2026 Marketing Secrets with Neil Patel & Eric Siu

Okay, we should be live. Okay, we're streaming.

We're live? Yeah.

All right, Neil, we're live.

Awesome.

So as people start to come in, we're going to continue to experiment with this. Let us know where you're coming from in the chat. And this time we actually even promoted this one a little more. You got to turn that thing off, you know?

I know.

So Neil's got his notifications on.

All right.

So, Neil.

Yeah?

As we wait maybe like another minute for people to come in here, I have a good topic for us to start with today. Are you ready?

Yes.

Okay. The decline of AI. So the decline of AI, this is the death of AI. Okay? So this guy tweeted this one. He didn't tweet this actually. So this is the death of AI. This guy posted on LinkedIn. Cursor went from 62% growth to negative 18% in six months. Lovable went from 207%.

Sorry to cut you off.

Can you please? Fucked up my clip, yo.

Okay, go back and redo your clip. But you're going so fast, I can't understand all the data.

I'll restart. I'll restart.

My bad.

I'll restart. I'll restart. Okay. So, so this is the decline of AI to death of AI. So I'll slow down a little bit. So the decline of AI to death of AI. Cursor, which is at 500 million ARR right now. Went from 62% growth to -18% growth in 6 months. Okay, that's one. Number 2, Lovable, $200 million ARR. They just hit $200 million, right? They were like celebrating it on LinkedIn. Lovable, these are vibe coding apps. Okay, so Cursor's more of IDE, but Lovable went from 207% growth to -50%. Okay, now senior engineers are— look, there's a chart over here which I'm going to show you in a second, but Windsurf down from 104% growth. Remember they sold to, they sold to Google, I think eventually. They're trying to sell to OpenAI, remember that? $4 billion or something. Negative 30%. Total category, 76% growth down to negative 15%. So senior engineers are like, see, this whole stuff is a bubble, it doesn't work, blah, blah, blah. But the bubble isn't actually popping because when you look a little closer, Base44 that was acquired by Wix, remember that one? There's a lot of these acquisitions, right? But they went from 950% growth to 1,161% growth in the same period. And then Claude Code exploded to $1 billion in revenue. And it's not even on this chart, right? So this chart, this chart over here, you can see, I can't pull it up that closely, but all you need to see is that it's turning red. Like Lovable is turning red, the growth rates, right? You can see Cursor's turning red.

Their data is off.

So you look at all this over here and then people are just like, oh my God, it's dying, it's dying. But the reality is no, like I would say a lot of these people using these apps are pretty promiscuous. I'm pretty promiscuous. Like I'll jump over to Replit, I'll jump over to Lovable, I'll switch to whatever. I'll tell you about the latest tool. You'll tell me about the latest tool. So I think people are still experimenting a lot right now. And I don't think these things are slowing down by any means.

I don't think they're slowing down, but whoever posted this, their data's off. Because I know at least one of the numbers for one of the companies you mentioned, and I'm not going to name which one, and the numbers you mentioned are totally different than what their real numbers are. So whoever created this chart, they're using inaccurate data.

Yeah. And he's— he didn't— he didn't call out what this guy Tobias didn't call out where he cited it from. But you have— this is 12-week change. Okay. Lovable, Cursor, Bolt, whatever, Windsurf, all these cognition, all these things. And there's a lot of red in here. But when you— I think all you really need to look at is who's actually driving the most enterprise revenue right now. It's Anthropic, right? Right? And drop it some enterprise coding, right? And so that revenue keeps going up and they've beaten everyone else right now. And you guys use it, we use it as well. So like, I think this is definitely not the decline of AI. It's just a little, you know, fear porn.

It is, but it's inaccurate fear data. And the reason I say that is I know the data for at least one of the companies in there. And I know for a matter of fact, they're growing. And their growth rate is really, really good still when you look at week over week or month over month, they're still in the green and this guy's saying they're in the red.

Yep. So, and then this brings up to another topic over here on your Wi-Fi is slow.

So I can't even get to it, but let's go back to the AI really quickly. People look at AI and they're going to end up saying, oh, these companies are slowing down. What they also don't take into account, how rare is it for a company like Lovable? I think you use a stat that they got to $200 million in ARR.

Yeah, $200 million in like 2 years or something like that.

Or I think it's less than that, right?

Yeah. And then $500 million for Cursor.

Yeah.

Yeah.

So how, watch, Lovable, how long did it take Lovable to get to $100 million in ARR? I think it was in months. So they got to $100 million in 8 months, all right? $200 million, my guess is roughly a year or a little bit more. 4 to 5 months. So they went from $100 million in 8 months, another 4 to 5 months, let's just call it 4, to add another $100 million. So they went to $200 million in 1 year. Now, of course, you and I know that they spent time before that to actually build the product, but dude, it takes forever to market a company and get it to $100 million in revenue. And The problem that we're facing right now in the market is people have unrealistic growth expectations of businesses. $100 million or $200 million in annual recurring revenue in roughly 12 months is extremely, extremely, extremely rare. And now people are expecting marketers and entrepreneurs to figure out how to grow their companies at those speeds.

Yeah.

So even if their growth slows down, It's still so fast compared to what normal companies are doing, especially ones that raise half a billion dollars or a billion dollars. Even those, most of those companies aren't growing at that pace. It's okay, they're still growing fast and still somewhat successful. And the reason I say somewhat successful is most of these companies have a churn problem. I wouldn't say the cursors of the world or that space because it's more sticky, But the Lovables of the world have much higher churn problems than the Cursors of the world, right? Just because of the industry that they're in.

You know, sometimes I listen to Jason Lemkin from SaaStr, right? He's with Harry Stebbings on his podcast. And, you know, the way VCs look at it now is like, oh, you have to hit these crazy growth rates, right? Or else we're not gonna look at you. And that's just not— sure, that's the VC game that they're playing right now, but you also have to live in, you know, What's the base reality for the majority of people, right? And so what we're seeing with Lovable or Mercor, the data labeling company, or Surge, which does a billion in revenue in bootstrap, by the way, in four years, right? It's a data labeling company. And so like we're seeing a lot of this happen right now. We're seeing a lot of this spend going going towards this capex going towards infrastructure build and like chips and all that type of stuff. And so you know that's the gold rush that we're in right now, which is interesting because earlier this morning I was talking to someone from my team. And he was just telling me he was getting a lot of job offers right now. Every day he's getting a lot of job offers. Okay. And I'm like, why don't you just take one of them? He's like, because I love it here, right? Because you care about, you know, my family, blah, blah, blah. Right? I'm like, oh, that's nice, right? What do we need to do to keep you forever? That's one of the questions I like asking. But the market's hot right now. But don't expect it— like, for the vast majority of people, you have to kind of ground yourself in reality. Just because you're seeing these headlines all the time in X doesn't mean that, like, how come we're not growing at like 1,000% or whatever, right? It's just, you know, it's the world that we're going into.

Yeah, it's unrealistic. And if you look at like those data labeling companies, it's A, a lot of manual work. They're offshoring to a lot of countries like India. And B, the margins are low on those kind of businesses. And C, they're doing it so the models can be better trained. But how long do they need to keep spending all that money on data labeling?

You know, actually, so I was listening to a pod with the Surge founder, right? And so the question was asked him, like, how long do you keep— like, is this data labeling thing relevant for? He's like, as long as AI still needs to be trained. Before we hit AGI, is how long you're— because AGI is like you have an AI that can do everything, right? So he's like, until we reach that, which I think Ilya from one of the— or maybe Andrej Karpathy was like, it's going to take us like 10, 15 years to hit AGI. So maybe 10, 15 years out.

Cigar butt business.

Yeah, yeah. Cigar butt business, which is what Warren Buffett said. Right. But again, Merckor, I think they're doing a couple hundred, if not like close to a billion in revenue surge. Again, bootstrapped to a billion. And you have Scale AI, which You know, sold to Facebook or sold 49% to Facebook, right? Remember that one?

Pretty much sold is their way of skirting around regulations.

Yeah. So all that to say is like, look, I don't think there's a decline in AI right now. I think you and I are very, very bullish about it. I think what's interesting to me too, I'm looking at data from Ramp. So Ramp is the credit card company, right? So this guy is always showing interesting data. So Ramp AI Index shows AI adoption held flat At 45% of businesses in November, driven by slight declines in the finance and technology sectors. So if you look at the models, by the way, this is interesting. OpenAI actually declined by 1%, okay? Anthropic up 0.8%, Google up 0.7%. So if you look at it over here, this is the overall, this graph, okay? OpenAI, like you see the green one's kind of going down a little bit, and then Anthropic is like boom, right? Which we just talked about. And then Google is like, oh, you see it's like, it's kind of like popping up.

So to clarify on this, this is Ramp, the credit card company, because they're seeing all the credit card spend. This is business adoption of AI, and they're classifying it as people paying OpenAI like for ChatGPT subscriptions or the API or Anthropic or Google Gemini subscriptions, etc.

Yep. Yep. Hey, you know what's funny?

Banana or whatever you want to call it.

xAI is going up as well, like very slightly. But Google, like Nano Banana, like Gemini pops up, right? So like, look, It's like once something new comes up, boom, this pops up, this goes down over here, and then they need to launch something new. And then they pushed 5.2 out yesterday, right? But in Anthropic, right, they're just focused on enterprise. And so like there's like stories within this one. It's like if Anthropic, we're just gonna focus on enterprise. Google, we're gonna try to cover everything. Maybe we'll give it away for free. And then our models are just gonna kick butt. And then OpenAI, they just like, they need to catch up in terms of innovation.

So yeah. Yeah. No, look, I agree with you on, The adoption. I actually think AI adoption, we're seeing it slow down in marketing as well. Like I've talked to enough companies, you've talked to enough companies. We all know about the AI slot problem. Companies are working on fixing it. I don't know if you saw ChatGPT recently announced their new model through APIs. Google did the same day as well. And they're talking about how it hallucinates less. At least Google mentioned that. But this slop is a real problem. And what we're seeing is a shift in companies from a marketing aspect. If you look at early or late 2024 or parts of 2024 to early 2025 and even mid-2025, everyone was pushing hard as like, hey marketing, you need to be more efficient. You need to do more with less people. We expect better results, faster growth. Like what are you doing with the AI? And now we're starting to see a shift within organizations of they're saying, hey, you need to use AI where it makes you more efficient and it can help you scale faster and save money. But stop trying out every new AI tool that just comes out because it's creating inefficiencies and we're not really seeing revenue growth. Go back to the fundamentals that are working and figure out how AI can make you more efficient in the fundamentals that are actually causing a lot of the revenue for the business.

Dude, when I was 23 years old, I was working for an agency called Wpromote, okay? So for this agency, I was an SEO link builder, okay? That was my job. And I remember, because I was always pushing the team to try all these new tools, right? At a certain point, one of the guys messaged me, he emailed me, he's like, dude, like, all you do is talk about new tools all the time, right? And like, that's great, but like, if we don't use these tools, like, what's the point? And he was basically saying like, you know, stop doing this like, It's like you're mistaking motion for progress, right? And he was absolutely right. And don't get me wrong, I still love these tools, but like, this is what I kind of tell my team now. I'm like, hey, I get you're testing all this stuff, but how does this scale over to our clients? For example, how does this help our customers? Because if you're doing it yourself in a vacuum, that's nice for you. And you know, you're showing some stuff off and you maybe think you're appeasing me because I talk about AI all the time, but you're not. It's got to help our customers.

And if you're going to have a similar approach to what Eric and I have, when Eric says, help our customers, he's not talking about like, what are you doing for our customers? He's more focused on how is this impacting our customers' KPIs, right? Their key performance indicators. So someone in marketing will either want more rankings or more traffic or more conversions or more emails, whatever the number is. When we talk on this podcast about what is AI doing for our customers or ourselves, We really don't think about it from, we got these images done, or we got more content done, or helped us with keyword research. We try to break it down to our KPIs. And the KPIs are usually things that are tied to revenue growth or profitability.

Yep. By the way, so remember I told you about Granola, the little AI note-taker? So I have it on right now just for fun, right?

Okay.

Even though I was supposed to ask you if we can record or tell you we're recording. But I got in an argument with a family member last week. I had it on, right? And I also did it for a leadership training thing. So let's do the leadership training thing. So there's business takeaways from this. And we'll use it for the personal side too. It's good for this. You can't use it with your spouse though, because it will never work. Because you can't win those arguments. But that's for another day. So we did a 3— we call it 3-year planning, but it's like an annual planning, okay? And I had Granola on. It was like an 8-hour meeting. It was on the whole time. And so through that, it has all the transcripts from it. And then I basically, yes, you can summarize the answers and all that. But what I'm more curious about is like, hey, what is everyone's Achilles heels, right? Like what is each person weak at? What is each, like what's the one thing each person needs to address for 2026 to have a successful year? Okay. And it was spot on. Like for example, for me is like Eric needs to stop opening the oven, right? Meaning that if you put a cake in it, you can't keep opening the oven all the time. You have to cover it.

You have to wait for it to cook.

Yeah. So, so that, that's like, okay, I'm like, okay, my action is I'm not gonna add a new directive in Q1.

Okay.

I'm also not going to help as much as I usually do and see how that goes.

Right.

And then for someone else, it's like, oh, you need to be much tougher as a leader, otherwise everyone's gonna run you over. Right. And so it's, it's, then I got a nice little image for it and I just pasted it into the leadership chat in Slack. And now it's just sitting there. Nobody disagreed with it. Right. Because when you have a computer here, like you can't, what are you gonna do? Argue with the computer, get mad at it?

Yeah.

And so it was very helpful across the board. It kind of rated each person in terms of like what their strengths are, what their weaknesses are. And it was very actionable too. And so, and then I could just keep asking all these questions. So that's on the business side. On the personal side, on the family side, I had it running and I was, I was going on a walk with this person, right? And this individual would not take responsibility for the things that they've done and would like keep just blaming other people, right? And then at the very end of the conversation, this person's like, you know, I'm a very accountable person. I'm a very objective person, right? And then so then I just opened it up. I'm like, hey, how self-accountable is this person and how objective is this person? It was like 1 out of 10 on self-accountable and like 2 out of 10 on like objective, right? I was like, hey, what do you think about that? And this person can't get mad at me, right? And so he's like, okay, fine. Like I'll listen to it. Like, don't you think you'd be wrong sometimes? I'm like, well, just look at it, right? So Anyway, all that to say is like helpful for conversations that you're having, helpful for leadership meetings that you're having.

So this Granola app, because I haven't used it yet, how does it know that I'm talking versus you're talking? I get that our voices are different.

Yeah.

But how does it know that you're Eric and I'm Neil?

I don't have a good answer for that, but I asked at the very end of the 8-hour meeting because we had like 6 people in it, I think 5 or 6 people in it, right? I was like, hey, who's speaker A, speaker B? Because they'll label speaker A, speaker B, speaker C. It actually labeled everyone correctly. Because I think it knows that like, if I like so-and-so saying, hey, what do you think about this? And then speaker C answers, then it starts to label that person.

So. Got it. So it'll identify a name as if I say Eric, it'll, and then you start talking, it'll know you're Eric.

And it's using like, I can use Opus 4.5, which is the newest Claude model. So that's what I use because it's a thinking model. So yeah, it knows.

Yeah.

Yeah. It's good. Like, because imagine all the Zoom meetings that you're doing and calls that you're doing and things like that. If you combine everything into one, you just have this brain that you can keep going back to. You already have pretty good memory, but what if you like have a second brain here?

On a side note, when we're working with charts and data, we find that Claude hallucinates less.

Claude is the best one right now.

Yeah.

Well, they say so. So OpenAI is like, they say they're the best. Everyone just keeps gaming the—

They all say they're the best.

So yeah.

But we, I'm not saying it is better or worse. I'm just speaking from a hallucination standpoint. When we actually give data, it comes back. With the same data that we give it.

Yeah.

And it gives us the output that we're looking for.

Dude.

Okay, to be very clear, when we give ChatGPT the data, Yeah. the output, Yeah. a lot of times does not match the data we fed in.

Yeah, dude.

And this is not complex data.

You'll like this. So this, this might give you a little push to use MCP. So this week I got data from my sales team on like how much we're, you know, how much basically I was like working through the numbers on how much we can afford to pay for an SQL, an MQL, a lead, right? And then what I did was I took that data and then I took it from like HubSpot and Google Analytics data. And I said, hey, based on all of our data, how can we— how much can we afford to pay for like an email, for example? And then it said, okay, you can actually afford to pay like $6 for an email if you want a 6-month payback. If you want a 3-month payback, you can afford to pay $3 per email. Well, guess what? Now I know specifically how much I can spend on marketing, right? If we can spend like, for round numbers, we can spend $100,000 on SQL, Then we should be doing this. Like, it's, it's once you know your numbers and this, you don't need to wait for a data analyst anymore and you can just keep messing with this all the time. It makes you a lot more confident with your marketing.

Did you double-check all the numbers when I gave you the output?

Yeah, it was, it was, this was using Opus 4.5. This is using Claude.

But it was accurate.

It was accurate. Yeah.

Okay, cool.

Yeah.

Yeah. And that's what I hate. What I hate is when people on my team end up using these models and then they give me back the outputs and they're sharing it and they're doing, you know, a presentation to me or updating me on what they should do.

Yeah.

And then I go and double-check.

Yeah.

And I'm like, this is off.

Yeah.

And you know, at that point I'm really pissed.

So, you know something I'm working on now? I haven't done this yet, but I remember, um, I, I read a book. This is like 21 or 22 years old, but I remember— I forgot what book this is, but like the— I remember this boss would always make the people that were bringing work to him or presentations to him and always ask, say, hey Neil, is this the best work that you've done? Right. And I think today's version of that is like, hey, have you verified the data before you brought this to me?

Yeah.

Have you double-checked this before you brought it to me? If not, then please go do it again and then bring it back to me when you're ready. And I don't think there's enough of that right now. I definitely don't do it.

Yeah. People know to bring me data that's checked. When they don't do it, I get pissed and they don't do it ever again.

But do heads roll?

If people keep doing it, yes, heads will roll.

So you've actually had to can a few people for this?

No, I haven't had to can anyone for it, but I would can it if they keep messing up and they don't check their data.

Yep. Yep.

You give them the warnings and HR does whatever. That's the problem when you end up growing into an organization with a lot of people. And in general, we are small compared to the Walmarts of the world and stuff. But for most SMBs, we have a decent amount of headcount. You have to start following these Regulations, rules. Bureaucracy. I wouldn't even call them regulations or rules. I would call them just internal bureaucracy and politics. And it's just like, okay, you go deal with this. I'm not going to deal with this.

As a side note, a question for you. So what percent, and you might not know this, but what percent of people for NP Digital right now of new hires are sourced versus, you know, coming through a job ad?

I have no idea. I'll tell you this. I do know this interesting fact, okay? So we were going— we're recruiting some people right now for some of our tools, Ubersuggest and Answer the Public. So then Mike starts hitting up our recruiting team or someone on our team. I don't know who it was. And they were just like, hey, I need help with these roles. And they're like, we don't have the time. And Mike's like, what do you mean we don't have the time? They're like, we're already overwhelmed. We have like, 48 open roles right now that we're working on. And he's like, oh, so then Mike just started doing it himself and started recruiting.

Yeah.

But with that many open roles, there's no way that it's being filled by network.

It's—

I'm assuming a lot of it is just going out there and recruiting. But on the flip side, I was talking to my CEO about an internal role for our organization. So we're in, I think, 28 countries. I don't know all of them by heart, but let's call it 28 countries that we classify internally. For marketing, I think we use a little bit less. I know we have people in like 35 or something like that countries, but we're in, call it 28 countries. We have at this point a good amount of global clients that pay us for different regions. Some of those clients we communicate all together and we're doing one cohesive plan. Some of those clients were not because they split up their marketing by region and each person has their own say and they want their own team and they want to do whatever they want, right? So we had to mold and adapt to the organizations. But we were thinking about hiring one person whose job is to work with all the big organizations we have, and their only job would be to land and expand. So if you're a company like McDonald's, who we don't work with, but I'm going to use them as an example because we don't work with them. Their job would be like, oh, we have Brazil here and we have Europe here.

We used to work with McDonald's.

We want to go and network with the people at McDonald's and try to get the relationships for the rest of Europe, then get them from North America, then get them from Canada and work with them for not just a cohesive strategy, but more so work with them to sell within the company. And more of a global role who not just builds relationships with clients, but also is in sales. So when we have roles like that, that are more, you need someone who's just really good, high level.

You're talking executive level.

Yeah, high level is a bad term. Executive level is the correct terminology for that. When we're looking for someone who's executive level, like those roles, we tend to pull them from our network. We tend not to do recruiting for it because we just see too much failure. Because like, even if you're using recruiting, whether it's executive level or low level, no matter how good you are, you're not going to have 100% success rate. Maybe 3 out of 5 or 4 out of 5 work out if you're lucky. With the executive roles, we don't like ratios like that. So we really try to go within our network if it's super important, because imagine hiring someone to deal with all our existing customers and cross-sell and upsell. You hire a wrong person, not only may you not generate any revenue, and not only are you paying this person, which is a cost, but no, even even worse, if the person sucks, they can ruin your relationship with your biggest clients, and then they can cost you a ton of money.

Yeah, I look at the time the time lost as because imagine having the right person, you would have compounded, you would have started to compound, and the money you make long term, it's just it's. A bad hire costs what? At least, at least I think it's like 2 times their salary or something like that. But I look at the time investment as like, if you find the right person, like Mike Gullickson, for example, right? It's working pretty quickly. But imagine if you wasted a year. You wouldn't waste a year. But imagine if you wasted a year with that CEO that wasn't working out.

Yeah, it would have been expensive.

Yeah.

But it's not just the time loss of the compounding effect. Imagine they're dealing with a book of business that's $60 million. And they ruined the relationship with a third, and you now lost $20 million of revenue. Forget the compounding effect, you just lost $20 million in revenue.

I think the acute pain, the stab in the side, is like you lose the revenue, right? But long-term, you lose a lot more too. Because that year, like, imagine all the bad relationships or the bad hires that they made too. So it starts to eat you like a cancer, right? So the reason— so going back to this question, the reason why I'm asking you this question, I was messaging one of our friends this morning. And so I do agree, like the best people you're going to find, like 95% or so are going to be sourced, right? And that's always been my philosophy. But for lower level roles, what percent of people do you think are being sourced from either being sourced or job ads?

For lower?

Yeah, let's say it's like director or something like that.

Yeah.

Just estimate.

Director or higher or director and lower?

Director or lower? Maybe—

it's easier if I do one level below a director.

That's fine, that's fine.

If I do one level below a director, I would guess that we're probably recruiting like 70-80% of them.

Yeah.

If it's director and higher, my guess is—

When you say recruiting, job ads?

Job ads, HR, following up with people. If I say it's director and higher, My guess is we try to use our internal network for at least 70%, 60-70%.

Yep. Yeah, so that's always been my philosophy, right? Like, you gotta source, like, and that ratio seems right. But I was thinking about it this weekend, I was like, okay, the team is like strapped, right, for, and then our recruiting's pushing, but they're strapped for talent right now. And I'm like, well, recently we spent not a lot of money on LinkedIn ads, we spent $2,500 and we got 2 people that are kind of mid-level, I would say, right? And those 2 people seem to be working out. I'm like, why don't we just spend more on ads? And so I was really annoyed at just like hearing about how like, oh, you know, we're overwhelmed and this and that on the recruiting. So I just like threw up a bunch of job ads over the weekend. And all of a sudden, some are even director level too. These are the people that have actually the 2 promotions at 2 different companies. I was like, oh, we're actually talking to some amazing people. And it's not even costing us a lot of money. And so all that to say is like, I was really against turning on job ads. But, you know, from what we're seeing so far, I don't think you're gonna find like the COO type or the executive types or even SVP types. But it's worth it. And our mutual friend that I was talking to this morning, they actually have the LinkedIn version that shows you who's open to jobs and it shows you the entire network, right? You're probably paying for that too. And funny thing is he shows me screenshots of who's looking at my company too. So yeah, anyway.

When we go and look to acquire a company, we look to see how many of their employees are looking for a new job. Because if you start, like, Like, there was a company that we saw in Europe, and no joke, I think it was like 70-something percent of their employees were open to work and looking for a new role.

70%?

70-plus percent.

Okay, what's, what's your bar for this?

Our bar?

Yeah, your bar. Like, what percent is too much?

Uh, so our general rule of thumb is we want less than 10% of the people working in a company open to, like, looking for a new job.

Yep. Yep. Which is interesting because before when it was a shit show 5 years ago, right? 4 or 5 years ago, so many people were looking, right? This time it's less than 10%. Yeah. Yeah.

And the reason this is an important metric, people like saying like, oh, look at our employee retention numbers. They're really good. And we see that data. So that company that we were looking at that had that high percentage, we told them and they said, No, no, no, this isn't accurate. Look at our employees right now and look how long they've been with us. So we verified the data. And they were correct. Their employees actually have a long tenure. But if a lot of your employees are looking for a new job, it means something's wrong.

Yeah.

Okay? And a lot of them may have a high tenure because they suck. And they can't find jobs in other places.

True.

So we don't just like taking someone's data and seeing how long their employees are there for. We actually like looking at who's looking for a new job, because if enough people are, it tells you that either if their numbers are low or the retention in the company is good, that means that they're probably not good and they can't find jobs.

Yeah.

But it usually also means there's something wrong with the company culturally.

Yeah.

For that many people to look for a new job, it's just they're not sharing it and you're not going to find out.

You know, so that's why I say culture is like a, it's a 60-day moving average. So you can't say we had a good culture last year or 2 years ago.

Yes.

It really is what have you done in the last 60 days and how are you behaving right now? And that is a good microcosm of how your culture is right now. It's a culture, it's a very recent thing. And by the way, I asked Perplexity this morning, I was walking back from the gym, just this question, like what percent of talent is sourced by marketing agencies versus using job ads? And how about B2B SaaS, right? And so job ads, basically generate the majority of applications and 40-50% of hires in many markets. This is not just for agency. Agency account for only a single-digit share of total applications and even a smaller share of hires overall. In B2B SaaS, agencies are used less often. I think it's like for senior and niche GTM engineering hires. So that's what it is at a high level. But I think your metric is good. 70%, if you're talking director plus, should be sourced. Yeah, if we're talking executive level, probably all of it, almost all of it.

For executives, we try to source all of it. It doesn't always work that way for us when we're expanding to other countries.

Yeah.

'Cause sometimes you don't know. But dude, I remember we acquired a company in Southeast Asia called SearchGuru. I think this was like a year ago or something like that, maybe a little bit more than a year ago. And I ended up going down there, met up with the founders, We put someone in place from our end to go and run that. It was someone that we did not, quote unquote, get within our network.

Oops.

That's all right. And we ended up hiring them. And no joke, I meet them, I talked to them for 10 minutes. I tell the person who's leading up the whole region, APAC, I'm like, they won't work.

Yeah. Why?

So when I was like, hey, this company that we bought, there were certain individuals within the organization that I saw that had, that needed some improvement. And what I mean by needed improvement, like when we're in client networking, they decided to play ping pong instead of talking with potential customers. And I don't think it was ping pong, but some other game like that, some office game. So that really irks me. I'm like, that's a no-go with me. So then I go up to all the—

The leader was doing that?

Not the leader.

Employees.

Employees.

Interesting.

So then this person that we hired, they're like, oh, we need to coddle them. And I'm like, no-go. You— they're like, if you just rip off the bandage and you're too harsh, it's gonna be a culture shock. It's gonna create too many problems. And then I'm like, this is a no-go. I get that. But they're being too nice instead of just fixing. And that day, if you have someone paying you, forget about culture or anything else, your job is to do best for that customer. You need to change whatever you need to for that customer to make sure they're extremely satisfied. And we did eventually end up ripping the bandage, and whoever didn't like that philosophy did not exist.

Yeah. You know what I would say?

Or do not stay with the organization.

My key takeaway from this, listening to Neil's story, so when I worked at Wpromote, I remember there was a period of time where the CEO walked by and I was actually playing one of the cornhole. So we had like cornhole and like all these like Google-given like things, right, in the office. And then people would just do it in the middle of the day, things that you didn't like. And I never understood why we had that. In my mind, I'm like, why would I ever do it? But hey, if everyone's doing it, I'm gonna do it too, right? So I remember a period of time I was like drinking like a soda or something and I was playing cornhole and he walked right by. But he was like down with it, right? I'm like, okay, that's him. I would never— I don't know, I'd do that at my org. Um, and when I had the, the office in downtown, we never had like games like that, right? And so I think what you're saying though is like, this is what— this is how you run things and this is how it is. I don't, I don't think what we're saying is like right or wrong, you know?

Correct. And some people like this lax lifestyle. I'm a big believer that I want to work with amazing individuals who are just obsessed about their work.

Yeah.

And I was talking with a startup yesterday and they're going to go public. This startup is not paying me. This startup has a lot of issues with their marketing. So I'm talking with the founder. I myself couldn't help but not dig through their website and send a ton of notes of what's wrong and what needs to be fixed. And then when I get a slow response, what do I do? I go call the founder. And then I'm like, hey, this needs to be fixed. Who do I need to talk to to get this fixed? I'm so obsessed about having their marketing flows and conversions optimized that I can't stop even though they're not paying me. So much so, I started texting the team and the founders and some of the people in marketing. I'm like, can you please send me data on your existing pricing pages and your flows and what you test and what converted? And then I'm dissecting and they're telling me the numbers. I'm like, this doesn't add up. If you get X amount of signups and this is the conversion rate, and you're telling me this is your LTV, your revenue would be higher by like 3, 4x than what it currently is. Something's off. I'm like, I need your real conversion numbers and it needs to be accurate so I can tell you what changes to make. Because the changes you're telling me that you made that decrease your conversion don't seem right. And I think you actually got a data problem because your numbers aren't adding up. And that's obsessive personality. We both have it, at least when it comes to work. I want people who love what they do.

It's okay. When I was 25 years old and I told Neil that a girl broke my heart, he just stared at me. Anyway, he just went back to talking about work.

Yeah, that sounds about right.

Yeah.

Now I'm a little bit better. Just a little bit.

Yeah. It's okay. We get better over time.

No, actually, I'm a lot better now because I want to hear the story.

Yeah, yeah, yeah. You like the stories now for your entertainment. But so let me finish on this recruiter piece and we'll move on here. So SmartRecruiter's technology benchmark shows referrals account for 16% of hires in tech.

Okay.

129% above global average. And then this is interesting to me because I think if you're running like a— if you're in San Francisco, you're running like a— you're running like an AI company or something like that. I think the bar for your talent is way higher. the competition for engineers is way higher too, right? And you need the best of the best and you've raised all this money. And so I actually think, my opinion, when you're a service-heavy business, what ends up happening is because people are the business, people start to cut corners. That's what I've seen. And I've seen like with these agencies, they hire so quickly, but then the— I posted something recently, I got a nice graph. I don't know if you saw this, but every B player you hire, it's like you think you can afford to hire B players, but you can't.

Uh-uh.

Because by the time, if you hire like 100 B players, okay, you actually have decreased your output by 100%, okay?

Yes.

That's what it is. And I have a graph for this and I think you would actually like it. But this actually leads to one of my points here before I pull up that graph. Let me ask you a question here. Would you rather have a $100 million services business versus a $1 million software business? And I'm gonna give you a little more context here, okay? So let's say one business is in the— we were talking about this the other week. Let's say it's in the home health niche, right? Or in the nursing home niche, okay?

For $100 million?

Yeah, it's doing $100 million a year, okay? So you get to choose this business, right? Which a lot of it is subsidies from the government, okay?

Is it profitable?

It's profitable, okay?

A little bit or a lot?

A little bit, a little bit. Because the margins on this type of business is like 3 to 5%.

So $100 million only produces like $3 to $5 million in profit?

Yeah, yeah, yeah.

Okay. Okay.

But also keep in mind, it's government subsidies. We talked about like the $10 grand a month. Right, remember that?

Yes, where you get paid to take care of parents and stuff like that. Is it that specific business that you want me to compare to the $1 million software business?

Yes, yes. So would you rather have that business, right? You're cash flowing right now, you have, you know, a lot of it's coming from government subsidies. Or would you rather have a software business that just hit $1 million in ARR? That is, yeah, you get to choose.

How old is the software business?

Year and a half. 2 years.

2 years. So I just want to clarify this for everyone listening because they probably don't fully grasp what that $100 million business is. The $100 million business that Eric's talking about, neither him or I do this, just for clarification, but there's businesses out there in the United States where they help you get paid by the government for you to take care of your parents. So if your parents don't have any assets like homes or anything like that, and they have low income and they already live with you, the government pays you money. So what a lot of people do, and this exists in the Indian community as well, which I'm ashamed of. You know, we, my family doesn't do it, but what people are doing is these people who are already doing well, their parents are, you know, have Lived here for a bit, they're taking care of their parents anyways than they would have, and they don't need help from the government. But because the government offers subsidies, they're just abusing it and getting free money. I believe those kinds of businesses are going away. And the reason I say that is a lot of it is scam-based versus they actually need the government subsidy. I do agree that there are people who are helping other elderly people that need taken care of and they can't afford it. And the person getting paid barely has money. And it's, you know, helping people out. For those people, I think it's great. But a lot of people are making money from this, and that $100 million business, it's a lot of sham clientele and scammy clientele where they don't need the money and they're just taking free handouts from the government. So I don't like that business and I would not do it. If it was purely legitimate and it was only for people who are needing it and is running at 5%, I would take that 5% margin business because that's $5 million a year over the million-dollar software business that's been around for a year and a half. Just due to the fact that if it is legitimate, you can sell that business and that $5 million profit business, you probably can get maybe $15 million for.

Mm-hmm.

$20 max.

Yep. But to Neil's point, what we're saying is, would you rather go with something that compounds, that's legit, or would you rather go with a hustle, right, that can go away at any time once the government takes away the subsidies? And they're paying attention to those subsidies.

Yeah, and in general speaking, Eric and I, even if it was a billion dollars, we don't like the hustle type of businesses. Not just because it can't go— or not just because it's probably going to go away over time, but because you feel slimy. Business is not just about making money. You want to market a product, run a business that you're passionate about, that you love, not something that's slimy. Because it's only going to last so long.

You know what's funny? We did a podcast like 2 years ago, I was like, the purpose of business is to help your customers. And Neil's like, the purpose of the business is to make money.

Yes.

But, okay, let me go back to the graph here.

It is to make money. I believe all businesses should end up making money, but if you don't love what you're doing, it's not worth it.

What if it's, uh, what if it's like a drug— you're a drug business, you're a drug lord?

That's too unethical. Or I'll give you an example. A publicly traded company hit me up to be the CMO, okay? Whether you want to consider that owning a business or being part of a business, massive organization. I would have got paid a nice lump sum to go to New York City. They would have paid for a home, a really nice home by Central Park.

Yeah.

And I'm not talking about like a $2, $3 million home or $5 million home. My upfront fee would have paid for, no joke, Depends on the recent— Couple years ago. Within a few years, yeah. Okay. And I, with stock compensation and everything and performance, I should at least hit 8 figures a year. So call it, let's call it $10 million. I'm just rounding. I'm throwing out a number. But most of it was all stock compensation. Okay. Even the upfront, it was, you know, stock grants, but then I would use my own money to buy the home, but it was a way to pay for the home. You're following me, right?

Yeah.

And I would have to stay there for a certain amount of time. The money wasn't worth dealing with the internal politics and bureaucracy. Forget that I already have something that makes money.

Yeah.

And it's just, I personally wouldn't be happy working somewhere, even if my current team can maintain my current business and grow it, then in theory I'd be making money from both places. I wouldn't be happy dealing with bureaucracy. I do agree doing a business or doing marketing, it's about growth and making money. But if you're truly going to be miserable, it's not worth it.

And plus your deal, not to give details, but Neil's deal is better. He gets to work on what he wants to work on. And the thing is, if you go work for that company too, you stop the compounding on your business. You slow down the growth significantly.

Correct.

Yeah. So, okay. I want to come back to this thing real quick here. And then I want to talk about, I was talking to our, our, my YouTube team, the strategy team. I was like, hey, what's wrong with this channel?

Right?

'Cause the reality is, Noah's sitting here, maybe Noah's nice about this, but I'm like, there are a lot of good moments that we talk about, right? And I'm just like, how are these good moments, whether it's you talking or me talking, how are they not making it, right? So I do want to do like a live audit on how we would attack organic social and where, how I think that also applies to paid media. But let me just show you this over here. So I'm patting myself on the back here with this tweet, okay? So I just said here, look, if you think about B players, right? Let's say an A player is 1 unit. Okay, let's say a 90% hire, still an A player, is 0.9 units. You following? Okay, an 80% hire is 0.8 units.

Okay. What is a unit? Like units of value?

Like, yeah, unit of value. Let's say like, like if I'm a B player, I'm 0.8, right? Just 80%, right? So, but if your company is designed to run on 90% hires, so like A- players, right? Every B player you hire creates a dilution multiplier of 0.8 divided by 0.9, which is 0.88. Okay. So what ends up happening here is if you have this ratio, if you if you have five B players, it ends up being point five six units. Okay, and then if you hire twenty B players, it's point zero nine, meaning that you've decreased your your expected output by ninety one percent. Okay, and then Gemini actually put together this nice little graph over here. Okay, and it's just the compounding decay of organizational output. So one is like point eight eight. It's not that bad, right? But you're like, oh, I think I can get away with that. Yeah, yeah. Then what happens? You have the Bozo explosion. And I literally had the Bozo explosion 5 years ago. Okay. And it's really hard. Very hard to recover from this. Very hard.

It's really hard.

Very hard. I've done it. Very hard. Wouldn't do it again. You just got to cut.

Yeah.

So you really got to cut. That, that those are the numbers behind it. Like, this is why when people are like, oh, let's just let them in. And like, this is why Naval tweeted this, right? The— this is funny because I, I don't know how involved are you with recruiting, but Naval said, Founders cannot outsource recruiting, right? It is literally the most important thing. The early people are the DNA of the company.

Mm-hmm.

And the thing is, the important size at which a company starts changing is not some arbitrary number like 20, 30, 40. It's the point at which the founder is not directly recruiting and managing everyone. The moment there are middle layers of management, then you are somewhat disconnected from the company. And your ability to directly drive a product team that can take the company from 0 to 1 goes away. So we really cannot outsource recruiting. People think you can. They hire recruiters. Maybe you can outsource a little bit of sourcing, but I would argue even that's difficult. So the non-obvious reason is that the best people truly only want to work with the best people. That's what it is. And you know what that feels like. And you won't tolerate working with— like the moment someone starts to like not have the right data, you're just— you've moved on to someone else.

Ah, yes.

Yeah. So I'm curious, how do you do it? Because I know you're not that involved with recruiting.

Mike is. It's one of his best skill sets.

Okay, which Mike?

Mike Camo.

Yeah.

He spends a lot of time—

Mike's really good with people.

He's the one who also got Mike Gullickson. Technically, JJ got us Mike Gullickson. So he closed— Mike Camo closed him.

Yeah. So he's a good closer. That's a big reason why your executive staff is so strong.

We closed Mike Gullickson before I met him. I met him after he signed on.

After Mike. So yeah, it's good. So Mike is your co-founder that's on top of recruiting? Yes. Yeah.

And for all leadership roles, he double checks.

And I wouldn't even say— I mean, like, you know, I don't think you care, but like, I would say what I've seen you recruit in the past yourself, it doesn't usually work. Like, not usually, but a lot of times it doesn't work out unless it's marketing roles.

Yeah, marketing roles, sales roles, I can recruit extremely well at. Yeah, and I only stick to those. So for example, Nick Roushan, I recruited.

Yeah.

Okay, so when we were interviewing Nick, it was me and Mike Campbell, my co-founder, and Nate.

Remember Nate?

He said do sales.

Yeah.

And I went to dinner with Nick, uh, and I was like, this guy's gonna be good. He's gonna— he can, he can close.

He was a paid media person at the time?

Uh, account manager.

Okay.

So he was managing accounts for iProspect.

Had never done sales before?

Never done sales. But I'm like, this guy will close. He's actually our number one sales guy, right?

Globally. Yeah.

So then, you know, I remember at the time, because we just started up. If you look at our current employee count, Chad is our longest standing employee. Nick is number 2. He's been there almost from day one.

I don't know who Chad is.

Chad runs all of content.

Okay.

So at that time it was expensive for us. Nick was not a cheap hire. I don't know what his salary was, but it wasn't $100 grand or anything like that. Like it was multiple 6 figures.

And this is first year?

I think including commission, all that kind of stuff. It was going to be expensive hire, right? Because he was already somewhat seasoned. I don't know exactly what it was, but It wasn't like a cheap role where he was in a position making $100 grand a year or anything like that. And sales is commission-based, so you can make more if you do really well. He's one of our best sales reps, or is our best sales rep from a revenue generation standpoint. Nick, at that time, Mike, I remember saying, eh, he's expensive. He's just like, ah, this is going to be tough for the organization. Can we afford it?

Yeah.

And I said, we need to hire him. And I remember sitting down with Mike and Nate there, and I'm like, he's in sales.

Yeah.

If it doesn't work out within 3 to 6 months, you cut.

Yeah.

We'll know within 3 months. But I'm like, I'm telling you, this will work. And Mike's like, I believe you. He's like, I believe in— I believe Nick will work too. We both felt that. I didn't have to convince him that he felt Nick was the right person, and he didn't have to convince me.

Yep.

And we're just like, screw it, you just go for it. Like, when you know someone's right and you can only get so many right people, You just go and get them.

Yep. And to some people it's like, oh, it's a gamble, we can't afford it. But like, that gamble will pay off exponentially. And sometimes you go for it. Yeah. And I don't care about budget or whatever. It's like once you got that feeling, like we would call it the fuck yes feeling, pardon my language, but you know, you know, and that feeling is right a vast majority of the time.

And then when we started working with Nick, he doesn't have a patience for working with incompetent people. So then he started helping us recruit better people in our organization. He helped us recruit JJ. Technically, he tried getting us a guy named John. I won't say his last name. And John wouldn't end up coming, but John referred JJ, who you met back in the day.

Yeah, yeah.

JJ was— I forgot what his role at iProspect was. And Nick was like, yeah, he's good. So we ended up getting JJ. JJ was great. JJ helped level up and bring in like one of our best operations people, um, Tracy. And then from there, like, it just kept snowballing. He kept bringing in more and more people.

Yep, that's what happens. So going back to the point, good talent likes to work with good talent.

Yes.

One final thing before we move on from this one. So, uh, Naval, the, the tweet says, so one good test— and I didn't actually think about this before— But one good test is when you're recruiting a new person, you should be able to say to them, walk into that room where the rest of the team is sitting. Take anyone you want. Pick them at random. Pull them aside for 30 minutes and interview them. And if you aren't personally impressed by them, don't join. When you do that test, you instinctively flinch at the idea of them interviewing randomly a certain person. That's kind of in the back of your mind, okay? Maybe don't talk to that person, right? That's the person you need to let go. Because that's the person keeping you from having this high-functioning team that all wants to impress each other. Yeah. Yeah.

And when you just have those people, they figure out how to make a business grow.

Yeah. Yeah. You don't need to tell them what to do. You can be the bumpers. Like, have you done the bowling with the bumpers? You're basically the bumpers.

Yeah. Yeah.

So they don't fall into the gutter. Yeah.

Yeah.

Yeah. So—

My favorite thing is someone asked me today, hey, one of our executives is going to Someone else in the marketing space. They're not a competitor. You know about this. We talked about this a few weeks ago. And they're just like, okay, we got a few other people on our team that they're managing. Who wants to take this over and manage these people? And I was just like, no one. We should have people who we don't have to actually manage like that and really oversee on a day-to-day basis. They're like, yeah, but some of these people need to actually be overseen. And I was like, cool, what does this tell you? This tells you that you need to end up replacing them with better talent and be fair to them and give them severance and stuff. And at first I told them, have you actually talked to those people and tried to get them to improve? They're like, yeah, we've tried, we tried training them, we've documented things, they just can't, they're not the right fit. I'm like, yeah, so the key is not to manage them. The key is to just put in the right people.

The best people are self-managing.

Yes, dude. I had this conversation with Salo who runs our marketing because we have someone who is going on maternity leave and they're not— or she's on maternity leave and she's not going to come back after. And I'm like, all right, that's cool. That's fine. And we made some changes in our internal marketing team. And he's like, dude, what should we be doing? How many people do we need? And I want more people. I was like, Salo, The key with really good marketers is you don't need a lot of them. You just need— or the key to a good marketing team is you don't need a lot of marketers, you just need good marketers. And I'm like, you're telling me how you need like 10, 20 people. I'm like, we just need 4 or 5 really amazing people and that's it. Small team, nothing more, and we can crank.

Yep.

And we've been slowly shifting to that for over a year, and our team's been getting smaller and smaller. And the results have actually been getting better and better. And then we mix in whenever we need hourly contractors, and we mix in our own agency to help here and there.

They call it 2-pizza teams at Amazon, right? You want to have a team that can be fed by 2 pizzas, right? And so anyway, today we kind of talk more about people, but one thing I want to talk about too. So we have, you know, I was talking to someone on the team today earlier, right? And he got an offer that was basically 2 times his salary. I'm like, why didn't you just take that? He's like, and so he's like, look, I'm getting hit up every single day by recruiters. It's a very high, it's a very hot market, especially in AI right now. And I'm like, so you're talking to these people? He's like, I'm like, why aren't you, why didn't you take one of these? He's like, because the difference is you care about my family and you let me, you're not like micromanaging my hours or whatever. There's no like, I don't need to relocate or anything. like that, right? I'm not saying this is gonna work for everyone, but I didn't know that that level, like people care about different things. So it's really important when you're talking to A-players on your team, constantly going to them, hey Neil, what do I need to do? Like we really value you. What do we need to do to keep you working at Single Grain forever? Is it money? Is it more time? Like what is it? And you just constantly go to them every 90 days, every 180 days or so.

Yeah.

You're just going to them, right? 'Cause you never know who they're talking to. And they're actually, it was a competitor I was trying to poach them, doing something similar to what we're doing on the software side. So smart on them, right? You know, it's like, yeah, I will never sacrifice money for— like, I'm like, what if they offered you half a million dollars? He's like, wouldn't matter. It's family first. But like, you know, it's different for every person.

Speaking of marketing, you have this topic in here, 21 million YouTube video reveals a new trend.

Yeah.

I'm curious on that, and the link doesn't work for me, but maybe it'll work for you.

No, it's, it's, it's gone, but I kind of remember it. So This is from Patty. Patty Galloway. So Patty Galloway, I'm gonna go to his Twitter. So he was showing a thumbnail of like a Red Bull video, okay? And this Red Bull video, it's the thumbnail is just like it shows a mountain and then there's like a helicopter, okay? Neil's about to fall asleep. So and then basically it's like it's not some crazy packaging or crazy intro whatever. It's just, it's a very interesting video, right? It's no like we're gonna try to like do all these jump cuts and things like that. It's so he's just saying that the the meta now, the way you play YouTube, is it might be a longer form video, but like a lot of people enjoy the vlogs, for example, right? You don't need to do any crazy cuts. And so that's what he's saying is is a little different with the game now. And I'm trying to find it right now, but that's kind of the high level. And he's showing look his I would recommend following him on on Twitter too. Because he's done all of these videos. I'm trying to find it still right now, but all these screenshots are like 12 million views on this video, 121 million views. So I think the key thing is if you want to win on YouTube, look, this is the Midwit meme, okay? So on the left side and the right side, it just says make good videos my viewers want to watch.

Uh-huh.

In the middle, it's like the algorithm has shifted, got to 10% click-through rate, 10 minutes AVD, optimal posting time, Hyperanalyze every second. So he has a lot of these examples where he's like, the video just takes off because it's a good idea, right? And the comment I've gotten from our YouTube strategy team, I was like, guys, why isn't the Marketing School YouTube channel growing more? Like, are we idiots? And so one guy, the one guy that gave us comments on it, I think his name is Josh. He was like, no, like, I watch all your stuff and I liked all the stuff that you and Neil talk about. But the problem is podcasts are a commitment. And there needs to be a big sense of novelty with it, right? And I'm like, well, we talk about the newest trends, we're talking about this type of stuff. What's happening right now, I started digging in more and more to my brand team. We have 2 full-time editors. One editor is doing one video per week. Okay, full-time. The other editor—

Only one a week?

Yeah, the other one is doing one video per week. I just found this out this week. And I'm like, What? And then, and then I went to our— we have like an agency guy. He's like manages a bunch of editors. I'm like, I'm like, what are you delivering? Right? And like, you'll see this, right? And he's like, well, I find out for what we're paying each month, we're getting like 20 net new pieces of content. And then we're also not posting on time for social. So I just opened up my Instagram grid, right? Because that's a good proxy. Because I know you have a good amount of clips from this 80 minutes. I know I have a good amount too. But in the last 10 videos that we posted, there are only 2 clips from this podcast. The other 8 are from PB Launch, which is doing a great job. They're very good with Shorts. And so my point of saying all this is that, one, if we go to Patty Galloway for long form, yes, have interesting videos. Sure.

Right.

Just make them.

Why even just pay those people? You should just not pay those people.

We'll come to that in a second. So because this is new information to me this week, right? But on the other side, too, you need to have people who have been there, done that. And you need to have a brand manager that's on top of things, right? Because I don't know who your brand manager is, but like I was talking to Raghav, who works for Gary Vee now. He used to work at Single Grain, so he's like Gary Vee's right-hand man when it comes to creative and brand. He's like, oh yeah, you like— he's like, you're missing a brand strategist that's like on top of everything. We had that, but they weren't on top of everything, right? And so all that to say is like, there's only one person to blame, me. But if you want to get this right, it's like, I think we have the right long-form stuff. You have to make sure you have the right people That have taste and are cutting up the right moments too. Been there, done that, people. Going back to talent again.

But why do you even need 2 people? You could get it all done with 1 person and—

That's what I'm saying.

They could be done for way cheaper.

That's what I'm saying.

And you're paying 2 people in the United States?

No.

Okay.

Yeah, yeah.

So it could be 1 person for probably less than what you pay the current person, and they'll do multiple clips a day.

Yep. But this is what happens, and so again, the only person to blame is me, right? But what I would say is, If you have a brand manager, like who brought the brand manager? I did, right? But if the brand manager hasn't been there, done that, and they start to hire whoever and they don't have experience there, what ends up happening is you're under attack, right? And that's why I think that's when things, the growth slows down. So this is a good microcosm of that.

Yesterday I was, I did lunch with someone who's a YouTuber, social media guy. His name's Marcel.

So he's— I've heard about this guy before.

Yeah. So he's like in like the, self-help space. Okay. Does well, has tons of Ferraris, nice home, yada yada. You get the point. So he tells me about this YouTuber that he's working with, this couple. They're getting more views than MrBeast right now on a daily basis. They're, they're literally the most popular YouTuber right now. Not for total number of subscribers, but when you just look at views.

Yep.

And I said, what kind of content is it? And he's like, brain rot. By when he says brain rot, he means just like random content that just passes time, like entertainment.

Mm-hmm.

So I was like, okay, what are they gonna do? He's like, dude, he's like, just imagine the brand deals. He's like, if I get them a brand deal, he's like, you know how much money they can make? And I was like, they're not gonna make much money at all. He's like, why? I was like, brands don't want to be associated with brain rot that much. Because it doesn't convert. It doesn't actually drive real revenue. If you look at MrBeast, a lot of his revenue comes from his own products like Beastables and snackable burgers or whatever it is.

Lunchly.

Lunchly.

Beast Burger shut down.

Beast Burger shut down.

He just opened a theme park though.

Oh, that's cool. But I know he does a lot of the chocolates, whatever they're called.

He does toys now too. Yeah.

Okay. I've seen the toys as well. But That's how he monetizes really well. Sure, he has sponsors, but he's built such a big brand, it's very rare to get those sponsors. And the sponsors don't make him that much money. It covers a lot of the costs for the videos. It's not a massive profit organization. It's a high revenue generation from everything that he does. But when you look at his content, people are like, oh, I got brain rot content. I'm just going to go get sponsors. I'm like, no. You're better off creating content around a specific vertical, having a fraction of the views, having less than a million followers, and you probably can make more income. It's very hard to replicate the MrBeast model or the Kim Kardashian model and make a killing. If you look at all of them, none of them make enough money from brand deals. They made the majority of their wealth from their own products. And if you're known for content for brain rot, It's hard to create your own product that's applicable to everyone.

Yep. So if we go back to this piece over here, okay, so he actually— here's the thumbnail. This is a 16 million view video, okay? So a private tour of an Indian billionaire's secret wildlife rescue center, okay? So like, I know some people want the payoff, so I'm gonna give you a payoff at least for one of these. So here's why this video did well. 3 key components. One, a big swing idea built on existing format. Two, access packaging. People need to know about this, right? And also like private or whatever. Okay. Three, video design for retention and satisfaction. Okay, that's fine. Um, but going back to your point, what ends up driving more revenue? You look at this podcast, for example, right? Um, earlier this week I was— we were supposed to connect on— there's a publicly traded company that wants to do a creator deal with us, right? You and I keep getting these influencer deals on the side, even though that's not our main business.

Yeah.

So we know our audience is more valuable. So all that to say is that I know for on the podcast side, on the audio side, we do well, but there's no reason the YouTube side shouldn't be doing well. So I'm actually doing a— those of you that are listening to or watching this right now, if you want to help the Marketing School Podcast, if you can find a way to clip this long form, find the right moments and prove that you've been there, done that, don't just say you want to work with us, we will consider that, right? Because we put effort— one, we get to eat lunch after usually, But we put a lot of effort into this, like live streaming this right now and all that. Like, we've been doing this for like 8, 9 years or so. And the fact that we have sponsors on the other side for audio only, I know this can go far and there's no reason why it shouldn't be able to. Yep.

No, I agree with that. It's just finding the right person who can package it all up and make it all make sense. And if you look at what Eric and I do is we try not to optimize views. Are we saying we're as good as MrBeast in getting views? No, we're not. Are we saying that we can get a million views? We've created content that goes viral and gets millions and millions of views. It doesn't monetize well for what we do and it doesn't make great money. So we choose to not go that direction.

You know what I think we do wrong with YouTube though? This goes for both of us, is I think the types of content we make, the bottom of the funnel is the right, not the bottom of the funnel necessarily, but it's the right content. But I forgot where I read recently, but I've felt like this for years. It's like you do need to have like a set of like wide TAM content So the algorithm kind of respects you, and then you have, you know, some of this other, like, maybe bottom of funnel type content.

I'm seeing something. So, okay, so when you think about bottom of funnel and top of funnel content, I probably got less views on social media this year than I did last year. So remember I've told you RFP numbers for my business in the United States. So in 2023, I'm going back 2 years at this point, point, we're at 16. 2025, we were at 25, which is 56.25% growth.

Mm-hmm.

2020— no, sorry, 2024 was 25. So 2023 over 2024, that's a 56.25% growth. 2025, now the month isn't over, the year's not over, we're at 39, right? Remember last year was 25. This is in the United States. That's generating a 56% growth exactly. At the beginning of the month, I told my team if they just hit 39, you know, I would be happy. I'll be okay with not having the 0.25%.

So you're over the moon now?

No, they already hit 39, and there's— and when they hit 39, there's, call it, 20-ish days left in the month because those numbers are a few days old. Um, this is December 12th when we're recording this. I told them, guys, guys, we only need 41 and it'll be a good year. And then no one responded to my text messages. So then I waited a day and then I sent again. I'm like, guys, let's get 41. What do we need to do? Again, no one responded to me.

At least you know how people respond to how you work now.

Uh-huh. Yeah. And they know well because When we were starting in November, we were just like, all right, you know, it's been a tough year because of tariffs. If we just get a 40% growth, you know, 45% growth, somewhere around there, 50, that's good enough, guys. That's close enough to last year. Law of large numbers, slower growth. And they're like, yeah, we think we can do it. And then as they started creeping up, you know, they said, Neil, you're just going to ask more. We shouldn't tell you the numbers because no matter what we hit, even if it's above what you told us a month ago, you're just going to want to keep having more and more.

You know, I talk to someone on my team recently. I said like, look, there's, um, no matter what you do, like whether it's you're running the company or people working for a company, people will try to game metrics or all these things or game how to work with you, right? Yeah. And that person was like, Eric, I would never try to game anything with you. And I'm like, what are you talking about? Like this whole thing is a game, right? If I— if you're trying to meet this profitability metric, you're gonna— you might look to cut costs here and there. Or if like Neil, for example, is pushing you all the time, then you know maybe not to give him the metrics as quickly. Maybe you delay the metrics a little bit so he's not gonna always be, you know, pushing you for the next one, the next one, right? Everything is a game, and I think people don't wanna accept that.

No.

Yeah.

And that's just how entrepreneurs are built, where it's like we enjoy the game.

We're perpetually dissatisfied. I told my team that. I'm like, let me ask you a question. I just wanna get— 'cause I've talked to a lot of friends about this already, but do you see running a company is Somewhat similar to having children?

No, very different.

That's so interesting. You're the first one to decline, and I thought you were gonna decline, but all my other friends say it's very similar because I still think we behave like children, you and me. I'm pointing at you and me right now. I think we're all children, right? And everyone has different— like, if you're like— if there's a parent above, like, they're gonna ask for different things and all that. They're gonna see what they can get. That's why I say it's, it's kind of similar, but I don't have kids, so I don't know.

It's very different. And here's why. When you have kids and they do stuff that you hate and they don't listen to you—

You can't fire them?

You can't fire them. And with kids, when they're young, there's, there's not a lot of logic, no matter how smart they are. They just get emotional. They can throw tantrums. They can be really well-behaved one day. Um, you know, like, My kids were sick a few days ago for one day. They were just coughing, but it was only early in the morning. And Eric's leaning back. They're not sick now. Uh, although William was sick this morning, but I haven't got anything from him. And they're like, oh, we don't want to go to school. I'm like, daddy has to work today. So if you're not going to go to school, you got to let daddy work. Okay. If you don't, if you let us stay home, we'll let you work.

They're both sick at the same time.

Yeah.

How convenient. They planned it.

And then they cough in the morning, but they were, they genuinely were sick.

Yeah.

Yeah. So then we're just like, okay, you'll let dad work. They don't go to school. Hour and a half comes, goes by, you know, it's by this time around 9:00 AM. And they're like, dad, when are you going to play with us? I'm like, dad has to work. Remember, I didn't go to school. Yeah, we got it. By the time it hits around 11:00 AM, there's no more, hey dad, just chill. Hey dad, you got to take it to the park. Let's go play with rockets. The rockets part I like. So for me, I'm like, all right, let's see if we can get it stuck in trees. I tend to do the stuff I shouldn't be doing, like goofing off with my kids. I'm like, the key with rockets is not just go high, but like, let's get them all stuck in trees and they can't come down.

Yeah.

Um, and that I have fun in it as a game, but it all became, hey, we need you to spend a lot of time. And I didn't get much work done. Again, no logic. What they promise you is not necessarily going to hold true. And that's not how it works with employees.

That's a fair example, but I think you get what I'm saying. Like there, there is a lot of similarities is my point.

Most of the friends who I know who are entrepreneurs that have kids, I can't think of one that'll tell me there's similarities, but I can— they all tell me this one same thing. Hey Neil, I want to work and travel more. And I'll always ask them why. And they're like, it's easier than watching kids. But they all love their kids.

I'm curious. So do this, do this later. Just go for the next week or two, go ask your friends. Because all my friends I've asked that are entrepreneurs with kids, they've said it's like, it's like, it's very similar. It's like the same thing. Some say it's the same thing. Some say it's very similar. You're the only one. And I felt that you would say it's different. And your reasoning is fair. But go ask some of your friends too. I kind of want to see what they think.

Yeah. And I think the entrepreneurs who are saying that it's very similar, They have a shit B and C team. If you have an A team, at least the people you're dealing with as an entrepreneur, you won't feel like it's like having kids.

These are— some of these people are doing a couple hundred a year.

Forget the revenue.

Yeah.

There's a lot of people that do hundreds of millions, if not billions of dollars, and they still have C teams because they're just in a massive TAM.

Yeah, but these are some people you and I know, and like, some of them maybe, but some of them have good teams. Yeah. Anyway, okay, so I want to, I want to, I want to tell you this. So this one's interesting. So do you want to know about the strip club sales lesson that 10x's your pricing?

A strip club sales lesson?

Yeah, so get this. A bouncer at a strip club, right? So he makes like $300 grand a year, works 4 days a week, no degree, barely speaks English. Okay, so this guy watches him and he turns away a bachelor party of 12 guys. Okay, so he says, sorry, we're full tonight. Okay, but the club was half empty.

They begged.

They offered $500 to get in, he said $1,000, and then they paid, right? Then the guy that was watching him was like, hey bro, like it was empty, why did you do that? And then the bouncer looks at him, he's like, like, are you stupid? Like, so he's like, look, if I let them in easy, they spend $200. If I make them pay to enter, they spend $2,000. They have already decided that the night is expensive, so they act expensive. So then this guy goes back and tests this on his like consulting. Before he was charging $5,000 for a project, right? Now it's like, oh, let me think about it. And so then he says, hey, I'm at capacity, let me see if I can move things around. And he doesn't talk to that, the prospect, for 3 days. And then he's like, hey, okay, I can fit you in for, you know, $20,000, but that's because of the rush. And then his close rate jumped up from 34% to 71%. So the lesson here, and this is a post from Gisco on Twitter, scarcity isn't a tactic, it's a filter, right? And so that's how this bouncer makes $300 grand a year. And then he just helps the club jack up pricing too, because everything's valued higher.

So isn't the bouncer supposed to just get paid a flat salary and not be taking money from people? Because I'm assuming they're not paying him $300 grand a year.

Yeah, but when— yeah, so he's getting greased by all these people. And then he also knows the game too. Like, hey, like, look, if you let them in, we'll give you $500, $1,000. So imagine how often that happens. He just manufactures scarcity in a club. And I used to be a club promoter at UC San Diego, right? And I— we would manufacture this really long line and there'd be nobody inside, right? Just to make it look like, oh my God, this place is popping, blah blah blah. But imagine, like, if he lets them in easy, they don't spend anything, they're not gonna spend much money. But because they already spent $1,000 to get in, it's like they have to spend a lot more inside.

Yeah, I get what you mean. Yeah, this model, for anyone listening, does not work if you're an enterprise.

No, no, but it works in different areas.

It works in different areas.

What areas do we think it works in? Strip club, that's one.

I think it works for like individual consultants as well. Like if you're a social media consultant or someone who helps other people with their marketing and you're individual, you don't have a big team.

If you're a club promoter, sure.

Club promoter. Yeah. Any way that where your personal time is valuable and you can say that you're full and you're creating quote unquote fake scarcity, whether That's ethical or not.

I mean, you know consultants that are doing 7 figures by themselves? Like, we're talking about like multiple 7 figures.

Yeah.

And they have like one assistant.

Uh-huh.

So you can do that because you are selling your time.

Yes.

Yeah.

I think in that model it works extremely well. Uh, you know, strip club is the obvious one because that was the example that you gave. Uh, I can't think of too many. I just know it doesn't work when you have a massive team because it's like saying, oh, we got 2,000 employees. Okay, sounds good. Uh, So yeah, we're full up right now. People would be like, you got 2,000 employees, you're gonna take all the business that you can end up getting. And enterprise procurement would be like, okay, well, we hit up, you know, 10 companies, you're one of them, and you said you're busy, so we'll go talk to the other 9, no problem.

Dude, you know, one thing I want to test, so I was reading about this, but Goldman, I don't know how long ago was this, maybe they still do this right now, but Goldman Sachs, they basically double employee salaries And what ends up happening is they get 3 times the profits. And so I was reading this, I was reading a book called Scaling Up Compensation, right? And so I was just getting comp ideas. And so I was like, whoa, like, because we're so big on AI fluency right now, what if we just took the market salary and we doubled it for everyone that comes in with super high AI fluency? Like, I wonder how that would go. I was talking to my CTO about this, right? Who knows? Like, I'll let you know how this experiment goes.

You should try it.

But I'm actually curious. And if it works well, I can see you doing it.

You should try. No, I wouldn't do it. Yeah, but you should try it. I'm curious on the results.

Why do I have to go through the pain? What about you?

No, no, I don't want to try the experiment. I know you'd be up for this.

I would be up to try it actually, because look, it's— Goldman Sachs is not stupid, right?

Well, there's no way Goldman's paying all their employees double the amount, or else—

Not all. But this was, um, I don't know, again, I don't know how long ago this is. I think they switched this. What we do know, like, if you're coming out of school, I think Goldman does pay more, but they also work you to death. to the bone, right? But if you double employee salaries and you get 3 times the profits, like Morgan Stanley pays better than Goldman.

There's actually a lot of people who pay better than Goldman.

I don't know, but they have the numbers here where it's like they get 3 times the profits from an employee, right? And so because it's higher perceived value and you're gonna have the people that, that want to do better for themselves coming from prestigious universities, and it makes sense that that would happen.

So Goldman has a closet full of pillows and blankets for people who want to sleep there.

Do they?

Uh-huh.

You know, I'm sure you've been in an office. I've been in an office and it's like, it's not labeled. It's like, it's a pretty Which office?

They have a lot.

The New York one. It's pretty stale. So yeah, I haven't seen that before, so I guess you have.

I haven't been to the Goldman office in New York. I've been to a few offices. It's big.

There's a lot of people there.

Not the one in New York.

Yeah, yeah.

I remember during one of the hurricanes, Sandy? Yeah, they had a generator and their lights were still on. And it was all over the news. It was like, the lights never turn off at Goldman Sachs.

Yeah, that's a pretty good ad.

Yeah, it wasn't an ad. It was all natural.

Oh, I thought it was a but it became an ad.

It could have been. Yeah, it could have became an ad, but everyone was talking about it because they were just like, look, Goldman Sachs lights don't turn off.

Yep. The last one we can end off here is so I'm looking at this this guy who works for Menlo Ventures. So they dropped a 12-page AI report. So this is how 500 executives at U.S. enterprises use generative AI. And so look at this over here. So what we talked about earlier, Anthropic is actually the— they're the leading LLM provider when it comes to enterprise, 40% of market share, whereas OpenAI dropped from 50% to 27%. This is in 2 years. And then you have Gemini coming out of nowhere, 7% to 21%. And then Meta is like, you know, fallen by 50%, right? So AI coding market share, Anthropic, 54%.

So when you're saying market share trends for leading LLM, I'm assuming this is only for Coding. No, this is not coding because Anthropic on the left side is 40%.

Yeah. So this is coding market share. You're right. Market share trends of leading LLM providers. This is for 500 executives.

Got it. So the left is enterprise companies. The right side is for market share for coding related.

Yes. And used by the enterprise.

Yeah.

Yeah.

I think ChatGPT is going to struggle more in enterprise because they haven't made enough moves to adapt. I think Google will start doing better on the enterprise end than ChatGPT. Dude, and that's where the money is, by the way.

This is what we were talking about earlier with the fast growth of Cursor and Lovable and all that. You look at enterprise AI, fast scale, and Lovable is not AI, but Cursor is.

So—

Well, Lovable is AI. Enterprise, enterprise, enterprise AI. Yeah, yeah. So now capturing 6% of the $300 billion global SaaS market. So we went from $0 to $1.7 to $11.5. So that's a 6.8x in one year. And then $37 billion, 3.2x year over year. So the growth is insane, and I don't even look at it like we talked about this last week, I think. But people say the SaaS market is like one trillion, right? But I think a lot of this stuff is going into services, which is like sixteen trillion. Yeah. So I don't know how you're looking at it. Where's the Gen AI budget go anyway? But you guys can check out Menlo. Maybe we can spend the last few minutes talking about this because where are you going with the software side of things? How do you see that evolving? Because Yesterday I was looking at one of the LLM trackers. They added in, you know, context, agentic workflows and content production, right? And I think everyone's going to start doing the same thing. And maybe a month ago we talked about how we do have a little, like where we're different is we both have a services line. How do you think you're going to separate yourself from the pack?

Sure. So I'll give you an example with Answer the Public, because that you'll see the changes in January. So we bought a tool that does content creation really good using AI. We'll improve upon it and make it even better. So that'll be integrated and launched within AnswerThePublic. So imagine doing keyword research, but instead of just picking keywords, you can just start writing content on any one of those topics within our system. It then creates a content calendar. And there's a lot of different steps from figuring out the tone of voice you want, the type of content you want, writing it, adding images, and it'll post automatically for you to— it'll create the calendar post automatically to either WordPress, Shopify, or Webflow. You can set it as a draft or you can just have it go live. We'll start doing that. Then we're going to start integrating promotions. And when I say promotion of the content, you then schedule a call with people on our team, and then our services side will work with you on promoting the content.

Oh yeah, getting links and all that too. Yeah.

And, and then we'll start doing similar workflows for social media as well.

And guest posts have made a big comeback too, because now they're like, oh, you can't just keep listing yourself, right? So all this stuff is like, everything comes back to services. And that's where I think you and I are differentiated, because the things you mentioned on the software side, there's multiple people doing. And like, we're even doing that on the ClickFlow side too. But it's like that, that's why it's like, you know, the thesis has always been from, from my CTO, it's like everyone's just gonna make the same shit, but then it's the human aspect Even Elon saying like, oh, live events are going to become more valuable. It all comes back down to the human aspect. Yeah.

But even think about like the AI visibility tools. How many people talk about them now?

Nobody.

Yes. No one cares.

Yep. Last thing we can end with here, just a nice graph over here. It's like coding dominates $7.3 billion of the departmental AI spend by category. Look at this, $4.2 billion on product and engineering, $700 million on IT, $660 million on marketing, right? It's all coding right now. Yeah, this stuff will catch up. And then you look at healthcare, dominates $3.5 billion vertical AI market, vertical AI spend, $1.5 billion going into healthcare.

I think coding is so much more stickier. I don't see marketing catching up like the way coding is.

Yeah, also because, um, so I think Ilya said this, one of the engineers, AI engineers, he was like, look, what is— whatever is verifiable, like math or coding, AI can pick that up very quickly. It's not going to hallucinate that much, right? Sometimes it might mess up on the numbers a little bit, but marketing where there's a lot of taste, there's a lot of room for— there's a lot of time before I think AI is going to just have something like Cursor for marketing.

So, you know, Kevin, do you remember Kevin from Seattle?

Yeah.

So Kevin from Seattle left a hedge fund, started his own company, no employees. He's been doing this for a while. And he takes his own capital and trades it in the market. Kind of like, are you familiar with Jane Street? You know, like the undercover billionaire, you know, like the founders and stuff. Jane Street's a high-frequency trading company, bot trading. And it's like Citadel, they're just like cranking out thousands and thousands of trades. And they're clipping like, you know, pennies on a dollar. But those pennies really do add up when you do them in quantity, assuming you can get your fees on the trading side low enough. Kevin used AI to code up his own version of Jane Street. Of course, it's nowhere near Jane Street's level. I don't mean it in a disrespectful way, but Kevin's making an arm and a leg. When I say arm and a leg, I'm not talking about like 10, 20% on his money. I'm talking about like in excess of more than doubling your money. And he's starting with a really solid base.

Yeah.

Okay. In short periods of time.

Yeah.

And he's been doing this for a while. So he's coding with these LLMs. The same code will code some of the trades correctly, or with the same code, trade some of the stocks correctly, and it trades some of them incorrectly. And with coding, it's not bad. He saved a lot of money. But even with him, he's like, dude, one mistake, like one of his bots did not code Microsoft correctly or did not trade Microsoft correctly. even though it's using the same code and it should have, and he couldn't figure it out. And he's like, man, he's like, this is when sometimes you just have to hire an engineer to review everything and just double and triple check.

Yep.

Because these little mistakes, they don't cost you like $1,000. Some of them cost you millions of dollars or hundreds of thousands of dollars. And he's just like, so he'll start eventually adding people.

Yep.

But I do see it hallucinating way less because we were talking about Hallucination in marketing versus coding. And he's like, yeah, I rarely have problems like this. And I'm like, dude, I have problems every single day with so many hallucinations. He's like, nah, these things work really well with coding because it's much more black and white.

And that's why you need to have a human in the loop. That's where we're going to end because I really need to pee. So goodbye, guys. All right.

When's he going to end?

I'll see you later.

Be right back.