Investing Masterclass with Shark Tank's Matt Higgins: Imposter Syndrome, Celebrity Entrepreneurs and What He's Bullish On
49:55 Share

One of the most stressful periods of my life was when I was in credit card debt. I got to a point where I just knew that I had to get it under control for my financial future and also for my mental health. We've all hit a point where we've realized it was time to make some serious money moves. So take control of your finances by using a time checking account with features like no maintenance fees,

fee-free overdraft up to $200 or getting paid up to two days early with direct deposit. Learn more at Chime.com slash MNN. When you check out Chime, you'll see that you can overdraft up to $200 with no fees. If you're an OG listener, you know about my infamous $35 overdraft fee that I got from buying a $7 latte and how I am still very fired up about it. If I had Chime back then, that wouldn't even be a story. Make your fall finances a little greener by working toward your financial goals with Chime.

Open your account in just two minutes at Chime.com slash MNN. That's Chime.com slash MNN. Chime. Feels like progress. Banking services and debit card provided by the Bancorp Bank N.A. or Stride Bank N.A. Members FDIC. SpotMe eligibility requirements and overdraft limits apply. Boosts are available to eligible Chime members enrolled in SpotMe and are subject to monthly limits. Terms and conditions apply. Go to Chime.com slash disclosures for details.

Toyota has been building a legacy of excellence for years. From developing hybrid technology to upping the standards of safety and efficiency, Toyota is always innovating, always making progress. And with Toyota's superior lineup of SUVs in stock at your local Toyota dealer, you can experience the legacy for yourself. So check out an adventure-ready RAV4 designed to be the perfect mix of style, practicality, and go-anywhere attitude.

Or test drive a capable and affordable Corolla Cross with the style, space, and available tech to keep you cool and connected. And both RAV4 and Corolla Cross are available with all-wheel drive, giving you the freedom to roam. Quality, reliability, efficiency. That's the legacy of Toyota. Visit BuyAToyota.com, the official website for deals, to find out more. Toyota, let's go places.

I'm Nicole Lappin, the only financial expert you don't need a dictionary to understand. It's time for some money rehab. Money rehab.

Don't you just sometimes wish you could have the Shark Tank judges sit around your kitchen table and just tell you what to invest in? Well, as usual, I am making your wishes come true because today I'm talking to Matt Higgins. Matt was an on-screen investor for Shark Tank. Off-screen, he has done many, many more deals from RSE Ventures, where he's invested in companies like Magnolia Bakery, Mamafuku, Milk Bar, Bluestone Lane, and many, many more. Today, Matt tells us which stocks he's bullish and bearish on, how he picks good investments, what his real take is on celebrity entrepreneurs,

and many, many more gems that you can use to refine your own investments. Let's get into it. Matt Higgins, welcome to Money Rehab. Thanks for having me. So Matt, you are a rich, successful dude.

I've known you for, when was the last time we met? 10 years ago or something like that? At least. We're dating ourselves now. You are rich and successful now, but you weren't born with a silver spoon in your mouth at all. And I know we talk a lot about this idea of like self-made, but you started with 5 million and you made 6 million. Is that really self-made or not? You really are. Can you tell us that there wasn't a silver spoon? Maybe sometimes there wasn't even a spoon of food in your mouth growing up?

More importantly, I didn't know which spoon to use. Like those are my earliest memories. Like why are there multiple forks whenever I would go over someone's proper home? But yes, I mean, the self-made word is kind of tough too, because there are lots of, I always consider my life as like a relay race and somebody passed a baton from one person to the next who gave me a break. But yes, I grew up in agit poverty, taking care of a disabled mom. I used to sell flowers on street corners. That is true. Starting at age 10, I used to scalp tickets when that was illegal. And I used to sell leather handbags for $10 at a Roosevelt field flea market. So

I did everything. So I was definitely not born with a silver spoon, more like a slice of government cheese in my mouth. Like the moldy cheese. But that was actually really good. And anybody who grew up on government cheese in the 80s knows what I'm talking about. It was actually very, very good. But I legitimately still have the box somewhere in this room. It says brought to you by the USDA. And it was a program in the 80s that they would subsidize farmers. And then they would send it to people like me to eat for dinner. Yeah.

In your book, Burn the Boats, you have a thesis that came from your upbringing that you say contemplating, just even thinking about this idea of plan B diminishes the probability of ever achieving plan A. So first, can you tell me what your plan A was and why you never wanted to have any other letters? That's fair. And somebody was criticizing me saying, this is hindsight bias. There's no way you could have known that if you made that one radical move,

but it actually was not hindsight bias. It was desperation. So backing up, taking care of my mom, I hated my life. So I want to make sure anyone out there who's a caregiver and resents it, like I'm being honest with it. I didn't want to be a kid and a caregiver. I wanted to have a girlfriend and bring somebody over my house, but it was disgusting. And I just hated life. And so I,

To me, it was clear that things were gonna get worse and worse. My mother had all these chronic issues. She was very obese and had all these comorbid conditions. And I stumbled upon in a moment of desperation, a hack. And it was actually inspired by my mom. She had gotten a GED as an adult, never had a chance, she was so smart, but never had a chance to go to school.

And I remember thinking, like, why don't I do on purpose what you did inadvertently? And why don't I get a GED? Because back then, if you did well enough on a GED, they would translate it to a GPA. And you could go to any college you want in America. And so I read an ad in a newspaper that said I could go from making $3.75 an hour at McDonald's to $8 if I was a college student. I was thinking, like, what is it about being a college student?

And my burn the boats moment wasn't this hack of saying, I'm going to drop out of high school and get a GED to go to college. It was when I presented this plan to guidance counselors and teachers, everyone's like, you're going to be a loser forever. This is before Mark Zuckerberg made dropping out cool. Now you're dating yourself. Right now. It's a good point. I really am.

And so in order to overcome the whole weight of conventional wisdom, and this is not hindsight bias. I was like, the only way I'm gonna be able to go through with this because it's wearing me down is if I give myself no option, no plan B. And the way to do that was I failed every single class. I always call it the land of misfit toys. I sat in the back of a homeroom with the other kids and I gave myself no choice. So by the time that I was old enough to drop out, no one even tried to divert me because I was a lost cause.

And by doing that, I went forward with it. I dropped out and I ended up going back to my prom, now 17, as president of my debate team. That single decision set in motion a repeating pattern throughout my life is when I want to do something bold, I need to actually cut off all escape, all retreat, and be honest.

I tell the story in the book, we can get into it. And when I went on Shark Tank and everyone thinks it's a heady moment, for me, it brought me to my knees because I just thought I was going to be exposed as the fraud that I am. And so I really wanted to write a book where I was cringy and shared things so somebody could say, oh, I see myself in you. If you could do that, maybe I could do it too. So you had imposter syndrome when you were on Shark Tank?

I mean, the worst kind. So my wife is my best friend, my wife, Sarah, and my partner and everything. And so we go out to LA and I'll skip the story of me trying to get on Shark Tank and losing 50 pounds and like putting a little zapper on my neck for posture, like all these insecurities about my lack of. Wait a minute. Why? What? I'm just kidding. You went through a full makeover.

I tried to do a full makeover because I really wanted to manifest being a guest shark and there's no online application. By the way, everybody lies, every executive, they all want to be guest sharks. Okay, honestly, so I was homies with one of the main casting people on Shark Tank for a while and he would always ask me to recommend people for Shark Tank, but he would always ask for women and people of color.

Matt, you are neither of those things. So I'm just saying, how did you get on as a white guy? By the way, that's such a great, I love that question. No one has ever asked me that question. I remember that it was close to not happening. And I got a phone call from Holly Jacobs, who helped put together casting. And she was like, you know, you blew them away in that conference room telling the truth about your New York story and your mom, we're going to give you two episodes.

And you are correct. I am indeed a white guy, a middle-aged white guy now. And they gave me a shot, which I am proud of because that's a hard thing to break through, which is hilarious. You just asked me that. But wait, let me tell you the story. So the night before, here's this heady moment. And my wife gets up at five in the morning. She's like, you know, okay, babe, like you're ready for your big moment. I'm like, no, I was up all night. I powered through the ambient, nothing worked. And she's like, okay, honey, why don't you take a shower and see how you feel?

And I got my head together enough because I listened to Eminem on a loop, Lose Yourself, to get me through it. And then I went and talked to Daymond John. I had an epic conversation. And I was like, man, I'm freaking out. He's like, why? I was like, I just feel like, I don't know. Everyone sees right through me. What am I doing here? Because I was so tired. And he's like, let me tell you something, okay? You and I have been through everything. Like, he's black, I'm white, but we both live within two miles of each other. He worked at Red Lobster. I worked at McDonald's. And he's like, you belong here because you are here right now.

And it was like Socrates, you know, just, of course, there is no final arbiter of belonging. And I powered through it. And when it was done, I did well enough to be invited back and be on other television shows. But I decided to share that story because if you saw the tape, you would say Matt Higgins was some version of a natural or good enough. But I

But I wanted people to know that I wasn't a natural and I felt not good enough because that is a more useful teaching moment. And the book is my way of doing that on a much larger scale of pulling back the curtain because all this Instagram nonsense creates this fake narrative that people who are successful have it all figured out. And now they're going to preach to you. When I met you, you weren't a TV guy or an author or a personality. You were a sports guy. You were working with Steve Ross. Like you're a nerd. You're a business nerd.

A nerd? I don't know how I feel about that. In the best way. We love nerds. All we do is glorify nerds on the show. But no, you didn't come from that world. And so it makes all the sense in the world that you were completely nervous and overwhelmed and felt even imposter syndrome at such a high moment of your career.

Not only that, it's like anyone out here can relate to this. I don't know why this is the case, but when we try to break out of our box, others try to put us back into it. And I think it's because when you begin to change the definition of who you are and how you manifest in the world, it's threatening to people.

especially those who don't have dreams, right? Because you're putting pressure on them to break out of their own box and everybody tries to stuff you back in. And if you're open-minded and intellectually curious on feedback like I am, it affects you. So when I went on Shark Tank, there were a lot of haters trying to like,

cut me down because every lot of people subconsciously wanted to be it and i'm like you're not rich enough you're not this you're not that i guess i was a nerd too apparently i was definitely chubby and i had terrible posture and so it affects you and for anyone out there who's trying to break out like those subconscious does that energy you're feeling is true people are trying to cut you down and so every time i would reinvent myself sports executive investor it

Shark Tank teacher at Harvard Business School. There's enemies come out of the woodwork and try to mess your head up. And I'm not immune to that.

Well, you had a freaking zapper on your back. What even is that device? It's a little thing you put on your neck. And when you slouch, it buzzes you like that to sit up straight. So I had a two-tiered system when I went on Shark Tank because I'm definitely a sloucher. I had the zapper and my wife over in the, and every time I sat down, she'd do a little eye thing like that. It was like very embarrassing. Now I sit up, you know, largely straight.

So they gave you two episodes. You ended up staying on for two seasons. Yeah. Obviously, you didn't shit the bed.

No, no, I definitely did. It kind of happened in the middle of the first pitch. And despite the story I told you about Damon John, if this was Hollywood, it would have ended there. But actually, no, I completely froze. And there was a moment in that first, they cut it out, of course, because it's 40 minutes. But this is completely true. I'm sitting there. I'm not engaging because it's hard because you're on the end. Right. And at what point Mark Cuban leans over and

and brings me into the conversation. This is competitive, right? And he had this look of pity, at least in my head, of who brought this kid here. And it like something triggered in me. I was like, I just closed my eyes for a nanosecond. I was like, wait a second. I've done more deals than all you people. Maybe not, but at least as many. And I have built things from scratch. And I architected my whole life from nothing. And I watched my mother die in that room next door in a fucking, sorry, in a chair. We get out of town.

No, in the fucking chair. You saw some gnarly stuff. Yeah, like on the first day I became press secretary, I walk out that door at 26. It's a dirty, sad place. I don't even have the money to have a nurse come over anymore to change her. And she's begging me not to go to work. She has an oxygen tank and she's like, please don't go. I was like, we have no money. I am press secretary of the mayor of New York. I have to go. I changed like Clark Kent.

And I get to the hospital after she calls me and she's dead. Right. So I'm sitting there in that one second. I'm like, you know, whatever. I have built this whole life from scratch. I'm going to fight. And I fought. And what's nice, Sarah recorded the room where everybody's watching on the monitors and people are screaming like, go mad, kick his ass. You know, it's going up against. Yeah, I was good enough. But I really do feel if you don't tell the truth of what it takes for you to transcend your circumstances and what the inner voice you have to overcome is.

then you're doing such a disservice because you're creating more distance. If I let the tape do the talking, then any other person who came from my circumstances would feel even less than because they're like, look at all you did. I don't even have any excuses. So I want to reinstall the excuses. Do you know what I'm saying? I want to create less distance with the book and with you and I having this conversation. And in order to do that, you have to lower yourself. And there was a sense of loss. I'm like, oh, I wish I could have let the tape do the talking. But then I was like, that's not useful. This conversation is useful.

This conversation is so useful and I come from similar background. It took me a long time to be able to talk about it too. And I'm curious because you've been in all these rooms and you've done all these deals. Have you ever been annoyed or I don't even know what the right word is. Felt like a chip on your shoulder when you're in these rooms with clients.

family, money, people, rich legacy people that were just handed a lot of their opportunities in a way that you were the opposite. It's funny. Dave Chang asked me this question because he does. I teach it at HBS Harvard Business School. And he's like, do you ever just look at those resumes with the Harvard kittens, just toss them out? And I was like, that's the opposite. Actually, I think that's

I would have loved to have gone that route. I would have loved to have two parents who were functioning and not be raised by wolves and all the damage that goes with that, all the years and years of patterns I have to break and still have to break. And so the answer is,

I don't know. And two, I think it's wrong to judge people because they didn't go through your version of hardship. Because as much as what I went through, like having a dad who never says I'm proud of you can do the same amount of damage as growing up on government cheese. And so for me, when I walk in that room, I'm like, whatever.

I actually feel bad for them. I'm like, you would love to have my origin story. You would love to have a GED to a JD because this society now values redemption stories. And now everybody makes one up. You know what I mean? Like I stumbled too. I over, I maxed out my credit card and my wife almost left me. So the answer is no, I don't feel that. I don't have the chip in my shoulder. Do you feel jealous?

I feel I'm lost longing. It's funny you said that I was walking through the airport, not that long ago. And I was thinking about the impact being a dad makes and my son's life. And for some reason I felt the absence of it in a way I had never felt. It was like, there was a little bit of space where I could contemplate, like, what would it have been like to had a dad in my life? What would it have been like to have a mother who didn't depend on me to, to be the hero child. And, and so I don't feel jealous. I feel sometimes lost, but it,

I can't go there. It's like the third rail and I look away. I think one of my last thoughts on this earth will probably be to come to terms with that, but I don't feel jealous. I feel pain.

Aren't we supposed to talk about money and light it and like being money is deep. I mean, if you want to get to the heart of any story, I think you follow the money trail. And I think we all have financial traumas. And that's what stands in the way it either stands in the way as a stumbling block, or it helps you as a stepping stone. And so really getting to the heart of where the ick is, I think is so so important, because we don't talk about money, we talk about everything else.

before we'll talk about money. Sexy time, politics, whatever. I'd rather talk about pain all day long. It's so boring. I go to hide in the bathroom and do the Irish goodbye if the stuff gets small. So this is good. We can stay here. I'm glad. So do I. Hold on to your wallets. Money Rehab will be right back.

One of the most stressful periods of my life was when I was in credit card debt. I got to a point where I just knew that I had to get it under control for my financial future and also for my mental health. We've all hit a point where we've realized it was time to make some serious money moves. So take control of your finances by using a time checking account with features like no maintenance fees,

fee-free overdraft up to $200 or getting paid up to two days early with direct deposit. Learn more at Chime.com slash MNN. When you check out Chime, you'll see that you can overdraft up to $200 with no fees. If you're an OG listener, you know about my infamous $35 overdraft fee that I got from buying a $7 latte and how I am still very fired up about it. If I had Chime back then, that wouldn't even be a story. Make your fall finances a little greener by working toward your financial goals with Chime.

Open your account in just two minutes at Chime.com slash MNN. That's Chime.com slash MNN. Chime. Feels like progress. Banking services and debit card provided by the Bancorp Bank N.A. or Stride Bank N.A. Members FDIC. SpotMe eligibility requirements and overdraft limits apply. Boosts are available to eligible Chime members enrolled in SpotMe and are subject to monthly limits. Terms and conditions apply. Go to Chime.com slash disclosures for details.

And now for some more money rehab. When you're looking for deals, does any of this stuff come up for you? Do you find that when you're evaluating companies, are you looking at numbers and EBITDA and valuation and stuff like that very agnostically? Or are you sometimes do those feelings of sadness or jealousy or chip on your shoulder come up as you're evaluating companies or founders?

It's the latter entirely. I weigh over index on the idea that the fish rots from the head. And in my experience, we pay little emphasis on diligencing the human and the founder. And I have used the same organizational psychologist for 20 years.

I am very, very deep into trying to assess what makes the founder tick and also trying to establish a level of honesty and intimacy so we can get to the hard issues. And the reason why is self-awareness is the greatest arbitrage.

If people over-index for self-awareness, they will course correct on their own. They don't require an intervention. So to break that down, if they are failing or they don't have product market fit or they have somebody they don't want to fire and they're not confronting it, if they over-index in self-awareness, they don't need me to make the phone call.

They don't need me to say your company's about to go under. They'll make that course correction before it's imposed upon them. Those who under-index, you know, take it right to the edge and usually fail. So when somebody under-indexes for self-awareness, unless they're a sociopath or a total narcissist, it's usually because they're afraid to look within. And that begins somewhere. So I oftentimes will try to create space to be vulnerable in the diligence process or whatever to get at, why are you stuck?

and try to assess whether they over-index for self-awareness. So long way of saying I'm way more focused on the founder and psychology than I am on numbers. I think that's so important. And I agree with you that self-awareness is the greatest quality you can find in business, personal life. It's definitely a journey, but it's probably the thing that you should over-index on.

There's been this huge conversation I'm sure you've seen in the Valley about founder mode. It was a term coined by the founder of Y Combinator after hearing the CEO of Airbnb speak. They say that founder mode is when a founder is involved in every aspect of the business. Is that something beyond self-awareness and doing the hard work that you look for in a founder?

I actually love this whole founder mode debate because it was like, there's a lot of truth to it. And there's a lot of room to mask bad founders or founder in over their head. So I think in its best form, it really means that there's a certain magic and intensity that a founder can bring that you cannot prosthetically install.

by simply hiring a professional manager. That is absolutely true. An intensity that a founder brings, this sort of desire, this pain and anguish to make their baby come to life and grow up cannot be prosthetically installed. So that's the thing you want to capture. At the same time, the person who is able to create something as a catalyst is not necessarily the person able to perfect it.

And the part that I find interesting about the founder mode debate, it enables one to justify a lot of potentially erratic behavior. And so the answer is somewhere in between. As I believe the job of a founder is to render themselves obsolete with specific tasks so they can level up. You know what I mean?

find the best damn marketer in the world so that you can go higher and higher and higher. And so for me personally, and I founded multiple companies, I'm always trying to figure out how to render myself obsolete in a given task so I could level up to higher order thinking. Let's use operations as an example. Somebody who is able to catalyze a business into existence as a founder, raise the money, enlist other people to their dream, all the hard things that go into creating something. If it's an operations heavy business,

business and you don't have operations or logistics experience, there's probably somebody better as a COO or some professional level than you'll ever be. So I'm in between. I respect the idea and the passion of a founder, but I also think there are a lot of founders who could benefit from professional management. I mean, a lot of celebrities, and you talked about Scarlett Johansson in your book, are entering the entrepreneurial space like never before, especially even in the alcohol vertical. Kendall Jenner, Kylie Jenner, The Rock, George Clooney. I mean, it goes on and on.

These are not founders, true and true. They need a professional, so to speak, to come in and help them with the business. How do you think as an investor about brands that are led by celebrities?

Yeah, I'm mixed, to be honest. I think that just a celebrity throwing their name on it is not going to be enough. And I think probably part of the problem with celebrity led brands is they think that they could mine the business from their own following. And that eventually taps out, right? Of course, you'll get early adopters, your customer acquisition costs will be lower at first.

because you have an audience, but it taps out. So when I see a founder who is self-aggrandizing, who's a celebrity and thinks that it's enough, I run away. At the same time, back to self-awareness, I actually love celebrities that have a degree of imposter syndrome and feel like they're a little bit out of their depth and they are looking for somebody to partner with. The greatest case I've seen is the partnership between Kim Kardashian and Jens

what they have done is amazing. He's a professional manager and has done an incredible job with her. And she grinds and works and cares about the product and tries everything on. I had her at my class at Harvard Business School and I created like a little mini flare up. Like, how could you have Kim Kardashian? I was like, she's a badass founder. She was in that room for two hours, taking every kind of question. She's done a phenomenal job. So the answer is, and I never thought about this before. I definitely gravitate to a celebrity founder that has a degree of imposter syndrome and feels out of their depth.

So self-deprecation is greater than self-aggrandizement. Yes. And a feeling of who can I enlist to help me on this journey? Because I don't have the answers here. Not everybody can be Ryan Reynolds, right? For many reasons, but yes. And government cheese greater than silver spoon when it comes to founders. Yes.

I don't mind silver spoon because I don't think that's necessarily defining quality. Silver spoon plus entitlement. Yes, government cheese better. When you go through companies, is there something that you specifically look for beyond that

redemption, chutzpah, whatever you want to call it in the founder? Yeah, I look a lot in initially language. What kind of language do they use? Are they a blamer? Blamers are never successful in the long term. Are they a victim? Victims are never successful. I look for people to take accountability, disseminate credit rather than go ahead and try to accumulate it. I look for people who have almost an absurd idea

and focus on a niche and believe that is the most important thing because it creates that energy intention creates exquisite products, right? So like oddly focused on one little sliver of the universe and just intensely as opposed to people who intellectualize their way to solving a problem

What I mean by that is I encountered this in business school. Some young person will have discovered a total addressable market, a TAM that they think could be absolutely huge. They have no emotional connection to this problem, but they believe that they can create a big business and then they pursue it. I look for founders who I believe

God or the universe, put them on this earth to create this business. And I could draw a line between something in their life, something in their DNA that brought them to this moment. The reason why is without that, you won't sustain the effort in the hard times. You'll get disinterested, but people who have that sort of inevitability about them tend to be very successful. And it's hard for me to distill it into a manual when I see it, but I know it when I see it. I know it 'cause it triggers this feeling of one, oh, you were born to do this.

But two, you will die trying and people who are willing to never die. Well, I ask you this because I think actually it's like obscenity, hard to quantify and you know it when you see it type of thing. But you can also talk about specific types of people. When I first met you, you were evaluating VaynerMedia that you're now a co-owner. And I remember you asked me, do you know Gary? And I had interviewed him on CNN and things like that. Is he the type of quintessential founder that you look for?

He is actually. No one would disagree that Gary was put on this earth to build that firm and to do what he's doing. Gary's oddly self-possessed, which I found annoying and alienating because he like sleeps nine hours a night and just perfectly at ease with himself because he knows what he's doing. He's able to predict the future and he doesn't really care if you agree. So there's a singular focus to Gary and belief in what he's doing and belief in himself. Not every founder I think has to have

that because that's a lot to ask. We all have things that we carry that we can work through. So I don't necessarily look for that self-possession, but I look for the intensity and commitment to purpose and that inevitability. Gary definitely has it. How'd you guys meet?

We met in a bagel shop. I was at everybody's dream job of my own, but definitely his. I was running the business of the New York Jets, which I had fallen into over a sequence of decisions. I love the job and the people, but I wasn't like, I want to go run a sports team when I grew up. And Gary was the internet star, the budding internet star. Like the ad hoc ambassador. Yeah.

Yeah. And to be perfectly honest, I wanted to leverage him to teach me social media so I could be the dynamic NFL executive and then use that to get to another job. I wanted to build a bridge to my future by being the cutting edge, innovative person. And I do embrace innovation early. And Gary was my bridge to doing that. I remember we met in a bagel store. My job was to try to sell him a suite, which is a really hard thing to do. But, you know,

He says he's gonna buy the Jets. This guy's got like billions. I was like, he's a wine life. He makes YouTube content. He's not buying tickets to the Jets. But I was like, but I'll go meet him. And I go to meet Kerry in a bagel store in New Jersey. The first 10 minutes, I was like, this dude is out of his mind. Cursing every 10 seconds. But the second 10 minutes,

Everything he was predicting resonated with me. I was like, oh, this is interesting. Your lack of finishing makes people underestimate you. I was like, if I could ride alongside of you, I'll just pick up those insights and we'll get rich together.

And that's the deal. When I partnered with Steve Ross, I went back in time and I was like, if we could have a social media firm at the epicenter of everything we do, we could change the outcome of the companies we invest in. And Steve, my partner, is amazing. In 10 seconds, like, I get it. I bring Gary into the office and he meets with all these suits. This is such a funny story.

He's pitching 20 people in New York, all real estate people. They're all buttoned up with their ties and all this stuff. And Gary's doing his thing. Me, a proud father, oh my God, isn't he amazing? I assume everybody's going to want to come into the deal. Every single person in the room passed. And I remember I had to tell Gary. He's like, how'd you do? And I was like, I thought you did amazing. But everybody passed. It's all right, brother. It's all right. Race is long. They'll see. And then Steve and I did the deal. How is he so chill? Yeah.

I don't understand. I'm not kidding when I tell you I would do anything to bottle that up and drink it because I spend so many hours auditing my bad decisions. And when Gary and I make a bad decision together, it's hilarious how we relate to it. I'll come, Gary, we screwed that up so badly. And he'll rationalize somehow

that it was a good decision and this is exactly how we wrote it up. And I'm like, no, but that's not true. Like, remember, this is me. You're lying to the person who made half the decision. And his way is just so much more peaceful. And he'll make fun of me for it, but I can't change who I am. I audit my decisions and Gary is at peace with his. So you mentioned Steve Ross, owner of the Dolphins. When you were kind of poo-pooing meeting up with Gary as like a social media guy who allegedly said he wanted to buy the Jets and couldn't even buy tickets. Yeah.

Do you change your mind on that? Do you think he could buy the Jets? I think Gary could definitely buy the Jets. I think he would need to continue to build that firm. I think we need to run a play. I can tell you the formula if you want. Tell me. Yeah. What's the formula? Because I was going to have the conversation with Gary, so now I'm having it with you, that we have this machine, VaynerMedia, which is phenomenal, one of the largest privately owned agencies in the world. North has $300 million in revenue. We've actually never taken something that we own together or we built and run it through our own machine.

whether I'm talking about e-commerce or product or buying nostalgic IP, I think there's another level we can go to. If we just had, we spent like 20 minutes together, we're both moving in all these circles. I am right now the co-founder of three companies. He's all over the place. If we just spend 20 minutes, we would identify a play to run and we run it through that machine. And that would be the path to buying for him to buy. That's not my dream for him to buy the jets one day. Take it, burn the boats. Yeah.

the middle of doing something else that I really love that I'm so passionate about. What are you so passionate about? I'm the co founder of a drone company that I had been working on in stealth mode for almost seven years quietly. And we just really came out hard in the last like eight months or so. And it was born Thank you. It was born of writing a check into a sport called the drone racing league. And it became very clear or this was 2015. Around 2017. It's a real sport.

It's a real sport. You just don't realize that all the young kids are just racing drones all over the place. We're getting older now. We're a little bit disconnected. Pickleball is real too. Pickleball, I know. Pickleball is an old people thing too. Exactly. I'm just showing the two extremes. But so anyway, long story short, it became clear to me and a group of others

that in the future, bad actors are gonna take advantage of this technology of drones racing a hundred miles an hour. And that it's very important in a future conflict that we be prepared. And we have this technology in the United States and we created a company in Huntsville, Alabama and we began working on drones for first tier operators, for elite military. And I've been at it for years and years and years. And I love the work because,

I have the same feeling now I had when I stood under the World Trade Center after 9-11 and I helped oversee the rebuilding afterwards of like, how does this happen here? And how do we not see this coming? I have the same dread when I think about drones that

that future conflict is going to be about drones. Somebody's going to put those drones to nefarious purposes. And we need to have a domestic drone industry in the United States so that we are ready. And Ukraine has proved that point. So I was just a little bit early on it, but I'm more passionate about this work than anything I've ever done. So to your question, why don't I work with Gary to acquire an e-commerce company? It's because I'm distracted by this other passion that I really care about. Well, not just an e-commerce company, but the Jets.

I know, but it's not my dream. So this is like the open AI for drones. It is. It's the most sophisticated, small, unmanned aerial systems. And it's called the UAS in the world. We have the best company on earth and we built it. And I'm really proud of it. And it fills me with a lot of satisfaction in a way that nothing else I do does. I mean, in the same way, I wonder if you fear...

the world of AI also being infiltrated by bad actors in the same way that you fear for drones. Do you think about that as an investor?

I do, but in the opposite. I actually think it's a tremendous development and the reason why, a little bit abstract, but before AI, if we think back two years ago before OpenAI, whenever it was announced, we already had a crisis of confidence in any information we were receiving because of Russian manipulation in the last election and this culture of cynicism and distrust that's been created in politics and society. Point is, we didn't trust anything.

AI ensures that you can't trust anything. So I would have thought by now, I loosely call it a system of veracity, right? So that we could check the origin of anything we receive

I would have thought we would have used the blockchain to register every type of video content and every type of any writing so that we could immediately verify it. I still think that'll happen. I would have thought it would have happened and been in place by now. So in a reverse way, AI is forcing us now to create a system where we can validate everything. And so that gets me excited. Hold on to your wallets. Money Rehab will be right back. And now for some more Money Rehab.

I would love to play a quick game with you. Hopefully that gets you excited too. It's a nerd game. It's called Bullish or Bearish. And the rules are very simple. I'll tell you a company or concept and you tell me if you're bullish or bearish. Okay. Cool? Yeah, do it. Sweet green. Bearish.

Why? Because I think we're going to enter a recession. You don't like salad? Yeah, there's that. I think we're going to enter a recession. And I think the price points of Sweetgreen will be under pressure. And I think they're highly concentrated in more urban environments. And I'm not sure people are going back to cities and work. Nvidia? Neutral-ish, because I think they're too highly concentrated. Only five companies, I think five companies make up 50% of their, and at some point, how many people are going to buy chips? So neutral. Apple? Apple.

Bullish. Although they really screwed up the rollout of Apple intelligence, but I'm still bullish because Surrey sucks so bad that all you have to do is improve it just a little bit. And if you don't have it in the new iPhone, you're going to feel FOMO. Meta. Bullish. Can't bet against Mark Zuckerberg. A fellow dropout. Yes, exactly. How could you? Uber. Bullish. Just amazing what they built. And I think they have an effective monopoly. Lyft. Bearish.

For the opposite reasons. The opposite, yeah. Bitcoin. Bullish, very bullish. It's just math. 21 million. They're not making any more. Supply and demand. Yeah, basically, just math. DoorDash. One of the first things people will compromise in a recession, which I think is coming next year. Starbucks. Bearish.

Same reason? I think the CEO was foreseeable that he was going to get a lot of backlash by saying he was going to commute and all these other things and should have been managed. And that tells me maybe under-indexing for EQ, and that'll show up somewhere, and also recession. But I think people enjoy their minor and don't. Yeah, but I could be totally wrong and really being unfair. So I'll apologize later if that's the case. I just think his rollout was so mismanaged. Maybe that wasn't his fault. Somebody else handled it. But people were so excited. The stock rallied.

Yeah, but then what happened, right? Then he got annihilated for commuting remotely. It was just so obvious. And so maybe I'm over-indexing for PR. I just thought it was sloppy.

But even in a recession, you don't think people want small indulgences? I think they do. This is what I was going to counter. But the problem is, in order for the stock to rally, you always need to get same-store sales up, steady growth, and that it's all about same-store sales. So even if enough people want their minor indulgence, if just 3% of people pull back on it, it crushes the stock. Chipotle, which is where Brian Nicol, the CEO of Starbucks, came from. Bullish. I think it's an affordable indulgence that will do fine. People love their Chipotle. Do you? Yep.

I do. What's your order? Who doesn't? I have burrito bowl, sadly, because I'm always trying to manage my weight. But I take Manjaro now, so I get to treat myself. Yeah, how's that going? It's going amazing. I love my Manjaro. And you're still hungry for Chipotle on it? I'm really not, but I get one meal a day that I could eat. So I've been on it a long time and not afraid to admit it. Like before it was fun and cool and sexy? I was on it within two weeks of it coming out.

Because my weight, my blood pressure was 170 or something. And I was in terrible shape. And it actually changed my life. Any side effects? If I actually overeat right after I've taken the shot before the shot kicks in, it's hard to sleep and you don't feel good. So you have to remember, oh, wait, I took a shot yesterday. I better not overeat. That's really it. Otherwise, no. Honestly, it's changed my entire health profile. It's been amazing. It's finally enabled me to win my battle, my lifelong struggle with my weight.

I'm the same way I hit a good level that I was over a year ago. Are you bullish on Eli Lilly? Neutral, sadly, because I did so well in that stock because as soon as I switched, I was like, oh, I'm going all in. And the reason why is there are a couple of other great companies that are working on a pill. And I think one in particular is Viking Therapeutics that I love and I'm going hard at. And I think

Lilly's stock is going to be under pressure for that reason. And two is the backlash politically and otherwise as an equity issue to bring the price down. So their margin profile is going to be under pressure.

So same thing with Nova Nordisk. Same thing with Nova, more so though, because Nova's drug, I don't think is an inferior drug to Mungero, particularly inferior to some of the other, well, particularly Viking. I think they'll both be under pressure. I'd be comfortable having money in Lillie that long-term. I just think short-term, it's almost at a trillion dollars. Trades at a phenomenal multiple that I just think every time there's an article about somebody else with another drug, the stock gets slammed.

This is so fun, by the way. What else you got? I'm just going to render an opinion on every stock on your list. We did not prepare this. Are you being facetious that this is fun? Because I actually think this is quite fun. No, I think it's so fun. Are you kidding? I would do this all day long. It's amazing. I just hope you're not done. We're not done yet. Best news ever. OpenAI. Very bullish.

Do you think Elon should be upset? I don't get all the energy he spends on being annoyed at people. And I'm not overly emotional. So maybe I'm not being fair to him. He feels like he was really wronged by in the origin story when it sounds like he was actually, but whatever, you're Elon, you're very rich and you created satellites in space and like you launch rockets, like just dude, get over it. I think you are emotional. I think

I think we have the tape of this. But I don't hold grudges, though, is my point. It's like, whatever. If somebody feels like you always win, why do you hold a grudge? McDonald's. Bullish in a recession. People still have their McDonald's. Okay, so let's double click on this recession business. Okay. What do you think is going to happen and why?

I've been bearish and wrong for a bit, but it's starting to affect my self-worth. So let's see. But when you print $5 trillion of money and you basically jack up consumer spending and we have unprecedented amounts on credit cards, I think over 1.1 trillion, and that interest is ticking away 25%.

And you have all the data that showed in order to get inflation down to 2%, this is at the end of the pandemic, at the beginning of the rate cutting cycle. In order to get inflation down to the rate hiking cycle, to get inflation down to 2%, unemployment would land between 5% on the low side and 7% on the high side.

There is just a ton of data that shows that unemployment will rise significantly before we get inflation truly under control and that there's a lagging effect of the rate hiking cycle.

Yet the market keeps ripping. And so I still believe it instinctively. And there are some signs, but I am confounded by the last jobs report that just came out last week that showed jobs continuing to grow. I don't really get that because it doesn't match what I'm seeing out there in the world. What I'm seeing across my portfolio is no growth.

People are not investing in building new units. People can't get financing. And the American consumer feels like they're broke, feels like things are too expensive and are not hopeful. And 28% of the American public says that things are worse off than they were at the beginning of the presidential cycles. But yet the market keeps running and I don't know. So maybe I'm wrong. Has this affected your investment strategy? 100%. Are you shorting the market? Yeah.

I hate shorting, but I am doing bearish bets. I only have a couple of stocks that I'm in that I felt like were decent bets. I otherwise, and in zero coupon bonds, it's called ZROS, which moves inversely to rates. But I've been wrong on that because the long end of the curve, it's complicated, but I've been wrong for the time being. So it's definitely affecting my behavior in the markets and it's affecting my behavior in venture. I don't like

And I see this across a lot of VCs and investors. Like you're just waiting for the other shoe to drop before you feel confident to put money out the door. But you really could. It's a lonely life to be bearish. I don't prefer it. I'm much more optimistic. So I'm in an unnatural moment in my life and my career to be so negative.

So you're not writing as many checks? Not at all. No, I'm mostly, I'm still doing very early stage direct investing, especially in DTC and CPG, direct to consumer and packaged goods. I'm doing a lot of checks there early stage because the valuations have come down and there's less people competing for deals.

Most of my effort and money is going towards building the companies that we own significant stakes in and just like working on what we're working on and not taking on new because I don't feel like the reckoning has happened yet. When I see unemployment uptick and just like a reset, then I'll feel more confident. But maybe I'll be waiting for that day forever and I'll just be fundamentally wrong.

Is there a stock that you are bullish on? Yeah, I just did it though. So I ruined it, but I'm really Viking. I just, and I'll tell you why. So it's a biotechnology firm, which is a generally a terrible space to invest in because you can wake up one day and phase two didn't work out. Yeah, this doesn't feel like a quintessential recession proof business.

area or stock. Yeah, well, that's why I like it because one way or another, it's either going to work or not. And this one in particular is this built in catalyst, which is obesity week is November 5. And they're going to do a readout of most recent results.

on their pill and on their injectable. And I think it's a tremendous buyout candidate because all these pharmaceuticals that don't have any type of competitor to Zempik and Mangerro, they need to find something. Their stocks are under tremendous pressure. But you just said it a second ago, I can be bullish on it because it's relatively immune from recession or not. It's either going to be right or it could be wrong.

So that would be one example. I still like Apple long-term, although they really bungled the rollout of Apple intelligence by separating the phone from the features. And I guess they had no choice. You don't hold grudges.

I mean, it's not an emotional anger at Apple. It's more, I was very passionate. I knew that it would play. I went hard at it when the stock was at 170. So I made a lot of content. So I was very right. But then I got shaky when they did the rollout in September because they separated the features from the phone. And then of course the phone is like no different. And so we're in this weird period where until I can play with the features, like there's no momentum around it, but I still fundamentally instinctively feel like when they roll out,

new Surrey, unless it's horrendous, it's going to make people want to upgrade. And that upgrade cycle can overpower the recession, in my opinion. People still want their better phones. Okay. The most important question of the day. You are invested in companies like Magnolia Bakery, Mamafuku, Milk Bar. Where do you get your birthday goods? Not Magnolia? Yeah.

I do what Taylor Swift does. Taylor Swift likes to buy a Milk Bar birthday cake on her birthday. And so I do. I send that to a lot of people for their birthdays. Right. And also, we have not like a banana pudding. It doesn't feel the same. No, it doesn't. And also Christina Tosi, who's the founders, like my sister. It's not that I don't love our Magnolia and I love banana pudding, but it's definitely Milk Bar. All right, Matt, we end our episodes by asking all of our guests for one money tip listeners can take straight to the bank. What is yours? It can be anything.

investing, saving, zero coupon bonds. Looking back, now that I'm a little older, I think I regret squandering what was always my greatest asset, and that is time. Time is not your enemy. Time is your friend. And so it just goes back to compounding that at the end of the day, we tend to look for lotto tickets when we were born with one.

which is if you just use the time you were given, you can be rich in a very identifiable, prescriptive way. And so I won't say how to take advantage of compounding, but when I look at a lot of my success, it wasn't actually active intervention. It was really just the inevitable passage of time. The real estate decisions that 10 years later had doubled. And so I would say anyone out there who was trying to emulate really successful people make a big move, you're probably overlooking your greatest asset, which is just time and compounding.

So back to young people, I do believe in home ownership. I believe as fast as possible, as soon as possible, get yourself into a property. Caveat, but you want to do it in a place where you have tailwinds. And if you have a young person and you're giving them advice about what to do with their life, don't put the emphasis on the job they take. Put the emphasis on where they take their first job.

Pick a market that has the tailwinds and settle for it. Maybe even not even the good job or a dream job because they'll build a life in that market. That'll be where they get their first home. That home will be the source of their wealth. So for example, Nashville, Charlotte, Tampa, like you want to direct your children to those markets and not worry as much about the job. I know I did too. Well, thank you for that. And thank you for spending your time, your most valuable asset with us.

Money Rehab is a production of Money News Network. I'm your host, Nicole Lappin. Money Rehab's executive producer is Morgan Levoy. Our researcher is Emily Holmes.

Do you need some money rehab? And let's be honest, we all do. So email us your money questions, moneyrehab at moneynewsnetwork.com to potentially have your questions answered on the show or even have a one-on-one intervention with me. And follow us on Instagram at Money News and TikTok at Money News Network for exclusive video content. And lastly, thank you. No, seriously, thank you. Thank you for listening and for investing in yourself, which is the most important investment you can make.

Toyota has been building a legacy of excellence for years. From developing hybrid technology to upping the standards of safety and efficiency, Toyota is always innovating, always making progress. And with Toyota's superior lineup of SUVs in stock at your local Toyota dealer, you can experience the legacy for yourself. So check out an adventure-ready RAV4 designed to be the perfect mix of style, practicality, and go-anywhere attitude.

Or test drive a capable and affordable Corolla Cross with the style, space, and available tech to keep you cool and connected. And both RAV4 and Corolla Cross are available with all-wheel drive, giving you the freedom to roam. Quality, reliability, efficiency. That's the legacy of Toyota. Visit BuyAToyota.com, the official website for deals, to find out more. Toyota, let's go places.