Here's How We're Investing Our Money

Johnny Volk, he asked, what are you both personally investing in right now?

By the way, do you know Johnny Volk? Do you know who this is?

He, I talked to him on Twitter and he's Joe Spicer's buddy.

He lives out here in the Bay Area. He lives like, I don't know, 15 minutes away from me. He's a super successful e-commerce guy, been in e-com for 10 years, sold his company recently, like, I don't know, a month ago or something for tens of millions of dollars. And he's a big investor in my rolling fund and several other rolling funds. Uh, really like ultra nice guy. So this guy's super legit. So he's asking, what are you both personally investing in? So you want to go first? I think you, uh, I think your answer is probably more interesting.

I'll go first. So right now the bulk of my liquid net worth is in publicly traded companies. Um, I own a bunch of HubSpot right now. I own a bunch of Airbnb. Besides that, I don't own anything else above $50,000. Uh, it's all in, um, so you're super concentrated in those two companies basically. Yeah, but then I have more money in the S&P 500. So like the total stock market index. Um, I have, I'm going to invest around $250,000 to $500,000, uh, in the next probably 18 months in startups. Uh, I ha— I own six figures worth of, uh, into a variety of real estate funds, including Sweaty Startup, Nick Huber. Um, and then I own, um, my house, uh, and I'm in the process of buying multifamily properties.

So I would say I have, uh, if you just broke it out, you're like, you know, roughly you're like, okay, 70% is in the stock market, really in the two companies, you know, where, where my wife works and when I work, something like that.

No, I, I own way more just S&P 500 than I do HubSpot and Airbnb. Um, but I would say that, uh, 90% of my net worth is in the S&P 500. Yeah.

Oh, wow. Okay. So just like low, low, low-cost index fund, basically Vanguard fund, simple stuff.

And then my goal is to invest somewhere around 1 to 3% of my net worth over a period of time into angel investments.

Gotcha. Uh, cool. And then some real estate mixed in, real estate being, you know, the house you live in and some other, you know, projects other people are doing. You're not currently Buying and owning real estate at the moment?

I own my house, but I want to buy 16 units. I also have, I mean, I'll say like half a million dollars in cash just sitting in a checking account, which I think is too much money. But when I bought my car, I just paid cash out of there. And then I own six figures of Bitcoin and Ethereum, of which I owned most of that Bitcoin from 2013. And I just bought like $75,000 worth of Ethereum. Like a few days ago because you and a few others told me it was interesting. Nice.

Uh, by the way, we got some criticism, constructive criticism I would say, which was like, oh, the last few episodes, uh, feel like, you know, rich guys talking about, you know, ways to make a bunch of money, which, uh, honestly, good description for the podcast. But, but I get what the person's saying because they're like a fan and they're like, that's me raising my hand because I think I basically was like, oh, this BitClout thing is cool and it sounds like a total Ponzi scheme. And so people are like What are you— are we talking about like Jack selling like an NFT for like $70 million? So it just sounds like a little bit crazy. So I think, you know, although I think your answer is great because I like knowing how people invest their money, I think it's— most people are very closely guarded with that info. People don't tell you what the hell they're doing. So you're kind of on your own to figure stuff out and you don't really have any data points to triangulate because all the wealthy people don't want to talk about what they're doing with their wealth unless it's with other really wealthy people. And so I think it's great you said that, but I'm also, as you were saying it, that was just ringing in my head of like some guy being like, why are you guys just talking about money? But it's like, well, that's also the theme of the podcast in a way.

And that was also the question and I'm trying to answer it truthfully. But also when we started this podcast, when you started this podcast a year and a half ago or 2 years ago, it really wasn't a bunch of rich guys talking about it. It was a bunch of hopefully soon to be rich guys talking about stuff. And we've been talking about the same stuff the whole time.

Yeah. Oh, you mean us? Yeah. Yeah. At that point. Yeah. Yeah. And also I put this out there in the manifesto when I started this thing, which is I think it's unfortunate that talking about money and how to make money and what you do with money to make— how you make your money work, earn you more money. I feel like it's unfortunate that that's taboo to talk about. Like it's like kind of like a— it's like kind of like low class or something to talk about because look, the reality is most people want more money. and people try to signal and say, oh, it doesn't matter. And all this stuff. I know a lot of people that want more money. Most of the people in my life, if I had the option, would you like more salary or less? Would you like more in your bank account or less? Like, the answer is more. And if all the people who have money are really guarded and don't talk about it and don't want to seem like they're bragging, well, what that really does is it kind of like just traps the information from others. So that's kind of like my overall view of it. I know you're similar because I remember being kind of stunned when we first became friends and you just Facebook messaged me. You're like, like, how much do you make? I was like, whoa, whoa, bro. Like, what's going on here? But I was like, okay, you know, ballsy question.

The reason why that I actually dislike that view, that if someone criticizes you for talking about money, it's because they are making the assumption that because you have money or because you don't, you are somehow better or worse. And in my opinion, like, I don't— just because you have money, I, I, I, that's— you have no intrinsic value to me. Like, you either are interesting or you are not interesting. And what makes you interesting to me is that people are just— they try ambitious stuff and they do neat stuff. Oftentimes that's correlated with money, but it's not always. Like, I knew this lady who would do these amazing art exhibits where she would like paint gold phones and like just do interesting stuff. And I was like, Wow, that's super badass. That's so bold of you to try that. She wasn't wealthy at all, but I thought it was so cool. Right. Uh, so to me it's about, uh, just being an interesting person. I don't really care if it's money related or not, but oftentimes it is.

Right. For me, I have like 3 or 4 different, uh, life games that I'm very interested in. Like, let's say right now I'm interested in the fitness game and I'm a total beginner. I'm a white belt at the fitness game. And so I have a trainer. He's like more like a black belt, you know, look at his body, look at his lifestyle. He's extremely healthy. And so I want to learn about the fitness game. I like learning about the happiness game. How do you be a happy person? How do you control your mood? How do I master my mood? I'm really interested in that, and I think about that a lot, talk to people about that. Then there's like the money game, and then there's like the making things that people want game. And I like all these games, and I admire the people who have done well in them. And I'm better at some than others where I'm like a total beginner, and in some I'm like a blue belt or a purple belt where I've done something, but I'm by no means at the end. So anyways, that's a tangent. But to answer John's question, did you want to say something else about that?

No, I answered.

To answer John's question, I'm kind of similar. I tweeted out my like holdings a while back. Maybe I'll do that again. I need to go back and recalculate, but I tend to hold about 10% of my wealth in cash. I think cash is being devalued and I don't want to hold cash. Cash doesn't Earn, you know, cash sitting in the bank is nice for a rainy day, but it doesn't earn you more money. Um, right. The 0.001% I get from Wells Fargo or whoever is not going to like help me. Um, I have a good size stock, you know, basically I would say beyond that, it's almost like 50/50 of public equities. So stocks, um, and, you know, crypto right now. And, uh, I, and, uh, and then angel investing. So I'm angel investing currently. Through the rolling fund, $4 million a year. But that's not my money. That's mostly other people's money. And I get a carry on that. I get a 20% carry of the profits. So that's kind of like investing, but I'm not investing my own money there. And I'm looking at real estate right now. But the problem with real estate for me has always been, A, I'm a beginner at that game, and B, I don't want to sign up for more work. So I'm looking for ways to get real estate that I directly own. But I don't have to do a ton of work. And those two are kind of at opposites with each other. I don't invest in other people's real estate funds right now.

Has your net worth or like your total portfolio increased a significant amount since your deal? Because it seems like you've like, weren't very active before and now you are very active. And has that helped you?

It has increased because, you know, the stock market's been doing amazing last few years. And then with the deal, you know, like where we, when we got bought, the Amazon stock price was $1,850. Amazon stock price today is $3,100. So just while working there, you know, you can get pretty significant gain in your holdings there. And because we got bought, like a large chunk of the RSUs were just in that one company. So that did well. Uh, crypto is Bitcoin has done extremely well. Ethereum has done extremely well. So those have like, really worked. And then kind of like the side hustle money from podcast, email newsletter, stuff like that, sponsorships, that sort of thing has been really nice. So that's actually picked up as well where I wasn't doing that before. So I'd say yeah, but I would also say what really changed was my attitude. Like, I just started acting like a guy who's got $100 million for better and for worse. Like, I take bets that are kind of too big for my bankroll sometimes, and that's a risk, and I might pay the price, but I sort of just started carrying myself and acting like, and basically making decisions like, what if I wasn't worried about money? What if I wasn't worried about going from A to B? What if I just knew that I'll get to B pretty much regardless? How would I bet if that was the case? And so I started making slightly larger bets and just being more active. Whereas before I was a little more conservative with how I was investing, which is a huge difference in our philosophies.

I'm way more conservative than you. Way more conservative. Yeah. And I don't think I was telling a buddy who he was like, because I told him I started angel investing. He was like, who do you think is going to have a better portfolio? And I was like, that's kind of interesting. And I, and the answer was like, my answer to him was, I think my portfolio has a higher chance of being pretty good, whereas Sean's portfolio has a higher chance of being Amazing or zero, right?

Yeah, I think that's true. That's definitely true. I guess like the style of who you admire sort of dictates what blueprint you create. So like, for example, I was really inspired by like Chris Sacca's approach to how he went from like, you know, he's like me, he's like a bit of a degenerate gambler. Like he went, you know, he took like his law school money and then was day trading in the stock market during the dot-com boom, rode it up to like a $10 million— like took $25,000 and turned it into like $10 million and then went in the hole $4 million. That was like a crazy degenerate gambling run. If you haven't heard me talking about my bets in crypto and I used to play poker, obviously I have a gambling problem also, right? And so I have that risk and reward profile. But then the other thing he did that I thought I was pretty inspired by was he, you know, he bet on somebody who he believed in, which was Ev Williams when he started what became Twitter. And then when he saw that it was a winner, he like went all in in a way that most people do not. Most people would've let their $25K check sit and been really excited and fingers crossed, I hope Twitter becomes a thing. He like started, quit, he quit his job basically, started showing up at the office every day being like, how are we gonna make this thing grow? I want this thing to grow. He went and personally was fundraising for the company even though he wasn't even a part of the company. But he was out there pitching investors to invest in Twitter. And then he ended up buying billions of dollars of Twitter stock, uh, before it went IPO and was their, I think, first or second largest shareholder at IPO and made billions of dollars off of his Twitter holdings because he knew when you have a winner, you got to go all in. So what I've seen is in technology, the winners get really, really big. And so you kind of want to like play small bets initially and then follow on really hard. And like when you see something that actually works, be really bold in the way you approach it. And like, hey, if you strike out, like, I kind of just think about it like this. I have a lot of faith in my skills. Even if I went to zero today, I think in 3 years I'd be right back where I want to be. We're right back where I am today. So like, I don't feel like there's a huge risk in terms of that. But anyways, that's a little bit off topic for one question.

All right, let's do the next one, which was a question that I actually have for you as well. Update us on your Rolling Fund. Is it what you expected? Are you more or less bullish on it?

It is not what I expected in that I didn't really think too much about it before I started it, to be honest, which is, I'm kind of impulsive. I was just like, oh yeah, that sounds like a cool idea. Let me try it and see what happens. But I thought, okay, I already angel invested. This is just going to be that with some bigger checks or do a few more deals. But I would say now that I have to deploy $1 million a quarter, I actually have to carve out more time. I have to consciously go and invest in more companies. So it's more work than I thought initially, but I brought on Romain, I brought on Zach, Ben helps me with it. And so they do a lot of the heavy lifting. Like, for this year's YC batch, Zach himself referred in 22 of the companies. He was the number one, I think, refer into YC. So he knew a bunch of the YC companies before they even got in. We looked at those deals, And then Ramin basically and him went through every single deal on an Airtable, vetted them, made a list of the interesting ones, did meetings with them, and then brought the most interesting 7 to me and were like, hey, we think these are the ones to do. And so I've been able to handle the additional— so it's more work than I thought, but I found really good people, so that's helped.

Who's this guy, Zach?

Zach is a young engineer. He was a YC founder himself. That company didn't work out. He currently, uh, so I met him because he listens to the pod or I don't know what, I don't know how he reached out, but he's like, hey, I heard you're thinking about a rolling fund. I'd love to help. I just want to see a bunch of startups and help a bunch of founders while I think of my next thing. And, uh, and it just turns out he's just like super well connected with the like young founder community. And so because of that, he's like referred a huge number of people into YC and into On Deck. And, uh, so he's got this really great network and he's like able to like see things earlier than most. And so I brought him into the fund and gave him a chance to, hey, now you can have some upside in this thing.

That's badass. And then are you more bullish or less? More?

Yeah, like the same. I don't know. I was— I have a friend, we have a mutual friend, Sully, who he wanted to get involved in a business of mine. And he goes, he said he texted me something because I was like, I was like, kind of, I don't know, is this I don't want to give up equity, but I think you're worth it. Yeah. So basically he goes, look, if I try, I win. And with this, I'll try. And so I just loved it. I was like, I've just got to learn a lot from this guy's philosophy in business. He just has zero of the doubt and fear gene. And I think that's through experience.

You would know more than I am, but this guy, Suli, it's him and his brother. I'm not that close with them. I'm friendly with them. I'm friends with them, but I'm not that close. That close. Like, I— if you told me that they were worth over $150 million, I wouldn't be surprised. And they still act like they're poor in a, in kind of a funny way, which I enjoy.

And they're, they're super humble, and they're like super hardworking still.

Is super humble.

Yeah.

And they invest in everything. So these guys are interesting. They're two brothers.

Yeah. And Suli's the same way, actually. When I first met him, I met him at— you, you hosted the HustleCon dinner at my office. This is how crazy the world works. This is like one of those You can't connect the dots looking forward. You can only connect them when you look back. You reached, you cold emailed me saying, hey, I wanna host a dinner at your office. I didn't know who the hell you were, but you made a strong pitch. You said, I'm gonna have all my speakers for my conference there. You can, you can ming, you know, meet all of 'em. I was like, all right, fair deal. You can use my office. At that dinner, I meet Suli. Suli's now my best friend. We've done tons of deals together. You know, like that wouldn't have happened if I hadn't said yes to something that was kind of a random thing. That's funny. At that dinner, I was like, dude, this guy's amazing. I've never heard this guy's name before. Why don't people in Silicon Valley know this guy? So I started Googling him. I find this story that back in the day, he had this company that was building Facebook apps, and he sold it for not a ton of money, but good for any normal person.

Like $2 million or $3 million or something like that.

Between $1 and $3 million is kind of what it sounded like. And then what did he do with the money? He had been building on the Facebook app platform, so he had been seeing that his app was growing really quickly. And his app wasn't a great business. It was like You know, those like silly Facebook apps. But he's like, Facebook is not silly. So he basically took a bunch of that money and just— he was like Chris Sacca. He aggressively started buying up Facebook stock back then before it was public. And then he did. And then he went to, you know, in Florida and he bought a bunch of real estate. And I just thought, wow, this guy's really like conducting himself. At that time, I was just kind of like, I thought of myself as an entrepreneur, but I acted more like an employee. Like I wasn't playing the game to win. I was playing with these like invisible handcuffs on me. I saw these companies that were awesome. I didn't even go try to invest in them. And when I saw that this guy, when he knew something was good, he was like, how do I take all the money I have and put it into this Facebook thing? I believe in this. And simultaneously, I'm going to build my next business now, right away. And so I just really admired him, and I thought that that was a great example to follow.

I put my all in it like no days off. On the road, let's travel, never looking back. Oh yeah, feeling like gold, I don't wanna hide it. Ain't nobody telling me no, I'm catching feels wherever I go. Yeah, yeah, yeah, feel like I can rule the world. I got to rule the world. Yeah, yeah, yeah, like I'm on top of the world.