions. So maybe three to five million a year, but it's one of those things where I'm like okay, you have the audience. You've got the angle on the content. You're just starting to get the retail distribution. I see how this plays out. It's a product that if you it, you're going to be buying it every couple months or every month. I think that one is absolutely going to kill it.

Rachel: Yeah. What's interesting to me, co-working spaces. Like obviously, WeWork didn’t do well. The Wing, they failed too, didn't they?

Sam: They did.

Rachel: But it's interesting, I was just at an event for Miss Skittlez is her name on Instagram, but her name is Mary Seats. She has a coworking space called The Bakery in Atlanta. It's focused around women, mainly women of color, and it does really well. It’s very successful. So her plan is now to scale it and now build a Bakery in different cities. This is the fastest growing segment of entrepreneurs is women of color.

So I'm interested to know, have y'all seen a co-working model work well? Because it is a subscription. Then she also does events there. She said it makes a lot of money.

Nathan: I have not seen to do well. I just want to compare for a second the margins between a co-working business and like okay, I'll pay $300 a month, $500 a month, I don't know, to get access to this. But they've got to have a full building. They have to have staff. There's so many things. It's got to look nice. Then if we compare that to Hampton as a business.

Sam: Yeah, I would never get into real estate. It's like it's takes money to make money with that. Whereas tech you can start with zero dollars.

Nathan: The way you win in real estate is that you buy the buildings and then you lease it to the company, to WeWork. So it's basically what Adam Neuman did where he owns it separately.

Sam: It’s a totally different skill set of being a financial analyst versus inventing things on the internet.

Rachel: Well, what she did that's different is she's not in downtown Atlanta. She's a little bit outside of Atlanta, which means that there's a lot of great parking. It's in a place that going to get less traffic. I imagine it's less expensive to have the space there. So it's interesting. I don't know. I mean, she seems to be doing really well and plans to scale it. So I'm excited to see her do it.

Nathan: Yeah, that'd be good. One thing that I'd love to do is take some questions. We've got a mic that we can pass around. Who's got something that you want to ask? Or if you have an example of a creator making the shift right now that you'd love to share, we're down to hear it.

Male Speaker 1: Thanks guys. So I know Nathan and Sam, you guys both work a lot around email and talk about the importance of distribution. I'm curious how you see distribution developing over time namely inbox service providers or Apple or Google basically taking more control. Then on the other side, social media. Obviously, there's been a lot of movement. So how do you see distribution in the future for creators? Is it a problem where it's something that there needs to be alternatives? Or do you think the existing tools get the job done?

Sam: I'll give us very short answer. You're better to answer this. The first month that we made a million dollars in revenue, I got this tattoo on my leg, and it's a pirate ship. It says bold, fast, fun because that was our motto. I used to say that The Hustle is a pirate ship. Every email subscriber is just a little bit of wind in our sails.

The reason being is that my opinion at the time, and it still is, was that email was the most, was the channel that you could own most but you don't actually own it. Because Gmail accounted for, you would know the numbers, for us I think was 50 or 60%.

Nathan: Yeah, that sounds about right.

Sam: If they made a change, which, thankfully, the only change that Gmail has made in the last 20 years is they've done promo. What are they for, like folders.

Nathan: Updates. Inbox, promo, update.

Sam: That's the only change they've made really.

Rachel: I hated that update.

Sam: Yeah, that's the only thing they've done. But if they made another one, I would have been screwed. So my opinion is email still, number one. I forget all the other questions that you had asked. I'm sorry. But you can remind me.

Male Speaker 1: There's some really.

Sam: You also asked about social media and stuff that.

Nathan: You don't have to excuse yourself, Sam. You're good. No. So email is interesting because there's not a single inbox provider, but Gmail does absolutely dominate. Then Apple.

Sam: How much of ConvertKit is Gmail?

Nathan: Of the subscribers? It's hard to say because you don't know about the number who are using Google Apps for domains, which is effectively Gmail. But if someone said it was 50%, I wouldn't be surprised.

Sam: Then Apple is another 25%.

Nathan: Apple was huge. Then a lot of those Gmail addresses are actually opened in Apple Mail. So you get a huge range of things. So you're having these shifts where the inbox providers, and this might be too nerdy, but the inbox providers are both saying keep your list very clean, unsubscribe anyone who's not actively opening, and then they're actively destroying access to all of your data in order to do that very thing.

So Apple, doing their privacy protection stuff where they're automatically opening a bunch of emails, there's things you can do around to try to understand and optimize for clicks more than opens, but it's definitely a changing landscape. The thing that you still have one, is that direct access to the audience.

For Gmail or Apple to remove that access, they're actually hurting their customer. Because if you think about it, they don't want to leave a door open for someone to come in and displace Gmail. So they need to make sure that they're keeping each Gmail user really happy. But then the other thing is I don't think those algorithms are going to change in a meaningful way. Because people aren't really, if it's not broken, don't fix it.

Sam: Of all the channels, in my opinion, email is the easiest to acquire customers repeatedly and quickly and cost effectively, which wasn't the case when we started. Now, it's different. It's way easier.

Nathan: There's no other channel that lets you actually segment your customer base. You can't really say hey, I'm going to put this Instagram real, but it's just for the business owners in my audience. It's not for the people who follow me for my fitness content or productivity. But email, you can 100% do that.

Like imagine in Instagram if you put out a reel, and it was actually different, the middle section was different or the call to action at the end was different based on who is consuming it? You can't do that, but in email, you absolutely can. So I think we're going to hold on to a lot of that ownership and value for a long time.

Rachel: One of the things we're doing is we text as well. So emails and texts. I feel you almost have to 360 surround your audience. So social media and then also text then also email. It's like how can I show up? How many touch points can I have with the same information? Because people are ignoring a lot of it or missing it or whatever. So.

Nathan: I would add into that to do retargeting. If you have email addresses for people, say if you're selling your course and you know everyone who clicked through the sales page, retarget them down your funnel with more content about it. They've been to your sales page.

You know they're a subscriber. You can send them very targeted content across the social platforms tied exactly to where they're at in the funnel. You have to pay for it. Some people are saying like why would I pay for that when I can email and reach this person for free? That's like well you get to hit it from a bunch of different angles.

Rachel: Exactly. I find that that we have to do that. Yeah, I love abandoned cart sequences. It's my favorite thing.

Nathan: Yeah, there's all kinds of different things.

Rachel: They just work so well. I don't know why, but they kill it.

Nathan: All right, who else has a question?

Female Speaker 1: Rachel and Nathan, thanks for your time. Sam, quick question. Congrats on your baby by the way.

Sam: Thank you.

Female Speaker 1: You're welcome. When you're talking about monetizing your newsletter and you gave that equation like number of people you reach times your influence, can you share how you thought about quantifying your influence?

Sam: Yeah, so I'm a nerd. I started thinking about this math a lot. So it's so funny. I was just drawing this Saturday. There's a sub equation of influence. I'm trying to work out what it is because I like these framework. I try to oversimplify some things, and it's fun. But typically, the amount of influence you have on someone, I think it's often correlated with the amount of time they've invested into you consuming your thing.

So an example of that is, I used to think YouTube was the number one best channel to influence someone. I've since changed to podcasting because I'm in someone's ears roughly two to three hours a week. It's very intimate. I have noticed that I will do little easter eggs where I'll say something in the middle of a pod, like contact me if you heard this, something silly way more on podcasts.

So for influence, it's a really easy way to test it is how many people will show up to an event. That's a hard test in the sense it's hard to pull off, but it's very straightforward. But usually it has to do, I think, with the amount of time they've spent consuming your content and how far they go down that slippery slope.

So usually, not always, it's a book. Someone who spends eight hours reading you will probably love you more than someone who has listened to you for two hours versus who has just seen one tweet. In fact, I know a lot of friends that are famous on TikTok. When they try to sell stuff, they don't sell anything because they only have 15 seconds of someone's attention.

Rachel: That's such a good point. That's why I think books are really powerful. Books definitely, my book definitely blew up our business. I think somebody has spent that much time, the audio book sold three times the amount of the hardcover. So you're in someone's ear for eight hours. I'm reading the book. People tell me all the time that they listen to it regularly. They've listened to the audiobook multiple times. So that's a lot of influence, if you think about it. So that interesting.

Sam: I think it's a time thing.

Nathan: Yeah. That's where a podcast is great. Just the sheer amount of content that you're producing. You can't produce that many books, but you can come out with new content every single week.

Sam: Well, that's one thing to think about. What are you giving your audience to consume? So if you're not regularly creating newsletters and a podcast, and maybe you're doing events occasionally, and you're on social media or whatever it is. Like what are those touch points that you're giving your people so that they can regularly be consuming something from you and learning from you? Or just getting value from you in whatever format.

So that's one of the reasons why this podcast exists because I would tell my people all the time, like always have something positive in your ears, always to have something that's motivating you so that you can kind of stay motivated, even when business is hard. Then I was like well, I'm not really creating anything to help with that. So I'm just sending you to other people's podcasts. So maybe I should get back to actually doing it consistently.

Nathan: Yep, I like that. I think you got the mic right back here.

Ethan: Hey, Ethan. Thank you guys so much for sharing your wisdom, honestly. Question more of big picture. So you guys have been entrepreneurs and creatives manifesting your dreams for years. I'd love to hear your insights about like what the meaning is. When you accomplish these things, how do you stay grounded? How do you continue to build something new when you've already done what ten years ago you would have said is it all, you know?

Sam: Do you do meditation?

Ethan: Yes. I'm a yoga instructor.

Rachel: I love your vibe.

Ethan: Yeah. I'm very curious about your answers.

Rachel: Well, I'll say for me I have a big mission. My mission is to close the wealth gap for women and entrepreneurs of color. Thank you. So that's what motivates me because otherwise I'd be like why do I work? I mean honestly, I think we all want intellectual pursuits.

So I think I would still write books and do things, but what gets me to show up and want to keep going with my business and what has gotten me through the really hard parts is having that mission and knowing that if I stick with it, I'm going to continue to impact more and more people and help more and more people close that gap for themselves. It's one entrepreneur at a time. So I think having a strong mission and why it keeps you motivated long term and makes you want to keep creating.

Sam: For me, it's a lot about I just I find it quite addicting to come up with an idea and turn it into reality and hope that I can kind of kick my dent in the world. I find that to be a very addicting thing to like bend reality into how I want it to be. I find that to be, it's almost exercise. You're like I want to lift this much weight. You train for three months, you hit it, and you're like that was so exciting. I'm so proud of myself. I want to do it again. Then the other half is just proving every high school bully and girlfriend who dumped me wrong and making up for years of feeling inadequate.

Rachel: It's a very honest answer.

Sam: Well, there's definitely bottles of champagne for all the grudges that I hold. Whatever I do something I can rub their face, I pop one of those bottles.

Nathan: I'm just imagining in your house. Sarah's like why do we still have these? You're like oh, they know why.

Sam: I'm plotting.

Nathan: Yeah. I think for me, it's just fun. Like the game of business that we're playing is I just thoroughly enjoy it. I really, I think about setting a big enough goal that achieving that goal is going to force you to change and become a different person. Not in the way of oh, now you're a douche, or you've sold out in some way. But in the like I had to become the person that can achieve this level of thing.

So I had this experience at our very first team retreat where we had 21 people on the team. We got together for the first time. We're in this big, living room in a cabin outside of Boise. It was a great moment. I was sitting around looking this. People were meeting for the first time. I was like wow, I love this. I realized they were all waiting for something.

I'm like what are we waiting for? What are we? Oh, you're waiting for me to like say something and lead this company. So in that moment, I had to shift from being oh I'm behind the scenes. I'm just working on these things to oh, I have to show up and lead this company. I had to learn new skills and level up in that way.

So when I think about building the business to 100 million in revenue, which is the goal that we're working towards right now, I'm realizing I'm going to need a couple more step functions of those to learn new skills and entirely level up. I'm excited for that in the same way of like the way you talk about a fitness goal and achieving that. I'm excited to figure out how I'm going to need to change to do it. Then also on the mission side, the mission for the company is we exist to help creators earn a living. So I.

Sam: Is that your number one motivating factor?

Nathan: What's that?

Sam: Is that number one or is that number five in things that motivate you?

Nathan: I think it is number one. If I told those stories, I would cry on stage. So like Alexis is sitting there. She was at that team retreat. She knows all of those stories. But yeah, it's definitely number one. It just would get into sharing it bunch of stuff that, there's a documentary that you can watch for that.

Sam: You want to do one more?

Nathan: Yeah, let's do one more.

Female Speaker 2: That would be me.

Nathan: Oh, you got it right there?

Female Speaker 2: Thank you for your time and big powerful missions. I really appreciate what you do. I'm one of those, I have your book.

Sam: Hold that up.

Nathan: No the mic.

Sam: No, hold the mic to your mouth.

Female Speaker 2: Oh the mic up. The book?

Sam: Hold the book too.

Female Speaker 2: Okay, I had so many questions, but I'm going to narrow it down. So I'm a recent empty nester of three kids. They are off in the world now, but I always feel running a business was pushing a boulder up a hill as a woman in the household and having a business.

Rachel: I don't think that's wrong. Sounds accurate.

Female Speaker 2: Okay so I wasn't going crazy.

Rachel: That’s accurate. Well, I would say starting a business is pushing a boulder up a hill, for sure.

Female Speaker 2: It’s been ten years, and it's always been like. But because of all the cultural, I guess, pressures that automatically go on the woman and when the male is in their career. It's a lot. But I'm asking because even though I'm two months into this, I'm still curious how do you all balance family and business without feeling you are pushing that boulder up a hill?

Rachel: Yeah. Well, sometimes I do feel I'm pushing a boulder up a hill with balancing both. There were definitely times where it took a lot. I mean, I just had a arrangement with my husband where he didn't like his job, I loved my business. So he stayed home with our kids. He was great at it. For the time that he did that before they were school aged. That was our deal. That's how we did it.

But the way that I do it is with lots of help. So I hire, hire, hire. I would rather have less money and never cook and never clean and never do all the things that I don't have to do. So I have a chef, and I have a house manager. I have a team at home that allows me to do my work. Then when I'm home, I'm 100% just focused on my family or unless I'm taking time for myself. So I don't have to go home and cook or go home and run errands. I don't do any of that. I just hang out with my people when I'm home, you know? So that's how I balance it.

Then also hiring a team in my business so I'm not doing everything. So I've given up. I could take home a lot more money if I didn't have a team, but I also wouldn't be building a potential billion dollar business. But yeah, so team is huge. So I hire and hire early and as fast as possible. That is key for me to be able to have that balance.

I have four children. I started having babies six months in. I just decided I was going to become an entrepreneur. Six months later, I accidentally got pregnant. 19 months after my first child was born, I accidentally got pregnant again. So, good at business planning, terrible at family planning. Then there's a third accident. My first child is my bonus daughter. So yes, four kids, and I've built this business the whole time. I've been a parent for from six months in. So it's very doable, but you have to hire help. That's, I think, the key and then also have strong boundaries and say no to a lot of things.

Nathan: Yeah, I think I have two different answers to that one is early on when.

Rachel: Nathan also has 50 11 kids. So.

Nathan: Three, to be specific.

Sam: Yeah, but you had kids at a really young age.

Nathan: Yeah, I was 21.

Sam: You had kids before even started ConvertKit.

Nathan: Yep.

Sam: Which is I always thought that was very impressive.

Nathan: Yeah. So there's basically two different phases, for us, of having kids where the first two kids we had when we were really trying to get the business off the ground. That was really challenging, oftentimes, because first I had to be very deliberate about the amount of time that I could spend and how intentional I was about it because I was used to being able to just throw a huge amount of time at any problem.

Then once you had kids, you realize oh I can't do that anymore. So my messing around of like yeah, I'll spend six hours to solve this problem. I couldn't do that. So I had to actually be super focused.

Rachel: Well, that's what I was going to say. It almost gives you a superpower because you're really intentional. You're like nothing is wasted. I'm not going to sit here and screw around on Facebook. I'm going to sit here and get shit done because I know I've got to be done by a certain time.

Nathan: Yeah. So I think when my first son was born, the next two and a half years was that where I was really intentional with my time. I was on it. I was writing a whole bunch. I made sure that I wrote 1,000 words a day. That was the most important thing. If I didn't get that done, or like everything else was negotiable, but that was the one thing that always had to happen.

Now, when my second son was born, I was trying to take on even more, and I was thinking like okay, I got that figured out. We'll do this next one. I can take on even more. I've leveled up as an entrepreneur or whatever. I actually got so stressed that I got shingles and like didn't work for six months. It was a terrible thing. So I tried to push through that, and it didn't work.

So I think early with kids, before you have the money to spend on help, you have to be realistic about what your appetite is and how you spend your time. Just be super, super disciplined. Later on, like my youngest is four now. So I have a five year age gap between my older two and my youngest. It's kind of a cop out answer, but a lot of problems can be solved with money, right, and hiring.

Rachel: It’s so true.

Nathan: Hiring help and having a nanny come and all these other things. It's just like this makes things so much easier. Then being able to step away from the business. In the early days of ConvertKit, if the app went down, I had to be either helping get that back up or answering tech support or whatever else.

I had an experience a few years ago. We were actually had a team retreat where we had an issue and a bunch of people gathered around. I'm like wait, there's like 25 people standing here who are more qualified to deal with this than I am. I could add nervous energy to this, or I can go sit down and have a conversation with someone else who's equally useless in this situation. So that comes with time. So I had an entirely different experience raising my youngest because we had money. We were not stressed.

Rachel: Same. We had a five year gap between my two, the two in the middle and the youngest. It's night and day.

Nathan: Yeah. Sam as a three week father, what would you say about this?

Sam: I had the greatest advantage, I felt, when I started my company was I had a girlfriend who I'm now married to. I didn't drink. I didn't work out. I just worked a lot. I didn't have any, I just explained to you I would not leave my house for three weeks at a time now. I barely did anything.

So I didn't have balance. I paid for it with my health. I had high blood pressure. I don't think I was emotionally in a good place. But I'm thankful I had a strong girlfriend who kept me going. But no, I didn't have balance. I kind of think when you're getting started and you're just trying to make it work to get the point where I could hire people, my realistic opinion is I don't think you can have balance. I think it sucks. I think it sucks. I mean, that's the truth.

But you're paying the price for one or two years to hopefully not pay the price for the next ten or 20 years. I would tell myself a lot of amazing things have been built from midnight to 3:00 a.m., and this is just going to be another example. I just didn't have balance. Now I have a ton of balance. I work for a normal 40 hour work week, and I feel happy. But I was unhappy then, and I'm happy I was unhappy then so I could be more happy now.

Nathan: There's a phrase that, I might have said it before on the podcast. I'm not sure. I actually heard it from Katherine. Katherine, do you remember the Rudyard Kipling quote? Do you remember on the spot if I give you the mic?

Katherine: It might not be the exact quote, but it says something like you can have anything you want. If you don't get it, it means you either didn't want it, or you tried to bargain over the price.

Rachel: Yes.

Nathan: So that stuck with me. You can have anything you want in life. If you don't get it, it means you either didn't really want it or you tried to bargain over the price. So when Sam's talking about not having that balance, it's not saying you have to live that life. It's just saying do you really want it? This goal that you're setting out. You're saying oh, I really, really want this. Oh, that's what it costs? I'll pay this. This is what I'm willing to put in. Sometimes that is actually what it costs. But other times, you're like okay. That means that you're not going to get that thing.

So I think as we talk about this idea of building a business at this scale, we're talking about something that is immensely hard. All of these people, everyone who's built an audience is now trying to tackle this next mountain that's even harder. We're saying I think we can do it. I owe it to our audience.

I have this chip on my shoulder that I have to prove something. So this is what I really, really want. It's like all right. Be honest with yourself about what the price is and if you're willing to pay it, and what the terms are going to be? Then if that's not what you want to do, like that's totally fine. Go pursue something else, right.

You're in this room, you've probably had some meaningful level of success. You can do that. But don't ever have it where you're sitting back and saying like I wish I would have done that. I wish I hadn't bargained over the price. So that's all we have for you tonight. Thank you so much for coming out.

Rachel: Thank you for tuning in to this episode of Billion Dollar Creator. If you enjoyed this episode, please and subscribe, share it with your friends and leave us a review. We read every single one. If there is a company you want us to profile on Billion Dollar Creator, send us a message on social media and we will consider it. Thank you and we will see you next time