The Billion Dollar Path w/ Nathan Latka

What's up, fastlaners? Ryan here, and today I want to introduce you to somebody I want you to meet. Nathan Latkutt. Nate is a buddy of mine here in Austin, and he is one of our speakers this year at Freedom Fast Lane Live 2016. I met Nathan this year, and he has inspired me to go bigger. And that's weird because Nathan is younger than me, and I want to beat him up because of that fact. But Nathan just thinks at a different level. He surrounds himself with ideas that force him to go much bigger. And he's got this big, audacious goal. You know how I publicly say that my goal is to own the Cleveland Indians? His is to be a billionaire by 34, and he's just as public about that as the fact that I am going to own the Cleveland Indians. So I want to share that level of vision with my audience here at Freedom Fast Lane. And that's why I wanted him to come and speak at Freedom Fastlane Live 2016. But before he goes on stage, I wanted you to meet him to see how big he thinks. Because if he has inspired me to go bigger, to be more aggressive, then I am 100% confident that he is going to do the same for you. Nathan is a polarizing character. He likes it that way. You may not always agree with him. I don't always agree with him, but I certainly like and appreciate his style. And I know you'll enjoy this chat with Nathan Latke. Nathan Latka, the man, the myth, the legend. Welcome to Freedom Fast Lane. Thanks for hanging out with us, Ryan.

Daniel Moran. Thanks for having me here, man. I appreciate it.

Yeah. I am so excited to talk to you, mostly because you have stretched my normal in the last six months that we've known each other or so. And that's pretty rare for somebody that, you know, I play football with and hang out with on a regular basis, for somebody to stretch my normal. And it's been. Been really encouraging. And I know, I mean, you've sold a business in the last year. You're heavily invested in real estate. You're on the path. You publicly say you'll be a billionaire at 34. And I want to unpack all of that in, you know, 30 or 40 minutes or so. But first of all, I want to hear the story about how the business that you just sold got started and what the heck you are doing now with your life now that you've taken your fat check and are moving on in the world. So would you take us from the beginning and tell us a little about the development of that business.

Yeah, well, I have to tell you, you know, nobody. Everyone's going, nathan, why are you doing this? You're crazy. You're. This is not going to work. It's not going to happen. Because you didn't say this in the intro, but I basically popped out of the womb, like, yesterday, right? Like, you know, started the business.

I was 12 years old.

12 years old, basically.

But, you know, I was in a small, small town in southwest Virginia. Definitely not the Valley, not New York, you know, not. The whole entrepreneurial buzz wasn't really there. The fact of the matter was, man, I was so insecure when I was studying architecture at Virginia Tech in 0809 because nobody was hiring architects. And I said, why am I going to put myself through five years of college, have loans at my butt and not have a guaranteed job? This is not good. I'm insecure. So I went back to my apartment that night and started cold calling people to sell Facebook fan pages. And the, you know, the long story made short there is. That was when I was 19 years old. We grew it to about 40 grand per month and monthly recurring revenue, raised 550 grand on a convertible note with a 5 million doll cap, an 8% interest rate, and a 25% discount rate for the investors who were some of the top angel investors in the world. Folks like David Cohen from Techstars, Paul Singh from 500 Startups. I mean, these are the best people tell me they're the smartest guys out there. So we were very fortunate to get them in the business. We then kept growing it over the Post kind of four years after that. And we raised $2 million from a Forbes billionaire named RJ Kirk. So total raise was 2.5 million bucks. We created 25 jobs. That's one job per year that I was on the planet, which is kind of cool. And we just recently, after growing revenues, pretty substantially sold that to our number one competitor in February of 2016. That competitor's name was Vodigo. And I had the privilege. One of the things I said, Ryan, was, you know, most successful people, when they go on shows like this, they just flat out lie about their success because they don't do it intentionally maybe, but they paint the rosy picture about how they sold their business 10 years ago. So part of the deal, when I sold, I told the seller, I said, we must record the whole thing. You have to be okay with me publishing this. It has to be done. It's not comfortable. Somebody has to do it. So recorded the whole thing. And I published those in live episodes, which your folks can hear@nathan latke.com sold. So that's that story in a nutshell. Nathan.

I want to hear more about what the business actually did and when you knew it was time to sell. So what was the source of the revenue of that business? And at what point did it hit that mark where you're like, you know what? It's time for me to cash out.

Yeah. So that business was a monthly recurring revenue business, and not one of these, like, horrible recurring revenue business, like a membership site. Okay. This is like a real recurring revenue business where customers were staying on average 42 to 40, you know, 5ish months, and they're paying between 30 and 300 bucks a month in average revenue per user. We call that arpu. Their lifetime values were very, very high. And we had over 10,000 monthly paying customers. So there was never a moment when we wanted to sell. But what happened was when we did that series A round of financing, which was on a 8 million or $8.5 million pre money valuation, again, I'm, you know, 24 years old, people are going, how did he do this? This is crazy. This is unbelievable. But we did it at $10.5 million post money valuation. You know, so the 8.5 plus the 2 million puts you at 10.5. And the money, that money was to go towards a new idea that we were developing at HEYO related to social commerce. And so we had this asset in our historical business that was pumping out cash flow. We didn't know what to do with it. So I was like, well, maybe we should sell it. Right? And that's what we ended up doing. You know, it's like, you never want to be like, you know, the girlfriend or the boyfriend, that's like whining and crawling on their knees for the other person to, like, give them affection and buy them. Right. You want to be in demand. So if I really, you know, and people always say this, you know, there's entrepreneurs listening right now who might want to sell their business, but you don't know how to get buyers to the table without seeming desperate. So what I did, and some people hit me hard for this, I think it's just deal genius. You tell me what you think after you hear it, but I think it's deal genius. All I did was I took the emails of the heads of business development from 20 competitors and people in our industry that I thought might be buyers. I put them in a GMAIL thread in the BCC field. All their emails were there. The subject line said something like, hey, heyo's shutting down. Here are the next steps when you open the email. It looked like an email we were sending to our entire customer base announcing that we were shutting down the business to pursue the new social commerce idea, which we'd raised the $2 million for. And my thought there, Ryan, was that these BD guys have egos. We have to make them look good to their executive, you know, their executive team. So they look good to their executive team is when they bring their executive team a deal at a great price point. So we had to feed them a reason that the quote, hey, oh, deal might be a bargain. That reason was, hey, guys, I just got an email from the founder of heyo. We see them everywhere. We know it's a healthy business, that they're shutting it down. This might be a great deal for us. We can get it on the cheap. Should we do it? The second he tells his executive team that his ego is attached to the deal. So all I had to do was get people to, in the executive management circles on every Monday morning meeting, get them talking about it, get their egos attached, get them to give me Lois, and then bid them against each other. So that's, that's what happened. That's how I ran the whole process.

Were you already soliciting some offers to sell before you started running this process or was it actually that you started almost like cold emailing them in order to start the conversation circulating?

Well, there were a lot of, we had a lot of inbound requests many, many times from people that wanted to acquire something. We had a multi, multi, multi. I mean a big, big, you know, your listeners wouldn't believe it if they heard the number. But a big, big offer early on, when we were about six months into the business that we turned down, that was an acquisition offer. We had many things like that. But I didn't really formally start telling people, give me Lois if you want a shot at it, until I sent that email that I just described.

What did you end up selling the company for?

So we, because of this just happened in February of 2016. I can't share what I actually sold the business for just legally due to an NDA. But I do like to be as transparent as possible. Right. So what I will share is that SaaS businesses are typically valued and this is a big advantage off top line annualized revenue. And so we got a great multiple on our top line annualized revenue that exceeded 10x. Right? So if you're making a, you know, let's. I'm making this up. Let's say you're making, you know, you know, $10 million per month. Multiply that times 12 or 120 million, then multiply that times 10, right? So boom. That's how you get that, you know, 1.2 billion, right. That's how you get the multiple. We were obviously under that, but our multiple we sold for was 11x on top line revenue.

That's fantastic. Congratulations.

Thank you. And it was very exciting. But I have to you, it feels like killing your baby. I mean, right? I'm competitive. You get like, bored after you sell it.

I want to go into that next, but I know in that capital raise, I've never done a capital raise before, and I've never run really a tech company before. What was the process of the equity negotiations and when you're raising that money, figuring out how much you're willing to give up, how much is going to go to investors? Did that make you uncomfortable? What was that part of the process?

Like, my biggest asset right now is time, being so young. So my goal right now, everything I'm doing is to get and learn and get smart people around me, right? And so keep that circle of five or ten people that you keep close to you and get the best people in there as possible. And by the way, that means you have to be really good at removing people, which is actually the harder part. It's easy to add smarter people. It's harder to tell the stupid people to get out. Right. For lack of a better way to say it.

So what I was doing through this, even now, you know, I would have taken the 2 million if they took 60% of the business. Because I'm learning from a Forbes billionaire, right? I flew down to his house, I spent a half day with him. I'm talking to him. You know, most people pay billionaires, actually, most coaches are like broke, but most people pay coaches money to coach them. I'm like, why don't I just let them invest? And so I don't mind sharing this. They again, they did they put in $2 million, an $8 million pre money valuation, or, sorry, 8.5 and a $10.5 million post money valuation. So we sold about 20% of the business for $2 million.

All right, cool. Did you have other partners that were involved in it, or was it you then working with these billionaires?

Well, so there's always other partners, per se. But, you know, what really runs a business is the cap table. Now, I was in full control of the business, right, Based off just other founders agreements and things like that. But we had angels, very smart angels that put the 550k in early on. You know, people like David Cohen from techstars. I also had two original co founders who, when, like when I founded the business, I had, you know, well over 100 grand in pre sales. I went to the E Club meeting at Virginia Tech and said, I'm giving 40% of my business away. I already have sales. First two people raise their hand and say, yes, boom, you're in. So I knew them for like two minutes, Ryan. I knew them for like two minutes before I was signing agreements. Biggest mistake ever, right? Biggest mistake ever. They only lasted the company about a year and a half, but they took. I didn't do a vesting schedule. Another big mistake. So they took 40% of the business with them, right? So I was at this point after the raise, sitting at about 40 to 50% of the business, but still in full control.

Okay, very cool. Now what the heck do you do with that money once you sell out? I mean, this is the dream, right? I mean, everybody wants to be at that point where they build a big business. You are in a business that is higher valuated than most money shows up. It's like you killed your baby. You really can't say that if you don't have a baby, Nathan, because now I want to cry. She says, daddy. Now I feel horrible even thinking about it, but you get rid of the baby. And I get the feeling that that's got to be kind of weird and depressing for a while. So what did you do next?

Yeah, so that's what happens to a lot of people, right? What I decided to do was start spending all of my time talking to the world's top entrepreneurs and ask them everything about their business. I, Ryan, had seen all these people online that called themselves millionaires and billionaires and all this. The fact of matter is it was a load of crock because I would overhear in the green rooms at conferences where these people were speaking, I'd overhear them saying things like, you know, I'm actually don't know how I'm gonna make rent next month.

Yeah.

You know, in my downtown New York penthouse, I'm like, your ass is broke. And I just paid a grand to come to this conference. Are you kidding me? So I, you know, I started doing these episodes, right? And people said, nathan, you should start publishing this as a podcast. So again, I started doing as A podcast. And now, again, the podcast has over a million downloads. Many. Look, I don't know. Your podcast is very successful. It's way up there on the charts. But many people are telling me when they see the data that the show is one of the fastest growing business podcasts they've seen because of how aggressively I go after the numbers. The fact of the matter is, Ryan, it's so selfish. I care very little about other people. Let me just say that humans are so inefficient, I care very little about them. The fact of the matter, I care about some of them. Right. But not all of them, let's be honest, not all of them. The people, though, that, you know, the responsibility I have, once you have people listening to your show for 15 minutes a day, your responsibility is to them, not the guest. If you think a guest is lying their ass off on your or lying, you know, on their show, you have to call that out. Otherwise it's disingenuous to the millions of people listening. And do the math. Million people listening to times 15 minutes. That's 15 million minutes of human lifetime. Divide that by 60 hours, you get hourly lifetime. It's almost three full human lives invested in your show every time you put a new episode out. So if you don't do a good episode, you're killing three humans, basically. You better make it good, right?

I appreciate those numbers, Nathan.

You better make it good. So anyways, to answer your question about what I did after that, I right now am voraciously sucking up as much, selfishly sucking up as much information as I possibly can, and I will then decide to jump into one of these businesses. So, for example, I had a guy on the show that talked about mobile home parks. I just met up with him last week in Omaha at the Warren Buffett Berkshire shareholder meeting, and we're doing a few deals together in the mobile home space. You know, I put some money in a hostel recently, an investment that I made. I'm looking at another software business. So I will. I am in a very much exploratory phase right now, and I will decide to go hardcore into another business all in, probably for the next two months. And I will take that business public, mark my words, before I turn 30. Okay? So I have four years to do it. I'll take it public by the time I turn 30.

I am a very big proponent of saying you make your money in your business and then you invest that money into other assets that pay for your life forever. It sounds like you're doing the Exact same thing. So what is it that you're investing in and what determines a good investment for you?

So most. Ryan, Ryan, I love your feedback here. Most people don't get into investing because it's very easy for coaches to make investing sound complex so that you have to hire them because you think. Because you think you need to, even though you don't. So I like to make this very simple. Every dollar I earn, right, no matter how it's hitting me, okay? Every personal income, dollar, not business revenue, every dollar I earn, 25 cents goes to me, enjoying my life, okay? I'm gonna buy the freaking mocha in the morning, all right? I'm gonna go on a vacation. I'm gonna buy the tux because I want to buy a freaking tux. I'm gonna buy whatever. 25 cents. The rest of 75 cents goes into a very diversified mix of 30% goes into domestic equities. Okay? That is an index fund in Vanguard. It just goes there. Done. 30 cents, okay. Or 30%. Another 20% goes into real estate. Okay, I'll talk about that in a second. 5% goes into foreign developing markets, 15% into foreign emerging markets. That's 20% foreign. 20% real estate. Okay, that's 40. And then again 30%. So we're up to 70% now in domestic equities, Right? The rest go into treasury inflation protected stocks to hedge inflation, and treasury bonds, unsexy investments. The key in all those is though, the most wealthy people on earth take a dollar they earn and figure out how to turn that dollar into a dollar twenty, right? And there's two things in terms of wealth accumulation. A lot of people make an investment and it might make $1.20 over the first year, but then after that year ends, you have to put your time in to go find another investment that does that. You don't want to do that because you don't want to spend more time. So I'm putting my money in things that will make me at a minimum, 20 cents on every dollar invested for the rest of my life. And those investments are difficult to find. So right now it's things like real estate. But there's some other things I'm playing with.

I find that most people who, most people are really speculators instead of investors and they're looking for some sort of home run play every single time. But the wealthiest people just consistently slight edge boring investments. Like they do value plays and they do long term dividend paying stock and they do index funds and they do things that year one, are really boring, year two, they're really boring, year three, they're less boring. And by year 30, you can hardly believe the returns. And that takes an incredible amount of discipline in order to be able to practice that. And most people just aren't able to stave off their desire for immediate gratification that long. I think that's why most people aren't entrepreneurs, because they can't stave off the. I think that's why most people are fat, because they can't put off the immediate win. And that's why, in the same way, most people are losing their shirt in investments. You mentioned real estate. So this is a passion of mine for what are you looking for in real estate? And also, are you taking more of the approach of I got this windfall amount of money that I'm just going to go put into assets, or is it more? You're strategically making incremental decisions.

I'll go backwards. Incremental decisions. And specifically in real estate, again, I'm only doing deals where if for every dollar of my hard earned cash I put in, I see a direct path to making at least $1.20 that year. So let me take you down the first investment I ever made, 22 years old, okay? In Blacksburg, Virginia, I was not willing to pay more than $47,000 per bed. So the sale price of any unit, you know, if it was 4 bedrooms, multiply 4 times 40, let's call it 50k. To make it easy, I wouldn't pay more than 200k sale price for that. Now, what that meant is on a 200k deal, I was gonna have to put 20% down. This is a traditional bank loan, 20% down. So $40,000 down. And what that would mean is because I knew that my rent per bed was somewhere between 400 and 600 bucks per bed, I would generate somewhere between a 15% and a 25% annual cash on cash return on that deal. So my first deal I did, you can look it up in the property records at 710 Roanoke street in Blacksburg, Virginia, I put in, it was a $238,000, sorry, $215,000 sales price, I put 40k or about 20% down, plus another 50, another 10k for closing costs. So 50,000 bucks on my hard earned cash into that deal. That deal though, the mortgage payment, okay. And after repairs and property management costs me about 1100 bucks per month. The rents are about 1900 per month. Boom. I'm not getting an $800 check every month for the rest of my life. Right. Assuming nothing catastrophic happens. Those are the kinds of investments I love. You do that and you do that enough and consistently. It's like turning a water faucet on. Right. Every half turn is another $800 per month check. If you take a water faucet, imagine your water faucet at home, and you turn it a half turn once every week. Eventually that velocity of water coming out of that waterfall would fill the ocean in under two hours. I mean, that's the key.

I think most people have a hard time seeing that just because they, they miss the long term compounding results of that. And they can't, they can't calculate all of the different. Like, you didn't even mention tax write offs. You didn't mention inflation hedging. You didn't mention the fact that, that this is going to be paid off by somebody else. You just mentioned cash flow, which is in my opinion, like 20% of the benefit of investing in real estate. And most people are just looking at initial win, that initial hit and deciding if it's worth it for them. I think there's a lot more behind the numbers that make that actually a better deal than you're, than you're even stating. But.

Well, you're smart. Just to be clear, you're. You are way smarter than me in this respect. I don't understand that stuff yet. I don't understand the effective return on real estate because I don't yet quite understand how to use depreciation. Right. I have people that do this for me, but I couldn't personally articulate it here on the podcast. I know there are many other benefits. I just know that the only benefits I can actually calculate directly is the cash. And if the cash works, it'll only be sweeter. Right? The cash return is the worst case scenario.

Absolutely. I say you buy on cash and everything else is a bonus. If the worst thing in the world is when people buy things speculating, hope it goes up in value. No, that should be an ancillary benefit. That should be a secondary benefit, not your primary. Buy me a coffee next week. I'll tell you about. You're probably leaving a lot of money on the table by not calculating your depreciation. Let's do it. That's for another day. I want to talk about. I know you're moving. You've done a lot with single families and you're kind of scaling up into some bigger projects. What? I think the market is kind of overbought right now, and I am only Finding good deals on really small deals. I think the big ones are really overbought. What are you looking at right now as far as investments on a bigger scale?

You mean strictly on real estate?

If you want to comment on others, I'd be interested to hear. But I did mean real estate when.

I asked the question. Yeah. So it's very difficult, especially in Texas to find cash flow related properties around Austin because of how taxes have increased relative to values. Again, if you are speculating, Austin's a great investment right now. I don't speculate. Right. I'm not betting on appreciation. I want immediate cash flow and there's too many people speculating to find those deals. So I'm kind of hoarding cash right now until something happens and then I'll go in deeper where I am going. And I'm looking at kind of other assets that are tied to real estate. So there's a hostile business that I'm looking at, which is a very healthy business. When you look at the per capita hostile bed ratio in UK compared to the US UK it's almost, you know, the UK number of beds per human living in the UK is almost 10 times higher than that in the US the reason I'm excited about that is me. I like investing in things that are things that I would use. I would love not to be paying 1700 bucks a month in rent here in Austin. I would love to pay a membership site. I'm not. And by the way, all you info marketers don't get all. I'm not talking about your membership sites with like videos and content. I'm talking about membership site like Airbnb where I pay 1500 bucks a month and I can choose to live at any hostel in the world. Check in any day I want. That is freedom. The freedom fast lane, baby. Okay, so. Oh yeah, I'm investing, I'm investing in these hostels because I think there's a big play here in terms of owning the hostels and actually then building a mini Airbnb where people can just travel the world whenever they want to be. Especially if their income stream is not dependent on a geographical location.

Yeah. And that's only going to get bigger and bigger as freedom fast lane and the top continue to take over the world.

Exactly.

Grow more entrepreneurs and Uber and the.

Showing economy and all these things.

Yeah. I mean we're disrupting the job marketplace. I think the 9 to 5 is a dinosaur. It's on its last legs anyway. But that's. Let's move on to a question I want to ask you about your next opportunity because you've got this goal of being a billionaire by 34. You've made it very public. You're going to be there, Then you're going to invest in whoever wants to buy the Cleveland Indians at that time. So tell me about that, the process of choosing your next opportunity, because I'm sure people are hounding you with things they either want you to invest in or serve on advisory boards or. I mean, it seems like if you free up your time from a business, it gets filled by all these other demands unless you're really, really careful about how you protect your time. So what is your process and your criteria for that next opportunity that you'll seek your teeth into? Because you don't care about the next $10,000 a month. You care about the billionaire status at 34. So what's your criteria, and how are you finding that next opportunity, and how will you know when you find it?

Well, let me just say, people hit me so hard, they go, oh, oh, I can't listen to this interview anymore. This Nathan guy, he's all about. He's all about money. And, you know, I want to do what I love. Well, you know what? Go listen to, like, hunky dory music, you know, on. Go hike the Appalachian Trail or something. I'm competitive. I like making money. Right? And the fact of the matter is, many of you listening right now, who might be stuck in a corporate job hating your life. I'm way happier than you. You might want to think that I'm not happy because I'm all about money. I guarantee I'm way happier than you because I have total freedom. So I will say it over and over again. I think that for my age of 26, I am probably. Many people are telling me this that have invested in me, that have seen me. I'm probably top 1% in terms of how to manage and spend money and create jobs with money and create growth. So therefore, I think I should make way more money. And that thinking is going to help me become and make a lot more money. And I've already done it. So I have a track record, right? So momentum is on my side. And, you know, part of this whole thing, Ryan, is people are scared to do what I do and project these big goals because they're too egotistical. They're worried that if they miss the goal, their ego's going to take a hit and they're not going to know what to do with themselves. Which is funny because people call Me, egotistical. And by the way, I am. I have a great ego. It's the biggest asset ever. It's an amazing ego. Okay. People would love to have my ego because you have to use it strategically, right? My COO at HEYO was a Mormon pastor. You think a Mormon pastor balanced my ego? You better believe it. Right? So you balance it out. But my point is, there's a path to being a billionaire. By the time I'm 34, I will do it. It comes down to discipline. It comes down to doing the same thing over and over, longer than anybody else. And it comes down to this thing up here on the top of my head. I don't know what it is, you know, a genius, a thinking, whatever it is, okay, it's this mixture, hair, whatever, right? The jawline. But you have to make it happen. And so there's many things I'm planning to do. You know, 2036, I will run. I will win the presidency. I think I will do amazing things for the country. I plan next year to write a best selling book. And while I'm able to sell millions and millions of copies, it's going to be fantastic when I sell that book. I will be setting up a ground game in every state to sell the book. Guess what? That ground game is an interview for my people for when I went for president ten years later. Right. So everything compounds on itself. Right. You kind of, kind of know where once you project and you have big goals for your future, you can start kind of bucketing things you're doing today and how they might appreciate or help create momentum for those longer term goals you have. And I'm going to tell you what, we're going to do some amazing things over the next decade, 20, 30, 40 years. It's going to be a lot of fun.

Well, when you are the President in 2036, you will have a running mate because I will have universal health care that will solve aging.

Bernie, we're putting a big wall, a big wall around you, okay? You're crazy. We can't let you in. There will be a nice big, big door in the middle of that wall. And once you have gone through the process and you're illegal, you can come in legally.

I'll text everyone in that wall and I'll crawl my way out with my teeth. Free walls.

Free walls for everybody. Everybody gets free walls.

These are the conversations that Nathan and I have. This is why we're friends. But I wanted, I want to know, what's the criteria for that next opportunity? Does it need to be something that is in the same industry you were in. Is it something that you need to be able to leverage? Is it something that has a billion potential customers? How will you be able to filter through and find that opportunity that you're gonna take public and that is gonna make give you that B status by the time you're 34?

Triple comma baby, right? So you want to look at something that I don't know how else to better say it has a lot of kinetic energy, right? Because kinetic people, most people, when you look at objects, you can't see, see kinetic energy because it's still. You can of anybody can see potential energy. Oh, that guy's rolling really fast. Oh, I want to get on his train, right? Of course. Everybody does, right? So I'm looking for opportunities that, for lack of better saying, currently are stationary, but because of other kind of macroeconomic things and microeconomic things happening, are going to have a lot of momentum behind them in the very, very near, future. So for here's an example, let me be more specific. A company like Uber, right? If you look at why it's working at a very simple level, it's easy, right? They take an asset, a car that people own so it's not on their balance sheet, and they realize that car has downtime, right? Whenever the person's not driving it, okay? How can you build a system that takes advantage of the downtime? Okay? Take that same principle and plug in real estate. Okay? What company is that? Airbnb. Right? Take that same company and plug in trucks. Dump like. Like trucks, right? There's a company called Dolly that's doing this because air, you know, Uber is not good for trucks. Dali is doing trucks. And when trucks have downtime, how can they team up with Home Depot to deliver mulch to Home Depot customers, right? So apply that same thing everywhere. What about clothes? What about rental unit? Ever look at self storage? People put all these amazing assets in self storage. They pay the self storage place 100 bucks per month. What's the stuff do? It sits in storage. What if you went up to a self storage thing, you put your, you know, an old bed in there, a coffee table, you pay the storage place 100 bucks, and then the storage company has an app that allows them to easily rent out your stuff to other people so that you actually the storage companies then paying you, That's a dead asset that data can make productive again. So I am generally looking at any dead assets where data and software can make them productive again. Is that helpful?

Absolutely. I mean, that's the model that my best friend in the world, Mark Jenny, is doing with RVShare.com yes, he realized exactly that there were a million entrepreneurs that didn't know they were entrepreneurs because they had an RV sitting around. It was dead use, and they could generate a few thousand dollars a month by renting out their rv. And they had no idea. And that's the reason why that company is exploding right now. So that makes total sense to me that you're looking for. My economics teacher in college used to say, economics is a process of taking things from where they are of lesser value and moving them to where they are of greater value. And it sounds like you're looking for something that is doing that on a grand scale in today's modern times.

That's exactly, exactly correct.

What are you going to do when you're a billionaire, Nathan?

Then set even bigger goals. Right. So look, and this is part of the problem, the bad thing about our world, the reason I'm easy, I think, and you know, I'm very confident I will achieve these things, is I study biographies of billionaires every day. So I feel like I'm hanging out with billionaires every day. It's easy for me to project these goals. The problem is, once you get to the top, right? What do you do when there are no real life examples to point to for you to aim at? You then have to have such a good imagination that you can make up your own thing to aim at. This is what Elon Musk is doing, right? Where you have the imaginative brain power to throw all of your wealth behind something that you create from your own brain. It's very easy. You know, people say copying is the best form of flattery. And most entrepreneurs, they think it's like a bad thing to say. I just copied competitor X, made it better by doing Y, and boom, now we're winning. Look, I copy the hell out of people. That's how you win. Copy what's doing, then do it better. The problem is, once you again have a lot of success, you actually have to start inventing brand new things. So that's what's most concerning to me. But I've gotten many years until I hit that point.

You ask an interesting question on the Top podcast, and I want to hear your thoughts. What CEOs or thought leaders are you following right now that you find particularly compelling?

So I really, really enjoyed studying the history of Michael Eisner at Disney, so. And here's why. Disney is an amazing story of American capitalism pitted Directly against art and creativity, right? Disney is a creative company. Walt Disney was an artist. Roy Disney was the financial machine. So if you study Disney's history, and there are many books that do this, so study Walt Disney the Triumph of an American Magication by Neil Gabler. Study Storming the Magic Kingdom, which is about when Wall street tried to take over Disney because Disney's stock price in 1984 went so low that the stock price and the market cap was less than the value of all the real estate they had in Florida. So. So, guys, you know, the Bass brothers did a number on them. And that's when Ray Watson, who was CEO, got. Or Ron Miller, who was CEO, got kicked out. Who was bloodline to Disney got kicked out. Michael Eisner came in, replaced Ron Miller. And then Michael Eisner just recently got, after taking the company from 2 billion to like 20 billion or 200 or something amazing, got kicked out because the board overtook him. In fact, Roy Disney or Ron Disney or Ray Disney, one of the old Disney brothers came in with some activist investors and basically kicked Eisner out. Put Bob Iger in. And Bob iger, today in 2016, is now running Disney. But that whole story is fascinating. And one of the things that I do to keep this stuff in my memory and still read fast is those books mention all kinds of other CEOs that I underline. And then I go back and read those CEO books. So everything I read is in a big web. They're all connected somehow. So does that answer your question? That's who I like studying, and that's how I connect them all.

Yeah, very cool. What does the word capitalism mean to you?

Capitalism to me means money. Lots and lots of money. You know, look, people, I am of the belief that poor, broke people like using rich, wealthy people as an excuse. I just. That's just the thing, I think. I think it's a mindset thing, right? And what I. What I love doing is making a lot of money so I can employ people who have mentally convinced themselves that they are poor or broke. You give them opportunities, you make them more productive, right? And you real. And then they start believing big things too. And that's what's happened, Right. I'm very proud to say of the people we've employed, some of them have gone off and started companies. Some of them are now leading other companies. And so that's what capitalism means to me.

Do you think that wealth is a fixed amount?

No. Wealth will always continue to be created. It will only be increasing and is not A fixed amount.

Very cool. I agree with you. And last. Last question, Nathan. Tell us a little bit about the top and where people can follow you.

Yeah, well, look, guys, the top is not for everybody, okay? It's a little bit like Jerry Springer for business, all right? Right. Ryan, I've been on.

I've been on twice. I've sweat both of them.

Yeah. Look, and here's the problem, right? And people hit me hard on this, but the fact of the matter is I could give a rat's behind about the guest, and many of them are my friends. Like Ryan. My goal when I have somebody live for 15 minutes is to get them to share as much information about their business as possible. The cap tables, the equity structures, how much they made, their tax returns, their last round of capital, what their valuation was, what their revenue was last month, what their expenses were, cost of goods sold on the Amazon product, what was the margin on the T shirt? What was the margin? All this stuff in 15 minutes. So they're rough. Sometimes they're rough, but I think your audience will like them. And if your audience wants to listen to, again, the full audio recordings, the phone calls I had with the buyers, how I negotiated the sale of my last company at, you know, again, 25 years old, then go listen to those episodes which are built into the top podcast@nathan latka.com. sold.

Nathan, I don't always agree with you, but I love you to death. And that's one of the reasons I love you to death. You have a beautiful, big old ego, my man. And I look forward to seeing where our paths go next. Thanks for hanging out with us at Freedom Fast Lane.

Yeah. We'll be at the event live. I'm gonna share some very interesting things live on your stage about billionaire status and how I'm progressing towards that. Maybe I'll share some income stuff, but it'll be a lot of fun. I'll see you there, Ryan. Thanks for having me on.

Last year at Freedom Fast Lane Live, we had Gary Vaynerchuk share what his path was to own the New York Jets. He's not a billionaire yet. I wanted him to deconstruct the process of how he plans to be a billionaire. This year, Nathan is going to be sharing the exact same thing. What is your plan to become a billionaire by age 34? So we're going to deconstruct the plan from somebody who is on the path because I'm on the same path, and I know some of you are on the same path too. What's the plan for you to be a millionaire, a billionaire, at whatever age it is that your target is. Nathan is going to be speaking on the first day of Freedom Fast Lane Live 2016. I know you won't always agree with him because I don't always agree with him, but I know that you'll be challenged, that you will learn something from Nathan as well as the rest of our speakers. Head on over to freedomfastlanelive.com to grab your ticket for this year's event. Our lineup this year is guaranteed to stretch you, guaranteed to challenge you, and if nothing else, will definitely be entertaining. I hope to see you in Austin, Texas this December, and I hope you enjoyed this episode of Freedom Fast Lane.

Take care.