Can a Podcast Help You Raise Money?

Can a podcast help you raise money?

Yes.

You see the news on 20VC?

All I can say is yes.

20VC raised $400 million from their podcast.

You know he's still in his mid-20s right now? Yeah, he's young. He started that at age 19.

Yeah, yeah. So for those of you guys who've never listened to a 20VC podcast episode, you guys should check it out.

It's good, it's good stuff.

Uh-huh, and what it pretty much is, is this guy named Harry, he goes around—

Harry Stebbings.

Yeah, he goes around interviewing other entrepreneurs and investors. And he started off with a small fund. I don't know what the first fund was, but he got that from his podcast and the viewership that he was building up from it.

It was like $10 million or something.

I think it was smaller. $10, $15. I think it was under like $20, $30 million, right? It was small.

Yeah.

And then the second one I believe was a little bit more than $100, less than $200 though. And then he just raised a third fund of $400 million, which he'll use to invest in companies. And typically these VCs get 2% management fees. So once you deploy the money, 2%, Would be $8 million a year, which would be used to pay for staff and expenses and a nice salary. And then you get 20% of the profits.

Yep. It's a good business model for him. I mean, the thing is that with these funds, he doesn't necessarily need a lot of staff, right? So a lot of the management fees will go straight to his pocket. And then whatever he gets on carry, just for everyone, if something goes really well, let's say it sells for $1 billion or whatever in profit, he might take 20% of that, right? The profits. At the end of the day, right? So, it's a good model for him. He gets the $8 million that's guaranteed and then there's upside, right? This is why a lot of people, they call it the 2 and 20. So, it works for him. But even today, like when I listen to Huberman Lab or when I listen to Dr. Peter Attia, I trust these guys, right? Like I trust their health recommendations. I trust what they're— oh, you should do this, you should do that. Instantly, I just listen to them, right? So, there's a lot of trust that he's built with the community. He's interviewed, you know, he's interviewed Sam Altman. He's had like the Snowflake CEO, I believe as well. So, he's had the top CEOs Mark Benioff. Yeah, in SaaS basically, right? Did he get Mark Benioff?

I thought he did.

I don't know if he got Mark Benioff. I think he was trying for a very long time to get him. I don't know if he got him yet. But bottom line is podcasts can build a lot of trust, which is why we've continued to do this. I think we're coming up on 8 years now. But before this show, I was talking to Brad from recordeditpodcast.com about the problem with all these new podcasts that are coming out recently. Do you know what the problem is?

They're too generic and mainstream.

So, okay, we've heard that, you know, some really famous lawyers starting a podcast, the Hot Tua girl started a podcast, right? Dwyane Wade started a podcast. I see all these NFL players like Marshawn Lynch. He has a podcast too. Everyone has a podcast now. But the problem is— Agency owners, if you want to grow faster, my partner Neil Patel and I, we are hosting live agency owner workshops in Beverly Hills, and you're going to learn how to get more clients. You're going to learn how to take yourself out of the day-to-day. You're going to learn how to recruit the right people, and you're going to be hanging out with like-minded people such as yourself. So if you want to learn more, just go to marketingschool.io/agency. Again, it's marketingschool.io/agency, and we'll see you on the other side. When everyone starts a podcast, the nuggets you have, like for example, with this podcast, the nuggets you have, you run out of nuggets really in the first year, if you even get that far, maybe the second year, right? And so you run out of things to say and everyone's starting to say generic things, which is what you said, right? And so we're getting a sea of genericness that's popping up. And the thing is, what do you see on Reels now? You see a lot of podcasts. What do you see on TikTok? A lot of podcasts, right? I think we're gonna get to a saturation point because everyone's starting one right now. So the question is, how do you even stand out, right? Like 20VC, they stood out because they started a long time ago and they focused just on, you know, these enterprise-level companies. And I think that's a unique angle. For us, we just talk about our reactions to marketing news now. And so for us, we stay relevant no matter what because we're talking about recent things.

Yeah, and we're also giving tips and advice. But if you look at what Harry did, he focuses on a vertical, vertical being venture capital. If you look at what a lot of people are doing, like Joe Rogan, it works for him to talk about whatever he wants early on. And he's built up a mass audience, can make great money from it. But your goal shouldn't be to optimize for audience volume, it should be to optimize for a vertical. And have a big enough audience within that vertical. But that vertical should be one with a massive TAM. So if people are willing to spend a ton of money, ex venture capital, you can make tons of money. We talked about marketing, you know, hey, we could pick up a contract just from an episode that may result into millions of dollars a year in marketing.

You know what I did? I went on Gong yesterday, and I looked at all of our sales calls, I typed in the word podcast, and about 10% of the conversations include the word podcast in it. So it doesn't mean all of it comes from the podcast. But you can imagine a good chunk of that 10% probably comes from the Yeah. So that's interesting. And I typed in the word YouTube too. There's a good chunk that comes from that too. So you can try that out because you pay for Gong too as well, right?

We don't use Gong.

What do you use now?

Uh, I believe—

You went for a cheaper one, huh?

Yeah. What's that company that has all the SaaS products based out of India?

Zoho?

Not Zoho. There was another one and then they're headquartered out of—

Not Freshworks?

Freshworks. I believe Freshworks. I could be wrong on this, but I believe we pay for a Freshworks alternative to Gong. Again, I could be wrong, but my team's like, oh yeah, we use some company from India that has all the SaaS solutions and they release a cheaper version.

Oh, very good, very good.

I believe it's them. So, okay.

Anyway, to wrap this up, look, there's, you know, Neil talked about, okay, you can go for a large TAM. You can also go for a small one too, because Invest Like the Best podcast, it's like strictly just targeted towards investors, but they have a lot of money, right?

No, but that's a large TAM.

Large TAM?

Total addressable market from a money standpoint.

Money standpoint.

Okay, so population—

I just want to clarify, I thought you were going for population, but in that case, they're going for a wide TAM from a money standpoint, right? Now they do really well and they take equity in their sponsors, Right. So they took equity in this company called TIGIS.

You know TIGIS?

No. Okay. So TIGIS, you can pay them. Like, for example, let's say you wanted to see what all the Omnicom, WPP, all these agencies are doing. They have researchers that will call in and you can, you can find all the research on all the things that they're talking about. Right. And we had a mutual friend that paid for it. It's like $30,000 a year. It's not cheap for the base level. And I was using it for a little bit. I was like, this is pretty good. Right. But anyway, they ended up taking equity in TIGIS. And I think TIGIS does like maybe 9 figures a year now. And I think they took a healthy percentage of it. So I could be wrong on that. But there are, there are other angles to this, right? So you can go for— I think what we're talking about, just we clarified it here, we're talking about revenue TAM in this situation, not audience TAM, right? Because sometimes people get them confused. So that's that. Yeah.

And if you do something, always focus on how much money you can potentially make, because you can go after 10 million people. But if you can only make A million bucks, that's the maximum size of the market. Well, it's hard to capture 100% of the market. So you may capture a fraction of it and you're doing all this work for, you know, pennies on the dollar.

Yep. You have this other one over here because we're talking about audio right now. So we have this one over here on Amazon's AI generator tool. The number one challenge for businesses is hiring. And more specifically, the number one thing I get asked for all the time is, Eric, where can I go find an amazing And the reality is right now, when you think about the world, we have inflation. That also means wage inflation right now. And it means that when it comes to hiring talent, you can't spend as much as you would have in the last couple of years because it's just become too cost prohibitive. And so we've partnered with one of the best offshore recruiting firms when it comes to marketing. They've been a great asset for us, and I believe that they will be a great asset for you. All you have to do is go to marketingschool.io/hire. Again, it's marketingschool.io/hire to learn more. You can fill out the form there and we're going to place you with the best marketing hires that we can help you find.

Yeah. So Amazon ended up releasing an AI generator tool where you can now more easily create audio ads. And they're getting into not just the game of AI, but they're getting into the game of AI with marketing. And this makes sense because Amazon is starting to generate a lot of revenue from their ad system. And not a lot of people talk about it. People talk about Amazon as an ecommerce engine. People talk about Amazon as AWS. But very few people look at Amazon as a company that generates a crap ton of money from advertising.

Yep. I mean, Amazon's a beast. I mean, you said over here, Amazon spends over $20 billion a year on ads with paid search being over $6 billion of it. So I mean, that's them spending, but they're also an ad machine as well. I think what they're the— how big are they in In terms of ranking for ad platform?

It's Google, Facebook, Amazon. Amazon's number 3.

Yeah. And so that happened very quickly.

At least in the United States.

Yep. So don't sleep on— I mean, look, there's gonna be a lot more of these AI tools that are coming. And then they're only gonna get better over time. Speaking of AI, by the way, I want to talk about why AI agents are not a moat, and what is actually a moat for your business. And so AI agents, you know, a lot of people are talking about. I've been talking about it quite a bit, right? Satya Nadella has been saying it. You know, Mark Zuckerberg's been saying, "Oh my god, AI agents are the future," right? Where you can have thousands or tens of thousands of digital employees working for you. They understand how you think. They work 24/7. They're infinitely patient for you, with you. Now, they're going to be important. But as I was talking to my CTO yesterday, we're just like, "Man, this is actually not the moat. Agents are actually not the moat." So then what is the moat? So the moat is like you have a castle, right? You know, then you have like the moat that protects the castle.

The moat is actually one.

One, it's brand, okay?

Or let's go back. Sorry to cut you off. When Eric's saying a moat is, back in the day when there was castles, there was water around the castle.

Yeah, so it's hard to break it.

Uh-huh. And then the drawbridge would go over the water so that way you can enter in the castle. But if the drawbridge was not down, you couldn't enter it.

I would assume that most people know what a moat is, but thank you for that explanation. I was thinking about explaining it. I was like, I'm going to back out, but then Neil explained it. So thank you, Neil. So AI agents are not the moat. Everyone's going to be using agents. You're going to be using agents. I'm going to be using agents, right? They're going to be high leverage. That's guaranteed. But what's not guaranteed is we've said that, okay, because of agents, resources are not going to be the constraint anymore. Creativity is the constraint. So creativity is a moat.

Okay.

So some people that are constantly learning, constantly talking to other people, that's going to be a moat. And then brand, not everybody can have a brand, right? And so you have to figure out how you can stay relevant and just figure out how you can stay ahead in terms of just constantly learning, right? Those 2 things I believe are going to be the moat. AI agents are going to be a tool. People are like, oh, what about agent orchestrators? I'm like, That's just a manager for agents. It's the same thing, right? It's like, that's not the moat. A lot of people are going to be using that. What do you think?

So I don't think creativity is really a moat because you can continually hire people and eventually find someone who's amazing at being creative, or there's a lot of organic companies. Some of your competitors will be creative, some of them won't. But I'm with you on the brand. I think brands are the only moat in business anymore. Like a good product, you can eventually copy. you know, anyone else out there, assuming you have enough time or money. But what separates products like Michael Jordan shoes or Nike shoes over Adidas isn't the quality of the shoes, it's just the brand. And it's the hardest thing to really build. And Peter Thiel, you know, he has this speech, and it's related to his book Zero to One, I think it's Zero to One.

Yeah.

And, you know, he talks about different things that you see successful companies have. And he talks about Most successful companies are monopolies, but they never want to admit that they're monopolies.

Yeah, like the church.

Yeah. And, and he'll say, like, Google would say, oh, you know, we're getting our tails kicked with phones by Apple. And, you know, our operating system, we're competing against Microsoft. But they don't want to talk about the search engine side, right? Because they really are a monopoly from that aspect. And funny enough, the court Trying to break them up. And Microsoft has a similar thing for different aspects of their business, but then they'll say, no, we're not a monopoly because look, we lost the phone race and we're losing the search engine race. And they all point to the stuff they're not doing well with, and they never want to talk about the stuff that's making them all their money. But on the flip side, in Peter's speech, he always talks about one of these things that these corporations always have that are these not just unicorns, but these— they're category winners. is they have massive brand value and they've done extremely well to build a brand. And what's funny is if you watch Peter speak, he talks about how you do some of the other things and how do you accomplish them. But when he talks about brand, he's just like, yeah, I don't know how you build a brand. Just the ones who have a brand tend to also win.

Right.

It's like this gray fuzzy area that people just don't know how to build a brand. A lot of it happens naturally. Sometimes it happens from being a first mover or a good product or just being out there on omnichannel. But it is really hard to build a massive brand because even if you're spending a lot of money, it just doesn't always work.

Yep. I would say that building a brand is far harder than just, let's say, hiring someone that's creative, right? But I would still say it's hard to find someone that's great, like a Johnny Ive, for example. That's like a one of one, right? So I think the two are difficult, but the brand is far harder. But I still think the two are high leverage. That's just my opinion at the end of the day. So that is it for today, guys. Please don't forget to review this video. and go to marketingschool.io/agency if you want to learn more about the Agency Owners Association, and we will see you later. In fact, you know, I'll tell you what, Neil and I will be recording in Germany. I didn't even tell him this yet. We will be recording in Germany. I found a podcast studio, so, you know, that's another way you can make the most of your trips. So yeah, bye.

Bye.