Unicorn Founder on Unseen Arbitrages, the Paradox of Wealth + Charlie Munger Wisdom ft. Ryan Petersen
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So that they we're talking to rine Peterson ryan, an interesting guy, because he started out. We're going to a pizza shop bootstrapping his own company to a millions of dollars, and now we runs flex for which is a multiple billion dollar, is is kind of done. Both sides, the big silicon valley game as well as the boot trap, make something out of nothing form of entrepreneurship.

And we talk about three things. The one big lesson he learned when he became friends of charlie monger, what charlie monger really taught him, number two, is a master class and negotiation. So things that he learned about negotiation back when he was in business school, that still help him today.

And the paradox of wealth. So why chasing money? While money is great and you want to make money, he says, money is great too, but how, instead of tracing money directly, you should do something else. And steady calls this the paradox of, well, so enjoy the epsom with lying people feel like.

Okay, today you have the silicon valley success story. So you've got flex port, this like a behemoth of a company multibillion on your company. winter. I see you did the silicon that you won the silicon valley game, which is great. And I live in the look vali like I spent ten years trying to win that game.

The other side of IT, though, that I think a lot more relative, is you are you working to dominus piz as a team? You flip scooters from, you know, on ebay. You then built in organist was as a bootstrap company that I think had kind of like real eba like that you're making millions and eat along the way. exactly.

So you've done both, right? You've done the bootstrapped game. You've done the flipper game. And then now you've done the big you know silicon valley disruptive, disruptive game.

And so I think that's cool that you did them and not just that you did all those things that one sort of LED to the other. Is that right? Like the scooters, LED tape or genius, which LED to ultimately flexible.

Yeah dict, definitely drawing the lines backwards. You can make that tatter really easily that um really the school as as work for my older brother and and his business partner, Michael kanko. We had a lot of frustration with freight porters and customs brokers, and we had a lot of frustration with finding good bachelor's. Those out of the two big problems that we saw.

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Go to hub spot dot com slash spotlight to see them all and get the demo s yourself back to the subset. I have this e come business that has over. I started IT kind of right before are right during copa, basically that we launched right after code.

And we've now done over around fifty million in revenue. But I would not found my factory had I not use import genus. And I I remember I was like, i'm kind of like a shortcut taker in general.

So I was like, okay, I either I can go on alibaba and I can try every single supplier on you, try to find a good one, or I can go to whoever I think has the best quality and just try to reverse engineer who is their factory, who is their supplier. And as I member of, like buying the ninety nine dollar, one hundred nine dollars, my water was like important genius subscription. And then actually there was somebody in your chat team that did the search for me because I wasn't showing in up initially.

And they went back like further in the records twelve months, fifteen months ago, and they found one manifest. And people don't know how this works. What you guys did was basically, you took public data about the shipping manifest, and then you organized and the structure tires. You can see for any business who's their supplier and french supplier who all the businesses they work with.

Is that right? Is that the right way describing IT Prices? Marg, there is still about the same, just hundred.

We reason a tty bit. But important genius come is the business that I started. If you are, you mention alibaba because that I started that business out of frustration. I was living in china for a while, and I would use alibaba to find the factory. I would show up at the factory, and they weren't expecting people just show up and be like fake Victories like he's just a middle like, you know, I like one time I did give a couple of the advantages, but I shown up and you like very clearly like making IT like this was not but you guys in the warehouse with no equipment itor anything so yeah, I was frustration for that. I think you've been poor genius.

Kind of like that organic search results like google you know if there was all ad words that kind of like what baba is like people paying for rice metics um alibaba eem is of course the original business would be to be searching for factories, but that that's not which charges their market cap. Their market cap is driven by doubt and alipay and all these other products, right? Um but the original business is like finding factories of important is so much Better than I do think that my brain is around seeing problems that somehow other people just kind of take for granted in their blind to in some way that they just sof accepted as that's just reality and then actually getting really curious about and looking at what can you do to solve IT and that's where in poor genius came from.

That's where what port came from and that sort of that same problem. It's annoying. I'm kind of annoying in that way like what I go to a restaurant and like doing bottle neck and analysis on the cash year.

Like what would I do that? Like, you know, get get the traffic flowing faster through this place. But I can help you.

what does programs work for the sp slep indice, right? I usually .

point people to that S A on on programs, as is called sleep in this, which is this idea that you kind of blind to the biggest problems in the world.

Paul has a good quote about you. I thought of my research. This is, this is the maki blush section, or IT.

So says program founder, my command says ryan, is what I call an army piercing shell, a founder who keeps going through obstacles that would make other people give up. A, you think is true. And b, why do you think, paul, things said about you?

I don't know this. sure. I I do work really hard to give up easily, paul. I've had a gree released to for one time.

I just seem me since the very early days I met all when I, before I, even i'd started like for, but barely my brother did. Why commodate? At the year before me, we were renting a house. I said IT used to be max election house because we used to get his mail. I don't know how, how lone before I was to be a long time before, because he wasn't .

a in the house. I was like .

where you got rich, but we were renting the apartment and IT was near a dog. Who is there a park where paul and take his kid? George is now older when he was, and we would, we would take my dog there to play.

So we had just like run into poll. And my brother was in Y, C. At the time, so we got to striking up conversation.

So policy meeting flex board was just an idea. Basically, he's been a great visor for us, said nice things. A lot of people.

what? What would ull help you with? Because i've asked people this a couple times and I feel like everybodys got a great program story of like there was a these crucial moments in every started or these these moments of uncertainty and bull either brings either certain level of confidence or clarity or a question or a bit of advice that was was held vote early on. Do you feel like there was one of those for you?

And he paused, got his superpower is like, not. He only sees what's possible. And like, how value are big.

Could this thing be if everything works? And he ignores every other outcome as possible? And that is probably the right way to do you see the invest day, you in a power all world to find like that.

And so he always saw inflict were really word the outcomes so outsized and enormous given the industry size and their an importance. Then and then he could help us sell that story to other investors to canada. He would send the emails early days to like topic in years, really great things about us, quotes like the one you've mention, different press and something like that.

He's also been a really big supporter of flash port top or which is our humAnitary and relief logistics division that, that helps nonprofits doing refugee camp logistics or other source of disaster recovery logistics. S he's been he's donated billion of dollars to us there and help us get the word out about all that stuff. So he's had a huge supporter of fresh board .

as amazing I was. Think about like the the first believer. I think everybody has this person who um believes in you more than you believe in yourself for a period of time. And it's sort of like a like a short loan take a short term loan that you can get off of conviction and is very helpful to entrepreneurs. It's actually very helpful to be that person, especially once you have a little bit of success as an you now can lend a little bit of conviction till the people you believe in when they, when they don't really have IT.

Yeah, I mean, paul's job is hard. way. This retired now.

But the job of being A Y C partners, a leader of Y, C, A, super hard. A lot. Most of these people are going to fail. So you have to kind of delude yourself if you really want to see only focus on what good happy is now is happy the as a very hard psychological i'm sure yeah.

maybe he needs another esa. It's like sleep in this, but it's on the vester side. It's like a filled line. This is like the ability to easily forget um with important eus, you took publicly available data, you structure IT, you made IT into a useful business that generates millions of dollars of your profit if he was like your brother also did that same business model right in a different space with build zoom, can you explain maybe what is the underlying you wait framework, how to think about business ideas like that, that might succeed? This seems like there's a pattern that there's multiple ideas like that .

that yeah build them was born out of the frustration and finding a contractor build jams by older brother David's company, one of these companies. But he was my cofounder with the por genius and and my boss for a while. And ah I was sort of my mentor and start up world, build them with form out of the frustration of fighting a contract to work on your house.

And underlying IT is this public data set of building permits are largely public record but hard access. And we had a lot of experiences of doing that with important unaids. So I built to search engine on building permits and lets you look up at whoever you are.

Anyhow, you can see who the contractors where they built on that, that worked on IT, which is pretty useful as our moor, by the way, as a tool, see who who built the problem. If you have a problem to find that person, they probably can help you with IT. Um but also you do your diligence on contractors.

No, you will be able to talk the actual home moon SHE worked like to work with dam, making sure that the reviews are actually for people that hired this current like there's a great data set out there. So I think they built a nice of business on top of that day is said, I think that government data is a big opportunity. The government has tons of public records on all kinds of stuff and no real incentive to organize IT in ways that are particularly useful.

IT makes IT hard to build defensive ability onto these businesses because other people can give this public record, people who can access the data to so you have to get distribution or build some kind of a network effect. On top of that, I can build the most cases like reviews that you're layering on to this and sort of brand is always the ultimate network, in fact, that you can build onto IT by, you know, I think people would think to defensive bit a little bit like how could you have defensively you a startup? Just how could you possible do IT yourself?

Yeah, we did IT upset recently on the um I was like, I found this APP that's called oasis is a water water quality tracking aps. So basic like how much, how much, you know.

forever chemicals are in your water? Oh yeah.

this is this kid. Is this kid to the same thing? He basically was like, he lived in a thing minnesota, where they had like clean water.

He drank tap all the time. He moved to L. A he started drink a tap water.

A taste funny. He got a little bit ick. He's like, man, I wish you figure this out.

Turns out every city has their own testing data that's publicly available. Turns out that you can request from every bottled water company their reports as well. So then he created this APP, that basic presented to the consumer.

And then he goes viral on tiktok with these like, kind of like fear base, like did you know that bubble blood? But you can check this using this APP. And he's built A A thriving business on this thing. I think he's like fifty K M R R and hee's.

just a kid in his twenty. It's not the most defense to junior .

man as right. But I I think it's kind of amazing that you could do this taking public data, making that .

heaven your brand and network effect distribution, getting users, getting people loyal to the executive velocity. Yeah, I got I remember going going to fight IT on twitter like five years ago with some guy talking about motes and I I was just making a play on word saying, well, you know, the mote turn out to be not that useful once someone invented .

artillery motes like that.

We don't use a motes like, would you to put allegation or to defend your business? So I was talk like, actually you don't really want to hide behind some walls like the real ever ever since the blitz creag in like one thousand and forty, one hundred thirty nine, whatever. We've learned that like high velocity attack is the way we're not like sitting behind defensive walls, right? And I don't know about some investors. I get really upset with me that I didn't believe in motes. Of course, you know, i'm just making a play on words right?

Well, you you wrote and hear something that found producing. I didn't know you were friends with chilly monger and speaking a motes, but IT monger famously talked about how defensively and votes are super important. Can you tell the story? How did you become friends of charly mongers?

Yeah R I P um I don't friend lee which are the more would say I had dinner at his house seven eight times um before he passed which is nine nine birthday body last year. Actually I am a huge fan of here's this S A which I think every Young for every person should really, especially Young people trying to figure their way through the world, called you got the art of worldly wisdom.

But definitely if you go a worldly wisdom charlie longer, i'll find that I actually found the one programming website. I believed pg published IT to the recommendation or website at some point. And I had ready when I was Young and feeling uninspired, or like trying to figure things out.

What should I do with my life? And the S A basically are you that there's in every discipline like biology or chemistry or whatever, the there's no you can define in them of disciplines how we want. Sort of somewhat arbitrary to say there's few hundred disciplines in the world and that in each one, there's two, there's two or three big ideas that there are eighty percent of the freak.

If you know those two are three big ideas, you kind of will, again, eighty percent that whole discipline. I can biology, it's probably like dark Darwinian evolution and something to do with genetics, which drivers y related. But like, you can get those two or three pig ideas, you will have a enough biology to be dangerous, right? And you can learn these ideas by going to read the text book. And so if there's only three hundred disciplines in three, two or three ideas as you're like, okay, i'm going to do about six hundred to two thousand ideas that if I could learn that i'd be like what monger calls worldly wise as an interesting concept that set me off on a journey of i'd probably read hundreds of book as a result of that. And so searching for the .

big ideas in every space. Yeah, like.

what are these disciplines? I like disciplines. I don't really that I found boring.

Well, like, okay, whatever I just going to find, I still learn the top ideas from IT. Um not not. I'm succeeded. There are some disappoints. I came in most of the and by the way.

his essay isn't just saying there are these ideas. He actually list a bunch of up. So is like, for example, things gravitate or or want to take all. Therefore, IT pays to be number one or number two or just be out and then he gives examples, right? So he'll give he the essays and just the concept of these ideas exist.

He gives a bunch of examples yeah and mental models build these two models from one disciple. Turns out there are also from um and a lot a lot of innovation comes from applying an idea like Richard firemen's a great example of this famous is he spent like two years as a biologist and like I disappoint and breaking work in biology just because he took ideas from physics that people hadn't really thought of frameworks and applied biology, right?

Anyways, I I was really inspired by monger for many, you know, decades, really system. And I was at a party at one of my investors houses, and I was just talking this older guy. Either of us knew anybody at this party, did know many people.

And he asked me what my favorite book is. And I started talking about poor charley's on the neck, which is a great book. Ah, that strike is reported, by the way.

I told him that book is my favorite, and he started telling me why and I told the story of worldly wisdom how I live in in china. I was bored out of my mind sometimes and so I bought all these books and just started reading books like hours a day every day. Um and he d let me talk for a long time before years again.

I know that book really well. I wrote that book. And then out of something is a guy in Peter copyin who wrote the book portrait y's armona is.

Like one of Charles munger best brands. And he just thought, got such a kid out of me telling him so much about how great his books that he brought me. Charles is now for dinner and went many times.

We came friends with a few other of charlie friends I got to involved, invited to lots of dinners. And generally, I remember when I first told him about what transport does. He was like, this is, that's great.

You have a great business because the key to success is dumb competition ate. And he start writing about like all that is experience working with free companies. And I also agree with tag on to is like grew member. Yeah when you're trying to think of what business to do all these guys doing A I started upside makes I think applying A I to some old school frozen industry is a great idea but just going straight ad in head on against other I genius is like a recipe like who wants to compete with people that ask more like you rather compete with lucco heads wherever you .

can yeah exactly. That's a very uh simple principle. Like in poker, table selection is like probably the most important decision you make.

So everyone thinks pokers about like you the loves and the advanced dating strategies of whatever IT is. And a huge amount of your success comes down to which table did you choose the city? If you chose to set down to the fish table, you're gonna pretty well.

And that one decision was the most important decision you could made if you sit down of all the sharks. Well, good luck. Doesn't matter how good you are, you probably just know, batter head against the wall for a while.

That's why I don't like burger.

When you met this guy, I like you said you're at a party and you like build didn't know anybody. There's just like alliance of the outcast that happens and of you you've heard the story about benin, Jerry, but they ask, then you have, how do you meet Jerry? And he goes, well, there were you guys friends immediately because they have been friends for a long time.

He goes, no, he goes. We just spur in the same P, E. Class and the, we had to run the mile and both of us hated runnings. So we were the only two guys walking. And eventually, if you're just walking at the back of one other guy, eventually you're start talking and he's like, that was the foundation of benin, Jerry also.

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And what I ask you about this, you said you moved to china most the thought process I got you there and what .

you get added to doing that um IT was two thousand and five IT was clearly booming IT seemed like the future we were at that time was working for my brother. We had the scooter company buying dirt bikes and rote. We say cuts, but offered vehicles doing buys kind cool motor sports products.

Uh, and we were buying everything from china would not like they were buying everything after the international. No one to dead been to china, right? And during college I lived in south america, I lived in chili and brazil, and I learned, I speak spanish in portage.

So I was like, I can, if they we can learn chinese, I could probably learn chinese, earn these other two languages, which was very nice. So I saved up money. And just like, look there.

did you plan to be there for a while to buy one way ticket? The what did you tell yourself going in?

I didn't have an exactly. I was just gonna learn chinese and learn about chinese culture and history and economics. And let's go on in the .

what's your tip if somebody's in their twins and their the kind of intrigued this, like the adventure path, what would you tell him like how would you tell him to think about .

this now that you, I think, really about your value, you and really interested cin, you like your values do. Well, no lot of people kind of go through life without thinking about this. I did.

And my value, without knowing IT consciously in my number one value in life, until I was about twenty five or twenty six, was adventure. And I just warn on the light trial kinds of go all over the world. And remember, this was pre iphone.

So IT was like, pretty adventure, as I didn't have GPS in my pocket or translation apps. I I D like figure, step out, walk around, asking people for directions and hope that they be nice to me, which they were. But IT was definite adventure.

And so at that time, that was my value, was like chasing adventure. That's up for everybody. But if is like, it's pretty easy to achieve going to achieve places, it's a lot less adventures these days.

I mean, you show, you call now you guys to china call lover D D, D D, I guess. And um you got google change, you got maps, you get translation apps. It's like too easy.

I I once rode my bicycle from china to vietnam, and no map. Are the map we had was all wrong, which is he worse than no map almost. And we just had to figure out we sell to people's houses at certain times like this. Like, yeah, old school adventure.

I I think back to my question about why program called you, you know, armor piercing shell, who just know who figures things out? I think I think this is where that you get the present right like IT doesn't start the problem solving and confidence that I am going to figure things out doesn't just start the day you incorporate your start up and delivery IT starts by getting a bunch of reps uh, earlier in life.

May be I think learning a foreign language in that county is extremely that it's not a good r wife from like you pride won't make any money off of this, especially now with chat. G P is incredible. I can do life translation in the every APP and every language I mean but like the humility of like people everyone though I wasn't for canadian, I mean I was like I couldn't speak um and like you know bus drivers think i'm an eighty um and having that over and no over and and over and every day is pretty good for your ego, in your humility and also for relating to other people like in your country and when you .

went there so you're like i'm to go i'm going to learn the language of a travel eat um but you're a business junky like you says something I ve saw on the research which was like you know like this guys my kind of people you go my form of entertainment is making a landing page one night and is sending some traffic seeking people click to buy right so did you were you kind of scheming and dreaming about business? What you were there? What what are you doing on the business side.

sourcing all of our products from china. And so I was I was going to factories by and like evaluate quality management pants. I do everything, make websites we do today and customer service.

Was that scooter business any good to make? Any money to do that? What was the result?

He was pretty good for like, you know, you made salary like sound like w two level income that was above that all my all of our friends at the time, but not like change your life kind of income, right?

You know this pocket, the title of is called by first million. And one of the things I at the beginning, the premise that the podcast was always going to be to be bring people on and ask him how they made their first million. And that's that's started.

I did a pipping to someone else, keep the name because when something is popular, changing the names a little risky. But I still do like the question of, like when you did make your first man, in what change? Because i've view money as a tool to improve the quality of your life.

And I think it's very easy to slip into money. Is this kind of measuring staker? I just think this thing you accumulate over time.

And so i'm curious for you, once you kind of had to win made probably during the import janise days were okay. You've made some like real money that you freeze up your time. How do you use IT and how did you feel and what you will was your mindset.

Now during that time, can you share anything you like? Think, because that is where a lot of people wanted get to there. They're just who listen to listen. I think .

they'll prety guy I did for my student dead that felt I adversity ate wisely a lot. In the wealth front, index fund investing bought a couple of like real state cast generating real state properties. I need some stupid decision, so I want to a club that failed. That was stupid, but I I didn't change much. First of people who tell you that money is that important or won't I I don't believe these studies that say like, oh like you you stop something .

improving your life.

Certain point i'm certain that, that can be replicated. Most of these psychology studies turned out to be not. There's a reputations crisis in psychology.

I'm certainly, that's what. And and like, you know that money is great because the more people have, the more they want. You must be great, right? Mazing number of IT way. Can you say more about this paradox of wealth?

Because I saw you right down this idea. I want to read you a line from this, and just kind of hear here you talk about this. So here's what you wrote.

Are you rote per dox? Focusing on making money will cause you to bake less money. Nobody wants to give money to.

People are too focused on money. They perceive them as greedy, and self should try to avoid them. They give money to people who add value for them.

IT is fine to want money, it's great. In fact, money is one of the best things in the world. But it's a paradox that more of that you want, the less of IT you get. So hack your brain into, instead focusing on the things that are upstream of making money. What's upstream of making money?

Yeah, I think about making money, solving problems for people at the end of the day, which means learning to get to get build your skills set up so you can learn. And i'm stream with that, is learning what the problems are and developing a set of skills and capabilities. So let you solve them.

Sales people who can suffer from this or they can be great, like great sales people are really consultative, like good to asking questions and good to diagnosis problems, understanding what their product or their firm can do to solve that problem. And you know, you bring those together, win. Everybody wins, creating wind wins.

But the perception of a sales person is a pusher that i'm going to make. I'm going try to get you to buy that you .

don't want to ad. But that's and you know this is true because we can't even call people a sale person account .

executive .

because sale, this is such a bad word. We had .

to rebrand. We had to go ale. And so mail.

there is only a couple of this may have change. I think I did, in fact, to a few years ago when I looked into at the rely three, three universities in the united states to offered a major in sales wow it's like it's part of everybodys job was like probably ten percent of all jobs in the whole world.

Their sales are explicitly and then everybody has to sell their idea as um we've yeah kind of been wrongly escape goat as though this was like a terrible all profession when in fact, or the key driver of every company, ty, even so many good tech companies fail with good technology because I can ever learn how to sell IT get customers and parties for the check is just the tech and there was going to selling so right? Yeah, I think packing the brain to say things are correlated with money, but this is Better to go up stream and actually causing generation of wealth. And the more you can study that, then you'll get lots of wealth. And I don't think it's bad, want money, but you just have to realize like IT might cause you to get less is a little like love, by the way, someone is obsess with, look, finding and a girlfriend or husband or something like a kit kind of creepy like, you know, work on yourself and yeah.

that's a great one. There's a great story about buffs. I don't know if you heard this one where he goes to a classroom and a bunch of kids sitting there and he says, all right, let's play a game and he basically says, I want you to point to one person in this classroom, you could choose any classmates, not yourself, but somebody else, and you get to get ten percent of their earnings for the rest of your life. Write down on a piece paper with the name of the person you're picking and why and so I have heard the story before. I want to buy yeah but .

maybe like to surprise .

you but like it's it's interesting the first, I think that makes the point well so he ever writes some the name and then he brings that up. He's like, no, okay, who here just ration? Did you pick the person with the best grades? And nobody raises to hand.

So already that tells you something right about school. And what we think is the valuable thing. Vers, what everybody initially ly and their got new is the valuable thing.

He says, okay, did you just pick a person with the highest I Q? And a couple of people raise their hands. Did you pick the guy who could throw the football far? This nobody raises their hand.

And so then he finds, starts asking, what qualities did you pick? And basically, that's where little came down to some version of the following characters. Is that buffer ultimately used for for picking people, which is know he talks about like energy.

So people who are really they're really obsessed with things really into things when they get, when they put their mind a project, they just never stop, they just never give up. They just kind of have an endless energy towards something. Another one was like integrity, right? Because if this person is going to act out bounds, then only ten percent of their future.

If they're jails not, can do me much good. I ve got to have somebody who's going to play by the rules and play by the law. They know what rules to break and what rules not to break. And the last one I was intelligence, which was somebody who was good to figuring things out specifically so not your grades or just a raw I Q, but somebody who tends to figure things out and um is a great so now you have the formula of what you need to be think if that's what you would pick and others that's what you need to be and there's that's what to reminds me of the the paradox of wealth, which is like you put one hundred people together, you're like, right? Who's going to be the wealthiest? I think intuitively we would know it's not the person who's going to just like sort of only chase money and try to just extract as much money as they could out of some system probably that could work as well as somebody who does the things you talked about.

The three of school, I took a negotiations class once. IT was one of my favorite classes. Everyone should try to get in to one of these things because always .

wanted to take this, I to go school. But i'd love to take .

a negotiation cause you're giving like a case study where both parties read this document slided different rules to play and then you negotiate with each other under those conditions. What's what's amazing is in a class there are thirty other players. If there are sixty people in your class, there thirty other pairs.

There are fifteen women. However, people um during the exact same things, you can compare yourself how you did against other people in the same thing as you. And now was over almost twenty years ago. That is very interesting.

Is that still in title lot of these people and you can track the people over the best interiors in a classroom environment or not the most successful because a very good extracting too much in a one of negotiation, but doesn't how life works right in life is repeat games like you to let the other guy win. And you know if you just took a tage someone like they're ever going to want to do business with, you get just why like you're not going to do that well. So it's kind of interesting a light like long large of udal study that someone could do on these things.

I worked with my dad for about nine months and working with your dads interesting experience in a bunch of different ways. But one of the things you actually get to see your data in a new context, and I got to see my data, one of things that I asked other people work and what's my dad good at? What's his strength? And they also um you know he's a good negotiator.

He's a great negotiator, but he's a little too tough. And okay, interesting. That's because I ask strength, weakness, they kind of have the same thing.

So I gone to the situation where there was one like high stick negotiations, basically like the future of the company was like, kind of up for grabs. And somebody had leverage. Somebody had leverage.

We also done this table. And my dad did one thing really great, which was he was like, we didn't really like the options on the table. And he's like, oh, okay, cool.

I'll always go with the third option then no, I know what. Like what's your counter? He's like, no counter? no. And he's he's like basically in the negotiation he's like as well. How are you going to you know explain this is is not about explaining the negotiation.

The more irrational person tends to win that the most stuff in party wins because the other person will just realize this person's irrational. So I just have to play by their rules. So he was super stuff to anyone.

And at the end they took a break, this kind of like, okay, let's go break before we kind of come back and finalize. And I asked this other guy who was kind of the arbitrary city. Then I said, what do you think he goes? I think you took too much.

And my dad kind of smile, he took the point of pride and I said, was like, what what do you mean by that? He's like is like you were at a poker table and you tilt the table and all the chips went towards you. There's no way this deal gets done, eventually gets done, right, because they have nothing to gain you if you ve taken everything away from them.

So they you have nothing to gain out of the transaction today, they feel forced. But soon we'll just realized not even I don't have to do that. I rather not. And that's exactly how played out. You know I learned the less and sort of that my dad's s expense about and the negotiation, you sort of both sides need to leave a little wanting.

Or even if you take too much, you need sort of to give back at the end in in order for something to be sustainable or especially if you're playing a repeat game. Where have you had negotiation in your life since then? right? Because it's not A A, not a everyday thing. It's once a thing.

Oh, we run a global gish company where we have to procure ocean fade and air phrase, and then we have to sell her frayed .

and ocean and may it's king custom services.

everything else that we do on the and the end basis. So there is a huge amount of negotiation. I think one of the big opportunities we have in this industry is I think the industry is very short term focused and transaction or almost mercenary. And some of these things you have to kind of go with the issue can change everything about the industry that wants. But being able to played a long game and say hi, we're going to wait.

We're going to make tons of money by building trust with people and showing where the profit pools are in, not not taking too much of IT and figuring out how to we um create the right wind wind in the era o and not I is a good frame more actually for evaluating any company's kind of their six stakeholders at the table that for every company, you have your customers, you have your vendors, which in some cases, no matter of that much. But for us, they matter what you ve got, your employees, your investors, you have regulators, and you have like the communities where you live and Operate. And so you've got these six stakeholders, and you've gotta create a win, win.

And it's a very simply way for each of them. They need to win in an ideal scenario. And you can go through a always any company and say, okay, let's score on a through ef on for each one of those things. Very rare to find the company where every single parties winning somebody usually.

you know so so what's the goal as IT mostly is, but nothing like .

to see what but where you have something that's bad, like you've got a lot of risk and that's no good, right? IT. I could all come to a stop like if they are especially if that like the regulators are not happy communities are like guy on the protesting, you you're trying to run you at the town.

Like, I think, like every basically to do, I think is a great company. Guess pretty much love IT the the owners that I love IT y're making free cash of this unused asset vectors done really great. The employees seem really happy over there.

The regulators, in some cases, sometimes they like IT the genre tax communities. I don't know. I don't want people enjoy party in the house next door of the mine.

And so that's an area for them as as they have this framework go OK where we emptied, what are we doing in the APP? They look at this, I don't know, they use that exact ramework, but they certainly going in, okay, as ban starting. What else can we do to make neighbors like us more really like? And so is a pretty simple framework. I think someone looking for a job at the company, they should definitely take take the time score. Each company they are considering on this framework for industry is the same way because, you know, if everyone is not winning and the thing might not be sustainable for the long term and all the good returns as an investor come by hold day for a very long time and letting the the compounding machine ride yeah .

the risk accumulates IT may not be a problem right now, but it's it's accumulating yeah eventually. That's a pattern G.

So here's the deal. I made most of my money from a newsletter business. He was called the hostel, and there was a daily news letter at scale to millions of the tribes.

And IT was the greatest business on earth. The problem with IT was that I had cost of forty employees, and only three of them were actually doing any writing. The other employees were growing the newsletter, building up the tech for the platform and selling ads.

And finally, IT was a huge pain in the by today's episode is brought you by beehive. They are a platform that is built exactly for this. If you want to grow your news letter, if you want to monodist a newsletter, they do all of the stuff that I had to hire does of employees to do so. Check out, out, behave dot com. That's B E E H I I V dot com.

You are also a partner at founder fun, right? Yeah, a venture partner, a venture partner. Founder fun. H, your linked in is looking for a generational company to back. How's that going?

great. I mean, I just just one. I've been a very loyal part of that, this one network for a while, they were our first series, a investor. They lend her a in our being participated.

I thinking every other round that we've done basically, and when they asked me the join is kind of no brainer for me, I mean, that would take me a while, say no brain. They only find that we can send our joining because I think they're really unique in their refusal to follow the heart in the thing for themselves. But I I join actually full time as a general partner.

And then I came back to the spot I took about six months where I was the year executive chairman and uh then I realized I to come back and be the CEO again at flight work. And so I kind of scale my railway back to partner ship. But i'm so part of the team you said like you .

know their unique in how they do things that i've been interacted with them a bunch to and felt that. But I always interested like what's the cause of that effect? So like what what is the example of something that they do differently on the input side that leads to the output of being, you know, of independent thinkers are contrary and are willing to make Better?

Others don't. Well, a lot of IT is just comes from Peter being refusing like he's just like that. His whole life disease is that people are memetic, and they will chase the same outcome, that team goal, the same object, the same memetic desire, everybody wants the same thing.

And if you can avoid that, I was a huge Operator as opportunity, if you can, to go look where other people are looking. And so a lot IT just comes. I would say probably it's just from Peter, but they're they really trained IT into the team.

It's how does that infest itself is a very high paying job. That one actually has a venter. Compensation structure is almost all tied to the outcomes, the performance.

But like a lot of vcs just make super huge the u be surprised how high the salaries are and at a lot of at other VC. Um so make a lot of money in a job that can really be measured to accept on a ten year time horizon. And even on that you could be luck.

And so and and you don't have like and overseeing like a boss product on your neck, like you can do IT from anywhere. Kind of nobody is every time my email of dc, they seem to be in france. So it's it's a it's a job that like is kind of a dream where you just so what's the incident of structure, therefore, like just talking fire and it's hard to fire for performance because IT takes a long time for these things to mature.

And again, that could be luck. So the way you get fired is by everybody can send to agree on that you're doing dumb things is that by doing dumb things is by having a consensus form around you that this guy is making dumb decisions. We got a fire.

And the law cases where fans fired someone who has turned out a few years later, i'd like, been their best guy, but they didn't know IT. So therefore, the way to avoid getting fired in VC that this is not found as what I like about them. They're very different.

But is the way to the verda fire is to be, well, to double check everything you do with other vcs, right? To make sure everybody agree and you don't want to do IT internally, because then you look like you got no opinions. You can Operate so you deal with all buddies at all the other VS.

So it's just a collusion, massive collusion racket on per like there's the incentives restructured sense that everybody he's talking to everybody to double check and mixture. And then that leads to regression, herd mentality, regression to the me. And that leads to people not wanting to take a lot of risk, which is just lay is just lay, right, like venture capital reveal about risk game.

But it's not all of up to tonight, and they found this once very good and not participating in those days. They'll really go to conference is the conference they do do got her reticent. It's like literally about herrets al ideas that you know to say.

I ww, that's probably the most unique conference, but you probably know what that is. Can you explain what heretical is? And then maybe so some examples of what I talk at her digi might .

be about it's her icon is idea, but most conference is people on stage or like can say anything that's not sitting the mainstream narrative, right? And her go on the ideas that you've come up into the age and says something that would like get you cancelled, some horrendous idea, the definition for that. Again, I will publish the talks online. I don't think because of the nature of IT all, but I i'm working on, i'm going to do IT all. If I can make, maybe next year i'll try to do IT talk.

The definition of herod's a person holding opinion at odds with what is generally accepted. I tested a bunch of friends who went.

I said he, what was the best thing? And they were like, well, like, you know, somebody get this to act like my belief in the probability that aliens exist has, like, has I actually meaningful to change based on x talk? Or this person gave this talk about, you know, the conspiracy around X, Y, Z and IT just sounds fast.

Sounds like one of the few conferences where I get there early and stay late. Yeah, we just like them. The market great .

and brand right? Like don't just follow the heart. They are not trying to like just reference check every deals they'll put their neck out there makes me crazy bad. What's m busy and I didn't haven't yet figured out, is how they have such an amazing track record because I don't think just yellow and they're very going to picking founders, I think, right? There's no formula for IT because people are unique, but IT is a really interesting and they are writing they're very big fun these days and they write large age checks with conviction but without being like pretty eet mckey who are just it's not then of course, they do diligence and analysis and stuff, but there's there much more built on who the founder is, on what they're all about.

Right before you came on, I ask in the, I sent to like dog at every guest and I one of the quest, I asked, like, what are three strong opinions? Are life flashy? Live by someone is related to what we're talking about.

Yet this quote from emerson says, the great man is he who, in the midst of the crowd, keeps with perfect sweetness the independence of solitude. And you had some examples under this. Can you talk about that, what that means to you, and whether some examples?

Well, there are some great, very practical examples that you can use in your life, and you will be able to see that this is true OK and literally related to crowds. And next time you are entering a stadium, what your brain will want to just follow the people mindlessly into the stadium.

But if you are able to snap out of that and go away, let me think for myself right now, these people have no idea, must remember, never been to the stadium before. They don't know what the entrance is, right? There is always another entrance that nobody he's lined up for.

You can just walk right in like, or parking am a big skill. And every you go to the ski resort, there are these guys that are like waving parking attendants. And their job is to park all of the cars, but their job is not to park your art car as close to the mountain as you could like their there's not a thousand spaces right next to the Jerry left.

So they're going to point everybody to where there's a thousand Jerry spaces, which like for sure you can have to take some kind of shutter, right? I'll take you an hour to get to the ski lip, but if you just ignore that guy, I mean, I want to be rude and to go way to do this is not like breaking the rules or whatever, but go straight to the front and then we are spot right next to the journey because somebody leaves, somebody always leaving and and so yeah you you can apply this at the very practical level of like moving your own body around when there's large groups of people and watching the hard mentality play out. This is very difficult often for people to do, like people are terrified of public speaking for good reason, like for thousands of tens of thousands of years, if you are standing in for a large group of other humans, they were probably about to kill you. You were there wear, or they were gna kill you.

So the best good have .

this should be, of course it's terrifying and learning how to become their a leader is not instinctual. I think IT maybe for certain sub so out for me I take me more time to get practice uh some of some degree of which just practice say, uh, did not feel terrified in front of groups and then do enjoy IT and like I don't think leaders are terrified. They they love the crowd or like but even spring string says he still gets nervous when he goes and plays and then they also like hack is brain to believe that that that like energy and harness to give the fans that they want IT.

Yeah, like you've mentioned a couple of things like just like that, brushing the mindset, hacking your mind. Are you big into mindset?

Uh, I think any founder is is is very hard for people to understand what a roller coast IT is emotionally um and our painful like the lows are pretty low and and the high and the low can come in the same day you I punched in the face constantly and um yeah you can get pretty down. You need to have released mechanisms and packs and ways to get yourself back up cause it's not it's certainly not not for everybody can tell .

you little hack. I do that maybe maybe useful for anybody out there. So I have a slack channel called literally hides and lows.

And what I do is that any time there's a high or a low, i'll go posted IT there the beautiful thing about IT because the sleeting, you could just grow up and realize you like three months ago, oh yeah, I remember that felt like kind of the end of the world that felt really bad. And now I don't. It's like a stub toast.

Like you remember how your last up toe felt like this, like a private junes for yourself. It's me in my cough atter. We do this and I do this and across every business I have. And so whether it's a high I room and then I go back and I get humbled immediately by a low like OK don't get too high on your own supply here or it's a low currently unlike well, i've already gone through if you just thrown up, i've already conquered a bunch of mountains like this before i've dealt with this, i'll be fine. And it's like immediate, like kind of a perspective machine and it's not even like somebody else perfect. It's like I also was in the slain same channel three months ago saying the same thing, crying wolf basically about this higher, this low and neither neither or as good or as bad as they seem in the moment.

It's yum. I like that. I might try that, but it's it's very hard for another a non sounder to appreciate how difficult that is. My my wife is a former journalist, tech reporter. In fact.

her, uh.

watching my ride, first hand watching is their own word. Participating in IT, has really kind of I she's like， I wish I would have known this side of the thing when I was writing about to understand I like because you know I think tech reporters are the old reporters by very important function of like holding the powerful accountable but like founders, you're not that power or kind of supporting through like right now, we appreciate a very powerful forces in the world like we ve feel like we're the ones like trying to has reached to power and flight for the little guy itself and then been on the narrative within the media.

Has been like I of the tech that you, the founders of the ones that we have, the whole account would be like, what about this like multi billion dollar trillion, almost tens of billion dollar mega corporation that I could peak with what I can't, right? I'm kind of pathetic. Sometimes we did that every day, like sometimes they're Better than us.

It's certain things and like we're trying to get Better. We get Better what's possible than they do. But we're not always the best. We're starting out like especially as an early stage bounder.

You have another one of the life philosophy that was simple. I had no extra words. So I want kind of want you to hear one, hear your explanation of IT. He said, you can just do things. What does that models do for you?

Oh, I don't know. I think there's this idea that you need somebody permission, I mean, you should have, it's wide, by the way, of A A law class is useful for people, sure, and underground to try to get like to do IT basic class legal law. I don't break the law, but you should have to understand with legal and what's not china, which is pretty mazing with this.

But in general, like sign illegal, you can just do IT. And there's a lot of things that people are expecting. You know, we come up through this like education system where everything's gated and you can get to twelve grade math until you finish you have with great grade map or whatever, and you don't get to go to college unless you get these grades.

I so within the institutions of the world, like others, you can't just do things. You have to follow the rules. But like in the real world does now works like there is no boss like waiting to tell you what you can do. A lot of people are believed that they have to raise venture capital to start a company, for example. And like, well, maybe you should think of a different idea that doesn't need any money and just do IT and that's what we ve did and we raise VC after ten years of doing companies without .

right yeah you don't need to have like the victim minds that you have on the Y C. application. There's a question about like what and the wisest application are not long either. So if the questions on there IT must have some value, there's only like seven questions on on the whole application.

And IT was it's what's an example of a real world system that you've hacked, meaning like kind of like this, like you could just do things or not following the crowd, finding the side door into something, I asked my friend shield, who I think invested in flex port early on. I O, hey, I I got right on the pot yesterday. What's a good ryan story from early days? He goes out, there's a bunch.

He gave me one. He goes, he bought Edwards for the keyword uber promo and just put his own promotion de there and just got a bunch of cheap. You were rides for himself that way.

Is that true? Did you do that? I got I became over best customer lifetime probably because I did I got like ten thousand dollars in uber credits by doing that. And then I treated over like IT was free because I was free for me for a while. And I thought we've made out kit out of spending like I got the eo.

I as bad wait to was as result.

Yeah, that was a good hack. I didn't come up with computer friend. But you know.

what's funny is I had two friends. I did that and I never I didn't occur to be to also do that, right? Like I just assumed that was done because other people had done IT. And I know they kind of shut IT down.

And sure, was he in bad? Like, I think I paid for google 的 Edwards campaign over Edwards campaign for them。

So we had this dude call into the pot as once, and he's a guy in india. And what he was doing, what he realizes, this arbitrage where uber had this like create like kind of you give credits to somebody and then you'll get credits, right? That was the I like the payout, give ten, get ten type of model.

But what they didn't do was they didn't account for geographic differences at the time. So he would just get a bunch people in india design. I could give them you ten dollars of ub credit, which was like a big deal, and they would sign up and they would take a ride.

And ride in india is really cheap, but he would get ten dollars of credit, and he would sell IT to americans. And so I bought thousands of dollars of credit off this guy. And I were really, really cheap as you could buy, like five grand of credit for thousand dollars, because this guy was farming them in india, basically.

And this worked for years, and he called into the pot test. He was like, literally, in like a small apartment in rural india. And he was like, he is like, I making I like, I forgot what I was like, fifteen thousand dollars a month, which is more than like my entire village makes basically doing this.

He goes, I don't know how longer to last that i'm still living here. I'm just saving IT up for now, but eventually they will close this loophole. And when they do, you know, that be a sad day. But but he was amazing to see that that loophole that hack yeah.

I actively spent through the credits prety quick and then just became ubs biggest customer for a long time now. Now ride my bike and I stopped riding .

a right to work. One thing I find fascine is you have a side hostel. And I find the same thing when entrepreneurs, these like side things that just work right off the bat.

You did this one about phone boots, like phone boots and companies. Could you just quickly tell the stories? Because I think this kind of is barring yeah well.

unfortunate close down, they sold the company and I didn't make any money, I think was kind of matters, to be honest. We basically started at for export. We never had enough conference rooms, and so I made of, I got these carpenters on crazy list to make a couple of phone without of just like wood built a phone with in our office at flex sport and put IT like a lot of phone padding in there to make IT somewhat sound true.

And they were terrible, the ones I made myself on crazy as because I didn't put, we put a fan, but not enough venelas. You'd come out of this thing just dripping in sweat. And yet people were in their non stop using IT. I was like the products this bad and everybody wants to use IT there's .

like something hero yeah .

so my friend henri k. Um who's the founder of air help, really ran with this idea and should give him all the credit he built IT a do a company I can talk to about IT. It's another thing to do is talk about your business ideas at the parties and stuff.

And if everybody want, I every time I talk to about this idea with the nor, if you like, I want to buy five people like in, I should have to start this computer. I've got like a waiting list to buy this stuff. So we made like this, really like sweets sign. And now that the companies failed, there have been sold. I can tell you, the ips, the seeker here, the collections, al property was we, didn't we put three .

fans in that ise genus hack. So I was going .

like fifty million dollars in sales.

fifty? Yeah, we're some thousands of them.

And somehow I couldn't make money. I was very frustrating. We hard to see you .

the unit economic wrong or the overtime.

Many people on the team when I am not sure if i'm pissed about this because it's the somebody should reboot .

this idea and just I do, I do without the mismanagement, I believe.

So now they might have become very competitive space. There's a lot of people at the time. There is no good cheap phone without there trying to make. I think we for like to grand, but you can make a phone for a thousand bugs. So I come on not .

so I think you can just do things category. I'm going to put this .

and I think somebody can do this again. I feel free to work with that, which that company didn't work. They sold to somebody addict.

The founder had an ambition to be like billion dollars of unicorn company. Instead of like this, let's sell the things staples for beauty, million dollars. And like .

we have exactly right. They were common on, man, this been fun. I'm a user of flex port.

I used IT for my e ams. You have help me forward a bunch of free. I here's how I know you ve helped me.

I still don't know what free fording really is, and we've done you know tens of millions of year in revenue and that's the beauty of IT. I don't have to know. I just know that our ship gets taken care of.

Its a low Prices. These yours to use tools. Thank you for for making that happen. Ah thank for import is also because I would have never found my supplier had I not used. That where should people follow you uh and and find out more .

i'm on twitter. My on x com lash types past is my handle and go to work for that com. If you're e com business or you run any kind of logistic you need to ship things from anywhere, anywhere. We started in freight poverty, which is, well, I joke you should we got free email for, we are like passing emails around the world. They get a container or never fret moves. But last year require jump of the logistics, and now we do direct consumer fulfillment all the way to the door as well as like contribution into amazon fba, handling that problems, like getting appoint mets and managing all of that. So um helping brands solved ms in their supply gers all about.

There we go. By the way, you're at your handles types fast. And I love that your brothers is types faster, ultimate big brother.

Move him to do that fast.

right? Thanks so much.

men.

Thank you.

Sh travel, never looking back.