0:00:06 So I think the theme of this episode is rich guys, crazy or genius? We’ve got the Bitcoin guy
0:00:11 who’s doing the treasure hunt and he’s either crazy or he’s a genius, right? Is he crazy or is
0:00:17 he awesome? Ralph Lauren, crazy or genius? Looks like he came down on the side of genius. I have
0:00:29 another one for you. Dude, have you heard about this guy who’s doing
0:00:33 the $2 million treasure hunt? No, I have no idea what you’re talking about.
0:00:40 Okay, well, can I interest you in a treasure hunt story? Yeah, $2 million, that sounds good to me.
0:00:45 There’s this guy named John Collins Black and there’s not a lot of info about this guy,
0:00:51 but he has basically hidden somewhere between $2 and $3 million across America right now
0:00:56 in different treasure chests. So he’s got five treasure chests out there, each with
0:01:00 a bunch of treasure inside and specifically it’s not just like cash, it’s things that are valuable.
0:01:08 So he spent the last five years buying valuable kind of artifacts. So one of them has, you know,
0:01:14 rare Pokemon cards, a 2002 holographic Charizard card. He’s got one with George Washington’s
0:01:19 jelly glass that he bought out of an auction. There’s things from it from old shipwrecks
0:01:24 and in total, the stuff is worth $2 to $3 million. He’s split it between five treasure chests
0:01:29 and he’s hidden it in physical locations across America. And then he released a book
0:01:33 that’s called There’s a Treasure or something like that.
0:01:39 It’s called There’s a Treasure Inside and it’s basically just clues to find his treasure.
0:01:43 And so there’s maps and clues and you can buy this book right now and go find this treasure.
0:01:49 Dude, wait, hold on. It’s even funnier. It’s on Amazon. It’s a book on Amazon called There’s
0:01:55 a Treasure Inside and the book is $35. So he’s going to recoup a little bit of his money.
0:01:59 A little bit of it, a little bit of it, but probably not as much. So he’s got like, you know,
0:02:05 a hidden, a Colombian green emerald and all kinds of stuff inside. And I find this kind of fascinating.
0:02:10 So this guy’s story is interesting. He was like a musician in LA and that didn’t really work out.
0:02:15 And then he was like, okay, he started creating websites for helping people find jobs and that
0:02:21 started going good. He used that to buy Bitcoin earlier, early-ish on. And I guess the story is
0:02:29 he’s a Bitcoin multimillionaire who was also fascinated by adventure. And so there’s this
0:02:32 thing called the Fenn Treasure. Have you ever heard of this?
0:02:37 Okay, yeah, Fenn Treasure. It’s a cache of golden jewels that Forest Fenn, an art dealer,
0:02:43 hid in the Rocky Mountains. Yes, I actually do think I’ve heard of this. I believe
0:02:47 Zach Crockett, Zachary Crockett, who used to work for me at the Hustle, wrote a big article
0:02:55 where he spent a week trying to find this treasure. How did he do? I don’t think anyone has found it.
0:03:00 So five people died trying to find this treasure because it was like, is it up in the mountains,
0:03:07 whatever. So they’re climbing. So five confirmed deaths chasing the treasure. Then he announces
0:03:17 somebody found it. I think this was in 2020-ish, 2022. He says that somebody found it. And then he
0:03:22 dies months later. It was revealed that former journalist and medical student Jack Stoof found
0:03:29 it. And then he auctioned it off for a total of $1.3 million of what he found. And so this guy,
0:03:37 John, whatever, Collins Black, was searching for that in 2020. And so he was like, during COVID,
0:03:43 he had searched for the treasure. He thought this was really cool. And when we were all in
0:03:46 lockdown, he decided, I’m going to do one of two things. He either was like, going to create a
0:03:53 children’s book publisher or create a treasure hunt. He did both. So he started accumulating assets
0:04:02 for this treasure hunt. All right. So when I ran my company, The Hustle, I think we had something
0:04:06 like 2 million subscribers. And we made money through advertising. We didn’t actually make
0:04:10 that much money per person reading the newsletter because advertising in general is kind of a
0:04:15 crappy business model. And so I remember sitting down and I’m like, what are all the different
0:04:19 ways that I can make money off The Hustle that aren’t advertising? And so to make sure that
0:04:24 you don’t make this mistake, Sean, me and the Husbot team, we went and looked at a bunch of
0:04:30 different ways to monetize your business. And we put it all together in a really cool document
0:04:35 where we lay it all out along with our research. And we call it, very appropriately, we call it
0:04:39 the business monetization playbook. Go to the description of this episode and you’re going
0:04:43 to see a link to that business monetization playbook. It’s completely free. You just click
0:04:53 the link and you can see it back to the episode. I have a friend named Chip Forsythe. Chip Forsythe
0:04:59 is a crazy person. I’ve been friends with him for 10 years. His brother is AJ Forsythe, who started
0:05:06 iCRACT, if you remember iCRACT. And Chip will go out. He’s friends with these guys who raise funding
0:05:11 to go find shipwrecks that they think have, well, I guess some of them are valuable just because
0:05:17 they’re shipwrecks. But some of them are valuable because they were like ships that had gold or
0:05:23 other like valuable stuff in the ship. And they raise money to go out and find these shipwrecks.
0:05:29 And he tells me all about it. And it’s like the type of story where the people who are into this,
0:05:36 it’s the only drug that fills that need. Do you know what I mean? Yes. It’s like, it is an intoxicating
0:05:40 thing to find this like. It’s romantic. There’s a romantic idea about a treasure hunt, right?
0:05:45 Yeah, like it’s awesome. And so like I understand why it’s not my obsession, but I understand why
0:05:49 it is other people’s obsession. The other thing I think is interesting is choosing to release a
0:05:53 book for this. I feel like there’s a missed opportunity. I feel like he should have done
0:06:00 something with TikTok or social media where I feel like there was a more viral way to release the
0:06:05 clues or to let people unlock the clues or search for this thing together. Like a weekly or monthly
0:06:08 announcement. Yeah, you know, I don’t know if you’ve seen there’s these things that go really,
0:06:13 really viral on TikTok. It’ll be like some women say telling this 39 part story of how her husband
0:06:19 cheated on her. And these things just, it’s like a true crime. They amass like tens of millions
0:06:23 of followers that are trying to just follow them. They worry for that next piece of the story to
0:06:29 drop. And I do think that there was probably a way to do this that somebody could do, which would be
0:06:37 to let do a bit of a treasure hunt, but use social media, use TikTok as a way to uncover the clues
0:06:41 as they go. And then people go in the real world using those clues rather than a book.
0:06:48 Steve Bartlett, who’s the podcast host of what’s called Diary of the CEO. Before that, he had a
0:06:53 like an ad agency or whatever. Before that, he worked for me back when he was maybe 19, 20 years
0:06:57 old, 21 years old, something like that. He was just like a young guy that we had as like a growth
0:07:00 marketer. And his job was to come up with great growth ideas. One of the things that he did at
0:07:06 the time that I remember was he grew his Twitter and Instagram accounts like crazy by doing a very
0:07:11 simple thing. He was doing these like cash drops where he’d put just 200 bucks in an envelope.
0:07:18 And he would say at a college town, I think it was, he’d be like, we’ve dropped it here. He would
0:07:23 post a video of him hiding it. And then there would be videos of people going and trying to search
0:07:28 for it. And they’d be basically, they would tweet where they hid it in some way. And then they would
0:07:31 tweet people going and finding them. But I don’t remember it was him that did this or somebody
0:07:34 else that was doing this. Dude, I’m going to start doing that. It was an effective strategy.
0:07:39 That’s a great idea. It was a great idea. And it was like 200 bucks. It wasn’t even that much money
0:07:44 that they were doing. And they were doing these mystery cash drops as a way to just generate
0:07:49 hype. But the genius of it was the content that they created kind of before the drop. And then
0:07:53 after the drop of people searching, it made it feel like a big deal. And then they would do the
0:07:57 next one. And the next one, I think it was just an account called like mystery cash drop that was
0:08:02 doing this, that was working, that’s getting really big. This was like 10 years ago. So I’m
0:08:07 trying to remember the guy who ran that account, messaged me. He listens to the pot.
0:08:12 Like it’s you never heard of this guy mystery cash drop. He messes before we even started the
0:08:16 podcast. It’s a long time ago. No, but he still does it. Like, oh, yeah, it was at hidden cash.
0:08:20 I think that was cash. What are these guys just messaged us? You don’t remember this?
0:08:26 And what for some reason, it came into our world where I forget what happened. Someone tagged us
0:08:30 on his Twitter thing. And he was like, I love those guys. And then he DMed me and just said,
0:08:34 hey, something like that. So maybe I got this wrong. Maybe Steve wasn’t the guy doing it. Maybe
0:08:38 Steve showed me this and we were going to like copy this strategy. I don’t remember the link.
0:08:43 Steve definitely put me on this because it was happening both in San Francisco and also in the
0:08:47 UK. The account now is suspended for hidden cash, which I remember happened back then. It got
0:08:52 suspended. I’m not 100% sure. But why? But let me just read this article. This was back in 2014.
0:08:57 So this is literally 10 years ago. It says an anonymous benefactor has been leaving cash
0:09:02 hidden across San Francisco, inviting strangers to find it via a series of clues. They left money
0:09:07 under chairs in public parks and stairways or in public bathrooms. And they basically post a picture
0:09:12 of them holding the cash and then like a zoomed in thing of where they put it. Like it’s like under
0:09:16 a toilet, but you don’t know which toilet. And then their quote was, I’ve made millions of dollars
0:09:21 the last few years more than I could ever imagine. And yet many friends of mine cannot afford to buy
0:09:24 a home in the Bay Area. This has caused me quite a bit of reflection. And I’m determined to give away
0:09:30 some of the money I make to charity and to do fun creative things like this. And that he or she
0:09:34 will leave it once or twice a week. Did somebody should just do this again? This is 10 years ago.
0:09:40 It would work today. I think this is awesome. I think I’m going to start doing this the other day.
0:09:46 It’s like a hobby. It’s like running. We just were jogging. We’re talking about like, I think I’ll
0:09:52 pick up this hobby. It’s like I’m going to play real life Willy Wonka. I just want to start controlling
0:09:56 people’s lives $100 at a time and just seeing like, if I can like make all the monkeys dance,
0:10:00 that’s kind of like what this is. It’s like, you’re just like, want to be a puppeteer $100
0:10:05 at a time a little bit, but it is like kind of fun. I think one of the problems is like,
0:10:10 you get that initial hit of like excitement and attention and everyone loves it. And then it’s
0:10:13 going to fade away. And then you’re going to keep hiding the cash, but you’re not going to get that
0:10:17 same hit. So you’re, it’s like an addict. You have to do more in order to get this. So then you’re
0:10:21 like, hmm, you know, it’d be a shame if somebody got hurt finding it, but that would make for a
0:10:27 whole nother new cycle around this. And then you sort of, you just keep escalating the prizes and
0:10:32 it becomes weird after a while. It’s like, Hey, Willy Wonka, why do you have a chocolate river
0:10:37 and invite children over all the time? Like this is just dangerous. Do you know, like at some point
0:10:43 it’s like, Hey, can you get, can we go and touch a dinner and you’d not like hide $200 for walking
0:10:47 into the restaurant? The funny thing is we’re so old that like everybody who’s listening to this,
0:10:50 that’s like under the age of 25 is like, yeah, you know, this is how every YouTuber, you know,
0:10:54 tries to get famous is doing this exact same thing. Yeah. They’re like, what are you going
0:10:58 to do next? Go give like a homeless guy $100 and film yourself like giving him a haircut.
0:11:04 Like that classic stick. Exactly. I think maybe the takeaway is, you know, what’s old is new for
0:11:08 some of these things. Like the, what the hidden cash this guy was doing. It’s not really all that
0:11:13 different than what Mr. Beast does and has done to great effect. All right. Can I tell you a story
0:11:18 about a different way to look at adventure about someone who’s like, I’ve obsessed over a little bit.
0:11:24 And I think you know this person, you know of them. And I think I’ll tell you a few facts that
0:11:28 kind of like shock you, but also I think you’re going to be into this person more than before.
0:11:36 So the story is about a guy named Ralph Lifshitz. He was a Jewish kid from New York City, grew up,
0:11:43 I believe in the 30s. And the story is basically that he wanted to be an actor. He grew up poor,
0:11:48 but he loved like seeing all these movie stars on TV. And he was like, you know,
0:11:54 I love that you can dress up and pretend to be another person. And if you pretend hard enough,
0:11:58 people kind of start treating you seriously and start treating you like that person. And I love
0:12:04 that. I love that. And I also love the idea that you can write a story and make it a movie. And I
0:12:09 can live my life through that lens, that the lens of that movie. And it gives me hope. So he was
0:12:15 like intoxicated by this, but he sucks at acting. And so he’s like, I can’t go to Hollywood. I can’t
0:12:20 become an actor. However, what I can do is I can shape these movies and direct these movies,
0:12:23 not with a camera, but with clothing. And so we get super into clothing.
0:12:28 What kind of leap of faith is that? I can shape these movies, not through writing or acting,
0:12:32 but through clothing. Yeah, so pretty ridiculous statement. No, it’s not. I’ll give you an example.
0:12:39 So he was like, he’s got this quote where he was like, I love how like these actors, like I like,
0:12:44 you could dress up as like a military person and you kind of feel a little bit tougher sometimes,
0:12:49 or I could dress up like a farmer and like, I actually want to go outside and like get dirty
0:12:53 a little bit. I could dress up like a cowboy and I want to go and like do cowboy shit. Like,
0:12:58 if you dress up with a suit, people kind of take you seriously. And I think that’s cool that you
0:13:02 can like pretend, but it kind of like, what’s the difference between pretending in reality?
0:13:05 If you do it long enough, like it kind of becomes like the same thing. And so he was like, I can’t
0:13:10 really act, but like I can dress up like these characters and I kind of a little bit start actually
0:13:16 feeling like these characters. And eventually Ralph Lipschitz, he got made fun of a lot because
0:13:20 his name, even like the Jewish kids were like, dude, your name has the word shit in it. Like,
0:13:26 that’s like, like your dork. And so he changed his name to Ralph Lauren. And so he starts,
0:13:31 that is Ralph Lauren, the clothing company, he starts selling clothes for Brooks Brothers,
0:13:36 like in their store. And then eventually at the age of 28, he starts his own business. And he’s
0:13:42 like, my first thing that I’m going to sell is ties. He likes ties. And he goes and he pitches
0:13:47 something like Bloomingdale’s. And he’s like, Hey, can you guys sell my ties? And the guy’s like,
0:13:52 these are great ties, I would love to sell them. But it has this name Ralph Lauren on the back
0:13:55 of the tie, like no one wants that shit, dude, like no one knows who you are. I don’t give a
0:13:59 shit about Ralph Lauren. You’ve got to take that off there. And he had it’s kind of a Sylvester
0:14:05 Stallone moment where he was like, like, I’m a nobody, but I need my name to be on these ties.
0:14:10 Like this is just a deal breaker. And Bloomingdale was like, All right, well, no, we’re not going
0:14:14 to do this deal. And so eventually he keeps on hustling and he gets his ties into like Macy’s
0:14:17 or something like that. And the first year of business, he does like half a million dollars in
0:14:22 revenue, which is a home run. He did this in the 60s. That’s the equivalent of like three and a
0:14:27 half million dollars today. Home run. After a year, three or four, he starts coming up with
0:14:31 different ideas. And he comes up with this idea of Polo. So the Polo brand, the college shirt
0:14:35 that you see everywhere. And he parlays. By the way, what’s what’s the back story of that? What was
0:14:41 his inspo, do you know, for the shirt? The inspo was basically, like I said, he grew up as this poor
0:14:46 Jewish kid in New York. But what he loved was this idea of like class and old money.
0:14:52 This idea of like WASP, even though he’s not a WASP, he like loved the idea of like sophistication.
0:14:59 And to him, the sport of Polo, that like screamed like both utility because it’s a sport,
0:15:03 but also like sophistication because it’s like supposed to be like a rich people who play it.
0:15:08 And the collar that Polo players wear, they would always wear a collar. And in particular,
0:15:13 they would button down the collar. So an Oxford button down cloth shirt, that’s comes from the
0:15:18 sport of Polo. And so do like certain style boots, certain style pants. And so there was a little
0:15:22 bit where it was like already considered like a fashionable sport. And so he says like, I’m going
0:15:29 to name my brand Polo. And so he builds Polo. And this shit over like the course of a handful of
0:15:34 years, it takes off. So now Ralph Lauren, he’s worth something like 10 billion dollars. He still
0:15:40 owns, I think 80% of the company. And he’s a great businessman. But that’s not what I actually am
0:15:47 impressed by him. What I’m impressed by him is two things. The first, he has this idea of like,
0:15:53 you are the director of your own life. And your life is basically a movie. And he has this idea
0:15:58 where he was like, I would wear clothes that would, I almost, I think Tony Robbins said this,
0:16:03 or you told me that Tony Robbins said this, where he was like, if I want to act tough or confident,
0:16:07 I make my body tough or confident. So what do you call that thing, where you like,
0:16:12 like flex your power posing, where you like flex your chest when you’re not feeling comfortable.
0:16:17 And you put your body into like a confident position and your brain kind of follows your body.
0:16:22 He sort of is saying the same thing, but with clothing, where he was like, you know,
0:16:27 if I wanted to feel a little bit more sophisticated than I actually felt at the moment, I would dress
0:16:32 a certain way and like my brain would follow. And I find that to be like a really cool idea.
0:16:36 And the second thing that he did that was really interesting is, I don’t know if you remember
0:16:41 this because we were kids, but do you remember Ralph Lauren advertisements? Do you remember any
0:16:46 of those like the photos and magazines? No, what was it? What was interesting is that what he would do
0:16:52 is he would, he used a lot of the same models. And the models oftentimes were not professional
0:16:57 models. But what he would do is if he wanted to like, he would set the stage. So basically,
0:17:02 he would act like he’s filming an entire movie. And so they would rent a home in the Hamptons,
0:17:08 let’s say it’s like the ad is for some type of summer, summer wear for the beach. He would
0:17:12 rent a Hamptons house and he would be like, well, if I’m like a wealthy family in the Hamptons who
0:17:16 has this like beautiful home, like, what would you guys be doing right now? Like, maybe you’d be
0:17:21 playing football, maybe you’d all be sitting on in the parents bed in the morning as if like the
0:17:26 kids just like woke you up. But he would create these like elaborate sets where he would like
0:17:32 make you live like you’re in a movie on set. And so he’s like, we’re going to all like pretend
0:17:37 that this is like real. And they would do this whole elaborate thing just for a handful of photos.
0:17:42 But if you look at a lot of the ads, they’re really like in depth. And it made me start thinking a
0:17:47 lot about like, with startups and what you and I do, we sometimes are just reactive to like,
0:17:54 to like, whatever like customers are saying, not more so like, how do we set the stage for what,
0:17:59 what do we want the world to be? And I think Amazon used to do this small thing where they’re
0:18:04 like, before we launch any product, I want you to write the press release. Like, tell me what
0:18:08 do you want a customer to feel about this? Or how do you want this to be described when it’s
0:18:12 all said and done? And because the internet has such a low barrier entry, and it’s really easy to
0:18:18 adapt and change things, rarely do we sort of think ahead and like, this is like my vision for
0:18:22 the world. And at least everyone in my small world, how I want them to feel, how I want my
0:18:32 customers to think, how I want them to appreciate us. All right, so a while back, we had Gary Tan,
0:18:36 he’s the president of Y Comator, which is the most successful incubator of all time. We had him
0:18:42 on the podcast, and he said that the future of businesses is creator led. And that’s why I’m
0:18:48 interested in the podcast, creators are brands. Creators are brands explores how storytellers
0:18:52 are building brands online. They’re going to cover the entire creative process. They’re going to
0:18:55 talk about navigating brand partnerships. They’re going to talk about what you need to know about
0:19:00 growing your social media platforms. Everything you need to know on this topic, creators are
0:19:05 brands is the pod. So check it out wherever you get your podcasts. Again, it’s called creators
0:19:08 are brands with Tom Boyd. All right, back to the episode.
0:19:15 I do think there’s something cool about I’m looking at vintage Ralph Lauren ads. And I see
0:19:20 what you’re saying, which is like a really heavy lean into like, yeah, like true lifestyle shoots
0:19:26 rather than studio or sort of framed, you know, just like, let’s go here, let’s get this single
0:19:31 shot you in front of the water. Boom. Yeah, that’s churning burn. It’s like, well, this is somebody’s
0:19:37 house in the Hamptons wearing these clothes, doing what they do with all of the little, you
0:19:43 know, family photos in the background and whatnot. Like it’s, it looks a lot more authentic. And this
0:19:48 is one of those things that’s interesting because as a business person, it never pencils out on a
0:19:53 spreadsheet to do this, right? Like up upfront, there is no way to sit here and justify this,
0:19:58 but then there’s things in your gut and there’s the people who actually do make the bet and do
0:20:03 pull it off. And then in retrospect, it sounds obvious. You know, I’ll give you an example.
0:20:08 There was a brand, a e-commerce brand, and they were talking about influencers.
0:20:11 It was like, well, what’s the, what’s the, they’re talking about an influencer campaign. They were
0:20:16 going to spend a million dollars on an influencer campaign with these Instagram moms.
0:20:20 And I said, what’s the return on ad spend of that? You put a million dollars in, how much
0:20:26 are you going to get back directly? And they’re like, uh, it might be, you know, 50%. Meaning we
0:20:30 might put a dollar room, I get 50 cents back. That’s not the way to do it. What’s your face?
0:20:34 What’s your Facebook ads return on ad spend? And they’re like, that’s like, you know,
0:20:38 a dollar 40, put a dollar and get a dollar 40 out. Why are you spending a million dollars on
0:20:44 these influencers? And, uh, are you able to measure the halo effect? I’m like using all this jargon.
0:20:50 And he goes, uh, hey, does your wife, like, does she follow like any of these people? And I
0:20:54 show my wife and she’s like, yeah, all of these people. He goes, ask them like a couple of questions
0:20:58 about these people. Like, Hey, do you know, like how many kids they have? What’s their names?
0:21:03 What products do they use? What’s the last product you bought that you heard them mention?
0:21:07 And like my wife could just rattle these from memory. If I was memory is like, I could tell,
0:21:11 you know, we watch all of Game of Thrones. And if I asked her today, what’s a Lannister,
0:21:14 she’d have no idea. She thinks it’s part of a staircase. And so I’m like,
0:21:18 she’s knows exactly what’s going on with these influencers. And he goes,
0:21:22 that’s why we’re spending a million dollars with influencers. And I was like, okay, you know,
0:21:28 there’s these things that if the result is not easy to measure, but it is true, right? It’s got
0:21:34 to be both. It’s got to be actually, actually work and not be easy to measure. Those things are
0:21:39 usually pretty mispriced, meaning that not as many people are willing to do them because most of us
0:21:44 want the safety and comfort of things that are proven, measurable, and I can spreadsheet my way
0:21:50 to conviction. Well, it’s basically all rooted in, can I justify this if I’m about to get fired?
0:21:55 Yeah, or just even my own self doubt, right? Even at like my companies, I’m not always thinking
0:22:00 I’m going to get fired. Who’s going to fire me? I own the company, but I don’t want to be an idiot.
0:22:02 And I don’t want to lose it. I don’t want to fail. And I don’t want to lose money.
0:22:10 And it takes courage to make bets. And courage is easier when you can, when the logic, when you
0:22:16 can logic your way there, when you can spreadsheet your way there. Do you do any of these courageous
0:22:21 bets that are non spreadsheet? Because I think you, I think part of the reason you idolize these
0:22:25 is that you didn’t typically do that. I didn’t typically do that. And I, and I still struggle
0:22:30 with it. But I have to like, when I watch some of these things, like we talked about Martha Stewart
0:22:33 recently, and now we’re talking about Ralph Lauren, like when you talk like, and when you talk about
0:22:39 some of these like culture changing brands or companies or people are us internet or startupy
0:22:45 people, there’s like, we think we are above the fold where we’re like logical. And we are like,
0:22:49 well, it’s easy. You put this much money in, you get this much money out. Like, why would anyone
0:22:54 do anything otherwise? But then there’s one step above that, which is it’s the right thing,
0:22:59 because it’s the right thing. Like, you know what I mean? Like, it’s like, it’s like,
0:23:04 you know, I can’t measure this thing. But like, I know it’s awesome.
0:23:08 Right. Do it because it’s awesome. Yeah. And so there’s like, we try to act like we are some like
0:23:13 savante internet nerds where it’s like, the math says x, y and z. But there’s always, there’s one
0:23:17 above that, which is, yeah, but it’s, it just makes sense. And so, and Peter Teal, who’s like,
0:23:23 the savanteus of savants has said like, there’s this fifth tentpole of this equation,
0:23:28 which is called brand. And he goes, I don’t understand brand, though. But like, I don’t exist,
0:23:32 but I don’t understand it. And that’s what we’re talking about here, which is like, it just feels
0:23:37 right. Yeah, yeah, exactly. So long story short, I don’t do this, but I respect it. And I know that’s
0:23:43 necessary. And I want to do more of it. Are you doing any of it with Hampton? Like, is there
0:23:48 one you could think of that you do? Yeah, like we have, we own this podcast called Moneywise. And
0:23:53 like it, like the only way that we think that it returns an ROI is if someone joins and they
0:23:58 said they heard about it through us. But that’s, that’s like the low end of the totem pole of like,
0:24:04 is it easily trackable? Right. But then no, like I don’t do enough. But I do need to do certain
0:24:09 things like this. The problem with this is you get caught in the day to day. And you also get
0:24:13 caught in the bills. And there’s also a lot of stories of Ralph Lauren, where like, he almost
0:24:18 lost the company many, many, many times where he like just didn’t pay attention. And in one hand,
0:24:23 you need a visionary who doesn’t pay attention to the profit because sometimes the shit that
0:24:28 makes the most profit doesn’t make sense right off the bat. Right. So I think the theme of this
0:24:35 episode is rich guys, crazy or genius. We’ve got the Bitcoin guy who’s doing the treasure hunt.
0:24:39 And he’s either crazy or he’s a genius, right? Is he crazy or is he awesome?
0:24:45 Ralph Lauren, crazy or genius. Looks like he came down on the side of genius. I have another one
0:24:50 for you. All right. And it’s Michael Saylor. Have you seen what Michael Saylor is currently doing
0:24:57 with the market and Bitcoin and his stock? I don’t understand it exactly, but I understand
0:25:05 that he’s always up to something. Like, I always, I know that he’s like the very bonds of business
0:25:11 where like, there’s always an asterisk next to everything he does. Yeah, that’s a good explanation.
0:25:17 Okay. So can I explain what’s going on? MicroStrategy is a software company. They sell
0:25:21 software, you know, at the time they’re selling software products and the software business
0:25:26 might make like 75 million a year of profit. It was like a small cap stock.
0:25:30 It had been doing great for like ever. Like it was a great, like he’d been rich for a long time,
0:25:37 right? Yeah. The business had been, I think he’s the longest tenured CEO of a public company.
0:25:41 I mean, he’s been the CEO of this company for like 24 plus years or something like that.
0:25:46 And, but the stock had been flat. If you look, if you just zoom out on the chart,
0:25:52 it looks like a very flat line. And when he came on the podcast, it was because at the time he was
0:25:56 doing something very interesting. He had taken his company’s cash reserves, like their treasury,
0:26:02 which normally you either keep in cash, maybe treasury bills, or you use it to buy back the
0:26:08 stock. And instead he used it to buy Bitcoin. So basically MicroStrategy was a software company.
0:26:12 The software company had hundreds of millions of dollars in their bank account,
0:26:16 which they’re supposed to just hold in case they need it. And his plan was I’m going to invest
0:26:20 that money in Bitcoin. Yeah, we’re going to switch our treasury strategy to being Bitcoin.
0:26:28 So September 14, 2020, Bitcoin’s priced at $10,000 a coin, and he buys $175 million worth of it.
0:26:34 And then a month later or so, he buys another $250 million of it.
0:26:36 Which looking back at it, that sounds great.
0:26:42 Yeah, at $10,000, $11,000 a coin. And he has since been buying more and more Bitcoin.
0:26:48 He now holds $37 billion of Bitcoin. MicroStrategy.
0:26:52 MicroStrategy does. He himself also, I think, personally owns like hundreds of millions,
0:26:58 if not a billion dollars of Bitcoin. They are up $15 billion on their Bitcoin position
0:27:04 in four years. So he’s generated $15 billion of value doing this strategy.
0:27:07 So it starts out by saying, I’m going to convert my, you know, step one,
0:27:13 convert our company’s idle cash into Bitcoin. Okay, did that. But now the company doesn’t
0:27:16 generate. And the idea was every year when we generate more free cash flow, we’re going to
0:27:19 do the same. We’re going to, you know, we make $75 million, we’re going to buy more.
0:27:25 But over time, he starts doing more aggressive bets. So what he starts doing is he starts issuing
0:27:30 these convertible bonds. Now, so he goes to the market, he says, hey, here’s a corporate bond,
0:27:33 you can buy the bond, we’re going to take the proceeds from the bond sale,
0:27:37 and we’re going to go buy Bitcoin. And he does that over and over and over again.
0:27:41 And on top of that, if you look at MicroStrategy’s stock today,
0:27:43 so when he was last on the podcast.
0:27:49 Well, let’s just actually say this in March of 20, the stock was $10. In March of 21,
0:27:53 the stock was $78. And today it’s $410.
0:28:02 Correct. And it is, so it’s up in the last five years by 2,600%. Okay, so it’s shot up. It’s,
0:28:09 if you compare it to even NVIDIA stock this year, it’s outperformed NVIDIA, which is pretty insane.
0:28:17 And so what is going on here? His company is now worth $80 billion as of today.
0:28:22 And how much revenue and profit does the actual business do?
0:28:27 The actual software business is declining 10% a year and is something like a couple
0:28:30 hundred million in revenue and under a hundred million of net income.
0:28:35 So it is a rounding error. It is no longer relevant to the stock price.
0:28:39 And does he have employees who work there?
0:28:42 Yeah, they still have employees that just keep running that software business.
0:28:48 But the stated strategy is her job is to acquire Bitcoin in the most effective
0:28:51 ways possible and hold forever. That’s what he wants to do.
0:28:57 That’s an inspiring talk every Friday at your all heads.
0:29:05 Right? Bitcoin prices up. Great job, everybody.
0:29:11 We did our job. And to his credit, he’s been buying throughout all the dips.
0:29:17 So like, Bitcoin price went up to $60,000, then it goes down to $16,000.
0:29:22 And even during that process, Bitcoin in December 2022, Bitcoin price is $17,000.
0:29:26 He buys another $50 million. He buys another $14 million. He buys another $150 million.
0:29:30 He has continued to buy throughout the whole process and Bitcoin is at an all time high.
0:29:37 And as of today, he just bought another $5.4 billion of Bitcoin at the, you know,
0:29:38 sort of all time high price.
0:29:39 How did he have the money to do that?
0:29:42 Again, he’s raising money in these bonds.
0:29:44 And so there’s, okay, so what’s interesting about this?
0:29:49 Here’s what I want to talk about is genius or crazy.
0:29:55 I guess I hesitated to even bring this up because, A, this is outside of my zone of
0:29:59 competence, meaning like, I don’t know corporate bond strategies.
0:30:02 I don’t know why, I don’t know how options traders look at this.
0:30:04 I don’t know what the bond market is like.
0:30:06 That is not something that I’ve spent 20 years in my career in.
0:30:07 I’m a startup guy.
0:30:10 Okay. So on one hand, unqualified to talk about this.
0:30:15 On the other hand, I’ve been a crypto holder and believer since far before Michael Saylor.
0:30:19 And I’ve seen throughout each cycle, how new players come in with new strategies
0:30:24 and build, you know, massive profiles and success on the upswing.
0:30:26 And I’ve seen things go very, very badly.
0:30:30 You know, last cycle there was Sam Bankman-Fried with FTX.
0:30:31 There was Doquan.
0:30:33 There was Three Aeros Capital.
0:30:37 There were several people that, for a moment in time, looked like absolute geniuses.
0:30:38 They were hailed by everybody.
0:30:43 They were on the cover of magazines, you know, Sequoia’s investing in FTX,
0:30:45 and everything looks incredible.
0:30:51 And then it all comes crashing down, either due to bad acting or bad risk management.
0:30:52 I don’t know anything about crypto.
0:30:55 And I can give you an example of a red flag that was on air on our podcast.
0:30:57 So, I don’t remember exactly.
0:30:59 I think it was 30 or 45 minutes in.
0:31:01 I asked him a question.
0:31:06 I go, “So, Michael, you’re buying all this Bitcoin with your company’s money.
0:31:06 Cool.
0:31:08 What are the downsides?”
0:31:12 Because, like, it appears as though, like, one of the downsides could potentially be
0:31:15 you’re losing focus on your main money-making software.
0:31:18 But, and I think you think that’s worth it.
0:31:19 But what are some other downsides?
0:31:22 And his answer was, “There are no downsides.”
0:31:26 And I was like, “Well, I mean, like, every decision has a downside.
0:31:29 Like, the downside of being healthy is that you have to go to bed early
0:31:30 when you want to go out and hang out with your friends.
0:31:31 Like, but it’s worth it.
0:31:32 Like, there are downsides.”
0:31:35 And he kept insisting, “There are no downsides.”
0:31:38 And in my head, I thought, “If you can’t be honest to me
0:31:40 about this, like, pretty straightforward thing,
0:31:42 are there anything else that you’re being dishonest about?”
0:31:43 Yeah.
0:31:46 There are no downsides, said every charlatan ever, right?
0:31:48 That is a, it is, could be a red flag.
0:31:49 That doesn’t mean it’s damning.
0:31:49 Now, let me give you the first–
0:31:51 No, it does not mean it’s damning, but it was a red flag.
0:31:54 Let me give you the generous interpretation of this.
0:31:57 So I actually agree with Michael Saylor in one weird way
0:32:01 when he said there’s no downsides, which is that for him personally,
0:32:03 there were really no downsides at the time.
0:32:08 At that time, if you go back and you listen carefully to Michael Saylor’s interviews,
0:32:12 most of the interviews, he just talks about how he had the epiphany,
0:32:14 and he realized that Bitcoin is the way, and he started doing it.
0:32:19 The true story is that there’s one, like, precursor to that epiphany,
0:32:21 which was that he was stuck between a rock and a hard place.
0:32:24 He had this software business that was successful.
0:32:25 It was profitable.
0:32:28 And I think at the time, it was even, you know, had shown growth,
0:32:30 or had been showing growth over the last 10 years.
0:32:33 And he was getting zero credit in the stock market for it.
0:32:36 And he’s like, what am I supposed to do?
0:32:38 Like, we’re a successful company.
0:32:43 We’ve been operating successfully for, you know, 15 plus years.
0:32:47 And the market is basically saying, give us back the cash.
0:32:51 We don’t, we will not value you for any of the cash you have on hand.
0:32:52 You should just give it back to us.
0:32:55 We are going to give you no stock credit for how you might invest it,
0:32:58 how you might use that cash, how you might grow your business.
0:33:00 We’re going to give you zero credit for it.
0:33:03 And so he had this problem, which was, no matter what he did with his company at the time,
0:33:06 he couldn’t get the stock price to go up.
0:33:07 He couldn’t increase shareholder value.
0:33:12 And so he had, in some ways, nothing to lose because he was stuck.
0:33:15 He had been stuck in this plateau for so long.
0:33:18 And the market, he had said, he says in some interviews, like,
0:33:20 the market was giving me a very clear message.
0:33:24 We don’t believe that you can invest this cash in any way that’s going to grow your business.
0:33:28 Well, then he’s like, well, through that, why don’t I just do something else with it?
0:33:31 If I can’t grow micro strategy with it, maybe I can grow it through investment.
0:33:35 And he went and he looked at real estate and he looked at gold.
0:33:36 He looked at all the different ways that he could do it.
0:33:41 And he basically, at that point deduced that Bitcoin was his best bet to invest the money
0:33:42 to actually grow the stock.
0:33:44 And was he like a crypto guy?
0:33:48 So 2020 for a lot of the hard cores was late in the game for crypto.
0:33:49 Was he like?
0:33:50 He was skeptical.
0:33:52 He did not believe in Bitcoin.
0:33:53 Somebody had told him about it.
0:33:53 He didn’t believe it.
0:33:54 So he wasn’t one of these early hackers?
0:33:55 He went back and looked.
0:33:58 He went and watched a bunch of pumps interviews and he started reading about it.
0:33:58 He started learning about it.
0:34:04 The other thing that was true was that he looked at the amount of inflation.
0:34:10 And he realized that the kind of stated goal of 2% or 3% inflation was misleading.
0:34:11 That it didn’t count a bunch of other things.
0:34:14 It also didn’t take into account the fact that if you were an investor,
0:34:19 you just put the money in the S&P 500, it was growing at 10%, 15% a year.
0:34:23 And he was like, look, if I can’t beat that, there’s really no reason to invest in my company.
0:34:25 If I don’t have the ability to beat that rate.
0:34:30 And so what he wanted to do was, you know, like most Bitcoin maximalists,
0:34:34 they just at the end of the day, they look at fiat currency and they believe that
0:34:37 here you have a weak currency.
0:34:41 And if you could ever, if you could borrow a weak currency at 0% interest rate
0:34:44 and use it to buy a hard currency like Bitcoin, that’s a good trade.
0:34:48 So that’s the, the two things that he wanted to do was he wanted to get out of fiat
0:34:52 because he didn’t like the direction that fiat was going with inflation.
0:34:55 And secondly, he knew his stock was stuck.
0:34:57 Okay, so that was that part back then.
0:35:01 But at that time, he wasn’t doing this thing where he’s borrowing billions of dollars to buy Bitcoin.
0:35:06 And so let me just like kind of walk you through the model of what he’s doing now.
0:35:10 Okay, so basically micro strategy issues debt.
0:35:13 They use that convertible bond, corporate bond.
0:35:17 And so that like today, they just did a $5 billion, whatever corporate bond offer.
0:35:18 Who did they raise it from?
0:35:21 Bond buyers, the bond market.
0:35:24 So there’s trillions of dollars that get invested in bonds.
0:35:30 And one of the things that you might say, why do, why are people buying a micro strategy bond?
0:35:31 Is it because of the underlying business?
0:35:34 And it was just buying Bitcoin themselves.
0:35:35 Or just buy Bitcoin themselves.
0:35:41 The arbitrage is that he realized there’s, you know, a trillion dollar plus market
0:35:44 of people who, of people who buy bonds that because of their structure,
0:35:46 they’re not allowed to buy security.
0:35:48 So they can’t buy stocks.
0:35:50 They can’t buy real estate.
0:35:52 They can’t buy Bitcoin directly.
0:35:53 They can’t buy the Bitcoin ETF.
0:35:59 So the bond market cannot access Bitcoin unless they access it through a bond.
0:36:00 Got it.
0:36:00 That’s interesting.
0:36:03 The mandate of those funds is that they can only buy bonds.
0:36:05 That’s why people gave them the money was you’re going to buy bonds.
0:36:09 It’s a 0% interest rate, but you can convert the bond
0:36:14 into micro strategy stock at a certain price at $300, $400, $500, $600 a share,
0:36:16 higher than the current price of the thing.
0:36:19 So it’s like a long-term call option on micro strategy.
0:36:19 Okay.
0:36:23 So if you were in the bond market and you wanted access to Bitcoin,
0:36:26 but your bylaws and your mandate does not allow you to buy Bitcoin directly,
0:36:29 then that’s a crazy loophole.
0:36:31 That’s a crazy loophole.
0:36:31 Supply demand.
0:36:36 So he’s the only supply on the market to absorb this demand that’s there
0:36:40 to get access to Bitcoin type of yield by issuing these things.
0:36:40 Okay.
0:36:41 So that’s the first part.
0:36:44 So then he buys Bitcoin and he goes and he tells the whole market,
0:36:46 I’m a forever buyer of Bitcoin.
0:36:50 I will increasingly be buying billions and billions of dollars of Bitcoin.
0:36:53 I’m doing it at the market price and I will continue doing that.
0:36:57 That instills a bunch of confidence in the Bitcoin market because Bitcoin says,
0:36:59 wow, there’s this whale who says, I don’t give a damn.
0:37:00 I’m doing this.
0:37:02 I’m deep pocketed and I’m going to keep doing this.
0:37:05 And so he takes supply off the market.
0:37:08 He signals to the market that I’m a forever holder and he says,
0:37:11 I’m going to keep buying bigger and bigger amounts as we go.
0:37:12 So the Bitcoin price goes up.
0:37:16 So now Bitcoin price goes up, which then causes his stock to go up
0:37:20 because his stock is based on the fact that they have $30 billion of Bitcoin sitting there.
0:37:26 And the stock goes up and then he sells more equity at a premium and he buys even more Bitcoin.
0:37:30 Now he’s selling equity shares to buy Bitcoin, rinse and repeat.
0:37:34 Is he selling any of his equity in the company?
0:37:35 I don’t know.
0:37:36 I’m not sure.
0:37:44 And is he liable for any of these convertible bonds or these bonds?
0:37:45 It’s not like a personal guarantee.
0:37:46 No, it’s a corporate bond.
0:37:49 If this goes south and this collapses, then his net worth,
0:37:52 which is highly based on his holdings of micro strategy,
0:37:54 are going to go down and his reputation and everything else.
0:37:56 And what’s his net worth now?
0:37:57 How much of a micro strategy does he own?
0:38:01 He owns 9.9% of micro strategy.
0:38:05 So as of today, just off micro strategy, he’s worth $8 billion.
0:38:09 Okay. In 2020, the company was worth $1.4 billion.
0:38:12 So he was worth a measly $140 million.
0:38:17 So he’s grown from a $140 million net worth, assuming that it’s his only money,
0:38:20 which is probably isn’t all the way up to close to $10 billion.
0:38:24 And it definitely had asymmetric upside versus downside for him, right?
0:38:33 Hitching his wagon to the Bitcoin rocket ship represented a way for him to explode up in a good
0:38:36 way in a way that he was never going to be able to do with just micro strategy,
0:38:38 the declining software business.
0:38:41 At the same time, there obviously is reputational risk and there’s capital risk.
0:38:43 Now, okay. So how is it going?
0:38:46 They’ve basically acquired almost 400,000 Bitcoin.
0:38:51 They’ve outperformed every company in the S&P 500.
0:38:56 And last week alone, it saw $136 billion of trading volume to put that in perspective.
0:38:59 Even GameStop, during the GameStop, GameStop never saw this.
0:39:05 So he’s basically created, he’s intentionally turned micro strategy into a meme stock,
0:39:10 meaning he’s detached it from the underlying business in the way that GameStop did
0:39:15 and created a product that the option traders want,
0:39:17 that the bond traders want, that the Bitcoin maximalists want,
0:39:20 that the Bitcoin skeptics hate and want to go short.
0:39:21 Now, what could go wrong?
0:39:22 Let’s go to there.
0:39:27 And by the way, let’s also say the craziness of not only doing this,
0:39:32 but then spending the last four years just on tour being a Bitcoin evangelist
0:39:34 is also like a really extreme step to take.
0:39:38 There were no half measures in what he did.
0:39:42 This is a sort of Elon Musk style, all in,
0:39:46 reputationally all in, financially all in.
0:39:48 And he has that personality.
0:39:52 He’s got the type of, I don’t know him other than the 60 minutes we spent virtually with him,
0:39:55 but he seemed like he had the personality where he’s super high IQ,
0:40:02 super low, like emotional, normal human emotions where he’s like,
0:40:03 but it makes sense.
0:40:06 The math says this, therefore I do that,
0:40:10 even if that is a ridiculous thing to most people’s standards.
0:40:11 High IQ, high T count.
0:40:15 Yeah, like he, he ponies up.
0:40:23 So I’m obsessed with being transparent about money,
0:40:25 particularly with ultra high net worth people.
0:40:29 The reason being is that there’s not a lot of information on this demographic.
0:40:32 And so because I own Hampton, which is a community for founders,
0:40:36 I have access to thousands of young and incredibly high net worth people.
0:40:40 We have people worth hundreds of millions and sometimes billions of dollars inside of Hampton.
0:40:43 And so every year we do this thing called a Hampton wealth report
0:40:45 where we survey over a thousand entrepreneurs
0:40:49 and we ask them all types of information about their personal finances.
0:40:51 We ask them about how they’re investing their money,
0:40:53 what their portfolio looks like.
0:40:55 We ask them about their monthly spend habits.
0:40:57 We ask them how they’ve set up their estate,
0:40:58 how much money they’re going to leave to charity,
0:41:00 how much money they keep in cash,
0:41:02 how much money they’re paying themselves from their businesses.
0:41:06 Basically every question that you want to ask a rich person,
0:41:10 we went and we do it for you and we do it with hundreds and hundreds of people.
0:41:13 So if you want to check out the report, it’s called the Hampton wealth report.
0:41:15 Just go to joinhampton.com, click our menu,
0:41:17 and you’re going to see a section called reports
0:41:19 and you’re going to see it all right there. It’s very easy.
0:41:21 So again, it’s called the Hampton wealth report.
0:41:25 Go to joinhampton.com, click the menu and then click the report button.
0:41:26 And let me know what you think.
0:41:33 Okay, so now what’s the, you know, at the same time,
0:41:37 maybe I’m just like a PTSD from past crypto cycles.
0:41:40 But like I mentioned, every crypto cycle, this happens.
0:41:43 Somebody gets super aggressive.
0:41:45 They’re seen as a genius.
0:41:48 They overextend or they commit malpractice
0:41:52 and they come crashing down when the cycle, you know, inevitably,
0:41:55 these things are all cyclical when it goes down.
0:41:58 Last cycle, it was FTX, it was Doquan, it was three errors capital.
0:42:02 These were multi-billion dollar vehicles that were created very quickly.
0:42:07 They burned bright and then they fizzled out due to one of those two reasons.
0:42:10 So I’m on the lookout right now.
0:42:13 Bitcoin’s at an all-time high instead of just jubilation.
0:42:14 I’m just keeping an eye out.
0:42:16 You know, fool me once, shame on you.
0:42:18 Fool me twice, shame on me type of thing.
0:42:21 So I’m just keeping an eye out what might, what might it be this cycle.
0:42:24 On the other side, he’s made a couple of genius calls.
0:42:30 So back in, I want to say, when was it, 2007-ish timeframe?
0:42:35 There’s a bunch of interviews of Michael Saylor talking about Apple, maybe 2012.
0:42:38 And he basically is talking about, he’s on a thing and he’s like,
0:42:41 Apple’s going to go to $2,000 a share.
0:42:43 And he’s like, you don’t understand what’s happening.
0:42:45 Apple is inventing, the same way that he’s talking about Bitcoin,
0:42:48 how Bitcoin is this, you know, the greatest invention ever,
0:42:50 how it’s going to be millions of dollars a coin.
0:42:52 He was talking about Apple the same way.
0:42:54 He’s like, you have a super, super computer in your pocket.
0:42:56 Do you understand what this means?
0:42:59 You know that 4 billion people are going to be carrying this thing around.
0:43:02 And then Apple’s going to be making, all the numbers just sounded insane
0:43:04 to people at the time.
0:43:07 And when he was talking about it, and it’s all come true.
0:43:10 Like his entire bet on Apple, he’s like, I don’t know why you would own
0:43:11 any stock besides Apple.
0:43:14 And like, if you had listed a Michael Saylor at that time,
0:43:18 so he’s always, he’s always had this like, you all are stupid.
0:43:19 This is obvious.
0:43:20 And he’s right sometimes.
0:43:23 Yeah. I mean, I don’t know, these are all oversimplifications.
0:43:25 But yeah, like, I guess the guy’s fascinating.
0:43:26 He is a fascinating guy.
0:43:29 I think he’s described him well with, he’s extremely high IQ.
0:43:31 He’s extremely high Cajones.
0:43:35 And when he gets conviction on something, he sounds insane.
0:43:39 And so, okay, you know, I think the main thing is where does this go wrong?
0:43:40 So I think the main place goes wrong.
0:43:43 Obviously, if Bitcoin’s price starts to crash,
0:43:47 the problem will be if, for whatever reason, MicroStrategy stock,
0:43:52 which today trades at like a two and a half times multiple of NAV,
0:43:56 you know, NAV is the net asset values, like the underlying asset that it holds, right?
0:43:57 It owns $33 billion of Bitcoin.
0:43:59 So the question is, why is it an $83 billion company?
0:44:01 Which is what you think it should be.
0:44:04 It should be like a $35 billion company.
0:44:07 Yeah, it should be, it should be whatever the asset is,
0:44:10 plus like the multiple of profit for software.
0:44:12 It’s a Bitcoin holding and acquisition company.
0:44:14 And so maybe you say, okay, here’s its holdings, great.
0:44:17 And then on top of that, maybe there’s some premium for the fact
0:44:20 that it’s able to acquire them on leverage.
0:44:22 It could do things that a Bitcoin ETF can’t, right?
0:44:24 So a Bitcoin ETF can issue a bond.
0:44:25 It is different.
0:44:28 But the question is, is two and a half X the right multiple?
0:44:28 Yeah, that’s crazy.
0:44:30 And the question is, the down spiral looks like this.
0:44:35 The unwinding looks like this, which is MicroStrategy for whatever reason,
0:44:39 either because Bitcoin price goes down or the stock market just changes its tune on it,
0:44:43 starts to not trade at such a premium to the nav.
0:44:49 And now all this money that it’s borrowed, these bonds expire 2027, 2028, 2029.
0:44:53 If those were to convert, he would be forced into selling Bitcoin.
0:44:56 And once he becomes a forced seller, now the whole market,
0:45:00 the whole Bitcoin market will start to crash because it’ll say, oh my God,
0:45:03 MicroStrategy is going to have to unwind its entire Bitcoin position.
0:45:07 That’s going to be $35 billion or more of Bitcoin hitting the market.
0:45:08 How much is Bitcoin worth?
0:45:11 Like, what percentage of a player is he?
0:45:14 He owns about 1% of the Bitcoin float today.
0:45:16 And he’s trying to get 2%, basically.
0:45:17 Dude, this guy’s intense.
0:45:24 Yeah, I guess my short story is, I don’t know what’s going to happen.
0:45:30 I guess my disclaimer is this, I do not know what’s going to happen.
0:45:33 More than that, I’m a novice when it comes to this.
0:45:37 However, I’ve been in a few crypto cycles before, and I’ve seen in every single crypto cycle,
0:45:45 when crypto goes up, somebody starts being very aggressive, buying crypto using leverage,
0:45:47 like he’s doing right now.
0:45:49 It hasn’t ended well in previous cycles.
0:45:54 And right now, everybody is calling this the infinite money glitch.
0:45:56 You go on YouTube, you search MicroStrategy, infinite money glitch.
0:45:57 He’s a God.
0:45:58 He’s the best.
0:46:02 And it always makes you wonder, what is the scenario where this unravels?
0:46:04 And do I believe that that could come true here?
0:46:06 There is no strategy that is risk-free.
0:46:07 There is no free lunch.
0:46:10 And I think that right now, the entire narrative is about how this is a free lunch,
0:46:12 how this is a free money glitch.
0:46:13 And I don’t believe that.
0:46:18 I don’t know enough to know the specifics about this, but my spidey sense is tingling.
0:46:21 Who’s the most conservative Bitcoin?
0:46:28 So conservative being their rational, and they could explain the pros and the cons without
0:46:30 being overly emotional.
0:46:31 Who’s that in the Bitcoin world?
0:46:34 So that’s a good question.
0:46:38 Who do I trust the most to have a rational opinion about Bitcoin?
0:46:40 That is a great question.
0:46:40 Yeah.
0:46:46 So there’s this guy like Andreas Antonopoulos, who I believe is that, but he’s a technologist.
0:46:54 So you don’t, you listen to him about how Bitcoin as a technology has great potential.
0:46:59 So, you know, you read his book, which is called The Internet of Money.
0:47:03 And he’s extremely rational and he’s a good faith actor.
0:47:08 Who’s the person that’s like, you know, if we all buy into this and if it works,
0:47:10 you know, the upside is this.
0:47:12 But if we don’t, the downside is this.
0:47:15 And this is like, who just says like, like, here’s all the potential.
0:47:16 I think a lot of people say that.
0:47:18 I think a lot of people understand this right now.
0:47:21 A lot of people say like, look, Bitcoin has these properties.
0:47:22 It could become X.
0:47:23 It could become the next goal.
0:47:27 Actually, most people fall into the bucket of they don’t price that as 100% certainty.
0:47:31 Right. They say it’s possible and there’s a potential for that.
0:47:34 That’s why I own some of it, but I don’t put my entire net worth in it.
0:47:39 And it is also possible that it doesn’t, doesn’t get adopted or that there’s a technical flaw
0:47:44 or that governments beat it down in these ways or that it becomes unpopular for these reasons.
0:47:46 And that’s the risk in this, right?
0:47:51 Like there’s a bunch of people that feel that those vocal thought leader rationalists.
0:47:53 What do they say about Michael Saylor?
0:47:55 They don’t take a position.
0:47:59 Like right now, even as I’m saying this, I’m thinking to myself, you know,
0:48:03 I’m going to go cut this in post because why take a position?
0:48:05 What’s the upside?
0:48:07 The upside is-
0:48:07 Well, there is some upside.
0:48:09 I might be right a few years from now.
0:48:12 You’re going to look good by like predicting things.
0:48:16 And there’s also the upside of like just doing what’s right and telling everyone,
0:48:18 don’t waste your fucking money on this thing.
0:48:23 Yeah, but I guess it’s, you have to be A, smart enough to understand it.
0:48:28 B, you have to have the desire to like look right by putting your neck on the line with a prediction.
0:48:36 Yeah, the Bitcoin community doesn’t seem like it typically has the moral fiber.
0:48:37 No, no, I wasn’t going to say that.
0:48:40 I was going to say they don’t mind expressing.
0:48:42 They don’t, they’re very vocal.
0:48:43 They, you know, if someone thinks you’re full of it-
0:48:46 Yeah, they’re also very wishful about their bags, right?
0:48:50 That’s, I think that goes back to your question of who could you trust to not speak just
0:48:51 hopefully about their bag, right?
0:48:56 They just, they want it to be true so much that they convince themselves it’s true and risk free.
0:49:00 What I’m trying to get at is who’s the person who I can trust
0:49:03 to find out what the opinion of Michael Saylor is.
0:49:07 I have searched long and hard because before this podcast, I did research to say,
0:49:09 and I literally tweeted this out.
0:49:13 So if you think I’m an idiot, I also think I’m an idiot.
0:49:18 My tweet today was, can someone with a better brain than me explain what Saylor is doing?
0:49:20 A, no strategies without risk.
0:49:21 What are the risks?
0:49:22 What is the math?
0:49:25 If Bitcoin drops to X dollars, it becomes a problem.
0:49:27 And B, why is the stock trading at such a premium to NAP?
0:49:31 That post has, you know, maybe 100 plus replies.
0:49:32 I read every single one of them.
0:49:34 I read other threads that people have put out about this.
0:49:38 If there was one great explanation, I would have just pointed you to it and I would have read it out loud.
0:49:40 I have not found one myself.
0:49:41 That doesn’t mean it doesn’t exist.
0:49:44 I have not found one myself that I can read and I can say, oh, in simple terms, I understand
0:49:49 why he’s doing this, why it’s working today, what the risks are,
0:49:51 how it would unravel if it unraveled.
0:49:55 I’m only recently at the age where I don’t trust everyone.
0:50:04 Up until recently, my logic was constantly like, well, the institutions are buying into this.
0:50:09 Therefore, it must be safe or like, you know, like whoever’s raising the money for this guy,
0:50:11 like surely they know what they’re talking about.
0:50:15 So now I’ve just two years ago got to the age where it’s like,
0:50:19 you know, they’re flawed humans just like me.
0:50:22 And so I don’t know who to trust with these types of situations
0:50:25 because I’m so uneducated on the topic.
0:50:28 But I have, my spidey sense is tingling.
0:50:31 I would, with my own money, I wouldn’t touch any of this.
0:50:36 Yeah, yeah, that’s what I would say right now.
0:50:41 I have no proof other than it just doesn’t feel good.
0:50:46 Do you know what the, I think, I think the Supreme Court or someone like that, like,
0:50:50 define pornography, like they said, like, you know, it’s hard to,
0:50:54 they’re like, it’s hard to define, but you know it when you see it.
0:50:57 You know, what’s the difference between pornography and like a nudity
0:50:59 in a National Geographic TV show?
0:51:00 You know it when you see it.
0:51:05 I don’t exactly know it when I see it, this situation with him.
0:51:10 But I know that something doesn’t feel right and I can’t explain why.
0:51:11 Okay, so here’s my commitment.
0:51:16 I brought this up today half-baked, and I admit that.
0:51:20 I’m going to go and try to find the smartest people I can
0:51:24 to explain this to me until I’m satisfied with the simple explanation of what’s going on.
0:51:26 And then I’ll share that.
0:51:29 If I leave this in, I’m saying that as a bookmark to say,
0:51:31 let’s hold opinions till part two.
0:51:34 I might just take this whole part out because
0:51:40 I’m uncomfortable with the level of half-informed speculation that was in this section.
0:51:42 I think it’s interesting.
0:51:43 I think it’s interesting.
0:51:50 But you know that like shockingly people look to you for like this, like you are.
0:51:55 I asked you that question of like who’s rational that people look to.
0:51:58 There are many people who would say Sean.
0:52:01 I am rational, but you had two criteria.
0:52:02 Who’s rational and intelligent?
0:52:06 It’s the second one that I fall a little short on in terms of these things, right?
0:52:12 And I think that you, like I’m still working through this problem.
0:52:15 I think that’s actually quite valuable.
0:52:18 Yeah, I guess I’m just like only 10% of the way working through it.
0:52:22 And I’m just thinking maybe I should have gone to 50% before coming on the pot and talking about it.
0:52:28 But I will say this, a lot of the people who have done well with Bitcoin
0:52:31 and the people who understand Bitcoin, it is the mid-wit meme.
0:52:36 Like they look at Bitcoin and they look at all the information
0:52:40 and then they reduce it down into a very simple way of looking at things.
0:52:48 And the simple way of looking at things, which is either this is a better version of gold.
0:52:50 And so it’ll be, it’s a tech improvement on gold.
0:52:54 There’s people who reduce it down and basically just say,
0:52:57 would I rather have hard money or soft money?
0:53:02 Meaning, would I rather save wealth in a, would I rather store wealth
0:53:06 in a currency that can’t inflate mathematically or a currency that will inflate?
0:53:10 And if you just whittle things down like that to a level of simplicity,
0:53:12 you can be right without even knowing all the details.
0:53:15 And so I think one of the challenges with your question of who are the smart intelligent people
0:53:19 is that the smartest, most rational people I know about Bitcoin a long time ago,
0:53:24 you know, eight years ago, told me a very simple thing, bought it, put it in cold storage
0:53:28 and moved on with their life. And they don’t follow all the twists and turns
0:53:31 and they don’t try to hop on the next wave and the next trend.
0:53:34 And they don’t do crazy options trading or 100X leverage.
0:53:35 They don’t do any of those things.
0:53:38 And they made a simple opinion based on a very simple assessment.
0:53:44 And they’ve proven to be right. And not overcomplicating this has been the signal
0:53:48 of who’s actually intelligent about this versus somebody who’s every day on the news
0:53:51 has an opinion on every single thing is trying to outsmart everybody.
0:53:56 Those tend to not be the people that I actually, you know, trust their opinion on this stuff.
0:53:58 Have you seen that show Love on the Spectrum?
0:54:02 Yeah, I have actually.
0:54:05 The show about autistic people dating, right?
0:54:10 Yeah. And there’s this one episode where these two guys dating this girl and he was like,
0:54:14 “Do you like tacos?” And she goes, “Yeah, I like chicken and cheese.” And he was like,
0:54:19 “I don’t have anything else to say, but I want to let you know I’m having a good time.”
0:54:27 And I want to normalize that in both dating and on this podcast, which is…
0:54:38 And that’s sort of how I feel right now, which is I don’t have anything else to say,
0:54:40 but I want to let you know I really enjoy this topic.
0:54:42 That’s it. That’s the fun. That’s the fun.
0:54:49 I feel like I can rule the world. I know I could be what I want to.
0:54:54 I put my all in it like no days off on a road. Let’s travel never looking back.
0:55:03 Hey, Sean here. Quick break to tell you an Ev Williams story. He started Twitter
0:55:07 and before that, he sold a company to Google for $100 million. And somebody asked him,
0:55:10 they said, “Ev, what’s the secret, man? How do you create these huge businesses,
0:55:13 billion-dollar businesses?” And he says, “Well, I think the answer is that you
0:55:17 take a human desire, preferably one that’s been around for thousands of years,
0:55:23 and then you just use modern technology to take out steps. Just remove the friction that exists
0:55:26 between people getting what they want. And that is what my partner Mercury does.
0:55:30 They took one of the most basic needs any entrepreneur has managing your money and being
0:55:34 able to do your financial operations. So they’ve removed all the friction that has existed for
0:55:39 decades. No more clunky interfaces, no more 10 tabs to get something done, no more having to
0:55:43 drive to a bank, get out of your car just to send a wire transfer. They made it fast,
0:55:46 they made it easy. You can actually just get back to running your business. You don’t have
0:55:50 to worry about the rest of it. I use it for not one, not two, but six of my companies right now.
0:55:55 And it’s used by also 200,000 other ambitious founders. So if you want to be like me,
0:55:58 head to mercury.com, open them to account in minutes. And remember,
0:56:02 Mercury is a financial technology company, not a bank. Banking service is provided by
0:56:07 Choice Financial Group and Evolve Bank & Trust members, FDIC. All right, back to the episode.