Yes, you will. Speaking of things that people may lose at and that might be giving them existential dread, what do you think about AI for entrepreneurs?

Oh, it's a great question. I'm not worried about it at all from a what will it change about what I do? So I have seen I basically see the history of humanity as humans, then humans plus tools, and then tools beat all humans. And so AI for now is a tool, just like the internet, just like computers. And we will use the tools. So I, as an entrepreneur, will use all the tools available to win. And so AI will come online and we'll do that stuff. Until AI can do everything better than everyone. And at that point, it doesn't matter. Nothing matters. And so again, me dreading that changes nothing about what I do today. And so what I will do today is what I've always done, which is do the best I can with the resources at my fingertips, what's available to me. And so I absolutely, across all portfolio companies are pushing, how do we incorporate AI into this? How do we put it into a streamlined process? How can we incorporate it in sales and marketing, whatever? And we will continue to do that until an AI is starting and running businesses without us. And at that point, we will try and do that. And if AI's own AI businesses and they're just out-competing humans at everything, then the world is different. And I have no ability to predict that. And so I'll just keep playing the game until I can't play anymore.

What's the most jaw dropping use of AI that you guys are doing in a portfolio company?

We're getting really close to being able to have it take calls.

Whoa. Yeah, specifically. Inbound, I assume.

No, outbound works too. Whoa. Sales? Setting. I think it will get sales. Wow. Yeah, I think end of next year it'll be able to do sales. Whoa. But like setting, I think we're basically like three months off. So main thing, the only issue right now is lag. So the actual responses are perfect. They're on script. They all reasoned. All that stuff works. The only issue is the lag time between someone saying something and the response. Or if someone says something, the person starts, AI starts responding and then they say something else, it can kind of like jumpstart it. And so the next big iteration that's going to happen is voice to voice. So right now, what happens is you, you know, prospect says something, it goes to a satellite, which then goes down to a database, which then transcribes it. AI takes that as a text prompt, responds in a text prompt, beams it, translates it to voice, and then beams it up to the satellite to then say to the other side. That takes like a second and a half. As soon as it's voice to voice, it eliminates like three steps. And so it'll probably be like a half second. And at that point, that's just human latency. And so that's close. Like that's, I think that's three months off, four months off. Like that'll be end of Q1 next year.

Wow. Now are you guys doing any of the training or are these

companies that are building these these are tools that we i'm not an ai company and so it's like we were talking earlier about the platform of like are we a you know are we a dev company um acquisition.com as a holding company is not is not an ai company we want to utilize the tools that are available to us and most of the ai companies that we've, you know, started vendor relationships with, et cetera, there's usually a training period that you want to train your specific, you know, model agent, whatever. And so we've been good on that process. Yeah.

That's where I want to get my hands in the mix. I want to do the reinforcement learning so that it will do the things we want to do. But yeah, I don't want to have to build the AI out itself. AI is the one that, man, this really gets me excited. When I think about how much it's already sped us up and we're, you know, what are we just under two years from when it launched? It's absolute insanity how far it's already come. If you could push a button and get it to work in one area of your company, that would just have a huge impact. Where would you want it?

It's tough. I'll give you three. I'll take them. So I mean, marketing sales. So marketing is like, how can we get the content stuff to be like truly top 1% The thing that's tough is that whatever, whatever the thing that I hate and like about it is that whatever skill AI can do for you, it can do for everyone. Yep. And so it has a massive equalization. So like the ability to execute is going to be not nearly as much of a competitive advantage, which I'll just say transparently I'm bummed about because I'm pretty good at it. But I'd say marketing and sales, both of those. And then the one that people might not expect is decision making. if if it can get better at prediction than me for outsized returns then of the three that would be the highest return thing that we could do and so i think that again but if it can do that for me it can do for everyone and so that's where that's again this is where i struggle with it so i just think of like what can i do today and then i i don't spend any time on what might happen in the future with it because when it changes, I'll be there.

Yeah. Yeah. No, that's I think the right way to think about it with that kind of stuff. The nice thing now is AI doesn't have taste. And so what I have found is that because the output of the prompt matters so much in terms of what I give it, that that still feels like it matters a lot. to your point about you have infinite or limited resources against infinite possibilities the same is true with ai so you can have it go a thousand different directions ten thousand million whatever and that matters so understanding the end target person that you're creating this piece for but it taking all of the manual work off of my plate so that now i can iterate faster so i just have to think about okay i need to understand my customer i need to understand what it is that i'm trying to communicate the angle that i want to do it knowing which piece to say yes to which to say no to where to push it and then to be able to edit it it it is it's taken so much time off of so many of my different workflows that's cool it's really incredible and for us because game development is such a big part of what we do if it can do 3d characters yeah oh my god that all of the cost is in the creation and the rigging of the 3d characters how far is that away now i'm gonna guess so i just saw very compelling 2d to 3d stuff it's static so you can't rig it yet so i'm gonna guess 2d to 3d over the next year is going to be extraordinarily compelling give it another 18 months so 18 months to 24 months and i think that the financial structure of a gaming company changes overnight yeah yeah it's pretty crazy so you were saying that you're bummed about it uh replacing certain aspects of marketing because you're really good at it what is the thing because we can all look at you and go yeah you're there's something here that you were unusually good at what is that thing I think it's rhetoric. Say more.

How you structure statements to make them more interesting or compelling for an audience. So

you're doing it intuitively or do you have a method?

The single greatest training grounds for this is Twitter. Error X. I started tweeting. I can't remember't remember you probably look at my profile probably three three years ago um and i think twitter is one of the best writing tools that exists because it gives you real-time feedback immediately for how good the quality of your writing and thinking is and so there are basically sentence structures that resonate better with people. And so that would be like having three things in a row where you have they all start with the same letter. If you have basically like a reverse sentence, like it's not about it's not about listening to people who are closest to you. It's about listening to people closest to your goals. And so it's like, there's repetition there. And you change one variable. You know, if you can't do it in a decade, or if you wouldn't do it for a decade, don't do it for a day. So there's alliteration. And so there's, and I would say some of this has been probably subconsciously intuitive, because I've tweeted probably 6,000 times over the last three years. And so I've had a lot of reinforcement loops. And this is where like AI will do better than I will eventually. But like right now, I can look at, I want to record this because there was this time where Layla and I were driving and she wanted to like tweet while I was driving. And so she would read me what she wanted to say. And then I would tweet it back to her. And they ended up like, they just banged. And you kind of get in the flow. I was like driving on the road. I could just like kind of like zone out and think about it. And like that, that's something that I've gotten significantly better at over the years and making more content. So it's like I have verbal practice and feedback loops, which are more delayed. So I don't think it's as strong as the Twitter feedback loop. And that's probably been, I think that's the, from a copy and content perspective, that's where I think I've put more emphasis. I love it. Because where this is really interesting for persuasion is that if you make the statement more memorable, people have a higher likelihood of remembering it. If people have a higher likelihood of remembering it, then they will think it was their idea. If they think it was their idea, they're more likely to do it. And so the best persuasion is when someone doesn't feel persuaded, they just think it's their own idea, and then they do it. And so if you make things memorable in a very real way, you will influence and change more people's behavior. And so if we look at the best orators of our time, the last hundred years, they were very skilled rhetoricians or whatever. And they use specific sentence structures that people tend to like. And it's like probably chords in music. I think it's the same thing happens with words.

That's interesting. All right. What's some of the worst business advice you see people give out all the time do

a bunch of things and see which one works why is that terrible god so many reasons um well first off trying to do many things at once you already have such limited resources the easiest analogy i can think of is imagine you've got one cup of water and you need to overflow another cup to get it to be an effective dose, right? Enough volume for you to see an outcome. The visual I can give is, okay, let's line up seven shot glasses because millionaires have seven streams of income, apparently. And so now we're going to pour that water into all of those glasses and then hope that it somehow overflows, but it's not going to. And so what ends up happening is you just have insufficient volume of action on seven things, and then you accomplish none. And the fallacy is thinking that you'll see which one will work, which assumes that the environment, the circumstance is going to be the thing that makes it work rather than you. And so better stated is that you can make any of them work, but none of them will work unless you focus on one of them. That's all rhetoric, right? That's the idea. And so I think that is a very insidious piece of advice. I think that you can try many things if you want. If you are going to do that, do it in sequence, do one at a time. But I say that knowing that if you actually try hard at the first one, you'll probably make that work. So try the first one that you think is the best one first, in which case, why do you even have six through, you know, six through two or seven through two? And so that, and I think there's this big idea. This is one that I remember talking to a portfolio company about. He was like, I'm not really sure if I'm passionate about this anymore, like about like this, this, this product or the company, whatever. And so he was like, I think I want to consider starting something else. And I said, what do you think the natural extreme of this looks like at the top? Because in my opinion, all businesses at the top look the same, which is you're going to have a head of marketing, you're going to have IT, you're going to have it as sales, head of product, head of customer success, whatever. And so if you win and you win all the way, it looks the same. And so where your entrance point to the maze is doesn't really matter if that's what the hypothetical extreme is. And so I have this story about a friend of mine who started a cookie store actually here in California. So he started this cookie and he was in fitness, right? So that was kind of hilarious. Like it's the really fit guy who starts a cookie store. And I remember I asked him, I was like, are you passionate about cookies? And he was like, no. And I was like, huh, weird. He's like, well, I looked at the market. There's a lot of people. And this was before Crumble. So he had a good inclination that like high-end cookies were going to be a thing. So he did his homework. But what he was passionate about was being excellent. And he did amazingly well. And so I think that you can be passionate about ideals and translate that to anything. And so I had a conversation with Ben Francis from Gymshark this year, probably the best day that I had from a business owner perspective was hanging out with him. Just had a really good conversation. And there's not a ton of people you can talk to about like levels and problems that come at that. And we had a great discussion and what was interesting. He's like, I can't believe that you're doing all these different things because he saw each of the portfolio companies as a different thing. He's like, I can't imagine doing anything besides Gymshark. This is all I want to do. And I thought about it for a second. I was like, acquisition.com is the only thing that I'm doing. These are just like fundamentally, like you have different types of clothing. I can't believe you have all these different types of clothing, all these different types of apparel. So it's really chunking up and chunking down. And so if anyone hears that and thinks, well, wait a second, I thought you told me that I should focus on one thing. How are you doing all of these different things? There's a very big misconception when you're starting out that CEO and owner are the same thing. And they are not. And that's because in the beginning, they are the same because you're the only guy. But if you look at Berkshire Hathaway, for example, Warren Buffett is not CEO of Coca-Cola. He's not CEO of Geico. He has operators who are in charge of each of those companies. Now, those guys couldn't run three companies. They can only run the one they're at, and he can only run Berkshire Hathaway. And so it's really chunking up or chunking down a level to understand how do you have multiple things? Because you can always go down and say, okay, well, if you have an agency, then you have 10 clients. How can you have 10 clients? You should only have one. Well, the logic doesn't carry. But it's really just that one person has limited resources. And so by limiting the scope of the problems that we have to solve, we get more leverage as in we get more for what we put in, in my opinion. And so, um, that was how I reconcile those two kind of styles of doing businesses that I am not CEO of any of them. And I'm not even really CEO of acquisition.com. Um, if at all. And so that's, that's been, uh, that was, that was how I, how I, how I made sense of that because that's the only one thing that I think about. All

right. So what is the difference between what life is like when you're running a million dollar company versus a hundred million dollar company? I

was gonna give the obvious answer, which was scale. Uh, that's like the first. What's the knock on? Yeah. So we have only one theory of how we grow everything. And so that's kind of been our unifying principle, which is the theory of constraints. So a system will grow until it is constrained and then we'll grow no further. And until you relieve the constraint, whatever the bottleneck is, it will stay there. And so the difference between a million dollar business and a hundred million dollar business is typically if you're a million dollar business, you're still, you're doing a lot of everything still. At a hundred million, you're predominantly making decisions and SWOT teaming in on high leverage problems that need to get solved. So kind of like the Elon, like we jump in and Layla and I have both kind of championed this methodology of close CEOing, which is rather than having somebody who's kind of like running the basically driving. So driving objectives on a regular basis, we see as like traditional operations and management versus kind of like CEO as saying, okay, the single most important thing that we need to solve right now is this product ascension piece, or we need to solve this sales constraint, or we need to solve this CS issue, whatever it is. And then basically CEO goes in, is now on every huddle for that because the operators who are running each of the divisions or functions are continuing to drive the ball forward. And so the TLDR is in the very beginning, you're doing everything. At the end, you're doing one thing very well. And your understanding of talent will dramatically shift over that time period. And so right now, you can't imagine having anyone else do anything because everyone who works for you probably isn't that good. And that's because you don't know how to recognize talent and or you can't compensate them well enough. And unless you're giving away big chunks of equity to people, which is a strategy, there's nothing wrong with that. But either you're building a dream team or you're bootstrapping it. If you're bootstrapping it, you're going to be doing a hell of a lot of work. If you build the dream team, then you're going to have to give slices of the pie away. Again, cool either way, expecting a different outcome from a different decisions where the problem comes in. And so that's kind of obviously like at a very high level. You're doing a lot of stuff with no help to you're doing a few things with tons of help. So that all of the normal day to day activities continue. And you're just thinking, what's the highest leverage move we

can make? How do you recognize talent?

So this is probably so if I had to say like the three things that have changed in terms of me as an entrepreneur for the year, um, or like last two years, like big, big moves, one is my understanding of brand. So probably four. So understanding a brand has, has deepened. My understanding of focus has deepened. My understanding of talent has deepened. So it's not like, Oh, I learned about talent. It's just my understanding of it has grown more nuanced. And the arbitrage that exists between B and A plus. And so I still think that one of the greatest returns that you can make as an entrepreneur is paying someone who's exceptional, exceptionally well. And Steve Jobs gives this, so I'm not going to claim credit for it. But he says, if you look at the best cab driver in New York compared to the worst cab driver, it's probably a 3x difference between. And that's the best and the worst. But the best marketer and the worst marketer, it's not a 3x. It's probably 100x difference. Same thing for the best engineer. And now that's the best and worst. But what about good and best or good and top 0.1% Well, the difference between those guys is probably still like 25x. It's huge, huge, highly leveraged. And so the arbitrage is that you don't typically have to pay the best guy 25 times more than the good guy. You can just pay him three times more. And then all the increase in throughput goes to the company. And that has been my shift and moving away from... So basically, headhunting happens in level. In the beginning, you start running ads to get... First, you talk to friends and family, right? And then you start running like Indeed ads and Craigslist ads to get people. And maybe you post in communities you own or you make public posts, whatever. That's how you get your next level of talent. And then from there, you start networking. Maybe you hire headhunters and recruiters to help you out. Maybe you get an internal resource who starts doing outbound, looking for specific types of candidates. And this also follows with the functions of the organization. If you're finding a low-level role, you can still do the lower leverage ways. The higher the role, the more individualized the approach, just like a whale would be if you're trying to go after a big client, a high value client, like, okay, I want to sign Amazon for my warehouse services. Like, okay, we're gonna have a really tailored approach, you're not gonna run an ad to get Amazon, you're gonna have to know somebody, you're gonna have to work your way in, it's gonna take a while. And so I would say that now, my thinking has rather been like, let's go find a unicorn. Two, I need John from this company to work for me. And I don't know John, but I know he's really good and I need him. How do I, what would it take for me to get him to be here? And so I'd say that that has been the shift and I am more okay with getting, I'm basically being involved in some of the highest level recruiting. And those roles take six, 12, 18 months, uh, to actually come to fruition because it's, it's like a courting process. It's more like a marriage. Like they don't need your company. And like, they have a career, you're not giving them an opportunity. Like they're giving you a company because they can drive an entire division of growth. They can take you international because that's what their, you know, that's their Rolodex is or, or they're, they can take you public if that's where they're, you know, what their specialty, whatever the thing is. And so that's, that's kind of how I see as a very high leverage use of my time, despite the fact that it's a very slow process that has very delayed reinforcement. Yeah.

Talent is a whole beast. How do you go in when you've got a role that you don't necessarily know? How do you make sure that you can't be bamboozled? So

Layla, so I'm stealing this from Layla. Um, her frame is talk to as many really smart, basically reach out to people who you would want to hire, ask them if they know anybody, hop on calls with them. And she uses the interview process as her learning process. And so from there, you know, if you only talk to one customer success person, you have no idea if they're good or bad. If you talk to 20, you have a really good idea. And so because then by the by the 17th, you're like, but what about this? And what about this other thing? And the the way that I think through this is a couple of razors. So razor number one is the quality and quantity of metrics they track and how they influence those metrics. So if I talk to, let's say I wanted to find a sales manager, I might say something like, okay, so how do you think about running sales and improving sales performance? Now, if the guy says, got to get in there, get the team riled up, you know, make sure the culture's good, you know, drive outcomes. I'd be like, okay, how do you measure that? Now, if the guy's like, you know, make sure the close rates are good. And yeah. And I'd be like, okay, how do you make that go up? Now, the best guys would say, well they would have every metric all the way down so it's like what's our contact rate what's our what's our what's our offer percentage what's our close rate what's our cash collected what's our backout rate by rep uh what's ltv to rep so because some reps have higher ltv because they'll have lower return because how they're sold what expectations were set and so if these are the metrics that i'm doing they would then say well which metric would you want me to improve i'd be, okay, let's say that offer rate's low. What do you do? Like, okay, well, then that's probably going to be a lead nurture issue, which is we're not qualifying people on the front end. We probably need to fix the headlines that we have in the ads and maybe the offer that we're doing for whatever giveaway we have that's generating these leads. And then I would probably add in some sort of disqualification process earlier. So if the guys can look at the stats, I could remove them from the calendar so they can open up a slot and then increase throughput. Now, if someone said that, then I'd be like, okay, that's clear. I zoomed in on a metric because he had many and he had quality metrics and he knows how he can influence them. And so if you have a very good idea, because I remember the first really good HR person that we brought on, they introduced all these new metrics to me that I had no idea about. And I was like, this is great. She was like, well, what's the cost to acquire talent here? And I was like, I haven't thought about it. She's like, oh yeah, well, we need to know we can spend this much to acquire talent. And this is our average cost to acquire role at each level. And then what's our, what's our two way fit percentage? And I was like, what do you mean? I was like, well, at 90 days, what percentage of people are saying it's a 10 out of 10 from the manager to the person and the person to the manager. So it's a two way fit. Both people say that this is a good, a good, uh, thing. And then what's her average time to fill? And I was like, I don't know. Right. And so all of a sudden she had all these different metrics. I was like, this makes complete sense to me. And I've never measured this. And then all of a sudden from that point going forward for every single head of people or director about whatever it is we're doing, if they're in charge of some sort of recruiting function, then if they're not bringing up those metrics, then I know that they're already not at that caliber. And so again, it's like the, and this is where I think, um, like entrepreneurial pattern recognition is so valuable is like every entrepreneur that I know who has had something successful and then started something else with the assumption that the first thing wasn't because of luck. Cause we, we have probably both seen some guys that got richer than they should have. I'll just put it that way because I remember I had a dinner with somebody once who was like, and I'll loop back, but he said, isn't it crazy that like gym launch could be the biggest thing you ever build? And I was just like, that is not true. I just like, I wholeheartedly reject your premise. I like, I, I know exactly what we did to build job too much. And I know all the reasons that it was not as big as I want it to be. And I know what I'm going to do next. And I know how to win. And, uh, that guy never ended up building something bigger than the exit that he had. Uh, and it might've been because of his view of the world or because he got lucky or whatever. But that pattern recognition for most entrepreneurs that truly are self-made that forced their will into existence, their ability to get it again after losing it all, or just when they take their second or their third or their fourth swing, they almost start, like for me, every company I've built has gotten to each revenue level faster than the company before. And it's because it's like, oh, I already beat the boss at this level. I know what has to happen here. Oh, I know what has to happen here. And then you finally get into virgin territory. You're like, I don't know what's going on. And then your rate of progress slows again. And so it's like you want to crystallize the artifacts of the knowledge of beating the game at every level so that when you get to that level again, you're like, oh, this is another one of those. I know good sales managers look like this. They know these metrics. They say these things. They interview this way. This is the best source for them. And then all of a sudden, when it takes someone 18 months to find a sales manager because they hire wrong the first time, and then it takes them a year to figure that out. And then they go back into the process and then they have to do sales manager themselves. And then they finally on their third try, and that was the constraint, they can't fix it. And so they stay stagnant that whole time. Whereas if you think about how much faster it goes when you're like, all the roles are right. And then it's like, boom, you just go to the next level. That's the order of magnitude. I think those are the scars and the lessons that we collect as entrepreneurs so that we have our cheat codes for when we get to that level next time. All right.