Your Product IS Your Marketing (Why Most Companies Get This Wrong)

So I want to talk about this new concept that software is becoming marketing. So really the question is, what if your product is your best ad? So this isn't necessarily anything new, but I think with the proliferation of anything that you can vibe code now, almost your software becomes the lead magnet. So it used to be back in the day, your lead magnet could be your, it could be like an email opt-in, like a PDF, right? It could be a PDF, it could be something like a quiz or something like that. But now you actually at software. So when I look at Neil's software, Ubersuggest, I look at that as a software that's kind of becoming marketing in its own right. Same thing with AnswerThePublic, with ClickFlow, with Carrot, we kind of look at it at the same one on our end. And the cool thing is within each piece of software, every time you have an interesting feature that you launch, each feature becomes a marketable moment. So like Clay, they're doing, they're launching like every week I think they're doing like a launch of a new feature with their product and it's something that people are asking for, but they're putting a lot of fanfare around it. And so we actually have a mutual friend. He was always launching one marketable moment per month. I think now you can probably launch one marketable moment per week.

Yes.

And so I think software now is becoming marketing. And I think the job of someone like Aneel or myself is we can prototype something and get it 60, 70% there, but then you can hand it off and then go from there, right? And then if you do have a product out there and there's a repo, you can just submit a bunch of pull requests and then your developers can decide if whatever you're building is garbage or not.

Yeah, no, look, I'm with you. I think you can end up creating a lot of marketing just through products. I started doing this back in the day, maybe around 7, 8 years ago with NP Digital. And the whole premise was we're going to release software. At that time it was Ubersuggest. We bought it for, I think it was like $120,000.

Wow.

Plus or minus, but somewhere around there. I spent millions in the product over years after, so not instantly. That was a choice because it was gaining traction. Keep in mind, everything's way cheaper now because of AI, and we didn't just release marketable moments, we released product for free when our competitors were charging for it. That made it much more marketable because everyone wanted to share something that was free, whether it's better, whether it's worse, whether it's the same. Free goes a very long way and I think doing that with product is super effective as long as it's pretty much free. If you release a marketable moment every single week that's a new feature, but people have to pay more for it, it doesn't mean that you can't still use it and generate buzz around it. We just see it not working as well.

Yeah, I think the, I mean, back in the day and back in the day was not that long ago, but you in SaaS, you call it product-led growth, right?

Yes.

Where you have a freemium feature and then you can upsell, cross-sell and grow accounts. So if you don't have a free version into your product, it's not going to be that helpful because there's too much friction to get people in the door. And so when I look at ClickFlow, our version of ClickFlow right now, we have an API and an MCP for it. There's a free version people can opt in for and the agents can find it, right? But more importantly, we just launched something and we kind of look at this as like a new AEO SEO autopilot system of 2026. And so what it does is like, let's use this podcast as an example. It will ingest the spikes from this podcast. It'll also use some skills and it'll look at what's happening in my topic, for example, or you can look at even some of my competitors as well, look at what they're putting out. And then it'll combine with our ClickFlow API MCP. It can also pull in your Google Analytics. It can pull in a lot of these different connectors. And then what happens is it starts to draft things, top of the funnel, middle of the funnel, bottom of the funnel. But that's something that we give away for free. And so, but because it's free, like it becomes interesting, right? So literally clickflow.com, you can pick that up if you want to. But that's how we look at this stuff. And I'm sure you, that's how you look at Ubersuggest too.

Yeah. And I believe it works really well. Although I don't think it works as well as it used to because so many people build product now. It is very competitive. It is much harder to get traction and noise than it used to be.

Well, there's a lot of noise now in terms of just overall marketing. What I would say is there are people on X that do a good job with their marketing and then some of their marketing, like these little— Anthropic does a good job, for example. Obviously they have a lot of reach. Claude, like whenever they launch a new frontier model, obviously there's going to be a lot of reach. But I saw this, so I interviewed this guy, Matt Van Horn, just to talk about loops. And he launched a video talking about one of his new products. And it's like a, this, it's called something, it helps you make CLIs basically, like command line interfaces. And that video got, it got 2 or 3 million views or so. And so I think if you do it well on Twitter, because Twitter doesn't penalize you for posting too much, You know, it can be really good for you and especially if it's the right audience hanging out there. So I think it's fine. I think it's also if your product is novel, it tends to kind of help itself as well. Again, when you look at OpenAI and Anthropic.

Yeah. Question for you is what products are you creating this year that you'll end up using to leverage for marketing, if any, or like from a free perspective or—

The one I just mentioned.

So it'll be free?

Yeah, it's free and it's free. And then obviously if you want to use it a lot more, there's going to be usage-based pricing. So yeah. Cool.

Yeah, you, by the way, you, we're not actually releasing any more product for free. I think we spend more time on doing organic marketing. When I say organic marketing, like press, you know, getting awards, stuff like that, paying, sponsoring events. And the other thing that we're still focusing a lot of time and energy on is just M&A because it's a great way to grow by just adding revenue.

Yeah, it might be a little, I think where things are trending for me is everything's more AI implementation when people are reaching out right now. So it's AI implementation as it relates to marketing and revenue growth. So what works for me right now is it's dinners, it's definitely content. So it's dinners, events, content, and I would say those are kind of the main drivers of our leads right now. And what's happening for all of our single-grain clients that want marketing, We forced them into SingleBrain. We're saying, this is how we work now. If you don't want to work this way, that's okay. You can go to another agency, we'll introduce you. So what that means is we're not going to have get on calls with you all the time. We're more so, hey, here's SingleBrain. You can talk to this agent whenever you want and you can get your data pulls, your reports, and you're actually going to work a lot faster. And they even said themselves, they're like, we actually don't want to talk to you that much. If the work is good, then we don't need to talk to you that much. So we have a lot of these workflows.

You're saying the customers are saying that?

Yeah.

I'm assuming more mid-market?

Mid-market, some enterprise too, some enterprise, yeah. And so we just say like, this is the way we work. And then like, you actually end up getting better results anyway. And they're like, well, we like this, this is different, right? So that's how we work now. But to your point, it is still mostly, for me, you just mentioned for you, it's like events, awards, what else?

Events, awards, and events, sponsoring events and speaking at 'em, as well as holding our own small events. Creating content like we're doing here, podcasting, other interviews, getting our team to speak more. So we're pushing hard on that. Partnerships, that's a huge one for us. So just hiring more people to ink out more partnerships. What else am I missing? I'm missing a few of them, but those are the big ones I would say.

Yeah.

And there, yeah, there's a lot of little things that we can do, be like, oh, let's go release more features in Ubersuggest and add to the public and release more for free and market it. But if I had to look at what really moves the needle, if I had to pick one thing, it's probably conferences. I think that moves the needle for us more than anything else.

Because with a conference, you get actually a couple, like not even a 2-for-1, you get like a 3-for-1 and 4-for-1. You know why? One, you get to speak, you get to sponsor, you also get to throw little side events as well, right? So it's like a 3-for-1.

And then, and it's amazing branding. So even if you don't pick up revenue, a lot of people hear your corporate brand and we found that to do well. The problem that we found with, Events is it's a really, really slow payback period. Like you do not make, we do not make our money back in year 1 after spending the money.

Are you speaking at HubSpot this year?

Uh-uh.

Me neither. We got cut. I'm like, oh dude, we're on your podcast network and we got cut. They're like, oh, and we can do a panel. I'm like, I'm good.

They changed the format.

Yeah.

What do you mean they changed the format? They changed the whole concept. It went from inbound to unbound.

So we're inbound, but we're not unbound.

I think so.

Okay. All right. But you know what I think? Like, I think throwing your own conferences goes a long way too.

Go ahead. And if you look at the speakers, they're very different. It's a lot of celebrities.

Yes.

Or well-known people, like famous people.

Yeah. Usually they only have one. Okay, we should talk about this. Usually they have like one anchor celebrity or 2 anchor celebrities. This time it's like 6 or 7 or 8.

I'm loading it up right now. Let's see if I can find— let's see if I can find the celebrities. Tom Brady.

Tom Brady.

Okay. Cynthia Erivo.

I don't know who that is.

Sunita Williams. Astronaut. TBN. And the list goes on and on and on of just well-known people globally. It's of just really Big companies, I would say, or quite a few of them are big companies. But if I look at the majority of the speakers compared to previous years, it is a lot of their own team members.

Which is cool. We should talk about this.

That's actually cool. I think that is more effective in the long run than bringing outside speakers if you're trying to actually generate revenue.

Yeah. I think this whole concept of employee-generated content, which is actually nothing new because I've been— when I first took over Single Grain, we were doing that in the very beginning. 14 years ago, we were doing that, right? Everyone was kind of posting and we're all engaging on each other's things. Clay does this really well right now. So Clay does— I think Zapier kind of does this a little bit too, where everyone's kind of engaging with each other on LinkedIn and they're all kind of growing at the same time.

Okay.

I think it's good that if you throw an event and then you also have that happening there too, like, who cares if you help someone build a brand and like if they move on, fine. But at the same time, if you're, you're, you're reaping the rewards of that, like, and you win a couple of deals from it, like it's a good deal at the end of the day. And, you know, people remember you for that.

So yeah, like they have like the CMO of JP Morgan and quite a few other heavy hitters.

Yeah, but we can do a panel if you want.

No, I'm good.

Yeah, exactly. So not that there's, I just—

I don't think there's anything wrong with that.

There's nothing wrong with it.

It's just, it's not for me. It doesn't drive revenue for you.

Exactly. That's why I say it's not for me. Because the thing is with the panel is like, you don't get remembered. You just blend into the crowd.

Yeah, and you're just answering other people's questions. Like, I just find that there's no point in speaking unless you can figure out how to drive revenue, whether it's direct or indirect. And I hate to be, you know, not, I wouldn't say a prick about it, but like, I don't know, stuck up, picky. But I care for revenue and like they have great speakers like CMO of Zoom, right? Like they have a lot of amazing speakers and, you know, being honest, I'm okay not speaking every year. I haven't, you know, I spoke there for quite a few years before that there was Yeah, 4 in a row. Yeah.

It was 4 in a row, yeah.

And for us, and I've talked about this on previous podcasts, the number one reason I spoke, you want to guess why?

For branding.

For branding, that's correct. Because we weren't picking up enterprise business from it. I still think it's worth it though for branding because the stage and the audience is large.

We didn't pick up enterprise business from it, but we did pick up a few clients that still are with us today from something I spoke at 2 years ago at Inbound. So that's what I can call out, yeah. Not enterprise though.

I have not picked up customers from it.

It's, they're probably too small for you to even remember.

That's true. We could have picked up customers, but I would say great branding and I think it's worth it for branding. There's another event that I would speak at for many, many years, RD Station.

Oh yeah, yeah, yeah, yeah, yeah.

It's like 7,000 people listening to your speech.

Yeah.

I think it's great branding.

That's when I first started. This is funny. When I first started speaking and then they put me in front of 5,000 people and I was so nervous. I remember I bombed it and Neil looked at me afterwards. It was just a funny time because I didn't get invited after that.

So dude, one of the times I spoke, and I believe, I'm pretty sure it was RD Station, great company, but I spoke and you have to remember in Brazil, most people don't speak English, at least in that audience. But I'm pretty sure most people in Brazil don't speak English because I've been there so many times. The audio went out.

Oh. The translators, that's what he's saying.

No, the audio, like the speakers.

Oh, the whole thing.

The whole thing. And the PowerPoint was still showing, the clicker still worked, people couldn't hear me even in English. So not only could they not hear me in English, I had to yell so then that way the translators, people could hear the translators. And like, you're talking about like 5,000 to 7,000 people. My voice went out literally right after that.

Good job on improvising. So here's what we'll say that's actionable for everyone here. I think events are top because you're building relationship with people and you could do multiple things when you go to the event. You could also host your own, like I'm hosting the YPO Global AI Summit, even though I said I would do no more events.

Yeah.

But I am doing it because I'm also going to one of their side events as well, which is like 1,000 people, right? So that's all worth it for me. It's funny because one of my YPO friends, he said, you didn't say this, but he said this, he this one conference he goes to every year generates him multiple 7 figures at the YPO thing, right? You should rejoin just for that. It's called the YPO Global Business Summit where you can do business with each other. And he always finds a way to get like multimillion dollars there. So all that to say, like I do that, there's dinners next week. Next week I'm speaking at 2 conferences in New York. I'm going to throw a dinner with AI operators on Tuesday. So you can do that as well. So you could tie things to the things that you get invited to. And I would say, At least for me, when I first started speaking at things, 25 years old, I spoke to a room in front of 20 people. That was like, and I'm sure you started really small too. So it's okay guys to start small.

Yes.

Yep.

Dude, I agree with that. And I actually think it's better to start small than just go really big. I think it's just too expensive, too risky, but small and then expand from there can work out really well.

I have thoughts. So let me tell you, I was talking to one of our friends today and then I was like, Dude, there's a premium on like, what kind of multiple are you putting on AI-pilled talent right now? So would you like me to explain that question to you? Because I want to hear what your answer is.

What multiple will we put on that AI what pill?

AI-pilled talent. So someone who is AI native, let's say you're hiring like a marketing manager that would typically make $100 grand. If someone comes into your company and say that they're super AI-pilled, they can do all these different things. What multiple do you put on them? No multiple? 1.5x, 2x, 3x?

Honestly, we haven't put out any multiple or ever, I haven't thought about it that way.

Yeah.

We hire people based on what we need, what they can provide, and then the negotiation is just based off of that. When I look at payment and how much it costs, 'cause I'm assuming when you're talking about multiple, you're really looking at how much we're willing to spend for that multiple.

Meaning that you're putting a multiple on the salary, the original salary. Like 100, if you put a 1.5x, it becomes $150K. If they're like, are you even putting a premium on AI-pilled talent? That's the real question.

We're not putting a premium on AI talent. We're putting a premium on all good talent, whether it's AI or non-AI.

Yeah.

We look at, so you could, let's use the example that someone is doing marketing and they can get 10 times more things done and the quality is just as good if better. I'm creating a hypothetical here. I would be willing to pay for, pay a lot more for that person. On the same time, if someone can close 5 times the amount of sales and they're just a better closer and their metrics hold through, when I say their metrics hold through, like they didn't promise the world and underdeliver, like they didn't lie to close the deal. They actually promised, delivered well. And we found that, let's say, their churn on the deals they closed were really low and they fell in line. I would pay a lot more for that sales rep. So we look at talent as, forget AI native or not AI, we just look at talent as the more you can produce, the more you can earn. It's that black and white for us.

So the way I see it is, yes, it's a production thing, right? But I will also say that where we disagree now is because remember, I, we, we, we had a closer that was very experienced, right? She started to struggle because she didn't start to pick up the AI stuff, right? Meaning that Because when we say AI-pilled, there's a lot. When you're AI-pilled, your relationship with change is really good. You're very adaptable. She didn't have a good relationship with change, nor was she adaptable, and she started to struggle. So she struggled to kind of sell other products and services. She struggled to understand the other areas, and thus it was just kind of going downhill for her, right? Now, on the other side, I believe that if you're AI-pilled, you love learning, you have a super bias to action, right? You're betting big on yourself and you're making these— you're super resilient as well because these things are hard to figure out. And so for us, the way I look at it right now, I was thinking about this and this led to my conversation with my friend this morning. But right now I'm probably putting a 1.5x on multiple, right? Because to your point, if you can do 10x more, not just 10x more, but quality, then you're worth it, right?

Yeah.

And so I think that's worth it. And that's why I think even with interns. So when I was talking to my friend this morning, he's like, dude, we start paying these interns like $20, $25 or so within 3 to 6 months, they're making like a real salary. Which is like unheard of before. Like you and I would've never gotten that when we were like 20 years old.

Yeah, that's true. Yeah, we wouldn't. But I also look at it as like, I don't care if they're an intern, I don't care if they're 50 years into their career. Good is good. Crap is crap. Yeah.

Yeah. It's a mindset thing. It has nothing to do with age. It has to do with your mind. It's all inside. Yeah. Yeah. You know, like whenever we used to speak at these masterminds or go to these masterminds, you'd hear the coaches always say it's all about the mindset. But that part is true.

That part is true.

Yeah.

The only part that I hate about mindsets, and you used to work with someone who was really big on mindset.

You did?

You did.

I did?

In your old Single Grain days.

Oh yeah, yeah, yeah, yeah, yeah.

You know what I'm talking about. I have a problem with mindset when it gets in the way of someone just doing logical things and just working. Like some people have this whole concept of mindset and they're like, you just have the right mindset and you'll grow. Like you're just not thinking big enough. I'm like, okay, thinking bigger, having the right mindset doesn't guarantee I know so many people out there that are like, I'm, uh, they do something, what is it called? Like a vision board.

Oh yeah. Yeah.

Yeah. Next year this is going to happen.

Yeah.

And I don't believe in the vision board concept. And I know some people do and they will say like, I'm going to be on a magazine cover next year. They end up getting on a magazine cover.

I know who you're talking about.

Right.

And are they based in New York? Yes, they are.

They used to be based in New York. Okay.

Got it.

Got it.

Now they're in—

Florida.

Yes. Yes.

Okay.

And I don't want to let you let someone triangulate it. So that's why I didn't say the second part, but go ahead.

Okay. And I don't think these people are bad. Oh, they're amazing people. They're good people. What I'm getting at specifically with vision board, this is the part that people don't keep in their mind or they don't take into account. If you constantly have this vision and you're writing it down, And you really want to achieve it, you're more likely to focus on it. Because you're focusing on it, it's more likely to come to fruition and come to reality. That to me is effort. That has nothing to do with the vision board.

Mm-hmm.

You push harder on something, there's a higher chance you'll achieve the results versus if you don't push harder on it. It's like me saying, Eric, I want to be a really fast runner. I can write it on a vision board, but if I don't spend any time running over the next year, nothing is going to happen.

Yeah. It's— the vision board is perceived progress. You know why?

Yes.

You spend all the time doing it and you put it up there and you don't do anything with it, right? And so what I would say is this, I look at— so I have these statues of Warren Buffett and I have a statue of Charlie Munger, for example. They remind me to be patient because whenever I look at them, I think about all the learnings, like all the readings I've done. Like that's helpful, right? So if you're using a vision board to constantly remind you, that's helpful. I will say this, Every morning, Neil, I've been writing in this 5-Minute Journal. Shout out to 5-Minute Journal. I've been doing it since I was 28 years old, since this girlfriend broke up with me because she cheated on me. So she got to do both. But all that to say, I started doing— so Neil, I had a goal when I was 37 years old. The goal, you know what it was? I write it every day. I've been writing since I was 37. What do you think it is?

Your goal?

Yeah.

Just keep building a bigger business.

Nope. So the goal was I will have, I write this every morning, I will have 2 kids by the time I'm 42.

Really?

I'm 40 now. So if you don't put the effort into it, Neil, it doesn't matter. So I'd like, to your point, I'm just writing it down and like shout out to 5-Minute Journal still, but it doesn't happen unless you make it happen. So now I would have to have twins. That's the only way to get there. Or I guess there's other ways too, but yeah.

If you do like IVF, I think there's a higher chance of twins. I'm not saying you should do it, but I think that's what happens.

Yeah. But anyway, no, but part of it was a bigger business too. So anyway, all that to say is I don't even know how we got to vision boarding, but I, by the way, I like this format more. You know why? Today's topics, they all came from a skill that I use called the last 30 days on the top marketing topics, but it's allowing us to move around fluidly.

Yeah.

Yeah. All right.

What are we going to pick next?

Well, I'm going to let you pick something that seems interesting to you.

Your brand is invisible in AI search.

Okay. So can ChatGPT find you when buyers ask? So this is interesting because I'm speaking at MozCon next week and I'm sure a lot of people are going to be talking about this, but I don't know, man. I, uh—

Wait, you're speaking at MozCon? I didn't know they still do MozCon.

They still do MozCon.

Oh, that's cool.

I think it's like, I don't know, 400 or 500, 600 people in there.

Oh, cool. It's owned by some other company now, right?

I think it's owned by a private— oh, I think Constant Contact bought them.

Is it Constant Contact?

Yeah.

No, it's a publicly traded company. Is it?

Look it up.

Uh, acquires Moz. Eye Contact. Similar name.

Close, close, but no banana.

Yeah. Subsidiary of Ziff Davis.

Well, there you go. Yeah. Which is interesting to me, but yeah, your brand is visible in, in AI search. So what do you do about it? Because like I look at your Ahrefs traffic, my Ahrefs traffic. I think we had a mutual friend that was looking at both of our traffic. Mine has gone down a lot. I don't know about you, but some of our competitors, it looks like their traffic's going up. So I just don't pay attention anymore to that.

Yeah. And I also look at traffic and revenue as 2 different things.

Exactly.

Our traffic has gone down some due to people click less from organic Google results. I would say even before all that AI stuff, our traffic started going down because we were ranking number 1 on Google for broad terms like digital marketing, we're ranking high up on page 1 for search engine optimization and SEO and terms like that, but it wasn't driving revenue from our ideal customers. And we found that doing some of the things I've talked about earlier on how we're marketing drive a lot more revenue for our business in the long run, and it's been super effective, but it's time-consuming, it's a longer play. And does it mean ranking on Google is bad? No, I think it's great. It's just going after very specific The keyword I got more traffic than anything else from on Google in my life for my own website was how to get more Instagram followers. Never—

Zero.

Yeah, zero revenue from that. I think at the peak from that one keyword, I believe I was getting somewhere like 600,000 visitors, or, and it could be variations of that keyword, like how to get more Instagram followers plus Siu. How to get more followers on Instagram, right? So switching around, but it's the same thing. But I was getting somewhere around like 600,000 visitors a month from that keyword.

And keep in mind, this is one blog post, guys.

One blog post. And not even the total amount of visits to that blog post, just those kind of terms. And it didn't drive any revenue. And it's just like, it quickly taught me that more traffic doesn't mean more revenue. This was a long time ago that I learned that. So I switched the strategy to focus more on enterprise.

You know, I think it's also important to understand whatever Neil and I are talking about right now, it depends on your business because even with Neil, he's talking about the nuances of what channels works for him. And I'm also talking about the nuances, but also we're like who he's selling to. And then also like what we're selling is a little different at some times. And so for— it's really like for me, for example, what's going to work? Oh, LinkedIn is going to work. Okay. X is going to work. Doing webinars works, doing events works, doing dinners works as well. And then in a sense, doing these free pilots and outbound works for us too, right? Because we send a lot of these different offers. And our outbound response rates are like, you know, they're decent, like 6 to 8% right now, maybe even like 9%. So it's not bad.

It's not bad.

Yeah. When I used to send DMs in other ways, you know, it was like 10%, 15%. Yeah.

Yeah.

We'll leave it at that. You were just speaking about Google. I thought that was really interesting. Do you know who Kai-Fu Lee is? Of course you don't. Real quick, if you want to acquire customers faster and more efficiently this year with the latest strategies and tactics, then check out singlegrain.com. That is my ad agency. Again, www.singlegrain.com. Check it out. And if it seems like a fit, we'll get in touch and help you with a free marketing plan. So no, I know you don't. So who is Kai-Fu Lee? Kai-Fu Lee was the ex-president of Google. So he said this, this guy over here, like my, my, he looks exactly like me, right? Oh, you missed it.

Here, rewind.

Look, he looks exactly like me. And now if they're all getting human amplifier thingy.

No, I don't know how you think he looks like you. He looks very different.

He doesn't. He doesn't. But okay, so let me give you a little background on this guy. So Kai-Fu Lee, this dude, he spoke at a TED conference I was at quite a while back. And he was just saying, he had this prediction. He's like, you know, the one thing that AI can't replace is creativity. He actually said in this video, I was wrong. He's like, it can replace creativity in many ways. So he said that. So here's what he said. This is recent, right? And so this prediction might be wrong as well. But keep in mind, ex-president of Google China. He says, I predict 50% of companies will need new leadership because the old management style won't work in the era of AI. That's That's exactly why I'm seeing 95% of so-called AI transformation initiatives fail. Most are bolting on AI pallets for functional tasks, but never touching the business core. And this is something that we're seeing quite a bit as well. So we should react to this. 50% of companies will need new leadership because the old management style won't work in the era of AI.

50% of new companies will need new leadership, you said?

Will need new leadership because the old management style won't work in the era of AI.

I believe it. I think a lot of people will have to adapt and they're going to struggle to adapt. I also think it's business by business. Like some businesses manufacturing, automating more of it, I don't think is as hard to adapt to.

I don't know, like to an extent, yes, but I saw a video today. You saw OpenAI released their 5.6 SOL, right? And I saw a video of a Japanese farmer that was, he was initially like rolling up the greenhouse, like rolling up the things for the plants to air out. And then he used 5.6 to come up with the machinery to plug everything in and it just rolls it up in the morning and rolls it down or like depending on the weather in the area.

That's cool.

That's cool, right? And that's, that's manufacturing. But I do think there's less disruption when it comes to manufacturing or like building the Iman that's being built over here, right?

Yeah, I think that's harder.

I think it's going to take longer for that to happen. But I think if we're talking about like truck driving and like, you know, drive like stuff like that, maybe faster. But I do think when we talk to— there's certain clients that we have right now, and I'm sure you're seeing this, like We have Single Brain and Single Grain right now, so I can see 2 different things, right? So I'll just ask about our Gong calls so we can see what's happening with Single Grain. And it's like, yeah, they don't want us to do anything AI. Some clients, nothing AI, right? Because they're scared. I'm like, guys, why do you think that is? They're like, oh, they're scared of it. Versus Single Brain, more, more, more, more, more, right? And so I would say it's like, I can see it moving up to like 50/50. And even within the company right now, which When we're sitting here last week, I was like, I, I have 2 cultures right now. 50, 30, 40, 50% is kind of like they don't want to adapt. The other 50% is flying.

Yeah, dude. Uh, you never saw my Vegas house that I built, right?

I saw it in a video and then you left.

Yeah, I sold it.

Yeah. That house— Neil built this house for 2 years. It was a beautiful house and he left in a month.

Go ahead. That house, we hired a company that showed me a video of how in a factory they use technology to build the frame of your house, and then it just plugs and plays and they're bringing it over in truckloads so that way your construction happens much faster. We did it. It was like this new age technology. Like imagine doing framing of a house, but it's done by a computer and machines and it's just done really quickly. And then they just bring over wall by wall and then people just connect them together like a Lego set. We paid for that. It works so well that it took double the length to do the framing than if we did it all manual.

Yeah.

Now it doesn't mean that technology sucks. It just means with certain things, like Eric was saying, with construction, things will just take quite a bit longer to adapt.

I'd rather go with proven at that point.

Yeah.

Versus like trying something brand new, unless it's like, oh, we're going to save you 90%, then maybe I'll try the brand new thing. What did they promise you?

They promised me they would build me a home in less than a year.

What is it usually? 2 years, 3 years?

2 to 3.

Yeah. Yeah.

It depends if it's a cookie cutter home, you can do it pretty quickly, but if it's custom, let's call it 2 years.

Yeah. You know what's funny? You're just talking about the mindset people and like, do you have a mindset person that works with you right now?

I do. Uh-huh.

I'll just leave it at that. Oh yeah.

Oh, oh, not an employee. Yeah, you're just saying let it contract. Yeah, yeah, yeah, yeah, yeah. The same mindset person, you know? Yeah, yeah, yeah, yeah, yeah.

Same mindset person. Yeah. By the way, speaking of which, so we're recording in my conference room. Usually we're recording in Neil's. I've been getting good comments about how much nicer this room is, by the way, in the clips.

And bigger.

Well, you have sunlight, you know, I have a nice background here and all that. But so one thing I've noticed is that when we use Overlap to make like little clips, 2-minute clips, 3-minute clips, like honestly, you should, your team should do the same thing. They should just use Overlap and make 2, 3-minute clips because this is where we have our Conversational takes, spicy takes sometimes. They do well on X. Some of them will get tens of thousands of views, some of them even 100,000 plus. And that's, I think it's a nice way to play the game. I think we've cracked X. We haven't cracked LinkedIn. Like, do you even look at your LinkedIn?

Do I look at any of my social media?

Probably not.

No, not too often.

Yeah, you don't check it. You check anything. You only check the revenue dashboards though.

Yeah. I do log into X to check news, but I don't actually check my own stats.

Yeah. So all that to say is like, I think this is our— if you guys are thinking about how we're thinking about it from a B2B services standpoint, it's, this is our pillar content. Our pillar content is either this or a YouTube video, like a YouTube long form. You record Shorts natively. I went back to doing that. You know what's been helping? Doing the little— we have a little skill now that where we have a resource, comment to get this, right? That's working really well for us too. And so we're going to push it more aggressively.

Some people have been getting banned for that, just as a heads up.

Really?

Uh-huh.

It's okay.

Depending on the software solution, you know, your whole profile.

Really?

Just be careful with it.

ManyChat?

ManyChat should be okay. It should be okay, but I've seen some people get in trouble with it and their profiles having issues. Yeah.

Just an FYI. Yeah, we use ManyChat for it. I mean, they seem like they have a good relationship with Meta for a while, but anyway, there's Speaking of meta, there's always a meta way of doing things when it comes to growing.

So yeah. Dude, I just think that all this stuff that's happening with marketing now, that when I go to events, people are starting to come to the realization that they need to start looking at more bottom of funnel. And you just mentioned it, you're just like, hey, do you look at your social media? They're like, I bet you look at revenue reports. Or you're like, Neil looks at revenue reports, which is very accurate. And I look at them quite frequently and I get them. Pretty much daily, or at least bank balances I get daily. And I can quickly see pipeline and all that kind of stuff and deals close, and I get email alerts on a lot of this kind of stuff. But what we found is, or what I found when I go to conferences now, before people used to be like, oh, how do I get more traffic? What's the best traffic source? What's the best hack? Now people are slowly starting to shift to, Hey, I really need to grow my revenue. I need to increase the LTV of my customers. I need to reduce churn. They're still talking about marketing, but they're starting to think in the right quote unquote mindset because they're starting to optimize for the numbers that really matter. And for the longest time, when you talk to marketers, even though finance people and executives working at organizations still optimize for the bottom line numbers, marketers still mainly focus on top of funnel.

You know why? Partly because we're in a zero interest rate environment for so long where money was free. Just go, go, go, go, go. So you hear from the finance people, just go, go, go. And then the marketers assumed it's supposed to be like that forever, but it's no longer— it hasn't been like that for a while.

You know, they may increase interest rates in the US, right? Some of the other countries, I think Australia increased their rates.

Yeah, we'll see. But hey, Warsh has a new strategy, so we'll see what happens. Yeah.

Work with Marc Andreessen.

My good friend Marc Andreessen's there now. So anyway, but this other piece over here, 95% of AI transformation is failing.

And you know what?

In this AI executive group where it's, again, we're talking multi-billion dollar companies are in there. I don't see a lot when they're talking about AI transformation. It's like these people have like, not these people exactly, but chief AI officer or head of AI transformation or whatever. And then when I talk to them, it's like, oh yeah, 12 people out of 8,000 people are AI pilled in the company.

Yeah.

So it's going to happen a lot slower. But here's the good thing. These companies are all more than happy to hire outside people to help them with this. And it's just going to drag out for a long time to this implementation. That's one piece of it. The other piece I want to show you, Neil, is this. So these charts over here, there's this engineering survey. Okay, so this surveyed 1,000 engineers. Okay, so 1,000 engineers. And now, here's what it says. Agents are getting— agent teams using agents, 89% are giving them write permissions now, up from 52% a year. Do you know what that means?

No.

Okay, so what level of tool permissions do you give your agents? So imagine you have like a Hermes or something like that.

So write permissions in which they can go and actually make changes on the data.

They can execute, correct. Yeah, so write humans with human in the loop, it's like 61%, and then write access independently without human approval, 24%. Read only, cannot make changes, and then we don't use agents internally. So 89%. This is up from 52% last year.

Wow.

It's only gonna get up, which means this, people are gonna have to invest more in security, more in governance.

Yes.

More in permissioning. I think that's a very good service to have, Neil.

Well, this is also why all the security stocks are crushing it right now. I don't know if you've seen that.

My tennis coach was like, I bought CrowdStrike. I was like, hold onto it.

Yeah, but let's look at CrowdStrike, okay? I have a few friends who own CrowdStrike. I haven't owned, I don't own CrowdStrike stock. And I'm not saying you should or should not, but if you look at their 1 year, they're up 54.54%. All right. That's a pretty big number. You agree with that, right?

Mm-hmm.

If you look at their quarterly revenue, they're growing at 25%. So yeah, their growth has actually accelerated. Okay. But when I still, I look at their numbers, like you look at CrowdStrike annually, it's called $4.8 billion in revenue. They're worth $205 billion.

What's the multiple?

On revenue?

Yeah.

The multiple on revenue is 40 times roughly.

And it's not multiple on revenue, it's not even earnings, it's on revenue.

Yeah, call it like 35 or something like that. It's crazy.

Yep. By the way, speaking about all these websites, speaking about security, I just think in general, if you're talking about a website now, I feel like your website has to be become a— your website needs to become a revenue agent, right? It's no longer just a brochure. Even if you look at it like a year or 2 ago, your website's like a brochure. But now there's, because you can, it can become like a revenue agent, you can, whatever leads it has or whatever visitors are coming in, maybe you can spawn lookalikes off of it. Whoever's visiting, maybe you can figure out, you can figure out how to create, you know, customized outbound campaigns for these people, right?

Yeah.

Or you can like create these landing pages that are customized So I'm just like, why, why? We're going to see a lot more of it. Like literally I have a loop running right now for the Single Brain website. It's running CRO tests every week. And basically I said, hey, raise the conversion rate by 30%. So I'll let you know in 4 weeks what happens, but it's actually doing it autonomously right now.

I'm curious to see the results from that. And going back to Crosshair really quickly, I couldn't resist, but I had to do the math on how much they're worth based on an EBITDA standpoint. I took their last quarter because it's one of their better quarters and I times it by 4.

So assume they'll at least maintain that.

They're worth 1,541 times profit.

That's crazy. That's crazy.

I myself wouldn't buy this stock. And again, this is not financial advice, but then again, I lost out on 54% gains over the last year. So I'd rather have the 54% gains than my logic.

Yeah. Well, like I think in this case, you just have to think about what your edge is and do you even have an edge or not? Right.

Not at 1,541 times profit.

And I'm looking at some stocks right now on my Robinhood trying to pull up. I'm going to show you, like, I think one of them is like 3,000 PE or something like that.

So anyway, dude, and if I take their last month's revenue and times it by 4, so their run rate and take their market cap and divide it by the run rate, they're worth roughly 36.8 times profit.

Hey, SpaceX is up 1.62% year to date. Here, let me show you this, AXTI, and then we can move on.

Wait, before I had a really interesting investing strategy. Again, I do not recommend this. This is not financial advice. So check this out. So I told you we're a C corp now, right? Did I ever tell you that I changed from an S to a C corp?

I think you did. Yeah.

Okay. So for anyone listening, the difference between an S and a C corp is S corp, the taxes flow through on your individual returns because I know many of you guys do not live in the United States. So So if I make $100 in profit as an S corp, call it, I have to pay roughly 40, 50 cents on the dollar to the government, right? As a C corp, the tax rate is roughly 21%, if I'm not mistaken. Plus you have to pay state taxes are actually lower in most cases that I've looked up in research. I haven't done state by state, but I looked up the states we operate businesses in because you pay taxes based on where you generate the revenue. And it's usually lower. So let's say my average tax rate is 25%. So I ask the bank, because we use debt to grow faster, right? So I ask the bank, hey, we have cash on our balance sheet, but we're not doing tons of M&A right now. Can I just take the cash on the balance sheet and buy whatever stocks I want? Because, you know, when you have debt—

That's your treasury strategy.

The treasury strategy. They're like, yeah, you know, you may be able to do this. And then we found out that in our terms we can't do it, but we're going and asking for exception. Because I was talking to a few of my executives, I was like, you know what, we do M&A and M&A's not a bad strategy. We spit off cash flow. I'm like, I think I would make more money just taking our profits and putting it into SpaceX for the next 5 years than buying any more company.

Yeah.

I'm not saying I have a bad company. I'm not saying I have bad employees or leadership. I actually think we have a great company, great leadership, great team, but there's no way we're going to beat the returns of SpaceX over the next 20 years as a marketing agency. This is just my take. I could be wrong.

I think you're right.

And I was like, hey, can I just take the profits and buy a lot of SpaceX stock?

Yeah.

And they're like, would you buy it now? I'm like, no, I want more of the pool to unlock.

Release.

Yeah, because a lot of the employees can't sell their shares yet. So I'm waiting for a lot of the investors and employees to be able to sell their shares. Again, this is not financial advice, but in theory, usually when that happens, that puts pressure on a stock, which can create downward pressure. And then does that mean if I dollar cost average and I buy SpaceX every quarter, I'm going to buy it and it keeps going up? No, I bet you there's going to be times where I overpaid for it.

Okay.

But again, not financial advice, but over the next 20, 30 years, I believe I'd make a killing over it and probably more than just buying more agencies.

I've tried to get very cute with my, excuse me, my treasury strategies before, but it was a little too aggressive.

So what was your treasury strategy?

My treasury strategy was crypto. It was too aggressive. Yeah. But I do agree, like SpaceX, like that's almost like a for sure bet for the next 15, 20 years.

Again, not financial advice. For sure is not a guarantee.

It's a guarantee for me, not for you. Yes. But you know what's interesting, Neil, we should talk about this because you just talked about raising some debt, right? And then you had talked about raising some money. So I'm going to New York next week and I am going to a couple VC offices to look at raising some money for what we're doing right now. And I was workshopping this with my Fable Five yesterday. I was sitting on my couch, I was like trying to watch X-Men. There's a new X-Men on Disney, it's really good. But anyway, I was workshopping this. I was like, wait a minute. It's like, I'm like, wait, I should raise right now because I have all the talent that's on the bench right now that's ready to go. And if capital is the constraint for us to move even faster than we want to, why would I not raise money right now? And it's, and I'm like, oh, I'm being a dummy. And then, you know, you want to talk about treasury strategies, things like that. Like that's a whole nother thing, right? But I think what we should talk to the audience about when you should raise debt and when you should maybe even consider VC.

True, we should. And one really quick thing too is, you know, now I'm like, huh, Can I add more debt? Because my cost of borrowing money is pretty cheap. It's in the low 2s plus SOFR. So call it like 6%. What's SOFR right now? SOFR's probably—

4.5?

SOFR rate, it's like 3.46? No, 3.58 now. All right, so 3.58. My cost of borrowing is roughly 6% based on today's rate, 6.08%.

Okay.

And I was like, huh.

Can you outgrow that?

I think I can outgrow that. If you look at the SaaS valuations in the stock market, if I hold it for 2, 3 years, I personally believe, and I wouldn't recommend this to anyone else, I personally believe, and I'm willing to take the risk with my own money, if I put it in that, I would clip more than the 6%. And on some of the stocks, I believe I could more than double up my money and that would pay for the debt that I borrowed. And I'm like, cool, I got some free cash.

Now that's assuming what, but if Neil finds a better engine in his company that's growing a lot faster, of course he's going to put all his money into that. So it just Depends on how fast things are growing.

Yeah, dude, I told you I took a loan out of my home, right?

This home?

Yeah, the home that I just finished up. I took a massive loan out on my home.

And this is going into stocks?

Like a solid 8 figures. Like a massive loan, right? And I just put it all into—

The same ones?

I put one stock.

Is it a SaaS stock?

Uh, yes.

Okay, we'll leave it at that. Yeah. Neil is in this for this, just so everyone knows, Neil's in for this SaaS trade for the next couple years or so because he believes the SaaS apocalypse is overblown, which I can see why.

So I think I'll triple my— I'll double up my money on profit. So I think the stock will go up 3 times. I won't name the stock. So whatever I put in, and you guys can guess how much I have because I just told you, I just pulled out money from my home. I pulled out 8 figures. I put it into one stock. I think I'll triple up my money. I'll have to pay taxes on it. California tax rates kind of suck. But even then, the long-term gains are, call it 40-ish percent, 39 or 38%, including the NIIT tax, right? The net investment income tax. Plus I have some NOLs, which will help reduce the tax rate. And then boom, use the profits from that, have the mortgage paid off. Although I probably wouldn't pay it off because my rate on the mortgage It's like 4.5%.

So 2 things, Neil, when he says NOL is net operating losses, the second thing is to do all this, you need to make sure you have a good business first and then you have the optionality to make these moves, right? So that's just not to say go do this immediately or just go, it's not that easy. You just can't go raise a bunch of money, right? But if you do have a good machine, a good engine, then you should consider taking on some more debt or maybe even raising some money. So thankfully for me, I own 100%. So yeah.

Yeah, that's true. I was just like, I'm like going to my wife. I'm like, you know, if we didn't have a home, you know how much more money we would make in our lives without the home? And you know, the feedback I always get back is—

You already have enough.

Yeah, you already have enough. What, what? Okay, if you double the money in the stock, how would our life change? I'm like, well, I can't answer that with a really good answer. Why can't you just say private The missus doesn't care for a private jet.

But that's how it would change.

That's true. But in theory, I can just use company profits. We have enough to just go buy a private jet.

Exactly. Your life wouldn't change. You have everything you need. This is the dream for you.

Well, my dream went from wanting to own a private jet, and I almost bought a private jet 2 times. And when I say I almost bought a private jet, I've probably spent 300 hours.

Did you know how many of those pictures you sent me? Yeah.

Looking, going to the shows, negotiating deals on 'em, flying to see ones that I almost wanted to buy. And then my life changed. It was because of something Eric sent me years ago and I was like, dude, I'm really getting exhausted of traveling. It may be better to just not travel as much and not own a jet and spend more time at And you did that for a year. Yeah. And I'm still traveling really heavily. But the other angle that I'm thinking about is, and I know I won't stop traveling, so it won't work. But other than the financial side, I was like, instead of traveling to all these events, maybe I should just go buy businesses that are fixer-uppers, not the ones that are growing fast, because then I can get them on a good financial deal, which makes the arbitrage easier, right? So because I'll break down the economics for anyone who's listening, if you want to end up buying a company, All right? Because you have to equate it with organic growth when you're spending money on marketing. But let's use a company that's doing $1 million in profit because it's the easiest number for me to end up breaking down. If I buy a company that's doing $1 million in profit, you may end up giving them like 3.5 times upfront. So you're getting them $3.5 million upfront and you're giving them the optionality To earn another $3.5 million, if not $4 million. So call it, you pay 7, 7.5 times that company, assuming you know that company's growing at 20% a year or 10% a year, you could make it grow faster. Maybe after 2 years it costs you 5 times what you paid.

Mm-hmm.

Because of the growth.

Yep.

And you're giving them the earnout based on their original profit. The growth reduces how much your multiple for that business costs. So let's say you pay 5 times for a business. It can still keep growing 20%, but law of large numbers, things usually slow down. You're not going to always keep getting the 20% growth per year, just being realistic. So when you look at it from that perspective, if you just borrow money, to keep this really simple, and you borrowed 5 times, it takes you forever to pay back 5 times.

Mm-hmm.

Depreciation takes a long time depending on which country you're buying it in. Then you got to pay taxes on that money, and then you got to pay it back, and then you got to pay interest on that money. You're lucky if you pay it back in like 7 years, you know? And that means you don't see any cash flow from that business for 7 years.

Mm-hmm.

So then we, Eric and I live by this company called Platinum Equity, and they're known for being buying not necessarily bottom feeder companies, but they're buying more distressed companies, companies that have issue or hair on it, and then they go fix it, clean it up, tear it apart, whatever they need to do. And I look at some of the businesses out there that are for sale. I'm like, man, I can buy some of these businesses for like 2.5 times upfront and pay no more than another 2 times max upfront, but realistically not more than call it 3x, 3.5x, and that's of the upfront. Forget the earnout. I'm just talking about what, let's say I pay 4x upfront. That's actually a better way to put it. Not upfront, sorry, 4x of the total deal. So if the company's doing $1 million in profit, it costs me over 2 years, $4 million.

Mm-hmm.

And then I would be able to ink out instead of a 4x, Call it a 3x or a 2.5x because of the growth that I can get on it. At that point, even though it's not sexy, the cash flows just really well and it doesn't take long to just pay back. So you just cash flow really well.

Yeah. And you could take on more debt.

You could take on more debt, do more of that. And then I wouldn't have to travel as much because I thought about just doing that in all the countries that I traveled to. And I'm like, huh, I probably wouldn't need to travel as much, but knowing me, I would do both and try to get even more growth.

Well, you know, Syed was very, our friend Syed was very wise about this when we did the event a couple years ago at the Beverly Wilshire. He's like, why do all this content when I could just buy other businesses? And that was very good. And then when I did an interview with somebody else and they said they got all their deals from content, turns out that wasn't—

Does this person live in Las Vegas?

Well, now I'm making it obvious, but it's, I don't believe that you can get a lot, most of your deals from content. I think you want to do well, you want to just keep growing, you just, you buy companies and then you can figure out how you want to financially arbitrage this.

I met up with that person. The problem with their deal, they're going to get all the deals from content. They were just like, yeah, I'm going to get people to just give me equity. I'm like, no one's going to give you free equity of a really good business. I'm like, I don't care how big your brand is. It's very rare. Yeah.

Well, the thing is, we'll just, there's, there's not a lot. I'll just leave it. I'm going to leave it alone.

Yeah.

Continue. Continue.

They switched the business model from going and buying to doing other stuff.

I don't think there's much buying anymore at all.

Yeah, correct.

Or it could be other types of businesses like, but yeah, no, they have a good model.

Real estate or whatever.

They have a good model. It works for them right now.

So it is good for them for making money from it, right? Yeah. But yeah, you know, and it goes back down to, do you do debt or do you use venture capital? I think when you use venture capital, you have a lot less limitations. All right.

So I wanted to take a moment to tell you about my podcast co-host Neil's agency called MP 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.

But at the same time, you said a lot less.

Oh yeah, bank will give you more limitations.

I mean, sorry, when you use venture capital, you can do a, you have a lot, lot of limitations, different limitations than a bank, but they both have their limitations.

Yeah.

You can't go and raise venture capital I was just talking to one of my buddies about this.

You've done both. Just metrics?

Yeah, I've done both, but there's limitations on both. And I was just at an event, my buddy's company spits off a ton of profit. Their growth isn't as good anymore, but when I say they spit off a ton of profit, you're talking about like a billion-plus valuation company. I wouldn't say they do $100 million in revenue. Let's call it they do more like close to $80 million a year in profit. Forget revenue. Revenue is much larger. But because they raised venture capital, they can't just take the balance sheet and just go buy a ton of SpaceX stock.

How much does he own?

Between him and his co-founder, close to majority. But even then you still can't, because there's limitations in the contracts when you raise venture capital. But on the flip side with private or when you, with bank debt, there's also limitations. They don't want you to focus purely on growth. They want you to focus on responsible growth, Profit.

Profit. Yeah.

Making sure all the numbers are good. Sometimes they restrict you on paying yourself. Well, venture capital's like, grow, grow, grow. It's okay if you're losing, you can still pay yourself well. We're not going to handcuff you as much.

Well, pay yourself well is like, like a founder salary most of the time.

No, they get paid really well.

Well, you can take secondaries. You can take secondaries.

Yes. Or let me rephrase. If you're a startup, a startup raised less than $50 million, It is like what you're saying, like it is, you know, you're paying yourself decent, but you're not paying yourself extremely well. But the companies that have raised like $300, $400, $500 million, billion dollars, a lot of the founders are making millions of dollars a year just in salary.

Remember that group, the video chat thing that was big during the pandemic where the founder took like $100 million in secondaries and he just like sold the— just got rid of the business?

I know what you're talking about. It was used for a lot of live events and stuff like that. Yeah, yeah, yeah, yeah, yeah.

Like he raised money.

They have like a billion-dollar valuation or something crazy.

He raised money and took $100 million in secondaries.

Like, good for them.

Good for him.

Yeah. But I think they would've done better if he just sold the whole business at that point and just cashed out.

Yep. Yep.

Same with like Clubhouse, remember? Like LinkedIn or whoever wanted to buy them. They should've just sold the whole thing. It's like they just got too greedy.

Yeah, exactly. Anyway.

But okay, so going back to your business, You grow organically. You've been releasing new divisions, new products, single brain. The list goes on and on in a good way. I don't mean it in a negative way. You've been seeing growth from it. You're profitable on a monthly basis. You used to put some of your balance sheet in crypto. I don't think you have much debt unless it's government debt, like an SBA or anything like that. So it's pretty flexible.

Correct.

Which SBA is some of the best debt you can take.

The best.

The best. You know, although I think they limit you to like $5 million or $7 million or something like that for a tech business. Or, and the rates are, the payment terms are actually very favorable compared to most banks or traditional debt. You just can get much more dollar amount from a bank if it's not SBA. So where are you putting your excess cash flow right now if it's not crypto?

Well, I'm trying to hire more talent.

So you're just reinvesting by just growing the business organically? Yeah.

But like, because it's been all organic, right? I'm just Like now I'm like, well, first the Fable Five was like, well, you need to go recruit these people first, go get these people, right? And then I was thinking about it, I was like, wait, they're all on deck, they're all ready, they're all bought in with the vision.

Yeah.

And then the thing is, now that we've done a few of these single brain pilots, they all want more and more. And then when we showed the single brain clients, they're like, we showed one of them that initially I went into the call just to listen to what they were saying 'cause they're like one of the larger clients. And it was like 20 minutes of just saying like, yeah, you guys are missing the mark here, da da da, you could be better over here unhappy, right? And then rightfully so. And then last 10 minutes I'm like, hey, how about we give this to you guys? Showed him that, he's like, showed him Single Grain, he's like, I'm speechless. And then he's like, we need this for everything, right? I'm like, great. So now I'm like, okay, well if the momentum's this way, then I'm like, I need, I should go raise something right now.

For Single Grain and split it out?

Both of them. Like Single Grain falls under Single Grain anyway, like.

So then you'll go out and you'll try to raise money?

Exactly, yeah. 'Cause there's a big firm in New York that everybody has heard of. They've backed like OpenAI, Anthropic, Shopify, Databricks, and they wanted to meet last year. I said, hold on. This year I'm like, oh, we got something. So I think I'm— because if I own 100% right now and I raise, we raise on like everything combined together, I don't need to dilute myself too much. So yeah.

And would you take a lot of money?

What's a lot of money?

Or how much do you want to take?

A range, $15 to $25 million.

So $15 to $25 million to just scale faster.

Decent amount, yeah.

I think it's worth it. I think you should spin off Single Brain into a separate company. I know it can be separate. And then raise, I think you'll actually raise quicker and you would lose less.

Give the reason. I have a sense for what your reasoning is. I don't want to guess it yet, but you give the reason. You give the reason because I think I know what you're talking about.

Go ahead. So half your company, forget the revenue split. If you just look at it, and I'm pretty sure the agency actually does more revenue because it's been around longer. So majority of your revenue is in an old school model that has a terrible valuation.

Mm-hmm.

The new company, Single Brain, has a lot of potential. It doesn't have the revenue profile of your older company, but it's much more sexy. You can raise money based off of vision, Without existing economics. If you include your existing company, it muddies the water because some of the business people, some people pay you for the old business, some people pay you for the new business. Investors like deals with no hair that are clean, that are simple. And I actually believe it would be easier for you to raise money just for Single Brain. So second—

Yep.

If I think Eric is a good operator and entrepreneur, but would you agree sometimes things go bad that you can't control for all entrepreneurs?

Mm-hmm.

Elon Musk had a lot of rocket failures before he had some success, right? We all take risks. I don't care if you're Elon Musk or Mark Zuckerberg or Bill Gates, everyone's had failures. No one has 100% batting average. If you do, you're not really taking enough swings. If you keep 'em separate, you also will an agency, you can hire someone to grow it, and you'll still have a business that is owned by you that grows, that doesn't have a lot of money being raised against it. Because if something goes wrong, for the investors to get back their $25 million, let's use that number.

Mm-hmm.

They would take everything and you would get nothing for 10 years plus worth of work. And I look at it as, and I know you're willing to take that risk, If you had the agency separate, I don't think Single Grain needs $15 to $20. I think you can get $10 million on a round with great terms. Maybe you'll lose 20%. You can even do it on a SAFE. You go push really hard on it, and then 6 months to a year later, you go and do a bigger round at $30, $40 million on Single Grain, and you spend your time focusing on that.

So we should unpack a couple things for the audience here. So I, the first part, there's 2 parts that Neil had here. here. The first part is exactly what I thought he would say. It's the story. When you have a story that the investors can get around, when something's hot, they love things that are hot, right?

Yeah.

They're going to pile into that. Now, the second part, I didn't know that, I didn't know your angle on that. And I think it's actually a very smart angle, but here's the thing, the challenge with this. So the firm that, the one that reached out to us a year ago, they're all in on the services as software narrative because, you know, you saw Sequoia talk about it, you saw Andreessen Horowitz talk about it, you saw Y Combinator talk about it, right? So they're all in on agencies doing So I would need to gauge him, this guy, to see how he really feels, like together or separate, right? To your point, it's cleaner if it's separate, and I would prefer it to be separate, 'cause then it's like, I still have 100% of this thing over here that's cash flowing.

It's a lot easier. Do you want me to introduce you to VCs?

I'll think more. I want 'em to all bid against each other, so.

Yeah, I can introduce you to some VCs.

But keep in mind, West Coast VCs are a little different than East Coast VCs. So West Coast VCs, they tend to, they're like lemmings, they follow each other. Right. And then the East Coast ones are, they just go or they don't go. So.

I know more, I know investors in all places of the world, but if you want some intros, I can make some intros.

I'll take them. I already have a couple lined up. I'll take even more.

Yeah.

I was going to ask you anyway.

Yeah. Just remind me tomorrow. I'll do some text intros, but just go with the narrative of single brain and just say, hey, I want to spend, this is where I want to spend my time. People will love that narrative. It's an easy, clean pitch. And maybe they don't give you $10 million, maybe they give you $7 million or whatever, but if you just take that chunk of money to get started, you can grow extremely fast because you don't have to be profitable. People love the narrative and just go push hard.

You know what the other thing is? I saw yesterday one of like a kind of single brain adjacent competitor, $136 million round, right? And then I saw Chamath for his services business, $132 million. I was like, what is going on?

Chamath was able to raise a lot of money.

Chamath, I believe, because of his relationships.

Because of his brand and relationships. Yeah. And that was, that was not Sequoia. That was a Salesforce-led round. Yep.

Marc Benioff.

And then Marc Benioff—

Mark Ventures too.

Yeah, which David Sacks.

Yeah.

But, and Benioff posted something on X with him and Chamath. I forgot where they were in Europe, but it was something—

Oh, they're like partying or something?

No, not partying. It was just more like, hey, with one of the besties or something like that. But, you know, Benioff wrote him a check. For Benioff, that is not a big check.

Yeah. I'm curious. I mean, those of you listening right now, do you like this format more where we're kind of just like shooting the, shooting the poo poo? Or, 'cause I enjoy this 'cause it's a real conversation. So yeah. Yeah.

But I can definitely, I have some solid introductions for you for people to take time. One of them you met, remember we went to a dinner at Avra with one of the buddies that was an LP in their fund?

Yeah, we're, we, yeah.

He's chill.

Yeah.

He does deals in Europe. He'll fly to 'em and all that kind of stuff. He has like some amazing LPs in his fund, but—

Are you an LP?

Uh-huh.

Okay.

But like, I know—

I don't wanna make you money.

Why not?

I'm just kidding.

I'm just kidding. I don't know what fund he would invest in. Some of the funds I'm not an LP in, and so I probably wouldn't make money in the deal you're doing, but I'm an LP in some of his older funds.

Yeah. It's okay. You're welcome to invest as well, Neil.

But I think that would be a really good fit. There's a lot of people that can do like $7 to $10 million rounds and just be like, go, because it's a huge idea and I think people love it.

It's not a— I think it's a great— so I think Neil's number 2 is actually a great idea. My only issue is with the ones that reached out, you know, especially that company that this one's well known. Again, if they want services software as a narrative, my sense is most VCs aren't going to want that and it's going to be cleaner. But some of these people that are in on that narrative, it's going to be different.

Here's a problem. And can I speak freely?

Yeah.

Here's— I don't want to talk about numbers, but here's a problem with that narrative. They're going to look at, hey, Single Brain, oh, you're doing this narrative. Cool. You already have enough cash flow. I want to see your growth rate from implementing this.

You're talking about when they're combined, right?

When they're combined, because the problem is already combined, I don't think the growth is going to be appealing enough for them to write a $15 to $25 million check because you have too much legacy revenue. And it's not like you can switch it all over the next day and make it all this new AI-enabled service type revenue. So I believe if you just created the new co that just did this, you've already been building a good brand, I think it's a much easier sell.

I don't like, by the way, this episode was great. You know why? Because you learned about how Well, so Neil has this ship right now, right? And he's like, okay, well, what do I do with the cash flow? Well, okay, what's going to grow the fastest? Okay, probably maybe SpaceX stock is going to grow faster, right? For me, it's like, well, what's going to grow faster? Well, I have this new thing right now that has the wind behind it, right? And then it's about how do you structure this stuff at the end of the day?

So yes, and Eric and I, although we're similar ages, we're in different stages of life and there's no right or wrong stage. I have kids, they're growing up. I also have been an entrepreneur a lot longer than Eric has.

14 years longer.

So I'm just in a different stage in life. Like Eric created Single Brain. I think it's a cool idea. I don't have it in me to do another one. Like—

You didn't even have it in you to work when you were 25. You're like, I don't want to do the work. Well, no, when I was 25, I was working a lot of hours and I was still When I met you, you're like, hey, hey, I don't want to do the work on this one. Can we find someone else to do the work?

That's true. But some of those businesses like the retirement home community or online websites, like a Place for Mom competitor and stuff, they weren't passion projects of mine. I was always willing to put in the work when I was younger into my own businesses that I was 100% owner in or 50% owners that I truly loved and I was passionate about. But there was a lot of businesses like, hey, let's go create an insurance lead gen business or a Place for Mom competitor for—

You made a poker site. Or a poker site.

Those businesses, I never had the passion on those subjects, so I never cared to put in a lot of time, but I was willing to put in some resources like money specifically. Nowadays, I'm not willing to put in the time into a new business. Like I just don't—

Nor do you need to.

Yeah.

I think the passion's also not there. The passion of compounding your money is more fun.

It's easier for me to just take profit that I'm making and dump it into like SpaceX or the stock market than it is to go work And you nailed it. It's easier for me to make money off my money at this point in my career and life than it is to go start another company. I look at that as just painful. I look at it as just deploy the money I make every month and why grind it out? Now, hey, I probably will make less money because of that, but I'm okay with that.

If someone sends this clip to your wife where you said, I'm okay, dot, dot, dot, she's going to hold it to you.

No, but she also knows that I enjoy working So, like when I travel and go to conferences and stuff, it still, it breathes life in me. I can't sit at home and do nothing. But when you look at it, when I speak at conferences and network and do meals and all that kind of stuff, that's a lot of hours of my week. But to me, that is not working. That's just chilling with people I like and having fun and networking and just shooting the shit.

Well, I'll come back to how we spend our time at conferences because I want to call you out for this. So we, well, let's just talk about it first. So there's, so Neil's an Indian person. I also had another Indian friend that spoke at one of my conferences and Neil and him both spoke.

Okay.

And the other guy was like, I saw him watching every single talk. He was like fully engaged for 2 days.

Yeah.

And he's like, you know, he's like, you know, Eric, I'm just a student of all this and I love it. I can't stand people that come in and just like, they just do a talk and they leave. Right. I was just thinking about you because Neil comes in and just leaves. But anyway, that was just—

Not leave the conference. I mean, sorry, not leave the city, leave the event.

Yes, leave the event. And then you do other meetings.

I'll do other meetings. Or even then I chilled with other people during lunch. We were talking about deals and stuff like that. That I enjoy. I do not have fun in listening to sessions. I'd rather send one of my team members and have them listen to sessions and take notes and then implement whatever they learn.

So speaking of single brain right now, I'll tell you kind of the interesting thing that we're doing with this. So keep in mind guys, this is managed revenue agents that we build for clients. When we start with them, it's a pilot, okay? So it's like, okay, you pay us, I don't know, $25 grand or something for a pilot. We do it for 45 days, right? And my CTO and I, we're on the call. Then what happens afterwards is we start to charge like a monthly fee, like $5, $10, $15, $20 grand or whatever. But after that, Neil, because it's so ambiguous, it's like, oh Neil, you want us to see, oh, your Anthropic bill is $10 million? Okay, what if we cut that by 90%? Will you pay us 5%? Okay, we get a performance on that, right? Or if it becomes, Oh, you want more creatives right now? How much are you paying for creatives right now? $500 per creative? Okay, we'll charge you $50 per creative. Oh, how much are you paying for this? Like, so it becomes more outputs and outcomes based by just saying there's a tier. It's like pilot, then there's a base fee, and then it's like after that we'll negotiate. And I think a lot of outcome-based pricing is coming for stuff like this.

Yeah.

It's just you can't map it out immediately because it's too early. You can't go for the ask immediately. So you go for the pilot first and then the base fee. And then you go for outcomes, so.

I totally agree with that. And I think it's a slow roll. It takes time. People have to be patient for many years before this fully gets implemented.

Yeah, totally. And that's, I think that's a boon for me. I think that's a boon for you as well.

Yeah.

And like, I wouldn't be surprised if you buy a bunch of these implementation companies as well.

We're already starting to look for some of 'em.

Yeah, I'm sure.

The problem right now is everyone just wants crazy multiples and I'm like—

What are they asking for?

Some are asking for like 25 times profit, 20 times profit. I'm like, no thank you. And there's a lot of 'em popping up. up and they're all like, this is the new future. I'm like, cool. They're like, it's so well, we have so much demand. You look at them every month, you're like, okay, so where's your growth rate? Where's the crazy growth that you're telling me you have so much demand?

What is the crazy growth rates that they're giving you right now?

Some of them are telling me like they can triple every single year and we're seeing more—

But they're not.

We're seeing closer to like 30 to 40% growth for most of them.

Per year?

Per year.

That's not triple. Never, never.

I'm like, no one's going to give you 25 times because growth is going to slow down as a ton of competitors enter the market. There's also going to be more demand, but people are going to be willing to pay a lot less for this than they are willing to right now. I think in the future, or let me rephrase, people will spend more money on it, but there will, for the same project and the same hours, I believe in the future, people are going to be wanting to pay less for that because there's going to be more optionality. There's going to be more efficient ways to do it. People have learned a lot from it, but in total, in aggregate, I believe companies are going to spend more in total on You know what I think would be better?

Like for, if I'm putting myself in your shoes, right? It's like, how do you hire these super crazy kids right now that are super motivated, right? And they might join as an intern, $20, $25, $30 an hour. Within 3 to 6 months, you know who's a superstar, probably within the first month or 2. And then these people are the ones that are building this out for you because they're so motivated and maybe you give them a piece of the action, right? And because I don't think this stuff is particularly hard. When clients come to us, oh, You know, the token costs are getting out of hand. Okay, yeah, well, that's obvious. You would just buy your own or rent your own infrastructure, put it on GLM 5.2, buy some subscriptions over here. Like, you give them the whole model, but like, the kids already know all this stuff.

Yeah.

Right? Permission, governance, all these things. You gotta have these 6 layers over here. So that's probably a better model because one of our mutual friends, all he's doing right now is hiring interns, nonstop interns, and they're running circles around the product team. The product team hates them. Their product leader got fired. I think another one of the product leaders quit or whatever. So it's like, it's good.

The same friend that's laying off a lot of people to increase EBITDA and redo their bank loans?

Yes.

Yeah.

Yes.

I like him.

Yeah.

It was a smart model.

Yeah.

But speaking of that, when Eric and I mentioned debt and reinvesting your money, keep in mind one of the quickest ways to go bankrupt is taking on too much debt. You need to be conservative if you're ever going to leverage debt.

You know, my friend Charlie Munger said this, he sits in my home. And so, you know, my friend Charlie Munger, rest in peace, he says, you know, the 3 ways that men go broke broke, ladies, liquor, and leverage.

Yes.

And it's really the last one that matters. It's leverage. He made up the first 2. The ladies, the liquor piece was just for fun. It's the leverage. So it's not saying don't take on leverage, but there's like too much leverage and there's also bad leverage too with bad terms.

Yeah, it's like I meet up entrepreneurs who are trying to grow their business and they have no debt and they're like, look at us, we did $7 million in profit. I'm like, cool, what's your debt load? Nothing. And I'm like, I'm not saying go stack your company with $20, $30 million on debt, but I'm like, you have all these ways to grow, right? Yes. What are they? Do you think they'll produce results? Yeah. When are you going to do them? Oh, we're going to do them in a year or 2 because, you know, I don't want to take all the cash flow. It's going to be too risky. Have you thought about getting an SBA loan and just taking $3, $3.5 million? It's paid back over 10 years. Oh, that's not a bad idea. I'm like, yeah, you can do a lot of that kind of stuff now.

Mm-hmm.

Now, one of my friends, Sean, owns a company and he is taking on leverage to get into retail stores. And he's just expanding fast and doing deals with really big box retailers like a Walmart or a Costco and places like that. I really literally believe his Walmart deal's almost done. And it's great. And it's just like, yes, leveraging these kind of scenarios, low leverage is really worth it. That's less than 1x profit.

What Neil's also talking about too is leverage is an amplifier, right? Just like AI is an amplifier of intelligence. So if you have a good business model, leverage will amplify a good business model, but also amplify a bad business model too. So by the way, a good business model can become bad. Remember I had that loan from a few years ago that was a lot?

Yeah.

Remember that one? Yeah. Thank God that worked out. That was a bad one.

It also worked out for you.

It worked out. Yeah. That one was, that one was like 8.

Yeah.

Got that down to very low. We'll just leave it at that. So anyway, all that to say is I think when Neil's saying this, you know, you just look at your, you're talking about the loan-to-value ratio, right? What are you recommending to the audience here?

If you're starting off half a turn, one turn, so half a turn, if you do $10 million in profit, you take $5 million. One turn would be be $10 million is you take $10 million on debt and you deploy it wisely. You don't just go and burn it and deploy it all crazy and all fast. And you draw on it. You can usually take it as a line or you can do like an SBA loan. And when you think about it, if you're doing a million in profit and you took on half a million in debt from the SBA paid over 10 years, that's only $50,000 a year. That's very manageable.

I think—

Plus interest.

The smart thing too, when you're talking about raising debt or VC, is this is where you actually use the powerful models like Fable or, you know, SOL, and you actually workshop it because it will help you unlock whether it makes sense to raise money or not. Because it's like, oh, if you want to grow faster and the only constraint is this, then yes, absolutely, you would raise money. But if you don't have a good system, then yeah, you shouldn't raise money.

Yeah. And me personally, I always operate at less than 1x. I never try to go over 1x. I just It's, there's nothing wrong with doing 2x, even that a lot of people say it's conservative. I just don't want to be holding in case there's another COVID or anything like that. So I always try to be at less than 1x.

Yep. Yep. So that's what we have to say about debt and doing deals.

And I think we have time for one more.

We do. You can pick one.

Let's go with B2B creators are becoming channel partners.

Where's that? Need a big creators.

Okay, I see that.

That's funny.

Creator programs are evolving from awareness plays into pipeline and partner distribution systems.

You know what's interesting? I want to say B2B here, but one of my friends, so I was playing poker with him. I was at the— I was playing poker during the World Series of Poker last weekend and his business does about $160 million a year and he works with Bryan Johnson. So not B2B, but he's B2C. And he has grown a good chunk of his revenue off of just working with these D2C creators and just working with them as channel partners. And so I would just say like, that's one example, but you and I get a lot of outreaches. And so I have my little Mr. Siu outreach thing, which is working really well, by the way. But I can't, you know what I would say? Whenever I watch these AI videos, a lot of these people are sponsored by HubSpot, sponsored by this company, sponsored by that company. And it seems like it's a, It's like you do a lot of influencers, so I'm curious to hear from you how that's panning out. Like how fast is that segment growing for you?

It's growing pretty well. What we see as the biggest, if you want to actually look at creators specifically in B2B, when we look at most software as a service companies, the creators and influencers that do the best are creating videos on very specific things. So let's use SEO tools as example. Eric and I both have SEO tools, so they may end up How to drive, how to rank number 1 on Google. And they do a whole video tutorial on how to do that. And then they'll do another one on how to optimize your WordPress site to show up on ChatGPT. And they'll do a whole tutorial that shows you how to do that with the tool Ubersuggest or Eric's tool or someone else's tool out there. And they're plugging the tool and they're like, oh, if you buy from my link, you'll also get X, Y, and Z that helps you get ramped up faster or helps you do X, Y, and Z faster. And that usually helps push people over the line because they're giving them something extra to sign up through their link. And those videos don't generate a lot of views, but people are creating hundreds of those videos and then you're getting a lot of influencers to do it and it adds up in mass quantity and you're giving people 10, 20, 30, 40, 50% commissions. It adds up fast.

And you just need someone to manage it for you. So if you have like an NP Digital, for example, they can manage it for you. We don't do it. I can say for my YouTube channel, I might not get the most views right now on my YouTube channel, but even if I get 1,000, 2,000, 3,000, like we're getting legit leads that come from the YouTube videos, like legit companies. Yes. Yeah. So you could, I would recommend, yes, you become the creator. If you're watching right now, your employees become creators as well. And you need someone that, someone good managing your influencer program could be like NP Digital, but it's not us. So anyway, that's it for today. We'll talk to you later. Goodbye.