The #1 Most Underrated Quality in an Entrepreneur

Josh Wolfe has this phrase where he says, chips on shoulders equals chips in pockets. Basically, it's when you meet an entrepreneur who's got an uncurable, unhealable, you know, identity wound, um, that ends up being somebody who ends up doing really well.

Let me fill you in on some things that I saw this week that I just want to get your opinion on. Sam Lessin. So Sam Lessin, uh, I think he was like an early Facebook employee and now he's an investor. Uh, he's, he says a lot of interesting stuff. So he did this tweet where he talked about, uh, revenge businesses, people who have started stuff because they want to get revenge. And an example of this is this guy named Parker Conrad. Basically, he started this company called Zenefits, which was fast-growing company. It kicked ass, whatever. He gets fired because it was like a bro-y culture. There was like, people caught like having sex in like the stairwells, like people doing drunk dumb shit. Like there was also like some compliancy issues of like not everyone was like compliant. And so he got fired. And so he starts this new company called Rippling, which has taken off like a rocket. And Sam Lessin, I guess, invested in it. Same with Palmer Luckey, guy got fired from Facebook. He started Oculus, now starts, what's it called, Anduril?

Yeah, Anduril.

Yeah. And so anyway, Sam Lessin has this really cool line. He says, if you have in your diligence checklist, is this company a form of deep revenge? The answer is yes, cut the check. And the reason I'm bringing this up is because oftentimes you'll talk to someone and they'll say, hey man, you got a lot of hate in your heart. You gotta let that, you gotta let that out. You can't, you know, you can't, you can't hold that in your heart and you can't like live with that. I've taken the opposite approach for like the last handful of years. I actually think that hate, if you have in your heart, it can be really useful. Like revenge and rage is like a very useful feeling.

So is shame.

People will be like, Why are you guilting someone into like doing this or that? I'm like, well, guilt is a wonderful emotion to improve. Uh, and I wanted to get your opinion on his, uh, take here.

I mean, I think it's honestly kind of genius. Um, and I think people don't like to say things like this, but there are a bunch of heuristics for investing that sound so stupid or sound inappropriate, but are actually true and useful. So, you know, for example, um, and you, and you can frame these different ways, but, um, I have a friend who was like, you know how Paul Graham talks about he wants to invest in fierce nerds? And a fierce nerd is basically, it's a nerd who's like overly competitive and also like a little bit of a shithead. Yeah, exactly. You know, doesn't, uh, is looking to sort of break the system, beat the system, is, is overly competitive, maybe, uh, unrefined in certain other areas of their life, but That's what you want. And my friend was like, yeah, I look for fierce nerds who love money. He's like, specifically the for love, who, for who love money is a, is a multiplier on the fierce nerd concept. And you know, we've joked on this pod before about like, you know, if in your pitch deck I'm like, okay, went on a Mormon mission or like, you know, grew up in, you know, a Slavic country, Eastern Europe. I'm like, yep. You know, little plus points are going off in my head. These are green flags in my head. It's not a for sure yes, but like, I'm not stupid. Like, eventually you realize, goddamn, these people from Utah can sell. Or, wow, these programmers from this area of the country are pretty, pretty badass. Or, um, when somebody is, you know, it's like getting up— being a Harvard dropout is a stronger signal than being a Harvard graduate. There's all these things that sound silly but actually end up being true, because if you're the type of person who can get into Harvard and then has enough conviction and an idea to drop out of Harvard against the social pressures of Harvard, That actually turns out to be a pretty good filter. Now, of course, these things can be gamed if people realize that these are the signals you're looking for, right? Like people showing up to pitch, pitch meetings and like acting a little extra autistic. It's like, okay, we kind of know what you're doing here. You're trying to fit some pattern that this investor is trying to match against. So all of these things would be gamed, but it's great when you can figure out a signal that is not yet common. And so this one of, is this person, you know, Is this a revenge company? Is a great signal. It's a green flag signal.

Have you seen the Ted Turner documentary that recently came out on HBO? No. Everyone should go and watch this. So Ted Turner has been one of my heroes for decades, uh, uh, because, uh, his biography was so good. And basically his story is that he inherited a billboard business from his father and it was a great billboard company. Like it was in the South and it, and it was thriving. He took the money from that and he started, um, a local TV station. He eventually bought the Braves for cheap. He bought the Atlanta Hawks for cheap. Then he parlayed all of that and bet all of his money in CNN and was constantly on the brink of bankruptcy, not because his businesses sucked, but because he was just like pushing it 100% all the time. And so there was this great line. It said— this is about one of his employees. He goes, Ted had a great sense of paranoia within the company, a sense that we were the little guys fighting for our lives against some big unknown guys. And the truth is, is that we are one of the biggest billboard companies in the South, one of the biggest in the country. But it made— we wanted to make everything seem more important than it probably was. And in fact, he insisted on taking his telephone calls outside on payphones because he wanted everyone to believe that his phone was being tapped. And, and if, and if you watch his documentary, he does all these amazing things. Like, for example, he's like, I have to launch CNN because Americans at the time, CNN was the first ever 24-hour news network. He was like, We owe it to America. Like, Americans need to have an option to know what's going on in the world. Like, everything had this grand sense of like, we have to do this for America, or like, they're trying to crush us. And it's like, who's they? We're the best. And that was a big takeaway from TED that I loved. And this post kind of reminded me of that same lesson posted by them.

There's a couple of things that come to mind on this. One, Travis Kalanick is kind of like this. So he had he had gotten screwed in his first startup, literally, I think by Michael Ovitz, um, and others. Basically, it was like during the LimeWire—

well, the background is Travis Kalanick, the founder of Uber. Before Uber, he started Red Swoosh, which was some type of LimeWire competitor, file sharing service.

Yeah, peer-to-peer file sharing service. And he ends up not making a lot of money from it. By the way, Naval, same thing. He has— Naval's first hit— Naval's now like, you know, this wise sage. you know, billionaire type of dude, but he was kind of like an angry, vengeful dude when he started ePinions back in the day. The VCs kicked him out of the company. I think ePinions ended up going public during the dot-com boom, or it had like a kind of a big exit. He got nothing. He got screwed by his own VCs.

He didn't make anything from that? No.

And he ends up suing them. So he does the thing that you normally in Silicon Valley, the founders are very afraid to fight back against the VCs. He publicly sues his own investors and ends up creating Venture Hacks, which is a, um, a blog dedicated to helping founders not get screwed by VCs. He's like, dude, I didn't know how to read these term sheets and I didn't know what these contracts meant. And they just kept telling me the dangerous words. Oh, don't worry, it's all standard. And he goes, there's nothing more dangerous than something that, than when a lawyer or a VC tells you this is standard. Don't worry about it. And he goes, well, standard ended up getting me screwed. So he starts Venture Hacks, a blog. Um, and that leads to AngelList, which basically took the power away from, in many ways, the, uh, VCs and gave it to angel investors, the founders. It created a marketplace. So, you know, it created more transparency, more liquidity, more, more competition in that marketplace. And AngelList becomes a multi-billion dollar company. Elon is on a revenge tour right now. Literally, the Democrats were attacking him or, you know, demonizing him, sue, you know, doing, uh, suing Tesla and SpaceX and all of his companies. And adding more and more regulation. And so he just flips the script, goes all in on Trump, goes on a revenge tour. Now he's basically like a, you know, de facto president. And he's now going— now he's going in with Doge trying to like rip out the guts of the bureaucracy, right? Like these, these revenge tours are really, really strong. Josh Wolfe has this phrase where he says chips on shoulders equals chips in pockets. Basically is when you meet an entrepreneur who's got a deep chip on their shoulder and it's sort of a an uncurable, unhealable, uh, you know, identity wound, um, that ends up being somebody who ends up doing really well.

Dude, that's a 10 out of 10 phrase, by the way.

Chips on shoulders is chips in pockets.

Yeah, that's a beautiful— he knocked that one out the park.

It's a good one. And I've actually had trouble with this. I used to go the other way. We would meet somebody and they would say something that just sounded like, oh dude, there's a part of you that's broken inside. Or like, you're really carrying this this revenge against somebody, I used to try to convince them that that's not— they shouldn't hold that or be like, this person, they're not like mature, they're not wise to it. And I immediately missed out on several big opportunities. And again, in that moment, my reaction is to either judge, which gets you nowhere, or distance myself and say, all right, this person is not as— they're not like-minded. They're not seeing the world the way I'm seeing it. And now what I've realized is, no, no, no, I need the exact opposite reaction. You go really close to that person and you hand them a check and you say, can I be a part of what you're doing? I'd like for your crazy psychosis to be to my financial benefit. And so like, I'll give you an example. So I'm very close to this person and they have basically made something. They, um, they had a bankruptcy back in their 20s, late 20s, I think. So they were doing really well, got to like a $25 million net worth, but were overextended. They're in the real estate game. Were a little bit overextended. They, they were doing development on behalf of this person who was expanding. There was like a guy who was expanding a bunch of locations. So he's like, cool, you're going to do 15 locations. Great. I'm in. I'll go buy these and I'll develop them for you. And then that guy got in trouble. That guy went to jail. So now he's holding the bag on these 15 locations that could only be used for one type of business.

All right, my friends. So a lot of you guys who listen to the show, you listen because you want to start a company, but you're not sure what idea to choose, or you may not even have an idea and you like our podcast, My First Million, because we've done a lot of the work for you on researching all these business ideas. Well, my friends, we've made life a lot easier for you because HubSpot, they just put together an entire list of all the resources that you can use to find a market opportunity to validate for your next business idea. So if you're looking for a market size calculator or tools to identify market trends or a huge list of ideas to get started, So if you're interested, there's a link below, click it and you can have access to the whole thing. It's completely free. Now back to the show. So you're saying like, it was like some guy, let's say it's like a fast food franchise was like, I'm going to be creating like 50 locations or whatever. Well, you, you go develop them and I'll meet you there.

They did deal 1, it was great. Deal 2, it was great. Deal 3 was great. And so he goes, awesome. You want to do 18 more of these boxes? Great. And he goes and gets them permitted for this exact thing. He does exactly what he's supposed to do on the real, as the real estate developer. But then that guy got in trouble for tax. He hadn't been paying his taxes or whatever. He can no longer do this. So now he's on the hook for like, whatever, 18 payments for a business he can't run and he can't use for any other purpose. And he can't really sell it because it's distressed. And it's— and this happened right in '08 when the bank crisis happens. And so nobody's investing in real estate anymore. So he gets like, basically this series of events ends up going bankrupt. Well, he, uh, has a traumatic experience and he goes bankrupt. Not only does he go bankrupt, he was, I think he was engaged or just gotten married. And all of a sudden he's back in his childhood bedroom with his wife. Uh, they've had to move back to his parents' bedroom. He's sort of ashamed of that.

And he had a $25 million net worth before that.

Yeah. And he's buying like a million dollar engagement ring, like that kind of thing. And they turn off the lights to go to bed and he's like, he's telling her, he's like, you know, I promise you, I will figure out a way. Like, I don't care what the hell I have to do. I will fight back. I will figure out a way to make this right. Give me 9 months. We're going to be here for 9 months in this room and like, whatever. And he gives her this inspiring speech, this like gladiator speech. And then he turns off the lights.

It's like, oh shit.

He had like the stars from like his, you know, those like sticker stars on the ceiling, the neon ones that they start glowing and they just crack up laughing. And he's like, oh my God, where am I? And so, and then he starts basically his revenge tour. And he's in the 10 years since then has built up like a billion dollar real estate portfolio using only his own money, no outside investors. Probably has, you know, I don't know, something like $4 or $5 million of his own equity in these deals and has, you know, really come back strong. And so I for years have been looking for a good way to invest in real estate. Like I looked at, should I buy my own property? Should I have some rental properties? I think, I think I kind of should take this internet money that I'm making. Like I'm all in on the internet and I think I should take like, you know, 10, 20% of it, have it in like hard rock tangible assets you can go touch and feel. That seems like a smart thing to do. But I never knew how should I do it myself. I'm a beginner and that takes time and I don't want to go fix broken toilets. Should I give it to one of these funds or syndicators? And then you would like meet them and you realize these guys are just fee monsters. They make all their money on the buy. They don't make any money. You can— good luck on the sell. They make their money on the acquisition fees and management fees. So I didn't like them. And then when I met— and then when this guy was like, hey, you know, like, do you want to do a deal with me? I was like, I'm all in because the chip on this guy's shoulder of proving his dad wrong and like coming back from that bankruptcy and all of this, like, even though today he's super wealthy, he'll never stop.

If you know, if you're a grown man who knows what it feels like to sleep with your wife in a twin bed, like, you know, that, that sticks with you, you know, like the feeling of like exposed ankles of blankets that don't cover your ankles, uh, stays with you.

If you've ever had to call top bunk with your wife, you've experienced a trauma that I would like to invest in.

Yeah.

When we were selling the Milk Road, I remember talking to, I think I could say this, uh, I remember talking to some of the potential buyers and was like, wow, you've been really successful. And I was like, what? And I'd try to get to the root. What was the motivation? Like, why did you even go this path? Was it just you had an idea and, or you had, you wanted to solve this problem? And I talked to two people and one was like, no, this girl rejected me in 9th grade. And I just remember thinking like, F that. Like, I'm going to become somebody. I'm going to book it. And he's like, yeah, I know it sounds stupid. And like, it was stupid, but it was effective. And the other one said the same thing. He's like, I, I was trying to live in a house. We had 6 friends and we were all like, hey, let's live together next year. And then we found this awesome house, but it was a 5-bed house. And they were like, hey man, um, it's only 5 beds. He's like, I realized I was in the bottom of my group and I was like, fuck those guys. Like every night they're having fun in that house. I am going to be building an empire. And I remember just thinking like, really? First of all, that was like 20 years ago or 15 years ago. Like, that's still bother— like, that still motivates you?

Or—

and they're— and like, don't you feel kind of silly that that bothers you so much? Like, you know, and they were like, no, I feel they were silly for ever counting me out. And I was like, wow, okay. I am not wired like these people. I am not fueled by the same rage and like kind of revenge instincts. And I'm not saying that's the only thing that motivated them. But the fact that that was there still 15 years later was very surprising to me. And I've now learned to bet on it.

I think that I'm not surprised that you've never had issues because you're— I've said this a bunch of times, you're very emotionally healthy, dude. I use rage and like guilt and like I want to—

nicotine.

I want to end it, you know, and I want to get back against someone. Like there's times that I remember my big brother like saying something smart aleck to me and I still feel that like Oh, I'm going to prove you wrong. Like, I still feel it. Yeah, that shit runs deep, but it is pretty helpful. It makes you pretty miserable at life, but it makes you like fairly productive.

I'm not going to lie, I'm kind of jealous about it. Like, I think on the whole it's probably good I don't have that, but it does seem kind of badass when I hear it.

It takes like, it's crazy what happens. So you know how I hate flying? I went through like 10 years of therapy to figure out why I don't like, I'm so claustrophobic. It comes down to when I was like, in second grade, my brother put me in a full Nelson, you know, like a full Nelson with like a big nose. And he dipped me underwater in our pool and he was like, you know, like teasing me. But I sucked in a little bit of water and I legitimately felt like I was drowning. I distinctly remember like, I'm dying right now. I'm about to die. And he kept dunking me and I was like, you fucking asshole. Like, I'm dying right now. And like, it's crazy how little moments— like, since then, by the way, I cannot stand elevators. I don't like taking subways.

You'll swim. You just don't—

you're like, I won't fly. I don't like anything where I'm constricted and I can't escape. Uh, that's— it's rooted in like, I can't escape. So if it's like a boat that like you're gonna go on and you can't see the shore, it's like, no, I'm not doing that shit.

Is this like hypnotist unlocked in you, or you're saying you figured this out through therapy or something else?

Therapy and hypnotherapy, yeah. Like, I've spent so much time and money to like figure out the root cause and how to overcome this, uh, all from like a, a 66 second interaction with my brother where he was a kid too. He was being innocent and just messing with me. Isn't that crazy how like the things that happen as a kid can like impact everything?

By the way, does it help when you figure out the what— the root cause? Or yeah, like does it go away a little bit?

No, no, uh, a little bit. Like I guess like, uh, there's this like idea of like, uh, getting over this stuff. It's called like walking to the gallows, where like when you get panicky it feels like you're dying. And in order to overcome that, you just got to be like fuck it, I'm gonna go die. Like, I'm gonna like experience this thing that I'm fearful of. And, uh, and you just have to do it. And it's like, it's pretty, it's pretty bad. And like, so you have to tell yourself all these stories to help get over it. And one of them is like, I only feel this way because John did this to me long ago and I was fine. Okay. I was fine. I will make it through this. Uh, and so you gotta like walk to the gallows. You gotta like tell yourself all these stories. And so that's like one of the many coping mechanisms, but it's just all happens because of a small thing when you're a kid. So it could have been like some girl said this, some guy said this to you. And it like, it's crazy. It just shapes like 50 years of your life.

Dude, what a sick phrase. Walk to the gallows. Wow. What a, what is a gallows even? Is that like a—

That's where you get hung. Is it from a pirate? I think it's, is that, it's where you get hung. It's like, so the gallows is like the structure where you're about to get hung. And so like, by the way, I tried to break this the other day. I went on the subway for the first time ever in New York. I was like deathly afraid to go into the subway and I'm like, we're just gonna go one stop. And I was like, fuck it. We're walking to the gallows.

There's also, this isn't just for business, this is also like, you know, revenge body is a thing. Remember that Medium post we both love, How to Lose Weight in 4 Easy Steps? And it's like portion control, um, you know, avoid beer, and then it's like have your heart broken, not just broken, shattered into, into a million itsy bitsy pieces. And he talks about basically it's the heartbreak that's like the fuel for the gym. Like, in the same way that like, you know, if you want Adele to go triple platinum, She just needs a bad heartbreak, right? It's— it fuels artists, it fuels fitness, it fuels business. And, um, I think it's sort of undeniable. I don't know if it's healthy, but it's definitely effective.

Taylor Swift wouldn't write hits if she had a successful, wonderful relationship.

Well, we'll see. Travis Kelce, we're all rooting for you.

She hasn't had any new hits yet. She's— she's— you know, she's— she has hits for a reason.

All right. What else you got?

Um, all right. So something a little bit happier. Uh, I saw this on 60 Minutes, uh, I think 2 weeks ago. I cannot stop thinking about this. So let me fill you in on this story. So there's a small country called Bhutan. Bhutan is in between India and China. So it's, it's between these, uh, behemoth countries. And because of that, a lot of people don't know about it.

And it's tiny, half the size of Indiana.

It's tiny. I think their stock market is 18 companies and the total market cap of their stock market is $800 million, which is 1/70,000th the size of the US stock market. So it's like this super small country. In fact, I read that in 1999, that was the first year they got TV. So it's like this tiny country. Well, in the '70s, the King of Bhutan did a diplomatic trip to India and, uh, according to the story, this Indian reporter goes, hey, King, you know, we're neighbors, but I don't know anything about you. Like, what's your deal? What are you about? In fact, what's your gross national product like? Like, tell me, what are you guys known for? He goes, gross national product? What? What are you talking about? GDP? What are you saying? In Bhutan, gross national happiness is more important than gross national product. And it was this like offhanded comment that he made saying their biggest export is happiness. We care about happiness. And that totally hit. It went viral. Everyone was like, this little country is apparent— they must be the happiest place on earth. The king says that they care more about gross national happiness than money. And the king was like, oh, people like really resonate with that. Let's make that our thing. And so over the next 5, 10 years, they actually implement this and make this— it's their thing. And so in this country, Bhutan, to this day, every 5 years, surveyors travel the country and they ask the people about education level, salary, and material possessions. So like a lot of like normal stuff. But then they also say like, do you have negative thoughts? Do you have positive thoughts? How much time do you spend working? How much time do you spend praying and sleeping? And the— and the data that they get is factored in to a lot of their, a lot of the rules and things like that that they make. And I thought it was like a great story, about how you can care about things that aren't seemingly important, like happiness. And I had, well, you know what I mean?

Like, it's like, you know, we care about like money and like, yeah, the touchy-feely.

Yeah. And there is a few critiques, which is like, according to the World Happiness Report, Bhutan is like, average. Like, it's like not kicking ass, but, but like, you know, I don't know if that's a matter of like different ways of measuring things like that. Because happiness is like a way, like it's kind of hard to measure happiness. Is it like that fleeting moment that you feel in like the 30 seconds after you've eaten a good meal? Or is it like, I feel contentment, whatever. But I thought it was cool for 3 reasons. One, the king just said some shit and it hit and he ran with it.

Like, been there, bro. I feel that. Yeah. It becomes a thing, right?

Yeah. It's like wearing a certain outfit in 4th grade and you're like, I guess this is my identity.

I'm a high sock guy. Yeah.

Like I'm a chain wall is my guy. Like I'm a chain wall guy. Like that's just my thing. Uh, cause a teacher said that. The second thing is that, um, I do think it's like pretty fascinating that in a culture that you and I are part of and America's particularly because we're such hard workers, uh, it's all about work, work, work. But that's not really like the point of all this. It's like to be happy. So I thought it was cool that they're measuring that. But another third and final, uh, thing that this makes this interesting. Have you ever heard of a pairing metric?

Yeah, basically like two metrics that let's say you have, uh, revenue on one side, but you might have profitability on the other in order to make sure that like if you over-optimize on just revenue, you might totally nuke your profits. Or if it's about, uh, growth, you want, you know, NPS score, make sure your customers are happy. Is that what you mean?

Yeah. And so when Tim Ferriss invested in The Hustle, we, I got to hang out with him for an hour or so, and I was telling him about how many subscribers that we were growing by. He's like, well, you need like a pairing metric. You need, uh, you know, not just top line, like subscribers, email subscribers, but like, are they engaging? Are they opening? Whatever. You have to have a pairing metric. Otherwise, uh, it kind of ruins the whole thing. And that was like kind of fascinating to me. I never heard that phrase. And I didn't think about having a pairing metric with like government policy or, you know, like anything other than business. And this is like a really great example of a pairing metric where it's about GDP, traditional metrics, but also, you know, make sure that your people are happy along the way. So I thought it was pretty cool.

Yeah, I love this story. I think I was telling you before this, I think we both somehow, the odds of us both having Bhutan on our list are so weirdly low. I think maybe we both saw the same thing. I saw the 60 Minutes thing a few weeks ago.

What did you think?

First of all, it's so funny when you watch 60 Minutes. 60 Minutes looks so old, dude. It looks, and 60 Minutes is basically just a YouTube channel.

It's great though, right?

It's great, but why does it look so old? Like, I, like, literally the person on there is old. The clock they use for the 60 Minutes thing is so old. All of the editing is so old. They don't know, like, what, like, a jump cut is. It's insane.

I think it's a fun fact. I'm almost positive it's the only TV show without a theme song. It's literally just tick, tick, tick, tick, tick, tick, tick, tick. Yeah, exactly.

It's crazy. So when you watch 60 Minutes, it's interesting to just look at it and be like, what is this, dude? Anyways, here's a couple of the things that stood out to me about this. So first, why do I— why am I interested in a country? I'm interested in a country because in the same way I'm interested in companies that are run in interesting ways, or if a company had a unique mission or business model or a unique way of doing things, that'd be interesting to me. Countries are just big companies. And I found this pretty interesting if you looked at it like a company where it was like, oh, what, what's our main metric? It's not revenue, it's happiness. So it's like instead of the GMV, they're looking at how much happiness they're producing in their own economy. And I like that they measure their own. And like, did you look at their, their happiness index, kind of 0 to 1 and how that all works?

Yeah, it's like a weighted score, right? What, what, and what were all the metrics?

Or it's basically, it's a weighted score. Then they, they sort of, um, they ask people a bunch of questions about their, um, you know, psychological well-being, their health, their time, you know, their education, all these different things. And they end up with like, you know, basically they're a 7. 781 on their scale, which is pretty good. And they measure, oh, that's up 3. 3% since last year. And basically 9. 5% of Bhutanese people are deeply happy. 38% are extensively happy. 45% are narrowly happy. And 6. 4% were unhappy according to them. And, um, and they're, you know, what I thought was cool was that a couple of things. Number one, it's one of the very few cases where someone in power gives it up. So they had a king and he voluntarily is like, you know what, this could just go to my son, but we need a democracy. And, and the funny thing is the people there were like, no, no, king, stay king. He's like, no, no, we need a democracy. They're like, democracy? You see, India is a democracy. Pakistan's a democracy. Look at those places. They're always at war. It's violent. Forget democracy. We don't want it. We're happy. And he was like, well, if I just keep giving this, you know, power down by birth, this won't end well. So I thought, seeing somebody relinquish power—

it's crazy—

their crime is so rare. Yeah, that you just overlook it when you're on the surface. But if you actually think about that deeply, that actually is like a really noble and very cool and very unique thing. How few— you know, Biden didn't want to give up power, and Trump doesn't want to give up power. Nobody wants to give up power. Power is one of the most addictive things in the world. And so I just thought that was really noble and really cool of him, um, to voluntarily go to democracy at a time of peace, which is, which is not usually what happens. Usually If a democracy happens, it's after a time of violence or war, people need change, or the Western country comes in and helps and tries to force a democracy on them. So I thought that was cool.

Did they say that was the only time that's ever happened that way?

It's the only one I know of. They kind of referenced that that's, that's never really happened before, that a democracy happened in a time of peace voluntarily. Also crazy that just like, you know, until 19— until the '70s, like in 1974, there's people listening to this podcast that are born before 1974, they didn't have a currency. It was barter. Even up until 1974.

That's crazy, right?

And the crazy thing was, even though there was barter, they still had to pay taxes. And it was like, you could pay your tax with like giving them, giving the government like a cow. Or if it's like, oh, you don't have livestock? All right. Uh, do labor then. And so then they built these amazing buildings because your taxes was basically community service. It's like, hey, I'll go donate like, you know, 100 hours of labor to pay my tax for the year. And then because of that, they built these really cool buildings. Side weird note, you know, our friend, uh, Shiel, friend of the pod, Shiel, uh, went there. I think he posted this thread. It's a thread of him going there. He like meets the king because he's like, it sounds crazy to meet the king, but like, he's like, I was at a bar and I was talking to this guy and that guy was the former, like, whatever. He was the former, like, prime minister or whatever. He's like, now he's a surgeon and he's just drinking at this bar. And he's like, oh, you want to meet the king? Yeah, I can introduce you. And so he meets the king and so he's like, he's talking about his experience there. One of the crazy things he points out is like a lot of the buildings have penises painted on them in like artful ways. So, you know, it's a little bit of Superbad mixed in there. I like that. Uh, the other crazy thing is the Bitcoin stuff. Did you see their Bitcoin stuff?

I know they have, uh, the, they, they own more Bitcoin than the total market value of their stock, stock market. It's like a billion dollars in Bitcoin.

Yeah, they basically have made themselves wealthy for life. They use their, like, their vast nature. So like, you know, they use hydroelectric mining to mine Bitcoin and it's, it's believed that they have a billion dollars of Bitcoin.

But that was, uh, like, I think that was reported like, uh, you know, 8 months ago. So I, it's as if they have double that now, you know what I mean? Like it's been a, they've had a great run.

The US has it because they seized the Silk Road, right? So they have, you know, the, the, the US has $20 billion, China has $20 billion, UK has $6 billion. El Salvador, which has been buying and holding Bitcoin, um, has $6 billion.

And, and, and, and the guy on that 60 Minutes show, he did a great job of saying, he was like, we're human. We still want to be rich and we want stuff and we want all this other stuff. We also want to be happy. And so, 'cause people were like, well, so if you're just about happiness, why are you buying Bitcoin? And all this, he is like, well, I, I still want nice shit.

Yeah, yeah. More prosperous we are, the happier we'll be. The other thing that I thought was cool, you know, they do free education, free healthcare, all that good stuff. Uh, but they also were like, hey, 60% of the land is going to be like dedicated to nature. And, but there's no, I think they don't allow mountain climbing. They like have these amazing mountains because they're in the Himalayas.

Yeah.

But you're not allowed to. And he said this great line. He goes, he goes, uh, nature is, he goes, nature is not meant to be conquered. He's like, man has this thirst to just conquer everything. Oh, there's a mountain, I gotta climb it and put my flag on the top. And they just had a different attitude. It's like, nature is beautiful. It's meant to be enjoyed, meant to be— it's sacred. It's meant to be sort of revered and not conquered. And I just thought, man, these people roll to a different, a different beat. And I respect it. I'm glad that these little experiments live.

I had the exact same feeling, which is I saw him talk and they sort of fit a lot of the stereotypes that you would have with like a Nepal, the Dalai Lama, like this, like wise, because, and I think they're like, they have like a national outfit or something like that. And it looks like the Buddha and they are Buddhist, but it looks like that, like whatever the Dalai Lama, like the shawl or whatever he wears. So they like jeans. Yeah.

We love Jinko.

Yeah. The national sport is grinding. They had this like cool vibe of like wisdom and shit. And it was very shocking to see see that because I'm like watching this on a Sunday night as I'm gearing up to talk about money and gearing up to get after it, crush the week. And then I see this guy who was like, talk about happiness and shit. And I was like, this is incredibly refreshing. It was pretty cool. It seems like a great country. I think, by the way, there's all these like other downsides. I think Shil even said he was like, it's a pain in the ass to get there. Like, I don't even think they have an international airport.

Like, the roads are not very developed. Like, there's, you know, there's there's other things when you prioritize happiness above all, maybe your roads kind of suck.

Yeah. So like, it was pretty sick, dude. I thought it was great. I was very inspired. So I wanted to bring up Bhutan.

Well, there is one other piece to it, which I guess a bunch of young people are leaving the country. Um, did you see that part? I didn't fully follow that, but they were then going to build a new city in Bhutan, the Mindfulness City. And it was going to be like, they launched like a $100 million bond and then they're basically trying to make it a city where it's like walking and cycling and green spaces for meditation and mindfulness-based education and ecotourism. Like all the shit Balaji talks about with like a network state or like the Praxis guys are trying to do. These guys, you know, Bhutan is building a new city with like its own cultural values, trying to use that to attract people to the country.

Well, you want to hear a funny story is, um, Balaji is— and a lot of these crypto guys are in on this new thing called American Classist. It's that monument that they're proposing that they build in the Bay Area. I don't know if it's, it will never get built, very likely. But the same architect who's on board with that is doing their, is the, that was the guy in the 60 Minutes episode. He's the guy who's building Bhutan's new city. And so there is this like weird crossover of the crypto guys and, and these people who are like, let's, what's a, what would a new city look like? And Bhutan. Yeah.

It's pretty inspiring, honestly. It makes you think bigger, right? It makes you think about, Things that you just take for granted, they just seem set in stone. They seem like they were just, they were already here. They'll always be here. It always was this way. It'll always be this way. And then you hear about somebody, you know, these people who are trying to like shake that and you realize, oh wow, it's all the whole world is more malleable than you thought.

Yeah. And they also were approaching it in an interesting way with their new city. I forget the quotes, but he said something about how he's like, we know that this is like a 50-year project. Like, we're gonna go slow because we don't want to hurt the environment. And it was— and the guy was like, but you're gonna be dead when they like do that. And he was like, isn't that awesome that something will like outlive me? Like, they had a very— so if you're, if you're listening to this, uh, it's on YouTube for free. So Google Bhutan 60 Minutes. It was an awesome segment.

All right, now that we talked about Bhutan and happiness and how there's more to life than money, can I tell you about one of the most ruthless capitalist, bloodthirsty moves that I've seen, uh, in a while.

You know how in boxing they say steal the round because like in the last 10 seconds that's what judges remember? They don't remember the first 100, they don't remember the first 120 seconds, but they remember the last 10 seconds. Yeah, whatever you, whatever you say last is what I'm going to be most inspired by. So let's— we skipped.

So sit down, Baton, you had your moment.

Yeah, now tell me how I can cut some fuckers. All right.

This is a private equity roll-up in the education space that I found pretty interesting. All right. What is— what does that mean? So I went to high school in Texas for the first 2 years, and then my mom and dad came to me one day and they were like, hey, check this out. Doesn't this look like a cool house? I'm like, yeah, it looks pretty cool. And they're like, we're going to live there. And I was like, okay, where? And they're like, it's in Beijing. And then my family moved me to Beijing in 10th grade. And so they went too. Yeah. Yeah. Yeah. Okay. That would have been super cool.

They moved me there and they moved themselves.

So they, so they were like, hey, you know, all those friends you've had, like, you're not going to see them anymore. And so, um, they also lied to me and said my dog couldn't come and told me that China doesn't allow dogs. And then later in life found out that was a huge lie. Um, so, you know, that's maybe that'll be my revenge tour, dude. That's it. But that's the thing.

Wait, so then they leave the dog?

Yeah, we sold our dog because, oh, dogs can't go to China. I was like, what?

Oh my God, stupid.

There's no Google at the time. This is pre-Google. So, um, so I finished high school in China and I went to this school called the International School of Beijing, and it was actually an awesome school and it turned out to be great for me to move and all these awesome things happened to me there. But as one of these things again, I just, I go to the school, I just take it for granted. There's a school here. I don't know, schools are part of The government, they're just like from the land. I don't know, God put it here. I don't know what puts these international schools here. And now I'm like in my 30s and I'm reading up and I realize, oh shit, these international schools are an absolute juggernaut of a business. And so, um, I'd like to tell you about this roll-up that happened called Nord Anglia. Have you ever heard of this?

Yeah, uh, my friend Anand from CB Insights, uh, is obsessed with it.

And so here's what these guys did. So the founding story is back in the '70s, you know, things like 50 years old, there was one school in the UK, or there wasn't even a school. It was like making materials for other schools to teach English as a foreign language to people who are trying to learn English in the UK. And then they expand that into Eastern Europe or whatever. And then they start their own school. They're like, oh, we'll do our own school for teaching international people and we'll teach them in a, in a sort of English second language kind of way. And over time the thing grows and it goes from one school to multiple schools and they create this like business that eventually becomes a $14 billion conglomerate of 80+ international private schools.

Can you say the name one more time?

Nord Anglia. N-O-R-D and then Anglia is A-N-G-L-I-A. So what do they do? Uh, and by the way, remember, remember when IMG sold IMG, which is like the sports prep academy, and it sold for a billion dollars. We're like, wow, Nord Anglia bought it. So this bought IMG. And the reason they bought IMG, they're like, IMG is a really cool sports-focused brand, but it's all in the US. We are, we know how to basically create international schools that the richest, wealthiest, or expats living overseas want their kids to go to. to be able to get into, you know, maybe U.S., U.S., uh, colleges. So they bought it for a billion dollars being like, cool, we're just going to take the IMG brand and we're going to pop it up in China and India and in all these different countries in order to, to, to get those types of students who are sports focused, whereas their schools are more, you know, teaching the, the, the IB curriculum, which is like the, the kind of International Baccalaureate, the, the equivalent of AP in the United States is IB. So like I took the IB. Program. And so, and but the cool thing about this business is actually for the first 10 years, it was just a slow burn. And these businesses fascinate me. Like, I don't even really fully understand how you can go from kind of like a consultant selling teaching materials. At one point they had a daycare, like a nursery built in. It was like just this slow, sleepy business for like 10 years.

Was it like a family-run thing?

Yeah, it was like privately owned. And then they hired the CEO and then they start expand— they start their own schools, they start expanding. Then they start buying other school, school, like, chains. So they bought, like, a 6-school chain, um, that had, like, a presence in, let's say, France. And then they buy another one that has a presence in Latin America. And they're just rolling up as many international schools as they can buy. They buy 5 schools in India for $200 million. Um, and so now they got 5, 5 international schools in India. And, um, basically this company ended up going public. A, um, it, and then had a take private offer and now is valued at $14 billion, which is pretty, pretty wild. And there's one PE firm, this Swedish private equity firm that has just made an absolute killing. It's called EQT on this entire like 20-year run of this business. Um, so, you know, let's say 99, here's the timeline, 1970s, it's teacher training and language programs, 1990s. So now this is like you know, 20 years into the business, they pivot to owning and operating their own international schools. 2008, now another 18 years goes by. The Swedish PE firm comes in, gives them a bunch of money to rapidly go expand and acquire schools. 2014, they go public. 2017, they go private again for $4 billion. 2024, it's acquired $14.5 billion. And, um, 2008 when they did the, uh, the private equity round, they were at $40 million in EBITDA. And, you know, about $200 million in revenue. And so these things trade at like 8.5x EBITDA basically. And they only own like 10% of the international school market. Still 90% of the international school market is fragmented and not owned by, by anybody.

Well, now they do a billion in revenue, it said.

Yeah, now they do a billion in revenue with, you know, hundreds of millions in EBITDA. And actually, I think it's even— I think it might even be even more than that. But like, just to give you an example, here's a slide. But like, this is like one of their schools. So they show like the profitability of a school. This is one of their case studies. So it's like Dubai. They open an international school in Dubai. They open it in 2014. It took $7.5 million to build it and open it. And then basically they break even in year, uh, year 2 slash year 3. And then it's basically making 55% net, you know, cash on cash once it's at that mature level, once they get the enrollment up to like 1,400, 1,500 students. And so you could see like the enrollment basically by year 3, they're at almost 1,400 students, almost at capacity.

How do they convince parents that they're worth it? Because like, uh, with school, it's tradition usually is what like, uh, you know, gets people to buy in.

Um, yeah, so it's kind of the same thing. So if you go look at their pitch, it's basically that you know, we have, we have the best-run schools. Our kids get into top-tier colleges. And, you know, uh, X percent of them grad— you know, a huge, like 90-something percent of them graduate. They do better than their peers on, um, you know, the, the standardized testing, things like that.

It's basically like when Chick-fil-A started expanding to New York and all the New Yorkers were like, finally, you know what I mean? Like people like know this, know this brand.

In Beijing, the school I went to, right? Like we probably had like 100% graduation rate. Like there's like no dropouts. Everybody graduates and then like 98% went to college. So there's like, it's like compared to like a normal school, the whole school I was going to in Houston before that probably was like 75% graduation and less than 50% would enroll in college the next year. And so, and then the school I went to, you know, that's a, that's like a first grade through 12th grade school. And every year you're basically paying college tuition. It was like $40,000 a year to go there as a first grader and as a second grader and as a third grader, as a fourth grader. But like, the way my parents afforded to go there was the same way that many students did, which is when companies bring you overseas, because, you know, let's say, you know, my dad worked for a company, they wanted him to relocate to like build up their business in China. Then the company basically pays for your kid's education as part of the relocation package.

And that's like a really good perk.

That's the perk. It's, oh, oh, you know, and so these schools basically, it's kind of like U.S. schools, how they make their money is because the government will give like student loans to anybody. Like anybody can get a student loan. So you get like, you know, $200,000 of debt to go to the school. Whether you're going to be able to pay that off or not doesn't matter. So the schools are like, great. That's why tuitions keep going up because they're like, awesome. The government will just keep paying for this. This is amazing. International schools work largely the same way, which is it's either very wealthy people there who want their kids to go abroad. Like if you're very wealthy in Indonesia or China or India, you want your kids to study in the United States and you're probably, you know, like very, very rich. And so you're, you're happy to pay, you know, $40K a year. For like elite, your elite education, or the companies are paying for it. So this is a beautiful business model where you're only catering to that top kind of 1%.

And interestingly, I think that there's actually a blue zone in America because when you think of a for-profit university, I think of University of Phoenix. Yeah. I think bad. I think they're the ones who let everyone in. Uh, and they just buy all the Facebook ads and Google ads and it's slimy. But for some reason, when I look at these schools, I think prestige. I think, uh, like, like it can be done well. Do you know what I mean?

You know, the one I want to do, or like I've been very like tempted to do, is the modern day film school. So like film schools exist in the States and that, you know, you can go to USC or UCLA. These are like the famous ones that you can go to, but like media and content has changed dramatically from when those schools were founded, right?

And credentials are less important, I would think.

And credentials are way less important. And back then, you know, let's say you were a student in the '80s and you wanted to work in film someday. Well, when you were in school, you really had no shot. You could go be an intern somewhere, maybe hold up, you know, you're holding the lamp, you know, in the back and you're holding the light. And that's like all you would be qualified to do. Today, Let's say you want to be good at creating films or content or music or whatever. You could literally be publishing on YouTube, on TikTok, on Instagram, on Spotify. You can be publishing everywhere and actually like, you could be in the market. You can be a player.

The day you have the idea to do it, you could be published that night.

You could be 14 years old and be, you could be the best in the world at doing Twitch streams or whatever it is. Right? Like, and so what, and the number one dream of young kids is to be a content creator. It's the number one aspirational profession, which you could judge and say that's stupid or whatever you want. The dream is the dream. That means there's a lot of demand for people who want to learn this. Why don't I go to MrBeast? Why don't I go to Jimmy and say, hey, why don't you create with your brand a university that is the modern day, like, content creation skill stack? So it's all the things you need to know, right? Videography, photography, scriptwriting, um, editing, sound production, you know, music production, all the creative arts basically, but do them in a way where it's like a 2-year program. It's like a, like a business school. So it's 2 years and it's all project-based. So you go there and you have access to all the equipment, which you normally can't afford as a young person, like the best cameras, the best recording studios, the best editors, terminals, all that stuff. Um, animators. And then there's people who have different disciplines. One guy wants to be an animator. One guy wants to be an editor. The other person wants to be a talent, whatever it is. And you work together on projects, you create content, you actually put it out on the networks, and you get judged based on the number of projects you create, the quality of the projects you create. You're getting real feedback along the way. And then you have mentors or teachers like a MrBeast or like others who are going to like drop in and basically teach you some of the fundamentals of maybe storytelling or different things that actually you need to do. And I think if you did this, I mean, just the math of this stuff is pretty crazy, right? Like you get 5,000 or 10,000 people coming to your school and it's, you know, $25K a year for 2 years, that, that's that one batch of kids, 10,000 people in a, in a, in a class. If they're paying $25K a year, um, for 2 years, that's $500 million in revenue.

What stopped you from doing this? You seem pretty hyped up on it and it seems like a very logical thing.

Um, well, I had the idea of like 4 days ago, so, you know, that's probably just a new idea. You've been talking about, uh, specifically the media thing, like I've always been interested, like, what would you do if you did a new school? I always thought of it in terms of entrepreneurship, but I actually think a more like trade school style school is better.

For sure.

Because you can only, you know, teaching entrepreneurship is hard because, A, there's not a class for business really. The business school doesn't teach you business, it teaches you management. Like, what you think of as Harvard Business School is actually a, you know, middle management to senior management training program, right? That's what that is. So I think when you actually learn a skill and learn a trade, that's good. The skill of business takes a lot of time and it's not one skill. It's like 15. It's a bundle of like 15 skills. You got to know a little bit about strategy and negotiation and marketing and building and managing all these things. So I think this trade school style is much better. There's an interesting example of this, by the way. Do you know what Full Sail University is?

Yes. So I'm looking up ITT Tech, but I'm also looking at Full Sail. I know a few people that went to Full Sail and they had great things to say.

Yeah. So Full Sail is kind of at, it's at that scale. So 25,000 undergrads, it's $26,000 a year. It's a private for-profit college. So you just do the math, by the way, 25,000 undergrads, $26,000 a year. So that's, that's like the annual revenue. Let's, let's do some public math because big numbers are an exception. That's $600 million, $650 million a year, uh, of revenue that they're generating from like a 4-year cohort.

Um, my friend Chris, uh, have you heard of the company, uh, Linode? Yeah, yeah. He bootstrapped and sold it for, I don't know, like $800 million. He's, he's from Nashville and I knew him when I was younger and he went to Full Sail and he would, and he's, uh, that's kind of how I learned about Full Sail.

But they have like, if you look at, you know, Jason Citron, the founder of Discord, he's one of the alums.

Yeah. And so I think they do more than just, uh, like I knew it as that's where you'd go to get like a, uh, like a, if you want to become a music record engineer.

Yeah. So it was like game design was one. That's why Jason went there. Cause he wanted to build video games. They have music and then they have the Dan Patrick School of Sports Broadcasting.

So he wanted to be like that much a TV broadcaster.

They had their own little program, a degree, a sportscaster degree program.

How does it work since it's not a normal, it's a for-profit university. Does Dan Patrick actually get paid to use his name or he didn't donate a licensing?

Or royalties.

That's crazy. That's great.

That's what I'm saying. For like, if you're, if you're Jimmy, you're MrBeast, like, why are you selling chocolate? Like, we should do this. And we just need to find like an operator and do it with a physical campus and like do the whole thing, right? Make the whole thing happen. And there's like an enormous talent economy that needs to be made, not just for people who themselves want to be a famous YouTuber, but every single company has to create content. Content is marketing. And so any company that needs, you know, go look at every, every corporation from, you know, like Nestlé down to your, you know, nearby eyebrow waxing place. They're all got an Instagram, they all got a TikTok, they're all posting content on there. And so every company needs media creation talents and nobody teaches you that. It's something— today it's something you learn on your own outside of school using your own social media as a testing ground. And I think that's a little bit crazy given the value of this thing. And so I think, you know, it's the type of thing that could be built and be a, you know, multi-billion dollar business within 3 or 4 years easily. You know, getting 5,000 or 10,000 people to, to enroll is not hard for, for something like this because it has tangible value too. Like when you walk out, not only will you have these hard skills on, you know, actual content creation, all the, the bucket of content creation skills, but like you're highly employable. So whether you become a creator or you're, or you go get a job, like you're highly employable with a set of skills, especially if you make it elite. Like, don't make it University of Phoenix. Make it more like Harvard, where it's like, oh, where do the talented people go? Right? What's it like, Juilliard? It's like, make it more like Juilliard, where it's, this is where the most talented people go and build that reputation. I think that's the key to get this right.

This is an incredibly compelling pitch. Um, I want to know what the downsides are, uh, which I don't even know if you know at the moment because, uh, you're 72 hours into this accreditation career transition.

Accreditation can matter. So if you want accreditation, you can do that.

Does that matter? Does accreditation matter? I guess it, I guess it does for optics, right?

No, it matters for funding. So, so how do you get funding from the government? How do your students get loans? If you're an unaccredited school, students can't get loans. They got to pay for it out of pocket.

Understood.

And, and so you want accreditation so that you're eligible for loans, which would let students go there, you know, who don't already have the money, plus you know, it's much easier to spend money the government gives you when you're 20, 18, 20 years old. Um, so, you know, you want to be eligible for that, but you can, you can get accredited or you could buy a school with existing accreditation. So that's not a blocker. It's just like a thing you got to do. Um, the hard part is actually running it and like doing it well and like actually providing quality education, right? You don't want to be University of Phoenix. So you got to have some soul. You got to have some, some energy. You got to have the entrepreneurial energy. Why? So why am I not personally doing this? Because I personally am not going to be the guy running this. I want to kind of make it happen and find an operator who wants to create something like this. And I can connect all the dots of how do we get the capital? Because this takes a lot of capital, you know, like Joe Lonsdale started a school in Austin. I don't know how much he— how much that costs, but I think it's like a— I wouldn't be surprised if that's like a $50 million to $100 million project of like—

what is it called? University of— University of Austin. Austin University. That's crazy. Uh, I mean, yeah, that's pretty wild.

And if you look at like, uh, so billionaires have put $200 million into funding that, uh, that school. So yeah, you know, it's, it's a big CapEx lift, um, to, to do it when you have a physical campus. And I wouldn't do it remote. I would do it legit. I would do it with a physical campus and I would just try to make it like awesome. And it's the same thing, like we talked about the Baton thing. It's a 50-year play. Like you want to build prestige and legacy like a Harvard or a Stanford. Where it's the reputation, the reputation and the brand is the value. You want the best people to pay top dollar to come to this thing and get the best education. Then you want all the companies who want to hire to value the label that you have. So to do that, you have to assume you're going to be, you want to do something that peaks, you know, like 50 years later, um, in terms of brand prestige.

Yeah, that's like an interesting thing, by the way. So, um, there's like been a lot of times where, uh, people will sign up to, for a university and the goal is that after 10 or 15 years, the brand name has elevated, so you bought the price before it was full, you know, it's just like investing in a stock. And then there's other times when a university level— Yeah, where a university will have a protest or something will happen and it hurts the brand. And you're like, for example, uh, let's say you graduated from Columbia, you're like, shit, like it's a controversial place right now. Is my— I bought this brand. Is that now worth less? Than what I was anticipating. And so there's this weird— that is like an interesting way to look at, uh, building a university brand of like, I have to increase the value for, you know, so I can, I can justify that the people buying, they actually bought it when it was cheaper as opposed to what it is worth in 20 years.

Dude, did you see Bill Ackman did a presentation about Harvard? Did you see this?

No. What'd he say?

Oh my God. All right. Well, I know we're supposed to wrap up, but this is honestly incredible. Jim Grant asked me to give a talk on Harvard, buy, sell, or hold in the same way you would do with a stock. I think the, the Harvard motto or slogan is Veritas, and the title is Veritas? Because, you know, he's on this like anti-Harvard crusade right now.

What's Veritas mean? Forever?

Truth, I think.

Truth.

And so he breaks it down like it's a company. Yeah. The business of Harvard College is providing education to students. And then he has like a graph. It's like enrollment has been flat over the last 20 years. Faculty growth has been modest, you know, growing at half a percent, but administration growth has grown by 40% in 20 years. So he's like, basically like, oh, you're not growing students, but you're growing your admin, your opex on the backend, right? And analyzing it like a business.

This is amazing.

And the cost has grown. Basically, the cost has doubled in 20 years.

He says you're growing by increasing prices, not by increasing the number of customers served.

Exactly. And then it talks, and so he breaks down the P&L. Breaks down where's the revenue stream. So how much is coming from donations versus tuition? How much of your faculty has diverse viewpoints? I mean, really, obviously his agenda in this whole thing was to basically be like, Harvard has gone too woke and the administration has gone like rogue and you're ruining the brand and the mission of Harvard.

He said the operating margin would be a -40% without distributions from its endowment.

Yeah. And it says in 1643, that's how old Harvard is. In 1643, Harvard's first mission was set up simply as Veritas, or truth. And he's got this old screenshot of like a hand-drawn logo of the shield, and then he reads like the, the laws, liberties, and orders of Harvard College. And it's like this handwritten document, um, about, you know, the, the goal was to encourage Harvard students to seek wisdom. And he's basically saying like, you know, then he shows how the mission charter has changed. So in 2020, it was instead of about seeking truth, it was like it removed a bunch of references to the 1650 charter and basically left it as more of like a DEI style mission.

Yeah.

And he's like, you know, paying attention to that. So, you know, he's like, what, you know, what happened to new ideas? What happened to the truth? And then he goes and he just breaks down like fact, also like even in the faculty growth, he's like, cool, is it growth in computer science teachers? Or is it growth in African American studies? Um, which, you know, he basically shows that African American studies grew like crazy compared to economics or computer science. Um, but then he's looking at the number of degrees that people are getting, and that's not growing. So he's like, you're not meeting— your supply is not meeting the demand of the consumer. You're just— your supply is growing arbitrarily, not, not to match, not to match demand. Like, I think there was only, uh, what was it, like, there was one degree recipient in 2023 in African American Studies and 57 faculty.

This is wild. And do you know, and, and here, I, if you go down all the way to the last slide, his verdict. He says, is Harvard a buy, sell, or hold? And his verdict as of now is Harvard is a hold. It still has many positive attributes. It has a strong brand, 400-year operating history, $51 billion endowment, and huge real estate. Uh, but it has many challenges. The quality of the education has deteriorated. There's so many competitors. Many talented people aren't going to traditional universities. They've misallocated resources, and the endowment has been a chronic underperformer. This is a very interesting way to look at many, many, many different decisions in life that are beyond just money.

How awesome is this?

This is the greatest. This is, this is a fantastic way to think.

Yeah. This is so cool.

Is this all decisions? I think I should, every big decision I have in life, I, I need to put together a PowerPoint like this. We did this with our child's name, by the way. We put 3 names in a PowerPoint and like Sarah presented them and like argued like in her favor, which name we were going to choose.

Okay.

Hold on, hold on.

What is that? What is even in the slide? What do you say?

Like, so the way that we make decisions in our house, oftentimes it's, uh, like one person will present 3 options and then the other person can select the one option that they want. And so if it's like, uh, Cheesecake Factory, Chipotle, or frozen dinner. So it's like, uh, if I'm selecting the 3, I will select 3 that I'm at least okay with, and then she could select the one that is of most interest to her. For baby names, it was like, uh, she was like, you, uh, I wanna select a 3 and then you could select the one. And so she made a PowerPoint and it explained, here's the 3 names, here's the background of the name. And I had like, um, parameters. I was like, I want something somewhat traditional. I prefer it be in the Bible because everyone in my family was named for someone in the Bible, whatever. And she's like, all right, here's the 3, uh, that I like. I'm cool with all of 'em. Here's the background of each name, uh, here's what it means, here's famous people named that, here's, uh, where it ranks on the popularity list. Here's—

is he trying to persuade you towards one, or it's a completely neutral, like, pros and cons of each?

In that case, it was neutral. But yeah, oftentimes there, there is an underlying persuasion bit. But the— if you're the person who selects the 3, you should select select 3 things that you like. Uh, you should, because that's like what you could do is you could select 3 things that you like, and then I, as the final decision maker, will select something and you're happy no matter what. It's a great way to make decisions, I think. And so she did this big presentation on 3 different names and I selected the winner. Uh, and that's how we got our baby's name.

Last podcast you said every month we sit down at the end of the month at our table and we review the month's budget. Financial decisions, key financial decisions that were made. We discuss unresolved issues that might be lingering. I'm kind of into the Parr Corporation. Parr Corp is, uh, probably one of my favorite corporations to learn from, and I think the way you run your marriage like a business partnership is both effective and hilarious.

We do.

Great combo.

Before we got married, we did that, by the way. We said, uh, you know, this is going great, like, we really love each other, we like each other, it appears as though, like, marriage is in the cards. You know, we said it's like 6 months into dating, write down where you wanna be in 10 years. Like, what do you wanna do? Like, let's, how do you wanna raise a family? Where do you wanna live? And we like made sure that like our wants and our interests, like we're like, all right, like we disagree here, but like, that's okay. I'm malleable there. But here's like a deal breaker. What do you feel about that? So for hers, it was like, I wanna raise children in the New York area so I can be around my family. That's a deal breaker. And I was like, yeah, that's cool. I could, I could, I could fuck with that.

Right.

Uh, and so yeah, we do this type of stuff. It feels cold. I don't even like talking about it cuz people think, cuz like It feels cold. Uh, but dude, this shit works. These type of like discussions where it's like, all right, now's the period to discuss this. You have the floor. That stuff is so effective, I think.

Yeah. Yeah. It's always great before you guys go to bed, you just shake hands instead of kiss. It's just nice, like to, to just keep everything on the up and up and, uh, as calculated as can be.

That's why I hate talking about it. Cause people think that everything's like systematic. It's like, no, like there's like 2 hours a month where like this is set aside to like have these like relatively formal discussions. But it's freaking awesome. I think that, I think if you like have a lot of kids, don't people do like family meetings? I know I saw it in like TV shows growing up, but it's not a thing.

Uh, yeah, I think family meetings are a thing. I think you guys just really, uh, take it to that next level. You guys are the McKinsey of family meetings, right? Like vows.pdf before your wedding. You had it all set up. It's good. I like it.

It works. I suggest everyone at least try it. It definitely works, I think.

All right. I think that's a killer episode, to be honest.

I feel hyped up. I have energy.

To be perfectly honest with a hard H, that was a great episode.

All right. That's it. That's the pod.