Learn. Share. Evolve…

0:00:04 All right, my friends, today’s episode, it’s special for me, and it’s going to be special
0:00:09 for anyone out there who’s a creator or who owns a media company. Let me explain. So I’ve got this
0:00:14 friend named Craig Fuller. Craig Fuller runs this company called Freight Waves. It’s a data
0:00:18 business, but they have a media arm, and it’s a huge company. They’ve raised tens of millions
0:00:22 in funding, and they make tens of millions in recurring revenue. Huge business. However,
0:00:29 on the side, he ended up buying a bunch of magazines, including flying magazines, a bunch
0:00:35 of boating magazines. Very weird of him to do that. And I wanted to do a podcast about that.
0:00:40 Turns out he’s bought all of these niche magazines for a very small amount of money,
0:00:45 and he’s only about three years into business, and the company’s doing around 60 million in revenue
0:00:51 and 12 million in profit. And it’s his prediction that by 2030, it’s going to do a billion in revenue,
0:00:56 which is, A, insane that that’s someone’s side project that they’re doing that,
0:00:59 and B, I wanted to learn all about it. I wanted to learn about the model that he’s doing,
0:01:03 where he’s basically buying these magazines, and then he’s selling the audience different
0:01:09 products and services, including like building an airplane hanger and selling space in that
0:01:14 hanger for a flying magazine, things like that. So if you have an audience, if you want to build
0:01:19 an audience, if you want to build a big business on top of that audience, this podcast is for you.
0:01:21 All right, check it out.
0:01:32 Well, we’re live. This is just how we just get right into it.
0:01:38 It’s not often that someone’s side hobby becomes almost cooler than their main thing,
0:01:43 particularly given that your main thing is this like massive hit. So you’re Craig Fuller,
0:01:47 you’ve got this thing called Freight Waves, which is a data business, but you guys also
0:01:53 have a popular media arm, and you display most of your financials online as if you’re a publicly
0:01:57 traded company almost. And I don’t know what the revenue is, but it’s somewhere in the high tens
0:02:03 of millions in recurring revenue. And then you also have, you’ve raised what, $90 million for that?
0:02:08 65 and venture capital, but we raised some debt on top of it. So total about a little bit under
0:02:14 80 million, or a little bit over 80 million. And then your latest kind of side project that is not
0:02:19 really the size of most people’s side projects is Firecrown Media, where you’ve bought dozens of
0:02:26 magazines and you’ve parlayed that into like, you’ve turned flying magazine into like a country club,
0:02:31 but for flying enthusiasts. And so you’ve like bought, you know, thousands of acres of land,
0:02:36 you’ve built an airport, and now you’ve, you’re buying even more pieces of property and more stuff.
0:02:39 And I think what Firecrown does about 50 million this year in revenue.
0:02:44 60 million on rate. So is where we’ll finish this year. So.
0:02:49 Golly, man. And what I didn’t realize I was doing research, I didn’t realize that trucking kind of
0:02:55 runs through your family, right? Yeah, my father started what’s now, or he sold the business last
0:02:59 year, but it came to fifth largest trucking company in the US. And my uncle started the
0:03:02 eighth largest, what’s now the eighth largest trucking company in the US.
0:03:07 Were your uncle and father competitors? Oh, yeah. Yeah. They’re pretty, pretty dire competitors.
0:03:10 But are they tight? Are they, are they good family members?
0:03:14 Nowadays, they’re much better, you know, they do get along now, but there was a period of time
0:03:20 where they just absolutely hated each other. My family is in the, my father’s a produce broker.
0:03:25 So I grew up with truckers. And it’s an interesting industry because the people who own the businesses
0:03:30 can be pretty wealthy, but they’re still rednecks. Like they’re still like blue, they’re like blue
0:03:35 collar guys, but they’re not necessarily always traditionally educated and they’re still rough,
0:03:41 even if they’re quite wealthy. Was your dad like a blue collar guy, even though that he
0:03:44 ran this huge company? Yeah, I mean, he’s a blue collar guy. I mean, he, you know,
0:03:49 he looks presentable in a suit and he’s talking to Wall Street investors. I mean, he certainly is,
0:03:55 you know, he’s presentable. He’s not guaranteed to embarrass himself in front of folks, but he is,
0:03:59 you know, he’s, he’s a finance guy. I mean, ultimately in trucking, you’re operating a business
0:04:05 that operates with single digit margins, you know, one to 3% margins. And so you’ve got to
0:04:10 know how to operate that business. It’s an owner operator type business. And so he certainly is
0:04:16 an operator. And he eventually, I think recently sold that business for like $800 billion, right?
0:04:20 Yeah, he merged it into Knights with, which is the largest. It was the second largest trucking
0:04:25 merger in history. It did about two and a half billion dollars when it sold for 800 million.
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0:05:05 And you were working for him. And I read that you worked for him starting at a young age.
0:05:09 You kicked ass. But for some reason, you butted heads with the executive team.
0:05:14 You got fired, I think in your late twenties or early thirties. And you started
0:05:19 shockingly, which I can’t believe you did this day trading. And you were like,
0:05:25 I got to build something. And so at 36, I think, or 34, you were like, I want to do
0:05:29 almost like day trading, but for freight stuff. Is that right?
0:05:33 Yeah. I mean, I got fired twice. So I got fired for my father’s trucking company,
0:05:40 US Express in 2005. It was actually my older brother who became the CEO of US Express that had
0:05:45 to be fired in 2005. And then my family’s a bunch of assholes, man.
0:05:51 Pretty much. But I love them. But this is the family tradition. You fire and you go out and
0:05:55 start your own business. And then they had a payments company, a fuel card company,
0:06:00 that they had incubated that I took over and scaled up. And then we sold part of it to US Bank.
0:06:06 And we were doing both fleet card processing and debit card processing, payment processing for
0:06:11 banks. What’s a fuel card? I know that truckers have them, but I don’t entirely know what they
0:06:16 do or how they make money. When truckers want to buy fuel, you figure 200 gallons if they’re
0:06:23 truly topping off their tank, they’re going to fill up with a thousand to $1,200 to $1,400.
0:06:27 Wow. Okay. And what, they use some card and do they get perks or something? What’s the business?
0:06:31 No, it’s for fraud management because what will happen is if you don’t, man, I mean,
0:06:36 think about it, you’ve got, you know, US Express had 9,000 truck drivers and you’re giving them
0:06:42 all an expense account that effectively they’re buying fuel, but they’re also doing over-the-road
0:06:46 maintenance. So if they need tires or they need truck brakes down, you know, those things can
0:06:51 be $10,000, $20,000 on a breakdown situation or could be, you know, thousands of dollars in tires
0:06:58 or fuel. And so, you know, a truck driver is responsible for probably $6,000 to $8,000 of
0:07:02 expenses per month when you look at what the total cost of an expense is. And so you have a lot of
0:07:07 fraud that ends up happening. And so fleet cards are there to manage the fraud, both on the fuel
0:07:14 spend, but also on the, you know, all the maintenance and stuff. Got it. I never knew what those did.
0:07:21 All right, cool. And so you’re growing this thing, whatever, it’s working out fine. And then you get
0:07:28 into freight waves, freight alley. That works out good. How long did it take to kind of get into
0:07:33 the tens of millions in revenue? It’s about 20 million-hour business by in two years, three years,
0:07:38 something like that. How did it grow so fast? The formula, right? Like, timing was great. This was
0:07:45 when a lot of venture capital investment made into the space. And then you also had this digitization
0:07:50 that was taking place where companies were trying to digitize the supply chain. And then, you know,
0:07:54 at the end of the day, I had relationships. It’s funny because my dad didn’t put any money in the
0:07:58 company. He told me I’d be a bad CEO and refused to invest in the business. And so I had to go
0:08:03 raise venture capital. Dude, are you and your family close? Oh, yeah. My dad and I talk about,
0:08:08 he’s now like, after he sold US Express, he’s now one of my largest investors in Firecrown.
0:08:12 He actually is my largest investor in Firecrown. So we’re actually really tight.
0:08:19 I’ve been following you for a while. And when I think of like a good media CEO, you are one of the
0:08:24 people that I think of. What attributes did you have that made him think that you would be a bad
0:08:32 CEO? Yeah. Well, I had ran a business, a payments business. He fired me in 2014, because it was a
0:08:36 tech business and technology businesses, while they generate a lot of margin as they scale,
0:08:39 they actually burn a lot of capital. You know, truckings are a cash flow business.
0:08:45 He didn’t understand that, you know, a tech business as it would scale would actually consume
0:08:49 capital. So he got really mad and he didn’t want to raise any money. So he fired me because he
0:08:54 didn’t think I could run a business that would be profitable, because that’s not how technology
0:08:58 companies typically work in their early phases. What’s funny about that business is that’s one
0:09:04 of the most valuable assets in family portfolio now. It just got a $500 million valuation last,
0:09:10 you know, sold some stock in September of last year. So it’s done well. But I’ve, you know,
0:09:14 I’ve been out of that business for many years. That’s all right. So this is the main thing that
0:09:21 I wanted to talk about. So there’s this blog that I love. It’s called Flash and Flames.
0:09:29 I’m pretty sure that, like, only maybe 10,000 people a month read Flash and Flames. So if you’re
0:09:34 listening to this and you’re a fan of, like, media businesses, this is my favorite blog on the
0:09:39 internet. It’s written by this guy named Colin Morrison. He’s based in England. He wrote this
0:09:45 article that I think it was called “Why Magazines Are the New Trophy Asset,” or something like that.
0:09:51 And I read that you saw that article and you’re like, “I’m going to go out and buy magazines.” Is
0:09:56 that right? Yeah. I mean, I was reading it and I was, you know, it was essentially the trophy
0:10:00 asset. And he was using the example of Mark Beanieoff buying Time Magazine and some others.
0:10:05 And it was really interesting because I was like, you know, I could never buy Time Magazine,
0:10:08 you know, the two media businesses that I would own that would be trophy assets.
0:10:14 Far beyond it would be like, Bloomberg would be number one and, you know, owning something
0:10:20 of CNBC scale would also be another. Obviously, there’s a way outside my league, so they’re not
0:10:26 happening. And I was thinking to myself, I had just taken up aviation, taken up flying. And I was
0:10:32 reading Flying Magazine and I was pretty uninspired. And so I was like, it would be cool to own, like,
0:10:37 an aviation magazine, to own Flying Magazine because that would be my trophy. I’m a pilot and
0:10:42 that’s sort of what I would like to do. And so it inspired me to reach out to the owners of
0:10:46 Flying Magazine and ask if they could sell the magazine. And they said, “It’s not for sale,
0:10:50 but we’re happy to talk to you.” And I made an offer and they ended up selling it to me. And that
0:10:54 sort of, it was started up, same as started off as a side hustle. I didn’t actually intend,
0:11:01 I thought print magazines were dead and dinosaurs read print magazines. And I became very skeptical
0:11:06 of the whole print magazine business model. But when I bought it, I fell in love with the,
0:11:12 not just the content and what you could do with it, but also the value what print brings to an
0:11:17 audience. And so what I found is that really, these print magazines are completely undervalued
0:11:22 that nobody will touch them because they do have the same philosophy that I had about them dying.
0:11:30 Yet they own these fantastically great communities and audiences that have been around for decades.
0:11:35 And tickly as you get into sort of the older populations that have grew up with magazines,
0:11:41 is they still have these really important sort of connections to the brands. And
0:11:44 what you found, that’s a really interesting opportunity.
0:11:47 Were you liquid when you decided to buy it? Or were you like,
0:11:52 if the price that they want is in the millions, I’m gonna have to go get money from someone else?
0:11:54 No, I had enough money to pull that off. So.
0:11:59 With your money, do you keep a large percent in like the S&P 500? And this was just a fraction
0:12:04 of it? Or was this like a meaningful amount? It was a, I mean, it was a meaningful amount
0:12:09 relative to my liquidity. I mean, in terms of my total net worth, not significant. But
0:12:15 I have a lot of paperwork as a venture-backed founder tends to be. But you don’t have a lot of
0:12:19 liquidity. So relative to liquidity, yeah, it was a big, it was a big number.
0:12:22 Then what was the thinking is, I’m gonna have to buy this and I’m gonna have to spend some hours
0:12:26 per week to making sure that it doesn’t lose money. Well, it was profitable. I mean, it was
0:12:30 generated about half a million dollars of EBITDA a year as a standalone entity, about $2 million
0:12:35 in revenue. So it was a small, this is a small business. And we buy businesses at three to
0:12:39 five times EBITDA. It’s typically the number of these things trade at. So we’re not talking about
0:12:45 a huge, like this wasn’t a huge capital LA. So it was like $1.5 to $2.5 million is what it cost?
0:12:48 It was about, you know, total purchase price is about three and a half million when you look at
0:12:54 cash and some deferred expenses and deferred payments. So it came out to about three and a
0:13:00 half million dollars, which, you know, seven times, five, you know, two and a half million up front
0:13:05 and a million deferred. And yeah, but then you got to deal with like two journalists. A lot of
0:13:09 times I hire journalists. They’re fucking pains in the asses. And like, when I think of like all
0:13:16 my potential side hobbies, I’m like, I’d rather be a beekeeper than like own a freaking magazine
0:13:21 to deal with these employees, or I’d rather get to like going for walks or hikes. I don’t know about
0:13:27 this. Well, like, I mean, I had, you know, Freightways as 40 years, if you look at total
0:13:31 contributors that are journal, like who qualifies a journalist or contributors, they have 40 to 50.
0:13:38 So I knew what the, you know, I knew what the rodeo was going to look like for running, you know,
0:13:43 having teams of journalists work for you. What was different though with magazines is these are
0:13:50 different than sort of younger sort of digital native journalists or journalists that have been
0:13:55 sort of working in newsrooms. As magazine journalists don’t do it because they make a lot of money,
0:14:00 they do it because they love the content. And there also there’s a sense of defeatism that
0:14:05 has existed across all publishers. And I’ve seen this in the multitude of acquisitions I’ve done is
0:14:09 where the editorial teams feel like the owners of the magazines don’t love them and aren’t
0:14:14 willing to make investments at them. And they almost look at you and I use this term as almost
0:14:19 liberators of their business because in some ways they love the content, they love the subject
0:14:25 matter, they have the relationships, they tend to be sort of micro celebrities in their own
0:14:30 communities. So these are the old school influencers, if you will. And yet they get no love from
0:14:35 corporates because what’s happened is the whole magazine business model has collapsed in the last
0:14:40 10 years because the way that magazines made money in the past, the internet has destroyed that
0:14:45 business model. And rather than sort of digitizing their business model or sort of evolving their
0:14:50 business model, they just started to cut cost. And so that was the way they sort of fend off
0:14:56 the inevitable. And the problem is at some point, the value that the community gets and the audience
0:15:03 gets is diminished. And these things are just a sort of a death circle. And so what we do is we
0:15:09 come in, we buy them in some ways, we liberate them from this sort of inevitable decline.
0:15:14 And they feel really encouraged by that. We upgrade the paper, we upgrade the quality,
0:15:19 we make investments in the editorial team. Flying’s editorial team went from three folks
0:15:25 when we bought it to 30. So you have three primary full-time employees. And then you have
0:15:29 contributors that are submitting that article that goes in the magazine. Very different from the
0:15:35 world you and I sort of come from, digital media, where you actually have a full-time staff that’s
0:15:39 writing content on a daily basis. They’re writing, they’re contributing a piece that’s once a month.
0:15:45 And so it may be an airline pilot or a flight instructor or someone who really knows the jet
0:15:50 market or the turbine market. And so you want subject matter expertise. And typically,
0:15:56 writing is a second, is not their primary job. They do it as a sort of a side hustle to make a
0:16:00 little bit of money. And that’s what these businesses have operated. But what they’ve,
0:16:05 what they’ve also done is they’ve, they’ve not made investments in like print quality or
0:16:11 online assets or any of that stuff. How much revenue did you do in the first year of owning a
0:16:17 revenue and profit? In 2022, I think we were about $7 million in revenue, six and a half,
0:16:21 seven million, something like that. Oh, so you like aggressively grew it. Yeah.
0:16:27 How? Because we invested in, so a couple of things we did was we invested in the magazine.
0:16:37 We raised the price. The magazine was losing $7. So the magazine was taken in $8 per subscription,
0:16:44 but it cost them $15 a month. $8 a year was the net revenue. I know, you look, you look,
0:16:49 for folks that are listening, that your face is exactly what mine was. They were generating on
0:16:56 average $8 in revenue per subscriber per year. And it cost them $15 to fill that subscriber.
0:17:02 They were losing and have since, as far back as our data went since 2006, losing $7 per subscriber.
0:17:08 And I said, wait, so fine magazine costs $8 a year to subscribe to. On average, the average yield,
0:17:14 the average across the whole subscriber base, the magazine generated $8 on average per subscriber.
0:17:22 And when you say yield, that’s not revenue minus the hard cost. No, that is, that is the revenue.
0:17:25 That’s the top line number. Oh, that’s stupid that you got to like. They were losing, Sam,
0:17:32 they were losing $7 per magazine per subscriber per year. Yeah. So like a flying magazine
0:17:37 subscriber is definitely going to pay $50 a year or whatever. You would think, right? That was my
0:17:43 reaction to it is essentially our communications to the staff were, to the sales team was basically
0:17:50 you’re going to raise the rates of advertising sales because we want to go to people who, so on
0:17:54 the ad sales, we raise the cost of ads, but we also just subscribers basically said, look,
0:17:59 if somebody’s not willing to spend $30 or $40 a year, then they’re not really,
0:18:04 they don’t care about the content. I mean, think about this. To buy an airplane, you’re going to
0:18:11 spend, you know, minimum $50,000, that’s a, you know, old aircraft. To buy a, most of the folks
0:18:15 are buying, you know, quarter of a million to a million dollar aircraft and some of our
0:18:21 audience is $75 to $100 million airplanes. And so you have a, you have a natural
0:18:26 audience that is going to spend a lot of money because they care about the hobby or they care
0:18:32 about their careers or whatever it is. They’re, if they’re not willing to spend $30 or $40,
0:18:35 they’re also not going to buy advertising because what happened is in the old days,
0:18:40 and how many subscribers? So we, when we bought that, it was about 108,000 subscribers.
0:18:45 That’s pretty great. We actually, when we raised the price, we raised the 30 initially,
0:18:51 it actually went down to 32,000 subscribers. No shit. We bled it out, but that’s okay. Like,
0:18:55 we wanted to do that. We wanted to get rid of, and there was a lot of what we call freeloaders.
0:19:01 They were essentially targeted for advertising purposes. Or they’re the people like, you may
0:19:06 remember this, I didn’t, when you were younger is your, like your school would have a fundraiser
0:19:10 and you would bring home a form and your parents would sign, like buy a magazine they didn’t care
0:19:15 about. There was a lot of subscriptions like that where the people that were actually subscribing
0:19:19 didn’t care about the content. And I basically said, I don’t want any of them. I want people
0:19:23 who actually care about the content. And we were very successful in doing that. And so we saw
0:19:30 subscriptions grow substantially in terms of actual full paid subscriptions and subscription
0:19:35 dollars, we were basically double the subscription revenue over the course of a year yet still had
0:19:40 like a third of the subscribers. We went down to 32,000. We’re now about 45,000. We’ve grown it since.
0:19:44 And are you able to manage this growth off the cash flows of the business or did you have to put
0:19:50 more capital in? I put more capital that I wanted to put more capital in. Like I could have ran it
0:19:55 tighter, but I didn’t want to. How much should you put in? Look, we total invested about 40
0:19:59 million dollars in the business, but that’s not flying. That’s, that’s all the acquisitions we’ve
0:20:04 done and everything we’ve acquired. At this point in the store, you’ve not raised outside capital.
0:20:09 No, no, I didn’t raise. I actually had a, I had half a million dollars in from two brothers of
0:20:14 early investors in Freightways that bought in, they got 15% of the business for $500,000.
0:20:22 So you grow it to 7.5 in how much profit? Business was about breakeven at 7.5 main because we were
0:20:28 not, we were not optimizing for profitability. We were optimizing for growth. Who’d you hire to run
0:20:34 it? So I was, I was doing a lot more day to day and I created a team to come in to run the day to
0:20:41 day operations. Okay. So we’re at the end of 22. And I think around this time you actually were like,
0:20:47 “Holy shit. I might have just like hit on something interesting. I should go out and buy
0:20:54 more and do this again.” Or did you first come up with the crazy idea to buy all that land?
0:21:03 So about the land in 2021, about 1500 acres. So originally I didn’t plan on being a real estate.
0:21:10 What we actually wanted to do was go out and build a media center connected to a runway. Because
0:21:14 if people are going to fly in airplanes, remember at the end of the day, the content
0:21:20 for flying is all about the airplane. Like people care less about the pilot. They care a lot about
0:21:24 the airplane. And this is no different than a car magazine where you’re going to look at the
0:21:29 Lambo or the Ferrari. For the aviation audience, they want to see the newest aircraft being produced.
0:21:33 And so we wanted to create a video center connected to an airport. The problem was that
0:21:39 none of the airports in the community, five regional community airports around Chattanooga,
0:21:45 were willing to sort of do anything. They said, basically, you have to go from the state, the
0:21:50 municipality, the state, and the FAA have to approve it in order to get to build a media center.
0:21:54 When you say media center, you mean? Yeah, to take video. We wanted to have a hangar that had a
0:21:59 basically a video studio and photography studio that we can bring airplanes in.
0:22:03 But you have to build that because it wasn’t there’s no hangar. There’s a national hangar
0:22:10 shortage across the country. And because what happens is nobody wants to municipalities who own
0:22:16 all these airports don’t want investment in private hangars for small aircraft. They want
0:22:22 the big airplanes. And there’s just a problem of allocation. So we decided to go build our own
0:22:26 headquarters. And I was looking for land, looking for about 50 acres. And I came across this piece
0:22:35 of land that had 1,500 acres. And it was priced at 3.65 million. And I drove up there and a
0:22:41 reminder of this resort in East Tennessee called Blattbury Farm, which my wife absolutely loves,
0:22:46 is sort of back to farming agriculture. So I show up there and I’m like, this looks and feels a lot
0:22:50 like Blattbury Farm. And that was sort of the original inspiration is we wanted to create
0:22:56 a fly-in community with a runway and home sites that are connected to the runway that
0:23:02 had that Blattbury Farm inspired sort of experience. How much did you pay for that?
0:23:06 3.6 million. Did you pay it or did you raise money?
0:23:10 You know, I borrowed from the bank. I mean, real estate is one of those things that you can go borrow
0:23:16 money. And so remember, I have a relatively high net worth. I don’t have no liquidity.
0:23:23 This is why I’m asking these questions because your net worth is significantly higher than mine
0:23:33 because your business is bigger than mine, but I’m liquid. And even me, I’m like scared to make
0:23:40 some of these bets. You don’t seem to have that same fear. You seem to be way more offensive.
0:23:43 And you seem way more, I mean, look, it’s not like we’re inventing like electric cars or
0:23:49 going to Mars. And so I don’t want to like grandiose it, make it too grand. But like,
0:23:54 you’re out laying a lot of cash on some really crazy ideas. You’re like, I’m going to build and
0:24:02 I’m going to buy an old magazine and I’m going to spend more of my money and build an aviation
0:24:08 community. Like that’s like really weird. And that’s really ballsy. What do you think you have?
0:24:12 What’s that gene inside of you that makes you think these wacky things are going to work?
0:24:18 Because of data, like my experience suggests that it will. But you know, it’s taking more shots on
0:24:22 goal. Like, yeah, I’ve got three and a half million dollars in an investment for a real estate
0:24:27 project. But if it goes to zero, I still own three and a half million dollars of land, right?
0:24:31 Yeah, but that’s a huge project to get into. Because do you know anything about real estate?
0:24:36 No, but you can you can bring in teams to go run those things, which we have. So
0:24:42 like, Sam, it’s a matter of scaling businesses and hiring teams to run these things. Yeah,
0:24:48 it’s risk. But yeah, I agree with you. This is just outside your expertise and you’ve
0:24:53 made it your expertise very quickly. Yeah, I mean, but media was outside my expertise.
0:24:58 Running a data business was outside my expertise. But real estate is actually, frankly,
0:25:05 I wouldn’t say it’s easier. It’s a different playbook that frankly can be learned. It’s not as
0:25:09 if, you know, building a SaaS business and building a data business, there’s a very small
0:25:14 number of sort of models to follow. There’s a very few companies that you can sort of model your
0:25:18 business. I think the risk is lower for that, though. The risk is lower for software. I disagree.
0:25:24 I think real estate is so much less riskier because you actually have finite assets at the
0:25:29 end of the day. That’s true. The difference though is when I can start a software, I can start an
0:25:36 internet or data company with significantly less money than it costs to purchase a meaningful piece
0:25:42 of property. But I own the land. Remember that land at 1500 acres at $2,400 an acre has value.
0:25:47 You can sell that land for something else. You can partition it out. You know, if you looked
0:25:52 at that at what an acre would go for in that community, $50,000 to $60,000 if it was subdivided,
0:25:57 just wasn’t. And so we knew the land had some underlying value. But we didn’t know if there
0:26:04 would be any demand for pilots. We advertised it was in January 2022, we actually took out ads
0:26:09 in our own magazine to test the market. What did you say in the ad? You know, it was written as if
0:26:13 it was written to my wife effectively. Like my wife was the target audience, which is your
0:26:20 Blackberry Farm audience. And we wrote a story about we’re building a resort and we didn’t focus
0:26:26 on the aviation, which is really what you would expect us to focus on. We focused on the amenities
0:26:31 around the experience that we’re going to build. We vision shaped it. And we didn’t expect to get
0:26:35 a lot of response. We had over 300 inbound inquiries on that one ad we took out in our own
0:26:42 magazine. And we were able to get people to sign contracts to basically reserve their spot. And
0:26:48 we knew then we had a winner. Did you make a joke about the fact that you’re new to this or were
0:26:55 you more professional? No, I didn’t make a joke about no, but we were very transparent about the
0:27:01 fact this was a not a joke, but being lighthearted, you’re like, who knows what’s going to happen?
0:27:07 I mean, ultimately, Sam, it’s about we recruit recruited people that actually had experience
0:27:13 and during the development, the master planning community, there are groups that actually take
0:27:17 on a lot of the burden to do the work that you need to build these things. It’s not as if I’m
0:27:23 having to 1500 acres is a huge project. You’re not going to do that yourself. You’re going to want
0:27:29 teams that deal with zoning issues, environmental issues, engineering issues. We brought in air
0:27:36 planning consultants. We brought in development consultants. And so it’s not as if I’m doing
0:27:39 all this work myself. I have a whole team, you ask who’s running these projects, I have a team
0:27:45 that’s running them that’s managing all the different pieces of it. And people wrote in and
0:27:51 they basically said, if you’re able to build this, count me in for buying a $800,000 home on that
0:27:55 property or something like that. No, that’s the, the lots are $600,000. So the homes are
0:28:02 probably $2 million to $3 million. And did they sign and what did they give to you that the bank
0:28:11 took as? They signed a contract and they let, they put a deposit. So $40,000 an acre on a $600,000
0:28:18 purchase price, but they put $40,000 in per acre, $20,000 per lot. And was it like you basically
0:28:23 quote pre-sold? Was it like $15 million worth of these properties? Yeah, we actually got up to
0:28:30 about $28 million in total bookings, total reservation deposits. But we thought we were
0:28:35 going to get through this process for environmental approval, quick road zoning approval. We actually
0:28:41 thought we’d break down by the end of ’22. So we had some churn out, we’ve refunded their money,
0:28:44 because these are refundable deposits, not as if they’re giving you money that you get to hold
0:28:49 on to. It’s no different than if you bought, you put a deposit on an airplane or put a deposit on
0:28:55 a car. These are fully refundable, but we’re about $15 million in total reservations right now.
0:29:02 So this project alone is awesome. But then it gets even crazier. And like, this is,
0:29:06 I’m just fascinated by you because I view you a little bit as a peer and that we’re both like
0:29:13 media nerds. But the way that we’re different is that you’re, you’re doing great with risk. Like
0:29:18 you, you’re, you’re going, you’re taking more risk, I think. But it doesn’t, it’s all working
0:29:22 out. And this is where it gets interesting is you’re like, all right, this thing worked for
0:29:28 flying magazines. What flying magazine? What happens if I go out and get more of these titles
0:29:32 and do this whole content to commerce thing? And did you raise money for that?
0:29:42 Not initially. So I have not raised any, my father invested when he sold his trucking business
0:29:46 last year. So he’s my only outside investor other than the initial round. Everything was
0:29:52 done by myself. And I was just using bank debt, frankly, barring money from banks and liquidating
0:29:58 my portfolio because I felt like I would rather invest in myself than invest in the SMP. I think
0:30:03 the difference between Sam isn’t necessarily that I’m like, I am willing to take more risk.
0:30:08 I’m also willing to take more shots on goal. I just think fundamentally, like an asymmetric
0:30:14 mindset that I have is, is I may lose, let’s say the real estate project went to zero,
0:30:19 I’m going to lose three and a half million dollars. That sucks. But you know what? I had been,
0:30:28 my dad cut me off, my dad fired me in 2014. I had basically like no job, nothing. Like it was,
0:30:33 I was for all intents and purposes on my own at rock bottom. I had to figure it out. I’ve done that
0:30:41 before. And so I’m not afraid of losing it all. And I know that I can get it back. And so we’ve
0:30:45 applied that role to everything that we’ve done. And we make acquisitions under the
0:30:50 philosophy that it’s asymmetric risk is like, let’s say that we buy a business or buy a magazine
0:30:54 that’s, we spend half a million dollars or a million dollars. And let’s say it goes to zero.
0:30:58 Let’s say that we’re completely wrong about a thesis. And the thing is just a dog. Well,
0:31:03 then we write off that half a million or a million dollar investment. But if we’re right and we get
0:31:09 a three or five or 10 x multiple on that business, that creates an enormous amount of value for us.
0:31:14 And so that’s how we’ve approached our acquisitions. And I’m willing to take bank debt because
0:31:19 bank debt is frankly pretty cheap. By the way, I think about money differently than you. And I
0:31:22 think it’s cool to hear your perspective because I think I should do it more. But the way that I
0:31:29 think about it with privately as a entrepreneur of private companies, I think if most of my money,
0:31:35 if most of my net worth is illiquid, any liquidity that I get, whether it’s annual cash flows or it’s
0:31:42 from selling, I sold one of my companies, I take all that money and I stock it away in like a safe
0:31:49 thing where it’s like, if all else goes to shit from whatever I have, that is enough forever.
0:31:54 And so that’s how I view it. So like, whatever, how much money I have, I stick it away and I’m
0:32:00 like, that doesn’t exist basically. And I’m going to go and use a very much smaller sum to go start
0:32:06 more companies. And I’ll try to live off of my income from those companies. And if they sell great,
0:32:10 if they don’t, hey, I still have this other thing that I have, what you’re doing is different than
0:32:14 me. And I like what you’re doing because I think it’s bolder. And I think it’s probably a bit more
0:32:19 fun if it works, which is you’re like, even though I’ve got this private, this other private company
0:32:24 that it’s doing quite well. So it’s not going to go out to nothing. But I have some liquidity,
0:32:29 I’m going to pile that liquidity into more interesting, but potentially risky things.
0:32:34 Well, like freightways at some point will sell, like it will show it will do be an exit. That to
0:32:40 me is the nest egg, like for my long term, like I know it’s going to sell, who knows what it sells
0:32:45 for. But there is value fundamental tangible value in the business. So for me, and it’s big enough
0:32:51 that it’s slightly very de-risk. Yeah, I mean, it’s totally de-risk. And there’s a lot of value
0:32:57 in that business. And I had a salary, it’s not as if I’m not like the board takes care of me. So
0:33:06 for me, I have that asset, everything else is that will set my family up for at least a generation,
0:33:10 like my kids would be able to go to college, be able to buy a house and so forth. So I’m not worried
0:33:17 about like my ability to survive if everything else falls down. But I do think diversifying my
0:33:23 risks through all these other projects actually enhances my long term returns, particularly
0:33:28 if I’m using my balance sheet to borrow money from the bank at frankly, relatively low cost.
0:33:32 But what about diversifying your time? That’s probably that. Well, that’s what teams do for
0:33:37 you, right? Like you hire people to run it like, you know, Preston Holland, who I think you know,
0:33:42 we brought Preston in to initially run flying. He’s now running a finance business that we’ve
0:33:48 got that is doing aircraft financing. We brought in a team to run. We have Reese that’s running
0:33:53 our real estate project. So again, and I fired myself from almost every functional role I had at
0:33:59 Freightwebs. Are you chairman or CEO of Freightwebs? I’m CEO, but the day to day,
0:34:07 day to day functions inside that business. Spencer Pylund, who’s my CFO and COO,
0:34:11 is running most of the day to day. Most of the day to day decisions are going through M.
0:34:14 I’m working through strategy and thinking about the long term prognosis of business.
0:34:21 So I can run and do deals and look at additional ways to lever this business up
0:34:26 without getting caught up in the individual sort of minutiae of running a business.
0:34:30 So how many titles has Firecrown acquired at this point?
0:34:33 We’re about 54, I think is the number.
0:34:34 Did you buy them in batches like you bought?
0:34:40 We do. I mean, publishers in the magazine business, it’s hard to get scale with one title
0:34:44 just because there’s a finite audience that will care about that content.
0:34:49 And so typically a publisher, and here’s the thing about magazines is that only 25% of the
0:34:55 content, 25% of the operations that business actually is value added to a customer. You have
0:35:00 audience development, you have magazine production, you have layout, like a customer doesn’t
0:35:07 experience that. Only about 25% of the cost structure is the editorial product or the
0:35:12 photography. So you need a lot of infrastructure to run a successful magazine or frankly,
0:35:14 media business operation. I think you know the media side.
0:35:20 Dude, it was the same. Basically, the hustle, we could have, I mean, we were out about two
0:35:24 million subscribers when I sold and now I don’t know what it’s at, let’s say three or three and a
0:35:30 half. Basically three people on editorial, if we were selling ads. So when I ran the company,
0:35:39 three people on editorial and 37 people selling ads and managing ads and making it grow.
0:35:41 Yeah. And those three people bring all the value.
0:35:48 It’s crazy, right? I mean, it’s just how these media businesses work is you have a couple people
0:35:53 that are upfront and the rest of it is infrastructure. And so what you typically see when we buy a
0:35:59 magazine is we’re buying a portfolio. We’re buying not just one title, but three or four titles
0:36:06 that come along with it. And so we’ve done maybe 20 different acquisitions that have made up that
0:36:12 portfolio, but some of them have been really big. We bought Bonnier, which is like the largest
0:36:17 publisher in Sweden, the sort of the Rupert Murdoch family of Sweden. And they owned a bunch
0:36:24 of voting titles, which we bought last, in last fall. And really, we owned voting, yachting,
0:36:30 selling world, fish, saltwater, sportsmen. And so really this large rain title and aviation,
0:36:36 we bought a number of aviation titles through various portfolios. And then we just recently
0:36:42 bought model trains, a bunch of railroad titles and astronomy titles. So bringing that all together,
0:36:49 that puts us the whole portfolio. Just whatever 12-year-old Craig is into. Boats, planes, RC
0:36:54 trades. So it’s almost like my five-year-olds dream. So I mean, think about it. Boats, it’s
0:37:00 airplanes, it’s trains, and it’s space. It’s pretty cool for a five-year-old boy, it’s pretty
0:37:06 magical. But what we’re buying are these audiences that love the content. They’re
0:37:14 enthusiast and effectively by owning the magazine, which we finance through the P&L of the magazine,
0:37:20 itself subscriptions and advertisements. We make money in media. But we’re ultimately buying the
0:37:26 audience itself to offer some other product or service to them. Yeah. So let’s walk through
0:37:32 this playbook. So the playbook is to acquire customers profitably. And you do that by having
0:37:37 a media arm that its own business or having a media company that is its own business and make
0:37:44 the profit via subscriptions and advertising. Step two is to make sure the audience, I imagine,
0:37:49 you’ll have to correct me, you’re doing something in your head of like, will they spend a lot of
0:37:54 money on something? Is that right? Yeah, essentially. But if they’re enthusiasts,
0:38:00 if a category is big and they’re enthusiastic about the category, then the answer is pretty
0:38:06 much yes. The thing to remember about magazines, and particularly magazines that are decade-old
0:38:10 magazines, is these things have survived, tend to the great Leo magazines that are over 100 years
0:38:15 old. They’ve survived multiple wars. They’ve survived multiple pandemics. They’ve survived
0:38:24 the Great Depression. The audience truly cares about the content enough to subscribe. If these
0:38:29 magazines have survived the internet age in multiple phases of it, they’re going to be around for many,
0:38:34 many years. And so, essentially, we’re buying it because they care deeply about the content,
0:38:37 and then ultimately, they can buy another product or service.
0:38:44 And then is step three raise prices and sell ads better? Do you think about that?
0:38:50 Well, I don’t think we look at it in the same step, right? So, we treat these, we have a media
0:38:56 business which runs the media operation. And then as we go find commerce, so let’s say aircraft
0:39:02 finance, we find essentially an executive, a CEO, if you will, that can run that business
0:39:05 through its own P&L that’s separate than the media business.
0:39:10 But in order to finance that, these people wouldn’t be selling you these businesses
0:39:15 if they were kicking ass, but you’ve been able to make them kick ass a lot better.
0:39:20 And so, you must be doing something just on the media side that they didn’t do. What are those
0:39:25 things? Yeah. I mean, effectively, you’re fixing a lot of their cost structure and looking at it
0:39:34 and in terms of the spend opportunity of that audience and create data that can really look at
0:39:38 data from the perspective of intent for someone that wants to buy a product.
0:39:44 So, if you’re reading Flying Magazine, you’re either a pilot, an aspiring pilot,
0:39:48 or an aircraft owner, or somebody who wants to own an airplane.
0:39:52 That’s the four prime. I mean, there’s people who read Flying because they like airplanes,
0:39:57 but it’s a small piece of the audience. And so, we know each of those categories
0:40:01 are going to spend some money in each of their outcomes. So, a student pilot is going to take
0:40:04 flying lessons. It’s going to cost him $10,000. If he’s going to be a career pilot,
0:40:10 he’s going to make $15 million over the course of his career. A lot of opportunity to help him
0:40:15 along his journey. If they’re an aircraft buyer or a prospective buyer, they’re going to buy an
0:40:19 airplane. They’re also going to buy insurance and finance out of that. They’re also going to have a
0:40:25 lot of expenses on that aircraft throughout their life. And so, these are the journeys that we have,
0:40:29 and that’s ultimately what we’re doing is we’re optimizing the magazine, the advertisers,
0:40:35 based on intent, not based on the fact that this is a number. And what we’ve explained to the owners,
0:40:42 that the advertisers is, wouldn’t you rather reach the 100 people that are going to buy your
0:40:48 airplane versus the 100,000 people that 99% of those people are never going to buy any of your
0:40:53 products? That’s what we need to do is actually get into that intent data. And we do that through
0:41:00 digital. Print is just one aspect of what we do, but it’s driving intent data to actually be able
0:41:04 to demonstrate to them there’s a value to that customer. That was a very good pitch. All right,
0:41:10 if you’re listening to this pod, I already know something about you. You, my friend, are nosy.
0:41:14 You want to know the numbers behind all of these things that we’re talking about. How much money
0:41:18 people make, how much money people spend, how much money businesses make, you want to know all of
0:41:23 this people’s net worth, all of it. Well, I’ve got good news for you. So my company Hampton,
0:41:28 we’re a private community for CEOs. We do this thing where we survey our members and we ask them
0:41:32 all types of information, like how much money they’re paying themselves, how much money they’re
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0:41:54 salary and compensation report. It’s going to blow your mind. You’re going to love this stuff.
0:42:04 Check it out now. Back to the pod. And then when you hire these guys to create, so I guess airplane
0:42:10 financing means you help people get loans to buy a plane. And then I think you have like a classified
0:42:16 section. So people selling planes. And then now you have the real estate one. I don’t know what
0:42:20 you’ve done with the other titles, how you’ve done the same content to commerce type of play.
0:42:24 But I want to hear more about what those are. But when you’re hiring people to build these
0:42:29 businesses on top of an audience, so do you hire, how much do you decide to invest in them until
0:42:34 invest in their new business until they’re able to make a profit?
0:42:39 You know, we have a, we’re pretty patient. I mean, it depends on the business itself.
0:42:42 If it’s growing and it’s hitting KPIs, then we’ll continue to support it.
0:42:45 You know, every business is different. Obviously, the real estate business has,
0:42:50 you know, we haven’t broken ground yet. So that, that is going to take many years to sort of
0:42:56 generate a profit. It has its own sort of journey. The finance business is a finance brokerage
0:43:00 business and it should generate profitability much quicker than some of the other projects.
0:43:04 You know, we buy e-commerce businesses. We’ve now in six e-commerce businesses.
0:43:05 What are you selling?
0:43:11 We own the largest NASA or the largest space merch store on the internet called the Space Store.
0:43:15 So it’s like collectibles. The aviation nerds and the space nerds are,
0:43:19 the Venn diagram for both of them is pretty tight. So if you want to, if you want like a model of a
0:43:25 rocket or a patch from one of the missions, we, we can sell that, whether it’s SpaceX or NASA.
0:43:28 And so what are some of the, like, what, what are you going to do with boating?
0:43:30 Are you going to build a harbor?
0:43:33 No, I don’t think we’ll do real estate because I think real estate is like,
0:43:41 the arbitrage in aviation is that you’re taking a piece of land that has beauty. It’s a beautiful
0:43:47 piece of land, but it’s not next to a body of water to build a lakefront home. And so
0:43:51 essentially what you’re doing is you’re taking this land and you’re arbitraging because the,
0:43:55 the runway itself is the arbitrage, right? The pilots want to be there.
0:44:01 And so with boating, it’s not as if I can arbitrage a lakefront property or an oceanfront
0:44:04 property because that’s already awesome. Exactly. And there’s the market’s already
0:44:09 priced that in accordingly. So for us, we’re looking at financing, we’re looking at e-commerce,
0:44:12 we’re looking at other categories that we think we could be successful. So
0:44:19 probably won’t be real estate, but it will be in other categories that we’ll look at commerce.
0:44:21 I think you said 40 million that you’ve raised for this whole thing.
0:44:25 Yeah, I didn’t raise. I mean, in between, I mean, my father funded,
0:44:30 has invested the money into, we haven’t used outside capital, if you will,
0:44:31 sort of family office.
0:44:34 Of that 40, how much have you spent on acquisitions?
0:44:39 No, that’s been the predominance of the investment has been through M&A.
0:44:43 But you’re going to do 60 million in revenue this year. I think on the tweet, you said
0:44:46 10 or 15% profit?
0:44:53 It’s about to do, our profit in March was 18%. And we, we think we can sustain 20 and we think
0:44:56 ultimately it sort of like levels out around 30%.
0:45:02 So you’re going to do 60 million in revenue, I think you said. So that means 12 million in profit.
0:45:07 Yeah, we remember that’s a run rate number. So that’s not a full, but yeah, 60 million in
0:45:11 revenue revenue, a little bit over 60 with 20% margins.
0:45:13 And then what do you think that would be worth?
0:45:19 You know, if you look at sort of public comps, you’re probably talking 12 to 15 times earnings.
0:45:23 That’s probably what, if it was a public, our goal is to get to a billion dollars.
0:45:27 A guy had no plans to sell this business. I like having cash flow.
0:45:31 Sam, I do appreciate cash flow. So it’s not just taking risk. I actually love cash flow.
0:45:35 You know, it’s funny as a venture backed founder. You’re kind of jealous.
0:45:39 You’ve heard this, you’ve talked about this on your podcast before is you get jealous of the
0:45:44 cash flow guys. Like the cash flow guys get jealous of the valuation and venture and the
0:45:48 venture guys almost every founder that I know are super jealous of the cash flow guys because
0:45:54 like, wait, we built this fantastically high valued business, but we don’t see any of that
0:46:00 money goes, you know, ultimately until exit. But you have both at this point, but you have,
0:46:08 so on 12 million in profit, 10 times is 120. Or no, sorry, you said 12 times.
0:46:12 Yeah, I mean, you can look at if it was a private trade, probably 10 times is a fair number.
0:46:17 So the business is worth at 60 million run rate, 12 million profit. I don’t know if it’s
0:46:22 trailing 12 months revenue, whatever, but roughly 120 million to $180 million.
0:46:28 That’s what the business is worth. And you started this in 22 or 21.
0:46:35 That’s awesome. Okay. And then you said, I think this is going to get to a billion in revenue
0:46:40 by 2030. That’s our goal. And we can do that through both organic and organic growth. I mean,
0:46:45 here’s the reality is there’s 4,500 magazine publishers in there. And say there’s no exit
0:46:49 for these guys. I mean, a lot of them are, they’re either owned by large corporations,
0:46:55 which frankly want to divest their print products because public comps are challenging for them.
0:47:02 Or they’re, you know, family owned businesses where they’ve been running the business for
0:47:06 multiple generations, or perhaps they started it 50 years ago, whatever. And they don’t have
0:47:11 an exit. And so we can go find, I mean, we’re doing a deal right now, where it’s in a business,
0:47:19 about a nine and a half revenue, about $600,000. And when you take out all the expenses, all the
0:47:25 owner expenses, about $600,000 a contribution, we’ll pay less than one time for that business.
0:47:30 And so there’s just not a lot of folks buying in this category. And ultimately, you’re buying the
0:47:35 audience. I mean, that’s really what it’s all about is, yes, we own and generate profit and that’s
0:47:40 great and cash flow. But ultimately, so I like to say we’re a private equity business meets venture
0:47:46 capital because ultimately VCs want the asymmetric hundred expert turn, we’re going to incubate
0:47:51 businesses that can potentially bring those high level returns, but using the audience,
0:47:55 which we already own. And so, I mean, e-commerce is never going to hit that mark.
0:48:00 But you have an aircraft finance business, you have a real estate project that very well could.
0:48:02 And we’ll find other business models as we grow.
0:48:07 You’re basically building a Hearst business style company. So Hearst,
0:48:12 have you read the chief, the biography of William Randolph Hearst?
0:48:18 I have not. You should, man. It’s awesome. So William Randolph Hearst, he had a successful
0:48:26 father. His successful father was a minor, I think, or like a gold gold. And in a gambling bet,
0:48:33 he won, I think, the San Francisco Chronicle and he goes to his son and he goes, well, William,
0:48:37 you’ve got the Chronicle. Hopefully you can make it into something. You’ve got a year to make it
0:48:43 not lose money. And so he does that and he does it by creating what’s called yellow journalism,
0:48:51 which is like clickbait of the late 1800s, early 1900s. And he kicks ass and he crushes it. And
0:48:55 he starts buying another thing, another thing, another thing. He starts buying all these titles
0:49:01 and he’s killing it. He’s crushing it. This is like a cable business before a cable where it’s
0:49:08 recurring revenue subscriptions, massive margins. And then they get so big, so they do a bunch
0:49:14 of things. One, they invest in this new sports network called ESPN. So now Hearst owns something
0:49:20 like 30% or 40% or 50%. I forget the number of ESPN. That’s they’ve made a billion off of that.
0:49:26 Then they buy Finch ratings, I think, which is a data business, which is exactly what you’re in.
0:49:30 And they start buying all this stuff. At this point, Hearst is owned by the family.
0:49:36 It’s one of the largest family owned businesses in America. They own this massive building in
0:49:45 right in the heart of New York City. My in-laws live literally on my wife’s bedroom that she
0:49:49 grew up in and I can reach out the window and touch the Hearst building. And I remember that was
0:49:53 funny because I almost sold my company to them and I was sleeping in that room when I was visiting
0:49:58 New York City. And anyway, they own this massive building that I don’t think they got a loan on.
0:50:03 I think they own this like multi-billion dollar building. They own a ranch in Wyoming or something
0:50:08 like that. They own everything and it’s owned by this family and it’s kind of sick and it’s been
0:50:13 around for a hundred years. That’s sort of what you’re doing. Hearst is amazing because it’s 10
0:50:17 billion or 12 billion in revenue, no debt. That’s what’s pretty astounding about Hearst.
0:50:23 Not even on the real estate. They’re no debt. They actually have a very large venture capital
0:50:27 portfolio. They’re an investor in freightways, by the way. So that’s one of the reasons.
0:50:32 Do you know all about them? I forget who I met with there, but I learned a lot about them.
0:50:37 But they’re like older guys. They’re like the Mad Men era where they like…
0:50:38 Oh yeah.
0:50:40 So it would have been a bad fit. But that’s what you’re building and it’s awesome.
0:50:48 Look, I think media businesses are underappreciated. I think what’s happened is the Hearst is they
0:50:55 own a bunch of newspapers as well. But I think what we’re seeing now is this if you own a strong
0:51:01 sort of thesis around a media asset and you can build products that take that audience,
0:51:07 that’s ultimately the playbook. We have these audiences. They love the content.
0:51:13 They’re subscribing and paying for a product, which is a print magazine or a digital experience.
0:51:17 They’re already the audience. We can offer them products and services that they naturally
0:51:18 would buy anyways.
0:51:22 Yeah, that sounds like… When you say that, I might get that’s so obvious. But everyone,
0:51:28 not everyone, a lot of people have tried this. Few have succeeded. Hodenke, I think,
0:51:33 is succeeding. There might be a couple others. But when Buzzfeed says they’re going to do it,
0:51:38 it’s shit. It never works out. I think it doesn’t work out because they have a committee
0:51:43 deciding on these things. Whereas you could be a bit more of a monarch where you’re like,
0:51:44 “This is what we’re going to do.”
0:51:49 Well, I think Buzzfeed along with a lot of other publishers has sold out to Programmatic
0:51:54 and have relied upon the platforms, the Facebooks and the…
0:51:56 And no one really loves them too much.
0:51:59 I mean, what is Buzzfeed anyways? It’s like a listical…
0:52:06 And I think the difference is that we’re buying magazines and media properties that had been
0:52:12 around for decades, where the audience, the people talk about their father, the grandfather,
0:52:22 the reading trains magazine or model railroad or flying. It has a lot of affinity to it.
0:52:27 And then effectively, we just have to find services. So we make money in media,
0:52:29 but then we have to find services that we can offer on top of that.
0:52:32 How many hours a week are you working?
0:52:36 No, I don’t count my hours.
0:52:39 But like maybe like a normal nine to five, 40 hour a week?
0:52:42 No. I mean, when I wake up at six in the morning,
0:52:47 because my kids wake me up till midnight, I’m pretty much either with my kids or
0:52:51 working on the businesses. So that’s not worked to me, man.
0:52:58 To me, this isn’t work. This is a game in some ways.
0:53:02 You’re in grind mode. It’s not like this is all awesome.
0:53:08 I do it to myself too. I end up getting overwhelmed and then I’m like,
0:53:10 I hope I have myself to blame.
0:53:14 What’s your goal? You want to be a billionaire? You want to just do cool shit?
0:53:16 You want to create something that lasts for a hundred years?
0:53:22 One of the reasons I like media businesses is because you’re always learning something new
0:53:25 and you get intellectually stimulated by a new challenge.
0:53:29 It’s a new audience. It’s a new product. I don’t know. To me, it’s…
0:53:34 You don’t want all the power, fame, sex and drugs that comes with owning spacemagazine.com.
0:53:40 Trains magazine is going to give me an enormous amount of power. Yeah. Our model railrider.
0:53:44 No, it’s not that at all. It’s not even the wealth. It’s more of the chase.
0:53:50 It’s the putting up the score in some ways of solving problems and learning about a different.
0:53:55 I mean, we have a business that I pay $10,000 for. It’s called Aeroswag. It’s an e-commerce business.
0:54:02 It will do $100,000 this year. I spend more time on that business proportionally
0:54:04 than any other one just because I think it’s cool.
0:54:10 It’s a print-on-demand t-shirt shop for pilots. I, frankly, should not be spending as much time
0:54:14 as I do, but I enjoy the… To me, it’s a hobby. It’s a tinkering kind of thing.
0:54:18 I bet it feels awesome to make your dad regret firing you.
0:54:22 It was fun proving that I could make it work, but I had a lot of that. I mean,
0:54:24 a lot of doubters when we first started the business.
0:54:28 Yeah, look, behind most successful people is a girlfriend or boyfriend that broke up with them
0:54:36 or a father that made one rude comment. In my case, it was a media executive who…
0:54:42 He haphazardly passed and was like, “Man, these newsletters will never make more than a million
0:54:46 dollars a year.” I was like, “You motherfucker.”
0:54:48 And you thought about that every day, right?
0:54:54 Every day. And I see this guy on sitting at floor seats at the Knicks, and I’m like, “You son of a
0:54:58 bitch.” So I would say the best thing to give a founder is an enemy.
0:55:06 So at Freightways, I had a guy, he was a CEO of our largest competitor, and he really pissed
0:55:10 me off because he told me I couldn’t compete against him. He was like, “I like to see you try
0:55:15 whatever products.” And I woke up every day thinking about him, and he got fired. And I tell you,
0:55:22 the motivation, it wasn’t as fun anymore because I needed him to be the guy. All of a sudden,
0:55:27 the company became nice to me, and it was like, “No, I want you at souls. Please go back to being
0:55:31 at souls because I wake up more, slightly more motivated every day.”
0:55:35 I was like that with the founders of Morning Brew. I was like, “I want to kill you.”
0:55:40 I’m like, “If I see you in public, I want to get a fight.” Now, they’re family to me.
0:55:41 They’re like my best friends.
0:55:46 Well, you are hosting a podcast on their platforms.
0:55:54 You know, people say, “Don’t be hateful towards this person.” And in my head, I’m like,
0:55:57 “Rage is the greatest fuel ever.”
0:56:02 Someone once told me, “If you got hate in your heart, let it out.” I’m like, “No,
0:56:06 I’m burying that deep. Let it go nowhere. Let’s feel I need that.”
0:56:12 Sam, it’s good for the team because if they also have the hatred of the enemy,
0:56:18 then they’ll go much further and fight harder than if you don’t.
0:56:25 Yeah, I love that. It’s sort of like a sport where you know, once the whistle blows,
0:56:30 you’re like, “Anything goes.” But once the game’s over, it’s like, “All right,
0:56:33 nothing but love, nothing but respect.” But while we’re in between the lines,
0:56:34 like, we’re getting after it.
0:56:35 Yeah, exactly.
0:56:38 And so, I think it’s good. Dude, thanks for doing this.
0:56:39 Yep, enjoyed it.
0:56:40 Craig Fuller, that’s the pod.
0:56:45 I feel like I can rule the world. I know I could be what I want to.
0:56:51 I put my all in it like no days off on the road. Let’s travel, never looking back.