$3.6M SaaS Founder Starts Selling Courses, The Video Formula That Made $500K | Ep. 3034

How you can trick the algorithm into making your content viral. So I actually don't know who this person is. I'm going to share my screen real quick over here. This guy's name is Alex Landings. Um, so if you see this, Neil, I'm pulling up my screen right now.

Do you see this? Now I see it. Yeah.

Okay, so I think this kid's only like 15 years old. So he says, okay, interesting discovery. If 17 creators post identical content within 3 minutes, the algorithm thinks it's quote unquote breaking news. It pushes everything to trending. He tested this 32 times with a few in-house ghost creators. It always works. So manufacturing news, Greater than reporting news. And so when he says ghost creators, I'm like, what does this guy mean? Right? Again, so his profile says 1 billion views generated destroying ads with ghost content at 10% the CPM. And so he has this thing called virality.cc. I know that's like a Discord group. There's another Discord group called clipped.exe or something like that. And then you have WAP. And what's happening is hiring a lot of these kids and they're giving them these long-form pieces of content. They're having them chop them up into different pieces. different, um, different accounts, and some will go viral, some won't. Um, but he's just saying that if everyone's seeing the similar account at the same time, it has a much shot— much higher shot on goal or a chance to go viral. And we've seen that. I mean, Neil, that's not what you and I do, but you and I have talked to a lot of people that do this, and I think it's worth calling it out. Like, it's not saying that we do it right now. I certainly don't do it right now. I don't think you do it either. But if we did it, um, we'd probably do something similar to this. Uh, maybe I'm speaking for myself. Go ahead, Neil.

The way I look at it is I think these are things that you and I would've done maybe 15-ish years ago, maybe 10.

True.

And I look at it now as you and I try to look at things from a lens of what's going to create sustainable growth and revenue and what aligns with us in the long run. And we think we'll keep working 5, 10 years from now. And if it doesn't, we usually don't do it because we just think it's too shortsighted.

Dude, you want to see something? You want— so I think these founders— so this is a company called App Mafia. I don't know if you heard about this, but one of their leaders is— he's a founder of a SaaS. I think he's only like 18 years old and they're doing $3.6 million in monthly recurring revenue. So let's just call that like a little over $40 million a year in annual recurring revenue. The software's called Cal AI. So I'm going to share my screen with you over here. The thing is, he combined with a handful of other quote unquote SaaS founders, and I'm saying quote unquote because Just watch this video real quick, and I don't know if you can hear it, but I'm going to play it right now. Are you ready?

Yeah. My name is Zach Dadigari. I'm 18 years old. Can you hear it? Yeah. Last month, I made $3.6 million. Now, I live in a mansion with all my friends, party almost every night, and shit, I got to go to class. Have you ever wondered why there are so many teenage millionaires now? It's because the game is easier than ever. Anyone can do it. And if you don't, you're just fucking lazy. The truth is society lied to you and money does buy happiness and you won't get there by playing it safe. VCs and tech billionaires have been gatekeeping this formula for decades, but we cracked it and now we're sharing it.

Fuck. Okay, so get this.

That's cool. I like the video.

So get this.

This little kid being like, screw you, we figured out a way to do better. I'm not saying it's real or not, but It's interesting.

So $70 million in combined revenue, okay? 237 million downloads, whatever that means. And then they're selling a course. I think the course is like $5,000. And then they have all these testimonials here, okay? Now, my whole thing here is I think it's great. I think these guys know how to get distribution. The Clue.ly guys actually came and they copied them. So you had a bunch of Asian people in there saying, hey, we're launching a course too, $5,000 or so. But there's people that are throwing shade at, especially the guy doing $3.6 million a month, saying that, look, if you're doing $3.6 million a month, why do you need to be selling a course right now? And why do you need to be selling this lifestyle and move into this course world?

Is it per month or per year?

Per month. He's doing $3.6 million per month.

So they're doing $70 million a month between all of them combined?

It says $70 million revenue. So some of the numbers are off because I saw another guy, it said $50 million in revenue. So I don't know what that is. I just know for the very first guy, it's $3.6 million a month in revenue for his Cal AI.

Got it.

Yeah.

So what are your thoughts on this? I don't understand why he's doing this if he's really making $3.6 million a month. That's just my 2 cents.

Yeah, I think if you're 18 years old and you're— I think so his justification was like, look, if there's a way to make money, we're going to make money. But that's what we would have done at 18 years old. I was still in college. And I think you had just started working for 4 years or so. So I think he was way more successful than either of us at 18 years old. And I think he'll learn. I think this entire group will learn eventually that it's not about the Lambos. It's not about showing off your watches. It's not about partying. Like, I don't even know why you're bragging about the partying piece. And you'll eventually learn that it is about the focus later. Because you and I, I mean, you just hit the— in your 40s. I'm about to turn 40, right? And I think you learn through, again, what I said earlier, experience comes from— wisdom comes from experience, and you have to kind of go through it a little bit. And I think once these guys learned that, hey, this course collab thing was probably— your time was probably better spent focusing on whatever it is your main app was, you probably would've made a lot more money that way. Yeah.

Yeah. And I think focus is something that it took you and I a very long time to learn. And we struggled with it in our early years. But I know it took me more than 10 years to learn. I don't know how many years it took you.

I don't think I learned it till like age 34 or 35 when I was going through it. Yeah.

Yeah. And I don't think I learned it until like maybe like 6, 7 years ago. Yeah.

But the thing is, it's not like we've solved it. It's always a constant battle. You're working it out every day.

Dude, so the other day I meet up with some guy for dinner and this guy from dinner, I won't talk about it too much. The first thing he tells me is like, hey, do you want in on this deal? It's a real estate deal. Someone has health issues and it's hundreds of millions of dollars in property, but keep in mind most of it is debt and loans. So he's just like, you can take it over, it cash flows, You know, in the mid-20s and your payments are, call it, you know, a million a month. So after the payments, you're pretty much making around a million a month in profit, which isn't bad. And I'm like, the first thing I said was, how much does the guy want? And they said $9 million. So the first thing that goes off in my head is I'm like, so you want $9 million for me to make a million a month in profit? So 12. So I make my money back in less than a year. The first thing I was thinking is, what's the catch?

Yeah.

Because I started looking at it. Sounds too good to be true. It sounds too good to be true. So I signed the NDA without getting into too many details because I'm not supposed to talk about the details specifically. And I look at it and I was like, oh, because I'm going through it and I'm like, if it's true, I'll do the deal. And the guy's like, when will you do the deal? I'm like, I'll close in less than 30 days. Like, you want to close next week? I'll close. Like, if it really is true, because on top of that, I'll get bonus depreciation, call it at least like $100-ish million, if not more. Right. I would say probably more than like $150 to $200 million.

You said this was a real estate deal?

Yeah. Commercial, like really big skyscrapers, right? Tons of them.

Yeah.

Right. But in cities where that aren't Los Angeles, so they're more affordable. but they're still expensive. You're spending hundreds of millions of dollars on real estate. And I was like, I would do this deal right away because then I save on 2 ends. One, I'm cash flow, I'm getting my money back quicker than a year or 2. I'm getting tons of bonus depreciation. So I had my team look into it. The first thing we started doing is we started calling every office building that's listed to actually look at the vacancy rates versus what they claim the vacancy rates are. Because you can just look at the square footage of a building and see how much is available versus What they're claiming is occupied, right? That was the first thing. And then some of my guys on my end were like, hey, we need to double-check this with them because some of the people are reporting different numbers. And then the second thing is we started looking at the loan terms and I'm like, wait, you know, call it 60 to 70% of the debt you have to refinance in less than a year, which costs money to do. And some of the buildings are underwater in which you're spending more than what you're collecting. But the only reason the numbers are working is because it's a package deal and some of the buildings are doing well. But I was going through all of this and I was like, you know, dude, if it's too good to be true, it usually is. And then the second thing that hit me right then and there as I was going through this, because this document was long, it wasn't like 10 or 20 pages.

You actually read it? Did you AI it too?

I AI'd it and ChatGPT just epically failed.

Oh, that sucks.

It was terrible.

Yeah.

ChatGPT was like, There are 5 buildings for sale or 4 buildings for sale. And I'm like, what are you talking about? There's more than 10. And at that point it was giving me some stats and I'm like, this is just already going to be wrong.

Did you try doing this for fun? Try running it, try dragging in deep research for it and see how that does versus regular ChatGPT.

I tried both. You did?

And it didn't work.

It just did not work. Wow.

Anyway, continue.

Sorry. Okay. So, you know, I was going through this and I was talking to my team because we have an M&A team that helps us, right? And I was using my M&A team to figure out if this is worth it because it's my company anyways.

Yeah.

So then I was just like, dude, I'm like, I just need to go back to focusing. And the moral of the story is like, there's always these shiny objects and I'm like, I already got a good small business depending on how you want to classify it. Some would classify it as a medium business and it's great. Like it already makes good money, great revenue, employ a lot of people all over the world. I should just focus on this and ignore the shiny object.

But you see, even at our ages right now, we can still get distracted by the siren very easily. And you almost got— like, it's okay that you got sucked into it. Like, that time is already gone, but to get sucked into it even more would've cost you dearly.

Yeah. And I look at it as it's like, it's the reason I got sucked in is because someone telling me, and it's someone I know, And I respect someone telling me $9 million investment, this person's sick, they just need out, and you'll make $12 million a year. And they've owned these buildings for a long time and they'll give you many years worth of financials and they're audited. It's just like, all right, let me take a look. But it really is like, what's the catch?

Yeah.

Because it is too good to be true. And they're like, oh, their family has money, they don't care for it, they don't want to deal with it. I'm like, This is just too good to be true. But yeah, and then they also sent me another deal, which was interesting, and it was in a physical product space, and it does well into the 8 figures in revenue. It's just mismanaged and misrun. And I was just like, huh, I can probably turn this from making a million in profit to like 6, 7, Pretty quickly. And then, but they don't want, they would ideally want 8 figures, call it 10+ million for the business. And I was like, dude, I don't want this distraction for $10 million. I'm like, if they want to give it to me for what it's worth, because I'm just basing it off of what it currently makes. You want a multiple on what you currently make? Great, I'll pay you that. But I'm not going to pay you based on what it's worth to me after my team puts in all the work and fixes it and gets it to where it should be.

All right, so I wanted to take a moment to tell you about my podcast co-host Neil's agency called MP Digital. Digital, and they work with a whole host of global companies or a global organization. Also, Neil has SEO tools such as Ubersuggest and AnswerThePublic. All you have to do is go to npdigital.com to learn more, and we'll see you on the other side. I don't know, all of this stuff just sounds like a job. Like, if it feels like a job, even though it's a good deal, it's still a job. And so we have a mutual friend, I was just speaking to him yesterday, and he was thinking about a deal buying a competitor, and this competitor has been declining for the last 2, 3 years or so. I was like, Just tell them you're not interested right now. And I knew exactly what was going to happen. He told them that they weren't interested and they immediately came back and they were like, oh no, we're down to do anything. We're down to do seller finance. We're down to do it. I was like, tell them you'll take it off their hands for nothing and maybe give them a little bit of profit and give them, let them save some face, right? Just to say that they had an exit. And I think moral of the story is the reason I told him to reject the deal initially is I wanted to see, I was like, tell me exactly what you feel after you reject them. And he's like, dude, the moment I rejected them, I felt relieved. I was like, yeah, that's why you shouldn't do these things that feel like a job. Like again, if you feel like you're buying a job, it is a job and you already have a job to do.

Yeah, no, I'm with you. I look at it as like, I have so many people though that can just do, that can deal with internet businesses. I can create a division called like NP Brands and just buy quite a few of them. And then my team can just make them more efficient. And we've thought about expanding there, I just, A, don't think it's the right time, and B, I need the right deals. If people want to do seller-based financing, or I'm paying them when I liquidate their inventory, or deals like that, no problem. I'll pay off their debt from day one, whatever bank notes that these people have, and I'll fix the business and grow them. But the big issue that people don't realize, when you have a declining business, most buyers, even if it's free, Like if someone had an agency that was doing $30 million in revenue or $200 million in revenue, then it went down to $100 million, then $50 million, then $30 million. And you're like, Neil, I'll just give it to you for free. Even if I knew that we can run it at 10%, 20% margins, I don't want to waste my time on a falling knife, right? That's what we all call it. When something's falling, you don't know how much more it's going to fall. And it just becomes a scenario where it's a falling knife and it's just like, this isn't worth doing.

Dude, speaking of falling knife, so remember we did that episode on interest rates a week ago? So George Gammon sent me a message, the guy I was talking about. I'm sorry, I have a poor connection. It's not Neil. So just so you know, Neil, it's me. So George Gammon, great macro YouTuber. Everyone should check him out. Really good at investing. Just his investing content is great. So he was just saying, remember, especially in a rate-cutting cycle, interest rates don't control the economy. They're a reflection of the economy.

So lower rates means a worsening economy.

Higher Rates means an improving economy. Lower rates might reduce borrowing costs, but it'll likely come with less demand, aka revenue. And so the last part he said, so I responded. I said, "Hey, but this also means risk on, which means assets are going to jump, right? Especially risk assets because you're you're pushing into when when interest rates are low, you know, you kind of go further down the the risk curve, right?" So he said basically bullish risk assets like crypto, bearish economy until. Economy gets bad enough, crypto holders are forced to sell, then it's bearish for both. Remember, Powell rationale for leaning more dovish was deteriorating labor market. And I just said I can see that. So I think my takeaway from this one is that things are going to go well first for equities and maybe crypto for a little bit until the economy kind of loses it. But we haven't seen the economy lose it for a while.

No, we haven't. Although the last 3 years have been bad, Yeah. At least in our world, it's been bad. And the other thing that I like looking at with interest rates being really high is for me, I have cash. And when I was getting 5%, now I'm getting, call it 4% on my money to just leave it in a bank account with pretty much close to no risk. I wouldn't say no risk, but close enough to no risk. It's just easier to leave it in a bank account and get 5%. But the moment the banks are like, hey, we'll give you 1% on your capital, I'll start deploying. Because at that point it's just crappy returns and you have no choice and you start taking on risk because no one wants 1% on their money. 5%'s not bad.

I'll take that all day long. You saw what Powell said, right? He basically said that, hey, we're probably going to get away from that 2% target, that the arbitrary 2% target they had set in like the '90s or something like that. So what does that mean?

He said that?

He said that?

I didn't hear that.

Yeah. I mean, that's huge. So your reaction is huge, right?

Yeah. That means they're accepting the inflation numbers that they're supposed to purely—

They're going to turn the money printer on. Yeah. I mean, it's already been on. So, okay. I want to give— I want to talk about one more thing and then we can move into one more of your topics kind of around content. So this is a tweet talking about how one video formula generated 300 million views and $500K in revenue. So let me just share my screen so you can see this. So let me—

here it is.

Okay, this is from the Startup Ideas podcast. So this one video formula generated 300 million views and $500K in revenue. It looks like luck, but here's how it actually works. Number 1, farm content across multiple accounts until something hits. Number 2, turn that winner into a series. So same concept, slight tweaks. Number 3, post it 5 times daily across 24 accounts. Number 4, translate to Spanish, Mandarin, etc. 5, pay meme pages $50 to repost. Number 6, run the best ones as paid ads. So one winning video times 7 platforms times 7 accounts, each daily posting equals inevitable virality. This is Virality Science. And so this guy basically was interviewed by Greg Eisenberg. And I think this to me reinforces what we're talking about here. It's, you just want more shots on goal. I think we're talking about organic short-form content in this case.

And how much revenue did you drive?

$500K, which seems low for 300 million views, but if it's organic, then it's pretty good.

This one video, how many videos? I'm curious to get that $500K in revenue.

That I don't know, but if you're posting 5x daily across 24 accounts and you're translating it, I'm assuming a bunch.

Yeah, yeah, well into the thousands.

I figured that should— Well, look at this, 7 platforms, 7 accounts each, plus daily posting. So was that 49?

No, the language.

Okay. Well, yeah, did you multiply it even more?

So yeah.

Yeah. So this guy, David J. Park, apparently he has a startup called Jenni AI. And I guess that's how he's growing it. And he looks really young too. Let's just look at him real quick. Looks very young. His Twitter says burn the boats. So hey, he's focused. Young guy, he's focused. When you say burn the boats on your Twitter, you're a focused guy.

What's the Jenni Group? What do they do? Do they have software that helps you do this? Because if so, that was a great interview and it helps him drive more revenue.

No. Okay, here, dude, this is funny. Check this out. Check this out. Let me share my screen. So he has this link on his Twitter and it's a dashboard to his revenue. So his MRR right now is $709K and then year on year he's up 14%. 57K subscribers, up 38%. Average churn 10.7%, which is pretty high. Trailing 12 months revenue, $9 million, but he's doubled in the last year. But I don't know what this product does. I don't know. Jenny, here, let's check it out. Jenny AI. See, now you have us curious. Oh, it's an academic writer and research tool for students. So this, this, this is a consumer SaaS and Shortform does what? Just like Cluey, cheat on everything. When you do consumer with organic, you crush it.

Yeah, because it's broad TAM. Yeah, I love it. Good for him.

But that's another, that's another signal, dude, dude, dude. If you look at the Clue.ly people and you look at this guy, they've all kind of figured out how to, as founders, they figured out how to crack organic short form. And I think that just goes to show you, if you're going to be like a young founder, and even the guys from earlier, like the Cal AI guy, $3.6 million a month, they've all cracked organic, organic social. And so I think as a CEO, you do need to understand marketing. You can't just say, oh, I'm going to hire a marketer. I've seen so many companies, some of our mutual friends, we've seen them fail because they thought they could just offload marketing.

Dude, a few weeks ago I was with Om Malik, you know, the VC.

Yeah.

Who invested in a lot of amazing companies. Before that, he was one of the most prominent tech journalists out there. And we were talking about Google and everyone's talking about how Google's afraid of ChatGPT. I actually think that Google's— because with AI, Google has so much data, I do think they'll figure it out in time. I don't think the company will go to zero. I think they'll still do well, but I also think ChatGPT will do well. The area that I think Google will struggle with is social shopping. So you look at Instagram and TikTok shops, it's like that's where Google is lacking and I don't think they'll figure that out. They don't have a platform. People use YouTube in a very different way than they use TikTok or Instagram. Social shopping, I think by 2030, the last stat I saw was supposed to be around $7 trillion a year. So it's a massive market. I think that's going to affect Google really poorly and it's going to affect Amazon. And neither of those 2 players have a solution to compete.

Yeah, well, I mean, what did they say? I was looking at, where did I hear this? But ChatGPT should be worth like easily grow into like a $1.4 trillion company in the next few years. And they kind of mapped out the details. I think it might have been on the All In pod. But I mean, key point here, you're not too worried about the big players.

No, they all do well and they'll figure it out. And by the way, ChatGPT has to still figure out how to be a for-profit company.

Cool. All right, guys, that's it for today. Please don't forget to rate, rate, subscribe, and we'll see you later.