This Profitable Business Model Might Make You A Billionaire | My First Million Podcast

What a fucking baller. I was gonna save this guy for next week, but we're gonna do a double billionaire of the week. So we're doing a double Billy special. Get, get your, get your Billy's right now. Richard Burton. Okay, so have you heard of this guy Richard Burton?

Is it Burton Snowboards?

No. Um, so this guy started a couple of different companies. So just if you just Google Richard Burton?

I did earlier and nothing came up.

Uh, oh, did I— am I saying his name wrong?

I think you got it wrong because I did—

no, no, okay, he— Barton, sorry, Barton, not Burton. Okay, so Richard Barton, uh, so this guy started Zillow. He also started one of your favorite sites, Glassdoor. Um, he also started— he has three, so he has Zillow, he has Glassdoor, and which— what's his other one? I was gonna research this for next week, so we're just gonna do this live here. Um, and he did Expedia.

He did Expedia, board of directors on Netflix.

He did Expedia, Zillow, and Glassdoor. What a fucking baller. Like, okay, Expedia. Yeah, so, okay, so how, how did this happen? So I listened to this interview with this guy like 5 years ago, before this podcast even started, before this podcast was even a little you know, sperm in my balls. And when I looked at this guy, the one thing that stood out to me was he had a very simple thesis that he used to start all these companies, which was information wants to be free. So okay, what does information wants to be free mean? So he was basically like, I'm gonna bring transparency to industries that are not transparent. And so he's, you know, let's take Zillow for example. Before Zillow and the sort of online house search companies existed like Trulia and all this Redfin stuff like that, The MLS listings were something that only the agents and brokers had access to. And so this is— they were gatekeepers. They were like, oh, you want to know what's on the market? Let me literally print out the MLS papers and I'll show you, show you these, and I'll tour you through these companies.

That's so great line, dude. Information that— information wants— you gotta—

information wants to be free. And so, uh, so then he did the same thing in travel, right? We had travel agents who were the brokers who you had to call and be like, hey, I'd like to get a flight and I don't want to pay too much. And you just trust that hopefully this agent is gonna do, gonna do their job. They're gonna know all the different options, different times, different airports, and they're gonna find me something that fits my needs. And Expedia was just a search bar that would just tell you, here's all the flights, you decide. Here's the information. You don't need to go to a travel agent anymore. And Glassdoor is the same thing. You wanted to know What's it really like to work there? And employers have no desire to put that out there. They don't want anybody to know any of the bad things that happen in the working environment of their company. And employees were often scared to do it because they would sign things that would be like non-disclosure, whatever, non-slander— forgot what the term for it is— non-disparagement. And so Glassdoor was unleashing the information about what's it like to work at X company. And so I love how this guy literally on one thesis has started 3 multi-billion dollar companies off that one premise. And so that was when I, when I did what you were talking about. I reverse engineered, how did this guy do it? It wasn't, oh, how did he build Expedia? How did he build Zillow? It was, how did he even get this idea? Oh, okay, what other industries today lack transparency where I can open them up?

What are they?

Oh dude, well, if now that's a billion dollar idea I need to have.

Let's think of some. One of them is pricing for enterprise software, right? What they do is they find out how much money your company makes and then they go, okay, we're going to charge you this, right?

I like that.

I like that a lot. Like, I hate that call for pricing, uh, model. I mean, I, I hate it, but it works. We do it.

Um, so AngelList did this, uh, in, in a way as well when, um, you were able to figure out, uh, who's invested in what. That used to be like sort of not easy to find information. It wasn't sort of like totally guarded, uh, but I—

Crunchbase as well.

I'm literally just looking at the tabs that I have open, right? Like Yelp. Yelp is something like that too, you know. How is it? What is it like to eat there? The review system, it, uh, organized and made public information that people wanted that was not super transparent before this.

Yeah, I mean, housing, he did that. There's a lot of— there's so many good ones, um, salaries. He did that with Glassdoor.

There's all— Glassdoor do salaries?

Yeah.

So there's, there's one that I use that's in the tech world called Levels. I think we talked about it once before, but they do it where with just the like kind of tech companies, it's like, what do people at tech companies make? And a lot of people have been doing this on, um, inside companies. So inside Microsoft, for example, they created an anonymous Google Doc where you can just put your level your job category, like engineer, designer, product person, whatever, and your salary and your pay.

And then Glassdoor does that.

Yeah, you figure out, am I underpaid? But this was even in like more specific— it was like in a company. These are people now, like, and it's not just Glassdoor, it's like just a few who kind of go and post this stuff. But they're getting like these, these companies are having these like really rich documents with thousands of people contributing and And right now those are just Excel docs. I wonder if you could take the— just the salary component of maybe what's in Glassdoor and do it in a better way inside companies so people make sure they're not getting the short end of the stick within their own company right now.

That's interesting. Another one is freelancers. So it's just what freelancers and agencies— so the problem with a lot of this stuff is When we were trying to hire some agencies to do WordPress development, I have to backchannel and go find out from people who worked with them what they were like. Once I sign up to an agree with them, I can't— I won't find out unless I'm a week in if they suck or not. Right. And it's like, oh my God, I can't believe that. I can't believe I'm in. And that's the same thing with like payroll software too. Like Gusto looks good, but when you sign up to it, you don't realize like what you like and what you don't like about it.

So we have a couple friends who are doing things that are trying to put out, you know, they're trying to make information come free of what software do companies use. So like a lot of people would want to know, what does The Hustle use? What do you guys use to send email? What do you guys use for analytics? What do you guys use for your paywall? What do you use for trends? And like, I know Ryan at Product Hunt, they're doing this with something called Stacks or Your Stacks, and they want to know what's your software stack that your company runs on. And it's an interesting idea. He's designing it kind of like a social network, but the value in the end, and if you did, if you get there, is, oh cool, I can now go see, okay, if I'm building an Airbnb type company, what do they use to run their company? What do they use for analytics?

Do you think that that is that working?

Well, it's really tough to build, right? This is one of those things where really valuable if you get there, really tough to get the information in because you have to get the incentives right, uh, later on. You have the incentive to come to the site because you want to see what other people use, but what's the incentive to post? And so he's trying to make it fun and interesting and cool to post, um, by making it like very visual, like sort of a—

like, good at doing that—

a profile for your company, right? Like, uh, like, yeah, we use this stuff. And, uh, so I don't know the numbers on how it's doing, but I do think it's an interesting experiment. And I think if they did it, it would be the most valuable thing that Product Hunt has built because it's a It's just inherently extremely— there's a great business model on top of that if you can show what software people use.

That's cool. I agree. Um, that's interesting. Um, I love this idea of information needs— or information wants to be free.

Yeah, let's think more about that. So I think we'll come back with an example of information today that is either behind a walled garden or it's incomplete, and if you set it free, it would make people make better choices or save them money or whatever it is. Like maybe it's something in the insurance space. Maybe it's, I don't know exactly what, but I'm gonna think about this because I think this is a formula for building really big companies.

Yeah, for me it's how much things cost, like freelancers and lawyers and things like that. That's always bothered me. I don't, like my lawyer could be like, yeah, we charge $700 an hour. And when I was first getting going, I was like, I have no idea, is that normal? Right.

And on the other side, it's also how much companies make, right? Like, you love it when you hear that a company's public or it's a nonprofit because you're like, yes, I'm going to get to their financials because they have to report.

But you know, definitely PitchBook for private companies. Yeah. Well, and they do it in a really interesting way. And they're owned by a publicly traded company. They do about $120 million a year in revenue.

What they do is like $25 grand for a PitchBook subscription, right?

Really expensive. And they do about $120— they're owned by, is it called Morningstar? Or it's a company, Brightstar.

I think it is Morningstar, or Morningstar is like the mutual fund thing.

It's— yeah, it's owned by one of those things. And I just read their earnings thing.

Morningstar. It is Morningstar, and they are the mutual fund thing too.

And they, uh, what they do is they do a bunch of different things. The first thing that they do is they crawl the web and they find SEC documents and they find like all type— they just crawl and find data. And they have a team of like 300 people who just hit the phones all day and call people and get the information. Right.

And then the other one that's like that is, even for podcasts, when we look at the top charts and we're like, all right, how do we become the number one business podcast? We don't know how much, we don't know how many downloads they get, right? There's this idea of how much something, how much is being earned, how much is something making and how much does something cost? I think that just generally would apply to a whole bunch of different spaces that you could use for this.

Yeah, that's why I use SimilarWeb 'cause they show me how much, traffic, they guessed traffic.

One of the dope ones of this, do you use Second Measure?

Yeah, they're great.

They're great. I think they're a little bit expensive.

I know what they are.

Yeah, if you don't know what they are, so Second Measure takes credit card spending data and can tell you essentially how much money something is making just by analyzing how many people are charging Spotify per month and then they're like, okay, cool, right? Imagine Spotify was not a public company, you'd be able to see Here's how much revenue that they're making. They do this with like the delivery companies. Which delivery company's winning? Well, they can just check this huge dataset of credit card spending and say, okay, it looks like Grubhub's in the lead and then second is DoorDash or whatever. And so second measure is super powerful using a source of truth, which is credit card data. I don't know how they get at it.

Whenever we talk about this stuff, all I wanna do is just like end the podcast and make my days 50 hours long and just start off with— Research everything. This whole data, or make information, or find it, information wants to be free, that whole concept, that's amazing.

That's the test. I want people to listen to this podcast and be so excited, and then I want you to feel anxious. I want you to feel stressed that you don't have 50 hours in your day to go do this, and that's how this should feel. I've heard a bunch of people say like, yeah, I have to keep pausing the podcast to like A, write shit down, B, take a breath, C, think about what's going on, and then I resume it. And, uh, yeah, that's what we want. It's that, that high value.