From Dropout to Billionaire: Lucy Guo’s Success

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I would not invest in any company that has like an exit plan. Like, I think a lot of people in their pitch deck always include like a, this is how we exit, and it's like, we get acquired, right? And when people ask me of an exit plan, I'm just like, why would I have an exit plan? Like, there is no exit plan. Because I think if you're already thinking about how to get acquired, like, the company's dead.

Hey everyone, I'm Dan Bova, writer and editor at entrepreneur.com, and welcome to How Success Happens, the show where we talk to people who aren't afraid to take big risks and ask big questions. So here's a question: is a college education worth the price of admission? Uh, today's guest might be able to answer that. Lucy Guo dropped out of Carnegie Mellon to pursue other interests, And it seems to have worked out for her.

Uh, the 30-year-old was recently named on Forbes' youngest self-made female billionaire after her first business, Scale AI, was acquired by tech giant Meta.

Uh, she is the founder and CEO of Passes, a creator-first platform that has attracted some huge investors with huge names like Shaquille O'Neal. She's also known for keeping a pretty packed work schedule. So let's not delay for another second.

Welcome, Lucy.

Thank you for having me. I'm excited to chat.

Great, great. So my first question, did Taylor Swift send you a note when you unseated her as the world's youngest self-made female billionaire?

I'm a huge Taylor fan. Like, she's probably the only person I've ever met in my life that I've like, you know, fangirled over. Like, I was like shaking. So no, she didn't send a note. And it was really sad because I would have loved a note.

That's great. That's awesome. So I don't want to be too crass and talk about money, but I just have to ask. So what's like, in practical terms, what's the difference between one day being a multimillionaire and then the next day being a billionaire? Like, what does that mean to your day-to-day?

Honestly, it doesn't really change my day-to-day much. Like, I still wake up, I go to Barry's, I go to the office, and then I go home and sleep. I would say there's like maybe occasionally there's differences, right? Where I don't feel as bad for maybe booking a private jet somewhere because it saves me time and that time is used working. I really, I do think time is money now more so in like those terms where it's like, okay, like the time I'm saving, like what could I be doing to like reinvest that money? back into like my business or like other investments, etc. But day to day in my life, it's very much the same. Like I still ordered my UberXs today to like get around the city.

Yes. Yes. I'd love to dig into some of that a little bit later as we talk about what value is, what's worth spending a little bit more for and what maybe isn't. But I'd love to start by just asking you about your decision As we noted, to drop out of Carnegie Mellon to just kind of go for it. Was that an easy decision to make or did it— was it a hard one to make?

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Yeah, I would say it was a super easy decision to make. At that point in time, I was already going to a lot of hackathons, spending time outside of campus, and I felt like I was learning more at these hackathons than I was in college, because college is very focused on, like, you know, theoretical computer science versus at these hackathons, I was like actually building apps. I was learning the tools needed, right? I learned most of my product design work at these hackathons. I learned how to build iOS apps at these hackathons. And it really got me thinking in a startup mindset. And I generally think in life when you optimize for learning, you can't go wrong. And I felt like I was going to learn more outside of college. But not only that, I thought I would gain access to some of the brightest minds in the industry just because that was kind of what the Thiel Fellowship was promising.

Mm-hmm.

I do think that you end up being like the average of the people you hang around with most. And it was an opportunity to be able to be surrounded by young, ambitious people that all wanted to start companies and change the world.

Do you think that people value what you just said enough? Like, you know, people are afraid to not be the smartest or one of the smartest people in the room. But what you just said was about surrounding yourself with brilliant people. Do you think people take enough stock in that?

I think everyone should be surrounding themselves with brilliant people. You want to be the dumbest person in the room. And if you're not the dumbest person in the room, like, find a different room to hang out in.

Right. Now, you're just— it sounds like you were very confident. You know, was your— was your family and friends telling you you were crazy? Or how did they react when you said you were going to?

I would say absolutely. My peers thought I was absolutely crazy because Carnegie Mellon doesn't really have that, like, traditional startup culture that other universities might have. Like, I think it's very good at training you to essentially be like the best computer scientist around, and you go off and work at like Palantir, Dropbox, etc. Those are the cool companies back in like my day and age. I think that, and my parents just, you know, they were immigrants from China, and education had given them everything they had in life. So they valued it for me, and to them it was me throwing away an opportunity for a good life. throwing away their sacrifice to go fuck around. So they weren't very happy with me either.

Are they happy now?

I would say they're happy now. Yeah.

That's good. So what is your— what's your advice for people who are, you know, about to make a big decision, maybe make— take a big bet on themselves? They're feeling a little uneasy and maybe they're not like You know, there are voices telling them, hey, I don't think this is a good idea. Like, how do you push through the kind of negativity, for lack of a better word, and just go for it?

Yeah, I mean, I think in general, people— what's the right way to put it? I think they over-index on the risk. Like, they think that things are riskier than they actually are. At the end of the day, you're not really losing much, right? Like, dropping out of college, you can always go back to college. Leaving that job, you may lose like a few years or like money, but that's not the end of the world versus like hopefully whatever you're pursuing next is going to give you the knowledge needed to really advance your career. Like worst-case scenario, you gain a bunch of knowledge. Best-case scenario, it's like life-changing money.

Yeah, right. So you seem like you're obviously a very driven person. Were you always this way? Were you like this as a kid?

You know, weirdly enough, I think so, but like not necessarily for like the motivation of wanting to change the world. There was something to like being— I was always competitive. So I think this like started off when I was even, you know, selling Pokémon cards on the playground or like building bots to like make money on Neopets. Like I wasn't really using that money to invest in stocks, for example, at that age. Like I was specifically building bots to get items on Neopets to sell and make money so I could buy better pets on Neopets.

Okay.

buy other things I wanted, like skateboards, et cetera. Because I always wanted to like be the best at everything. And that included like owning the rarest pets on Neopets. Yeah. And I think that competitive nature drove me to like really where I am today. I also think I just like really love building products. I think like, I don't know if it's like just competitiveness, like, oh cool, I built like the best arcade website, I built the best internet marketing tool. But it's really cool for me to see like people use my, like, the apps I build, right? Like, I would build random apps on weekends for fun, um, and then just launch them on Product Hunt, and then they would go viral and get millions of users. And just like seeing people out in the wild use it was just very cool.

Yeah. Oh, that's cool. Well, I was just gonna ask you, I mean, besides, besides obvious, uh, monetary rewards, like, what do you, what do you get out of all this? Like, what, what drives you to keep wanting to do more, you know, Some people would say, hey, you've made a pretty good living. You can retire and do nothing for the rest of your life. So like, what makes you want to keep doing stuff?

Yeah, I think I just want to continue to impact the world. Like with, you know, Passes right now, I'm friends with our creators and they tell me constantly how their lives have been changed, how they've been able to buy a house, pay off student loans, like pursue their music career, et cetera. I think at the end of the day, like, When you are able to make money, you can drive impact in the causes you care about. Because theoretically, like, let's say I was like making tens of millions of dollars selling socks, right? Like, I might not necessarily be passionate about socks, but maybe I'm really passionate about education, and I could use that money and like start a nonprofit or donate it to somewhere where they're democratizing education across the world. I think that like in general, money drives the world and money drives impact. So I keep doing what I do to continue driving impact.

That's great. Can you, can you explain a little bit more? I just sort of like brushed on what Passes is, but can you, can you explain what it is and how it's different from other platforms?

Yeah. So at Passes, we're building infrastructure to help creators really build their businesses and their brand, which is pretty different than other platforms in that there are no other platforms that are doing this. This is everything from, you know, like we're giving them health benefits so they don't have to worry about that. Because a lot of people worry about health insurance when they, you know, leave their jobs to really give them data and analytics like AI agents to help A/B test their posts and like figure out like how much like pieces of content should cost. Stuff that like maybe managers do, but they take 10 to 20% of your earnings in order to do it. We're like starting to look into building fintech tools as well because we like care about the long-term generational wealth. Like thus far it's been more like white glove customer service in that sense where, you know, we can like show them the right directions or like introduce them to like the right wealth managers. Like, could we do that in-house? Like, absolutely.

So how does it work? Like, how does— is it anyone? I've got a YouTube channel and I come to you and I say, I want to, I want to be bigger than MrBeast. Or like, how does it all work?

Yeah, so you just sign up and it's— we have our self-serve product. And there's a bunch of different features people use in different ways. So when you land on like my page, for example, the first things that I'm selling are like, you know, one-on-one video calls, Cameo requests, merchandise, et cetera. Some people use it for livestreams, some people use it for messaging, some people use it to like manage their Discord channels because Discord has been like a very popular form of community. So now they can earn money on their Discord channels. We're continuously building different revenue streams for creators to be able to monetize because every creator Like, has like a best way of monetization, I'd say.

You, uh, I mean, you, you explain it, uh, so well, and it sounds like such a great idea, and it is such a great idea. What's your approach when you are talk— when you're pitching to investors? I mean, you seem, you seem pretty convincing. Uh, what's your advice to people who are— got their, their first idea, or they're going into their first pitch meeting?

My advice is actually very different for raising money. So I think when you're raising money, you should always only be raising when you don't need to raise, or at least act like you don't need the money, because that's when investors want to come to you, right? So my piece of advice there is, if you're starting out, you have no metrics whatsoever, go approach investors, but like from an advice standpoint, like don't ask for money, just say like, hey, like, I really admire you because X, Y, and Z, you seem domain knowledgeable in what I'm building. I'd love to grab a coffee and get some advice on an idea I'm having. And then you ask for advice, you talk about yourself, and at that stage, they're really betting on you as a person. And if they want to invest in you because they think you're impressive, they're going to offer themselves. And when a round is preempted, it becomes like the hottest thing in town, I guess. For my Series A, so we did a pretty large Series A earlier. I— our numbers were just like phenomenal, and I knew that. So I just sent out an investor update, and immediately everyone started inbounding and asking like, oh, are you raising? Like, let's chat, blah, blah, blah, because they just wanted to preempt it. And when I got my first term sheet and it was a preempt, I was able to go to everyone and say like, hey, I wasn't fundraising, but like we got preempted and then we became the hottest ticket in town. So there's strategies, but the main strategy is like, act like you don't need the money and they'll come to you.

Got it. That's great. I love that. Let's talk a little bit about— so Scale AI people, what do you say to the people out there, maybe a little older people? People are terrified that AI is coming for their jobs and about to put us human beings out of business. What do you say to people who feel that way?

Yeah, I mean, I think AI is going to be our best copilot. They're going to help us be better and more efficient at our jobs. And at the end of the day, human traits are things that like AI can't really replicate or like human relationships. So for example, like AI might be able to do a lot of outbound for creators, like, you know, find brands, reach out to brands, et cetera. But at the end of the day, there's a relationship built between like the creator and the brand and like someone needs to sign the contract. AI is not signing the contract for you. And I think that over time, these like innate human qualities are going to become like human-only qualities, like being good at sales, for example.

Yeah.

And being able to build relationships, understand people, like human empathy, that's just gonna become a more necessary skill in the job force. And I think new jobs are going to appear that we might not necessarily know need to exist, but will exist in the future. Like prompt engineering is already like, you know, a very hot job at the moment. And that was not a job years ago.

Right, right, right. Yeah, of course. You just touched on something that I wanted to ask about, you know, some of the entrepreneurs that I've met, You know, they have great ideas, but they're also very introverted. They are not good salespeople. What do you advise to people like that that maybe aren't so great at walking into a pitch meeting and having, you know, jaws hit the ground about their great idea because they can barely put a sentence together?

I would say go to like executive coaching class or get a co-founder that is great at sales because at the end of the day, you're not just selling like Like, you have to sell everyone. You have to sell to your employees. Like, you have to sell to people to hire them. You have to sell your product. You have to sell investors, et cetera. Um, and if you can't do that sales, like, you need to have that co-founder, and that co-founder needs to be able to do sales, or go to an executive, like, coaching class and learn how to get good at sales.

And how do you, with your team or teams, how do you, you know, describe your leadership style? Like, how, how do you keep everyone on the same page? How do you keep everyone moving forward? Are you in the nitty-gritty of everything or do you kind of give them the ball and watch them run? How does it work with you? Yeah.

So, I ask that all my leadership is also like they do IC work because I really do believe that as a leader, you cannot judge how good your team is unless you do the job yourself, right? How do you know that customer support person that you hired is doing a good job with their answers, is responding quickly enough, et cetera? if you aren't doing it yourself. Like, how are you supposed to know someone's a good designer unless you're a great designer yourself? So I, I would say I'm definitely in the nitty-gritty and I try to like do the icy work in every single function along with asking my team to do it as well to be able to really judge if their team is doing well. We have like literally a product quiz that goes out every single month and we require everyone in the company, including managers, to take this product quiz so that when creators have a question, Whoever's able to answer first answers first. Like, I don't like things kicking down the line of like management layers because that's just not the fastest way to get things done.

So, have you, have you had any mentors along the way to where you are now that made a, you know, kind of significant difference in how you approach things or, you know, just any aspect of your career?

Yeah, I mean, I've had amazing people that I've always asked for advice from. Honestly, VCs, where I would, you know, map out pros and cons. I remember like a big one was leaving Snap to go to YC and really just, you know, asking every single person for feedback, advice. I will say most of them told me to stay at Snap. Like when I didn't, they were still there for the journey for me.

That's great. Well, let's talk a little bit about your day-to-day because, you know, you've talked about this and it's, you know, you're not a slacker, Lucy. Can you describe a day just like, you know, when you get up to when you kind of like snap the laptop shut for the day?

Oh snap, the laptop shot is kind of different. Okay, yeah, so I would say I probably get up at like 5:45 AM-ish, um, and then quickly pack. I go to Barry's and then I'll do 2 Barry's classes in a row. I'm getting lazy though, I used to do 3. Okay, so I do 2 Barry's classes in a row and then I pretty much go like straight from Barry's to the office, um, and then my day in the office is very It's not always consistently the same, but I think that like what generally is consistent is I meet with the design product team because I wanna see like how far along we are on building our features. And then I wanna catch early UI/UX mistakes. Like the worst thing that can happen is, you know, you have a product idea, the designer takes a month or 2 months to design it and it's nothing like what you want, right?

Yeah.

So I stay close to that team and then I stay close with like, you know, our marketing socials team, just speak in our sales team, because obviously those are like the GMV revenue drivers. So working on strategy there on just, you know, ways we can automate the process more, how close we are to like getting a contract signed, etc. Other than that, it can really vary. So for example, today was like a big podcast day where I filmed with you, Nasdaq, and one other person. Actually, Nasdaq was really more a little interview, but Yeah, it's, it's really never the same.

Wow. So I'm exhausted just listening to that. What is your kind of secret for staying energized for all of that?

I think that working out is actually a really big part of it, to be honest. It keeps me disciplined and it adds an extra cup of coffee. Like, it feels like an extra cup of coffee in a day. And I like, I hate that this is like such a eh answer 'cause it's not really advice, right? But my parents just never really slept. I'm pretty sure I have that gene where you don't need to sleep that much. Like my parents probably sleep at like 1:00 AM and wake up at like 5:00, 6:00 AM daily. I saw them do that like my entire life. So they, yeah, I kind of just learned from them.

Wow. You should get some sleep.

I think some sleep would be good.

Yeah, I do.

I would say like last night I got 6 hours, maybe 5 and a half.

Wow.

Like, I try to shoot for 6 hours a day. Like, that is like my ideal scenario.

Okay, that's good. So is there anything that maybe people dream of, oh, one day I'm gonna have this, you know, shiny object that maybe you've experienced and you're like, let me save you some time and money, it's not worth it?

Um, I mean, I think having it and like renting it is kind of different. Um, but I think, okay, I would say like, I think my first answer is probably nice clothes. Um, I don't actually think it changes. Like, I can't explain it. Like, I think it changes people's perception of me. Like, if it looks good, it looks good. Like, that's, that's my opinion on things. Mm-hmm. Uh, I think my next thing is, Um, at least for me, when I do the math, like, you should just charter. Like, having a private jet actually doesn't make sense. And I've ran the numbers in every single way possible. And you just like— and I get like, I would have actually spent more money and been okay losing money on a PJ knowing that I like, it was my own plane. Except then I realized your plane is out of service like a decent amount, like 2 months a year.

Yeah.

And at that point you're chartering anyways. It was like, okay, so you don't even get your own plane anyways. Um, because, and I would like, I've been on enough flights where like the plane just like goes out of service that I'm like, no, like we, it's actually better the charter.

That's great. I, I, I spoke with somebody, uh, recently who, um, uh, did get a PJ and told me confidentially, I'm going to be paying for this thing for the rest of my life. So, uh, you know, I, I think, uh, that's good advice. All right, so I'm not gonna get a private jet.

Yeah, even with the 100% bonus depreciation that you can now do, yeah, it's still like you will still lose money versus chartering.

We always also ask people for their business hot take, the thing that they cannot stand that they have to experience over and over, uh, either in the workplace or in pitch meetings or whatever. Do you have one?

Like things I hate about running a business, or like just—

Just something that bugs the shit out of you. That it could be as little as, as easy as someone sticking a meeting on your calendar that you didn't like ask for, or it could be bigger. Some people say when someone's pitching me and they have terrible breath.

So it's like, is there anything that you're just like, I hate Oh yeah, I would say like, I think that I really hate meetings. Like, I think all meetings should be like 30 minutes minimum, like maximum. Um, you can do things mostly async. Um, and then if we're talking about just pitching, um, this is actually a really hot take, I think, but, um, I would not invest in any company that has like an exit plan. Like, I think a lot of people in their pitch deck always include like, this is how we exit, and it's like, we get acquired, right? And when people ask me if I have an exit plan, I'm just like, why would I have an exit plan? Like, there is no exit plan. Because I think if you're already thinking about how to get acquired, like, the company's dead.

That's awesome. I love that. That's great. Okay, so we get reader questions or listener questions. I keep saying reader, but listeners on podcasts.

Is this live?

No, no, no, no, no, no.

Oh, I'm so confused.

Sorry. Yeah, no, we, we, we go on social media and say, hey, we're talking to Lucy. Anyone have a question? So someone popped in a question. How do you celebrate a win? This is from Ty asked that.

I mean, this is strange, but I don't really celebrate. Yeah, I, I'm not like, okay, yeah, we won, like, now let's go throw a party or like go eat dinner. Like, yeah, just move on to the next.

All right, that's great. And, uh, and now in the interest of time, we're gonna, we're gonna slide right into the speed round. Uh, so I'll ask you a couple quick questions. So the first one is, what is a habit that you are happy to And one that you wish that you could ditch?

I mean, that habit that I'm very happy to have is just Barry's Bootcamp again. Really, they should give me some equity in the company. I don't actually own any and I don't get referral fees, but it just keeps me energized in the day. I think that like as a founder, you can go a little crazy when you're putting in a bunch of effort into a project and you're not necessarily seeing the results or output. But with working out, it's just so consistent, right? Like the output you get is the input you put in. So that, and then what's the other question?

What's, what's a habit that you wish you could ditch?

What's a habit I wish I could ditch? Um, I don't really have bad habits, to be quite honest.

We'll take it.

Yeah, I'm thinking right now. Um, I guess Like how I wish I would eat healthier. Like, I don't know if that makes sense. Like, I haven't— like, I wish I could ditch it. Just like, oh, how about I wish I could ditch it? Like, so when I'm like sitting down and bored, I'll just like eat even if I'm not hungry. I'll eat nonstop. So, and I don't eat healthy foods either. So in that sense, like, I need to just like— I wish I could just like focus.

Yeah.

Like if I'm on my laptop just like working on I'll, I'll just eat because I'm like, well, okay, like, I'm just like sitting here and like, I'm on my laptop, I might as well just be multitasking with food also.

What's your, what's your go-to snack?

My go-to snack would probably be these like truffle chips from Taurus. They're delicious.

And for those, for those who don't know what Barry's Bootcamp is, it is an incredibly intense workout. And the fact that you do 2 of them back to back and used to do 3 of them back to back is just— I barely made it out alive at one. So that's pretty—

I will say, I think like my determination is quite impressive. Like there's a worldwide challenge that was going on and I want to get first place. So I remember on the last day of this challenge, I did 7 classes in a row to make sure that my team won first.

That is dedication. What is something that most people love that you secretly can't stand?

I mean, I don't want to say secretly can't stand, but because I like, I just don't care. But, um, I think that like I don't spend any time really like watching movies, TV shows, scrolling TikTok, etc. And I do think that that's why I have like so much time in my day. Um, but yeah, I mean, like it just, it's not in my schedule.

Uh, and then, uh, as a social media, uh, person, what is something that the algorithm keeps feeding you that you wish would stop?

Oh my God, these like Chinese dramas. It's like ridiculous. And the yearly subscription to these Chinese drama like TV apps, which are like the short clips, are— it's like $400 a year for like the worst The worst cheesy crap ever. And I'm like, I get it, I'm Asian, but like— and they're like, it just seems like cheesy love stories where like someone has a secret identity and then like identity is revealed and like some other girl is jealous of the girl and like the drama happens. I'm like, why? They're all the same script.

Well, I think you should start— I think you should start a competitor. You could, you could beat it, beat it at its own game. What do you say about that?

Honestly, they're probably making a lot of money.

Yeah, at those prices they need to We need a few people addicted.

Right, right. Awesome, awesome. Well, Lucy, you are an incredibly busy person and incredibly inspiring person. I'm sure people listening to this are all fired up. So thank you so much for talking to us. How, how best can people kind of keep up with what you're up to?

Um, just go on my Instagram. It's just Guo for it, go for it, but Guo. And, uh, I story stuff in like real time basically, so you'll be very kept up.

Excellent, excellent. Well, I, I really do appreciate your time and, uh, just amazed by what you've accomplished and, and can't wait to see what you do next. This is very cool.

Hey, what's the biggest hurdle that you feel like is getting in the way of your success? Let me know at howsuccesshappens@entrepreneur.com.

At CLA, we're in your corner and on it. We coach tax strategies and Little League first base. We help you adopt AI data tools, and we adopt rescues named Buddy. We walk your factory floor and jog the local 5K, though sometimes we walk that too. Wherever you're coming from, we're right there with you. And we're here to help you. Wherever you're going, we'll get you there. CLA, CPAs, Consultants, and Advisors. Learn more at claconnect.com/withyou.