I went to a capital camp this week and like the best way to describe it is a place for investors and people who are looking to raise funds to meet at the networking event. There's three types of people: investors, there're entrepreneurs who are looking to raise money, and then there are entrepreneurs.
We're just going to network. I went to the network and honestly it's expensive. It's 10, 000 a person, but there's no, it's not. Yeah. Technically it's 13, 500 per person. No, it's not. But they do, they have like a little, are you trolling me? Did you actually pay that? Did you not know this?
Is this a bit, is this like you're trying to make people laugh that are listening? No, no, this is real. I thought it was 3, 000. Are you serious? Yeah. Remember when you and I were going back and forth texting each other and you were like, I can't believe you didn't bring this up to me. This was one of the reasons I didn't bring it up to you.
Cause it's 13, 000. It's not 13, 000. I swear. Tell me right now. Are you trolling? No, I'm not trolling. I swear. It's 13, 000. I got a discount code. I didn't pay 13, 000.
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What did you pay? 10? I'm not telling you what I paid. Oh my gosh. I'm not. I'm so good. I revoke everything I said about having FOMO. I'm so glad I did not go to that.
Do you know how many businesses I could start with 10 or 13, 000? That's 13 businesses. Do you know how many hypoallergenic cats my wife could buy too? Yeah. Cause she just bought them. That's awesome. What? She just bought cats. We just bought two hypoallergenic cats for six and a piece. Oh, okay. I couldn't wait to tell you that this was a weird way to introduce this whole conversation.
You're anyways. Okay. Anyways, we'll talk about that later. So capital camp, there's like an initial filter, right? Can you afford to go to capital camp? How many were there? There's 350 people there. This is what I wanted to go through with you, the math, right? I can't help but do some of the back of the envelope math.
Right. You just start thinking about things. You're like, all right, 350 attendees, average cost, 10, 000, 3. 5 million in revenue. Were there any sponsors? Well, I shouldn't say that. Not that I know of, and it wasn't noticeable for there to be sponsors there. I mean, you better not have sponsors if you're charging that much.
Come on. Well, and the thing I liked about this conference is it was. It was fantastic. It was by far the best conference or event I've ever been to. Okay. I'll go through, I'll go through these, but like the first thing I wanted to do was kind of break down the economics of capital camp. So 350 people, 10, 000 a pop, 3.
5 million in revenue for four days, essentially three and a half days, but four days. But then I started going through the costs. I'm like, all right, 350 people, three and a half nights, 350 a night, 450, 000 for lodging. Cool food. I said, a hundred dollars per meal per person per day. So three meals a day, three and a half days, 375, 000.
They had to rent the venues, 250, 000, but why are you including lodging? Do they pay for your lodging? Yeah, it was all included once we got there. Where did you stay? I stayed at this hotel called the Stony Brook Inn or something. It was actually funny. There's two super nice hotels that they had people stay at close to the event.
And then there's a hotel really far away out in the boondocks that sucked. And I didn't know it sucked until I. They had a mix and mingle or whatever at one of the hotels. It's probably random. Right? They probably don't place people at certain hotels. I go in the freaking hotel and it's like marble, flooring beautiful wood, mahogany bookcases lining the walls as you enter.
Like it's just a very cosmopolitan feeling. Super nice. The Stony Brook Inn looks the way it sounds. It's like a nice motel eight. Right. Like it's dumpy beat up. Yeah, it is what it is anyways. I talked to one of the people who were putting on the camp and I got some back of the envelope numbers, basically.
It was like a thousand dollars per head per day for the staff. Now that includes like the planning, the marketing, the coordinating of logistics, all that stuff. And so when I added everything up, the total cost of the event was about 3 million. So you have like total money coming in 3. 5 total costs, the event three.
So let's just say they made 500, 000 on it. 500, 000 is not. A little sum of money. It's a small margin for most people. That's what I was gonna say. Like for this, like the point of it was not to make money off of this event. The point of it is to promote permanent equity. And for there to be deal flow and like to be the thought leader in the space.
So as I'm there, I knew telling you those numbers would make you throw up. So that's why I was so excited. I have many thoughts, so please proceed. As I was there, it got me thinking about this thesis that we've had for a while is that events and premium events in particular are going to become more and more sought after.
We're benefiting from two tailwinds. One is COVID. Everybody worked from home. It's been really hard to get people. Back to the office and remote work has persisted. And because of that, companies have larger budgets. They can spend on these types of things. And then we're also benefiting from social media.
Like people are all on their phones. So when you go and have real in person experiences there, they're fantastic. I, this is my fourth. Conference this year, I went to, we had a, we had a tree trimming bootcamp. We had a SM bash where we went to the capital camp. And then I'm going to another conference to convert it in a week.
And it's obvious there's a craving for networking and community. And as I was there I'm gonna give you some examples. It was the best event I've ever been to because they cared about every little detail. So it was an invitation only. First of all, you felt a special high ticket price.
So you're already like, okay, I'm expecting a lot. I checked in, they knew my name and they knew a little bit about me. Like it was obvious. They had either looked at my LinkedIn or they read my bio. Like somehow they knew some stuff about me. Like they made some comments. I mean, it does cost 13, 000 to do a LinkedIn search.
So that does make sense. The girl comes up to me when I first check in, I have my water bottles. This much water is left. She's like, would you like me to throw that away and get you new water? Can I get you a little refresher? Yeah, absolutely. I probably took 2, 000 over time. Uh, you're going to do this the whole time, aren't you?
Oh, this is my bit now. Also, can you be very clear that we are not, this is not an ad for capital camp. They're not paying us. No, no, no, no, no, no, this isn't an ad for capital. If they're paying you, they ain't paying me
the swag. So they had all this swag, right? Like it said, capital camp, their shirts and hats and bags and all this stuff. And when you went in. They said, swag's free. Take however much you want. Now, obviously you and I look at it and we're like you paid for that swag. I grew up poor. Do you know what you're doing here?
I'm going to, I'm going to clothe my family for three years. But there's like this psychological check that happens where it's like, they said, take as much as you want, but most people are going to be like, I don't want to be that guy. Yeah. You know what I mean? Like all they did, do you remember how many peanut M&Ms I came home with from main street?
I'm still eating those M& Ms. I literally am. They had more food there this time than even, don't tell me this. It was amazing. And like one of the other small touches was there, you were never sitting by yourself alone. Unless you want it to be like, so if you had your headphones in, nobody bugged you.
But there were a number of times where I sat down because all the tables were full or I didn't know anybody. And one of the camp staff members came up and they just started talking to me. Hey, how's it going? Where are you from? Because they want you to feel included and special and that like, you're having a good time now for an introvert like yours, obviously it's one of your worst nightmares, but I just thought it was exceptionally well done.
I thought it was exceptionally well done. And it's gotten me on this. Continuing on this kick of like conferences, bootcamps, live in person events are not the future, but they're going to be very popular over the next few years. All right. You got to go full Andrew Wilkinson when you describe it and be like, it was beautiful.
It was a beautiful business purchased at a fair price. It was a great business valued at a fair price. It wasn't a cigarette, but it was, no, it was, it was, it was a really well put on. Function again, it reminded me of the bootcamps that we did. Like we could do more of these boot camps or there's a lot of opportunity, I think, in this space for live events.
All right, go. I want to hear your feedback. First of all, I went to Texas Roadhouse last week and the server was helping us. And then the manager comes by and he's like, is everything okay? Are you guys doing okay? And he left. And I was like, while he was there, I was like, okay. And then he left. And I'm like, Oh I just, I don't want to be talked to.
I don't want to go to Texas Roadhouse to make friends with a server and a manager and a busboy and a host. I was just triggered when you said that. Chris checks into Texas Roadhouse and is like yeah, so here's what's going to make this a good night. Don't look at me. Don't talk to me. Don't think about me.
Don't even fart in my general direction because I will sue this company faster than you can say what. Hey, how's everyone doing tonight? Oh, good. 15%. I'm sorry, sir. What? Oh, that's just what your tip dropped to. Uh huh. Oh, I'm sorry, sir. Oh, 10%? 10. Is that, Oh, could that be a bit, should that be a bit, let's do it, write it down.
All right. So first of all, I hear you. I agree with you to an extent that it sounds awesome. And what I'm about to say is biased because I wasn't there and I have half FOMO half glad I wasn't there. I feel like whenever there's something expensive, the business owner is much more likely to be like, listen, we're just, this is a passion project.
We're just, I mean, like we're lucky to break even on this. You know how many times I've heard that crap? I'm sick of it. I remember when Sam Parr launched Hampton and he did a beta group. And he beat. There it is. I literally had to wait for it. And he emailed me with a Calendly link and I never took it, but he's like, Hey, uh, this is five grand.
And it's, I think it's 10 grand now per year. And he's like, but I don't make any money on that. It's just, I'm just trying to learn. I'm like, dude, it's 5, 000 to join a club and your cost is a zoom membership. Dude, just be real with me, dude. We're all capitalists. Just tell me you're making good money or don't tell me anything about it.
Just own the price, like either own it or own how much money you're making. But none of this, like, I'm just, I do it for the love of the game. We were lucky to break even, but I just don't like that. What does that have to do with capital camp? Because that's what they said to you. They're like, yeah, it's a thousand dollars a day.
And so you were able to back end into the math and they know that other people are going to be doing that. It's called a capital camp, but it's like, I don't believe that they only made 500, 000. You don't think that the staffing costs a thousand dollars a day. I think you would like, you could crunch it in a certain way where it would appear as such, but I just, I'm more speaking to the overall principle of that.
Just own your prices. Okay. So you think it was like a big moneymaker? That's the point of them doing it. They put you in a 13 per night hotel, a hotel that I would have booked, right? Which that's a problem. Yeah. I don't disagree with you. Keep going anyway. But it is very interesting.
The larger point of charging a lot of money for a high touch conference like that, because it speaks to the point that you and I make about having the value exceed the cost, right? Hey, can I refill your water? The cost of that is almost nothing, but the value is like, but the value. Yeah, so I respect that and I like that.
Are you going to change topics? Yes. I just thought it spoke to their company ethos. I thought it was very well representative of them as a company. I think it's smart of them to try to position themselves as a connector within the company. That world again, I think they made money, but I don't think that, like, to me, the purpose of this, if you've got a company that's doing 20 million a year and EBITDA, and this event makes you 600, 000 or a million dollars, like, you're not putting this event on because it's like, Oh, this is the main money driver, right?
There's other uses of that capital that you could do to me. It just signals that. If they're being very smart and strategic long term, they're doing this to position themselves well, so they can get more deals flow, so they can be at the center of attention and attraction. It's smart.
It's smart. It's smart. As I was just thinking of hypotheticals as you were talking, so I actually wasn't listening that closely, but I just think it like you go back in a year and you, it's in Columbia, right? Where the university of Missouri is. And you're like, Oh, we're going to take you on a tour of the campus and show you something.
And you see that the library is like named after you because of your 13, 000 contribution. It's like the most money Columbia, Missouri has ever seen in their lifetime. I will caveat that. I know Brent Bishore is a good guy and he's honest. I don't doubt that he's doing the right thing. And I think it's very smart of them to have another event six months later that costs a small fraction of that, right?
Agreed. All right. Well, I got some ideas. Some of these are stupid. They're stupid in a way that the Pet Rock is stupid. And that it could make you a lot of money and everyone's going to think you're an idiot for starting a business like this, but then you'll get the last laugh. I got this idea today.
I went on a 50 mile bike ride and yes, I am flexing and I didn't have to say the distance, but I can go the distance. So I came off from this bike ride covered in sweat and my dog comes up to me and he just starts licking me. And he always does that. And it's like, Oh, okay. You, you need some electrolytes.
You need some, that's what he needs. He just wants the salt, right? Dog electrolytes. Okay. I like that. Exactly. And so let me get there though. Let me, I gotta walk you there. Okay. I love my dog, but I'm not like a dog person, right? You know me, right? Like, yeah, it's kind of like kids. I love my kids a lot.
Other people's, but you're not a kid person. It's whatever. Right. Well, I actually can't am, but anyway, dogs are just fine. They're fine. Legally, you're not allowed to be within 600 feet of a school. Well, uh, edit that out. That's all I meant. Don't actually edit that out. By the way, he's so confused right now.
Anyway, so he starts licking me and I'm like, okay, if I were like a dog person and I had that same thought, I'm going to be thinking, oh, you poor thing, we need to get you some more salt. Oh, does your dog food not have enough salt? That's how dog people are. That's what you would think? Yes. You wouldn't just think, oh, you're a dog, you lick everything.
No I'm saying, if I were a dog person, like a dog empath, and then I had the same realization that maybe he's licking me because he needs electrolytes. Okay. All right. Yeah. Then I might make the connection. Oh, I feel so bad for you. Cause you don't have enough electrolytes. Therefore I'm not doing a good enough job as your dog owner.
Got it. You with me? Okay. Yep. I'm with her. And so it's like dog electrolytes, salty dog. That's what I'm calling it. Okay. And here's what it is. It's a very, and my wife thought of it as a very good name. So we're in the car and I brought this up to her and I'm like, all right, give me, I need a business name for dog electrolytes where you incorporate like dog into the word electrolytes and she's just like salty dog.
And I'm like, you are, you're brilliant. Frickin rain man over there. Can we go home real quick? Anyway, here's what, here's what you could do. You could literally get, you know what light salt is? No it's 50 percent salt, 50 percent potassium, which is like two thirds of electrolytes. Then you need to throw some magnesium in there.
That's basically electrolytes, salt, potassium, and magnesium. You can literally just take that and put it in a, like a salt shaker. And they do sell these, I Googled it, but it, there weren't a lot of search results and they have like dog chews for electrolytes. And there was like one or two products as all.
Okay. I think there's a world where you could literally just put powdered electrolytes, salt, potassium, magnesium in a shaker and just have people shake it on the dog food when they get like a salt shaker. Exactly. What do you think? Salty dog. What? So this is going to be just cause I'm not in this world at all.
Like we as humans don't, we try to watch our sodium intake, we try to watch our salt intake. Like are there any. I don't know, secondary health impacts to the dog. Are they going to get like heart disease? Are they going to shoot? Oh, dude, we send a card to burn with burning dogs. We send a card with the potassium for burning dogs that say, Hey, look, when your dog dies, don't be salty, call burning dogs.
It's vertical integration. It is. I think it's a great idea. Thank you. Thank you. I'm going to get ahead of
what some people are thinking right now. Like, well, it's just stupid. Just put salt in another different packaging. Yes. Sometimes it can be that easy. It can literally be that easy. Look at five hour energy, or you're just taking an energy drink and put it on the counter.
Yes. It's a look at billion dollar company. Look at liquid death. Yeah. A billion dollar marketing. It's just marketing and marketing. That's it. Yeah. That's why I like it. Right. That's why the salty dog name is like, Oh yeah, that's genius.
It's an easy product to sell. People will get it right away. And it's, yeah, I like it.
I think it's great. Thank you. Yeah, it's clean. I've got a list of ideas that got away, right? I don't regret not starting a lot of things because I start so many things and there's only so much time, but one thing that I should have started was like dog seasoning. I had this idea like, no, this is the background music for you to tell this idea.
I don't know. You're putting me in a bad mood. Dog seasoning. Okay. And it's like, it's like this. Okay. Okay. Is that not right? I thought that's what you're doing. Oh my gosh. I didn't know where you're going with that. Uh, to feed the dog on top of his food. Right. Cause they eat the same thing every day. And once again, I'm empath, but if I were, I'd feel bad for them to have having to eat the same thing every day.
Cause we're imputing our own emotions onto them. Right. Okay. Yes, they don't, you know, you know, I buy that cheap dog food. You already know I do. And so I had, I had this idea like a decade ago and it didn't exist. And now it's a thing, my friend, it is a thing. And it's, it's pretty much too late for that.
Dude, you've always been early. Honestly, you always been early with these ideas and like your wife says. You always, I won't say it's like the idea. Do you remember, I remember calling you in 2010 when I was at USC and I was like, Chris, Chris, Chris, Chris, Chris, what would you think if on your wrist, instead of it being a watch, it was like a smartphone that sent you notifications and you could wear it on your wrist.
I vaguely remember that. And it would have your email and your text and it would show up and you were like, that's stupid. No one would ever know. That's dumb. Nobody wants that. No one would ever wear it. Sometimes we're too early. We're too early. That's right. We're smart guys. I freaking love that.
What else? What else you got? So you could do if we're talking about too early for dog seasoning, you could penetrate that market with salty dog, get into a bunch of households and say, Hey, second product line seasoning. You could go about it that way. Maybe we're not too. You know what you would call the seasoning, right?
Yeah, I know. But I want, I have a great name for it, but I want to hear yours because it's probably dumb. Doggy style. This is a kid friendly podcast. This is a kid. Tell me that wouldn't be a good name. Tell me it wouldn't be a good name. It's irreverent. It would be the best name. It'd be an incredible name.
It'd be an incredible name. It would be my dude. Think about the commercial. Oh my gosh. Think about the commercial. Your dog's name is Frank. Frank loves doggie style. Okay. Frank's favorite doggie style. This is a kid's podcast. This is kid friendly. Do you remember? Do you remember that Kmart commercial where it was like free shipping?
Cause I can ship my pants. Yeah. I can ship your pants right now. I just shipped my drawers. Yes, that was a Kmart's Hail Mary into staying relevant. It was such a good ad though. It was such a good ad. It fell at the four yard line. We need to find whoever did that ad and do that ad for doggy style. Okay, I'm ready.
Be right back. The reason I like, like for real though, the reason I like this space is because people's empathy towards their pets. And the importance of pets in people's families is growing like crazy. People having less kids, they had, they got more pets during COVID and they're treating these pets like their family members, they have more disposable income, they can buy them different types of foods.
They can get them, you know, salty drinks because their electrolytes are low. There's a reason why vet clinics. Are booming. There's pet insurance for healthcare. You obviously you've got burn a dog cremation. Yeah. Yeah. Pet cremation now because we want to take care of their dogs after they pass respectfully.
Like it, it's a real thing. So I love thinking about ideas that are riding tailwinds. You're not inventing a market. You're looking at a market that's taking off and saying, what could I do in this market? That's already taking off. How can I ride this wave? And you come up with some of these ideas like salty dog.
There you go. Did you, please tell me you already bought the domain. I hadn't even, are you surprised? I'm sure it, I'm sure salty dog. com is taken. It's gotta be unless it's salty D a W G. I think I've seen 13 seafood restaurants called salty dog. So I'm sure the domain is taken, but salty dog could call it salty dogs with a Z salty dog.
Seasoning. com is open. Wait, no, it's not open. Anyway, let's move on. Anyways, let's move on. I got another one. You ready? Go. Yeah. Okay. So do you know what a bomb calorimeter is? No. It sounds like something that I don't know that scientists would have. Yes, it is. Very good. I found this very interesting, basically the science of how many calories are in food.
Okay. Do you know how a bomb calorimeter works? I'm assuming it somehow measures the amount of calories in food, but yeah, but like the mechanics of it, it's extremely interesting. So no idea. Yeah. Okay. Let's say you take a plate of spaghetti and meatballs. Okay. And you want to know how many calories are on that plate.
Exactly. Hey, how many calories are in my plate of meatballs?
So you take the food power. This is the power through it segment. You take the food and you dehydrate it. You get all the water out. Okay. Then you grind it down to a powder. Why wouldn't you just not made the spaghetti? Why wouldn't you just done it before you made the spaghetti? Hear me out.
Okay. Okay. Okay. Okay. What if you're anyway? Just hear me out. You dehydrate it, you grind it down into a powder and then you press it into a pill form, like a capsule. Okay. Tiny, tiny form. And then you put it in a, it's like a cylinder, a metal cylinder that has like a, I don't know, I don't remember chemistry, like a, I don't know, something coming out of it.
And you measure the energy, the calories that it burns off and you burn it. You light it on fire inside that cylinder and it keeps all the heat in there. It measures the heat. Okay. Okay. The amount of energy emitted from that. Okay. Oh, I didn't know that. Yeah. So if you grind up a salad, it's not going to get that hot in there.
If you grind up a bag of potato chips, a lot of calories in that, right? There's a lot of recent data that shows how inaccurate nutrition label facts are. And I saw this myself in trying to manufacture a busy juice. There's very little oversight on what people put on the ingredient label and the nutrition label.
Not there is oversight, of course, the FDA, right? There's not as much as you might think. It's not an exact science. Exactly. And I think there's a growing body of people that want to know what they're eating, right? They want to know what they're putting in their bodies. And so right now you can't just go to Amazon and buy a calorimeter.
And it's technical it's expensive. It's kind of weird. It's usually done in a lab. If we want to manufacture a food, we send it off to a lab and they do it for us. I think there's a version where you can take this and put it in homes. It's not going to be quite as accurate.
It's going to be simplified, like an iPhone and people can buy it. It'll start with the health freaks, right. And then work its way down to more popularity and people can get like, let's say you have a meal you eat every day and you want to know how many calories in that meal.
So every time you eat it, you can, you know, it's consistent. You can measure the calories in your food. And I think it'd be cool for kids. And I think it'd be cool for health freaks, losing weight, all that. What do you think? To quote the Backstreet Boys, tell me why I don't get why you would do this because there's a market for it.
It's not. Well, you hear me out. It's not going to be a hundred percent accurate anyways. It's not going to be accurate for every single meal. It could be. I guessed at that. It could be very accurate. It's not. It's not a hundred percent accurate. It's telling you what the calories were for that meal that you dehydrated and burned, but it's not necessarily for every meal that you do, maybe there's different ways.
Maybe. I don't know. Anyways, beyond that. It's directionally correct, which is essentially the labeling on the back of a piece of food. Like it's directionally correct. Like, why do the extra work to be a little bit closer? It's not telling you necessarily anything that different. Like, what are we talking about here?
I'm going to need you to be a yes man here and just agree with everything. I think it's actually a really good idea. You know what I would call it? What's that? D's. Oh, gosh. Listen, they can't all be bangers, but I think there is a, there's a market for this and there is precedent for things being done in a lab, like on a niche scale and then coming more mainstream.
No here's what I will say. I think that food in particular is something that people are looking at a lot more, especially as millennials, people our age are getting to a place where they have more disposable income. They're looking at food. What they put into their body. Like we grew up on gushers and microwavable food and lunchables.
And you look at the science now and the amount of plastic parts per million in our blood is incredible. They're finding plastic like in people's testicles. They're finding plastic in the cells of our, what? That's what it is. Nevermind. In our arteries, like they're finding all these plastics in our food.
And so people are looking at this and saying, we've got to do something differently. Like we've got to re engineer the way that we package food, the way we prepare food, the way we ship food, the way that we feed the animals who we eat, right? Like it's not just about the end user. It's about what was done upstream.
So I think what you're identifying is definitely a growing trend of people who are interested in what they put in their body. I just don't know how many people are like. You, I think you would buy something like this for sure. I just don't know how big the market would be. I agree. It's a small market, but I think if you develop products for yourself, right?
That is the best way to develop a business or a product to solve your own problem. So if I had a ton of time on my hands, I would do this. I have no desire to do this, right? And I just know just because of the law of large numbers that there would be a small market for that. And based on the precedent of other things being sold like this, it would slowly expand and it would become more mainstream.
I have an idea off of your idea that I think is genius. Are you ready for this? I'm going to take it totally different direction. I think there's a YouTube channel. That would, could be created of you taking meals and then comparing the labeling of calories dehydrating it, getting it down, burning it, and then actually measuring the calories.
So that would be a cool YouTube channel. Like it's such a good idea. It has to exist, right? It probably doesn't. Cause I've actually gone down YouTube rabbit holes for this stuff and I didn't see anything like mainstream. That is a really good because then, then you have a YouTube channel that people are watching and you can sell products through your YouTube channel that you care about like food, right?
Like then you're, then you are tapping into the broader market of people who care about what they're putting into their bodies. And you had cited like, Hey, this would be cool for kids to do. I think like kids would really like that. Like my boys would love to watch a YouTube channel about that where it's like, all right, tonight we're making pizza.
This is what the store says. And it's like, and you like list everything out. Now we're going to dehydrate it and you just go through the process, film it. Anyways, I think that could be a really cool content channel. Can I give you some more examples of things like this that went mainstream? It's the Pope Catholic.
Infrared thermometers. Those started out in industrial and scientific applications. It's like, why do I need a different thermometer? This one works great. Those are popular now. PH meters, right? They were used in labs. Now they're used for all kinds of things. Who would have thought that we want to know what the pH is in our pool?
Don't we have a pool guy for that? People want to know. Spectral photo meters, spectrophotometers. They were used in labs to measure the amount of light that a chemical substance absorbs. And now they're used in the food industry, UV sterilization, right? Sterilizing UV that's UV sterilization. Have you seen that product that was on shark tank that you put your phone in there and with UV light disinfects it, right?
That was. There's one Geiger counters. They measure ion ion is ionizing radiation. Look, if you're going to cite these things, at least be able to pronounce them. Ionizing radiation is what they measure. Okay. Now there is a market for buying these on Amazon. Okay. For what? What do people use those for?
Just like in the Ukraine, they're near Chernobyl. They're like, how many I need to measure the Geiger's Gregory. Why do you have a goiter growing on your neck? Measuring radiation. Also things that like, like you said about microplastics, there's going to be a world where these micro what? These plastic tools are sold to the general public.
I think that's what I think. All right. I got a topic I want to ask you about. You ready? Let's go. Let's hear it. So Chris and I's experience is very different. Chris has experience launching and creating businesses from scratch. My experience has been in buying and growing and selling businesses. And one place in particular.
That we just have very different amounts of knowledge. I E Chris knows a lot about it and I don't is in digital marketing. And so we've actually been like, you and I have been talking a lot about digital agencies, potentially even launching one of the back of our audiences, but have you seen this thing that Google just rolled out last week, AI summaries?
Yes. So Google, traditionally you type something into Google and it will either, well, it'll do both. It'll show people who have paid to be at the top of that search, or it'll show people That have gotten there organically and in the last week, I listened all in about this. Did you last week? Yeah, it was really good.
And so last week they rolled out this thing using Gemini their artificial intelligence, where it's like actually giving answers to people. And so SEO, traditionally search engine optimization, these small and medium businesses would build their websites in a way. That made them trustworthy, right?
They would do their layout, make sure that it loaded fast anything and everything to build trust. But one of the biggest ways they build trust was through content. And so you would have a lot of content on your site, either blog posts or social media, or just parts of your webpage that explain things.
That Google could then go and scrape and say, Oh, this website has a lot of this information. They rank higher because they're more trustworthy. They also have all of these backlinks to other websites, right? There's, it was a whole game that you would play. And SEO in particular has been one of the best ways for organic traffic to come to websites.
So my question to you, cause I don't understand this stuff really well. How do you see this impacting small businesses? Because we've seen unlimited rollout, which is Sam Thompson and Steven Ullman's company, and their focus on the long tail keywords. It would seem to me that if Google is spitting out answers, To these questions.
And they're not allowing people to go click through the organic search results. It's taking away the opportunity to grow organically without having to do the paper. In fact, this may actually be better for Google because you have to actually pay for the ad space. Keep people on Google longer too. Right, right.
And now for a business owner, like I got to pay in order to rank as opposed to just the organic rank. Now, I don't think it takes away from G geography, but anyways, you are. Miles ahead of me in my knowledge of this, it seems like a big deal to me. What do you think of it? It seems like a huge deal. I don't know what's going to happen.
I think Google was really worried for years when rightly so that AI was just going to crush them. And now they're probably thinking, Oh, this could be really good for us. Right. And it happened a few years ago when basically Google would give you a summarized answer. That they would pull from a website and then give you the source.
But think about how much time you actually spend on google. com. When you search for something, sometimes a millisecond, the results pop up, you click immediately. How much time are you going to be spending on Google once they put everything you need right there versus all these other websites? That's what's really interesting about this is that Google, let's say they would quote it, right?
And then they'd send you to the website. Now what they do is they crawl the web and then also based on all that data and information that you've put up there that made you trustworthy, they've said, Oh, this is the most trustworthy data. We're going to use this as. The basis for our answer, but they're not giving attribution.
So they're going to give the answer, but they're not going to cite their source, or at least right now, right? They're not citing the source. And so you've done all this work and you've created the content, but now you don't even have the link to you and Google, I under, I get it. Or we have all this data.
Why wouldn't we just give them the answer as opposed to sending them off platform to these other websites? I get. Yeah. That's the, that's like the interesting shift to me. So I think one of two things are going to happen. I'm going to call it the Walmart option and the option B. I can't, I didn't prepare.
I can't think of an option B. I can't think of a good name for it. Walmart option, right? Walmart starts expanding across America and all these mom and pop stores go out of business. Oh, what do we do? What do we do? Walmart crushes everyone. That's what you do. They go out of business period. And then eventually it the pendulum swings a little bit, it's like support small business, but honestly, Walmart has never been better.
They're great. Right. Yeah. Yeah. And so I could see that happening where it's like the big guy just wins again, the trillion dollar company just wins and all these little, you know, the equivalent of A shoe shining shop, AKA all these random websites, they just don't get traffic anymore and they're done.
They're toast. And Walmart might link to them as like a pad on the back in like the footnote, but who's going to click that? No. And so that's one option. The other option is massive carnage and people not wanting multi trillion dollar companies to win in a class action lawsuits to. To protect the little guy, right.
With the WordPress block. But how is that sustainable? Like, how are we going to like, how are we just going to put our hands up to AI advancing and stop that? Yeah, I think it is going to get litigated because of the attribution piece. Obviously we don't think of these small businesses as content creators, but the content is proprietary of those businesses.
And I think what they're going to say is like, look you built this model. You used our proprietary data to build the model, and now you're not compensating us for the model that you built. So I think it's going to be decided in the courts. But to your point there could be a ruling on that in five years.
Between now and five years is a lot of time. There's a lot of businesses that can go out of business. And so what Google gets slapped on the hand and five years from now and says oops, sorry, yeah, we'll put attribution again. Oh, okay. There'll be a link there. There's still, there's still winning. So it's not only the small businesses, like I'm curious about digital agencies that do the SEO stuff.
Does this make them obsolete? Do they have to pivot? There has to be a business opportunity in this. Like anytime there's a big disruption, there's also a big business opportunity. I don't know what it is yet. I just haven't thought about it a ton. This is a tangent, but did you see the business that Kamal sent us to look at to potentially buy?
So for the, for anyone listening, we're looking for businesses to buy right now. And so Kamal, our awesome chief of staff has been sending businesses our way. A UI slash UX agency, which is user interface, a user experience agency. I'm just going to read this real quick. I have it pulled up. I was floored at the numbers of this.
They're asking 5. 5 million. Their net profit is 1. 8 a year. Okay. So we're talking to three X multiple on a digital agency that's growing, that has seven figure EBITDA and it's been around for six years with 17 employees and I was thinking about this. My first gut reaction was, Oh, this is, Oh, this is interesting.
We can do something with this. And my second reaction is dude, if I own this business, I'm probably going to be selling this right now too. So why would I buy this business? Like of all the things that AI is disrupting. It's disrupting UI and UX like already, we're already there. It probably isn't even showing in their numbers yet, right?
They're probably still growing and they'll be growing in three months, but I bet you anything, the owners are smart enough to know that their days are numbered. Yeah, I remember this business now. He said, I didn't do a ton of research. It was this week, right? I would just want to know from the owner, like, why are they selling?
If there's a compelling reason that the owner is selling at this price point, right? Like maybe, Oh, my wife's sick or we need the money. Like some, there's a reason for it. I could be interested, but I tend to feel like you, although I don't, I also don't want to make. a decision without knowing all of the data.
Oh, sure. Yeah. So no, no, no. Just like, hear me out six months ago, you're looking at Google and you're like, man, AI is going to freaking eat their lunch. They screwed up the, they screwed up the rollout of Gemini. First they call it barred. Then they call it Gemini. Then they roll out Gemini and it's like showing George Washington as a black guy.
And there's a big outcry. And then they just miss way that he was, he was black and Hamilton though. So there's something to that. I just want to be respectful. That's on me. That's on me. Okay. Anyways, like they've botched every rollout related to AI up until this point. And then all of a sudden they, they release this and you do like the second and third order effects of this.
And you start thinking. They're going to make more money now from businesses paying them to be ranked because it's no longer through SEO. Oh, they're going to make more money now because people are going to be on their page longer. This is actually a boon for them. So, but you weren't thinking that six months ago.
Now you're thinking, oh crap, they're going to be much better placed. And that's an example of the facts just hadn't, we just hadn't. Been able to evaluate all the facts yet. So for a business like this, that Kamal sent us, I think there's a lot of fear from those agency owners that are like, I got to get out because it's totally going to ruin and disrupt the business.
But there also could be a counter argument to say. We just don't know yet. Maybe they're able to pivot. Maybe this is ultra beneficial to them. And we don't know. We haven't dug into the numbers, but just changing so fast. I think SEO is about to have its biggest change ever, but that it's not going away. I think SEO is no longer going to mean how you rank, but it's going to mean, did Google choose your content?
To put in the summary for someone else's, it's freaky to think about. We have businesses that rely on SEO and are we going to be chosen? Are we going to be the lucky one chosen as tribute to be in that summary or not? Right. Or like we. We have another stealth project right now that we're hoping to be reliant on SEO.
Now we're not investing a ton of money into that, but what's that going to look like in a year? So I have that argument, right? Which is what we're talking about. And then the other side is like my self driving car analogy. It's like the last 5 percent takes as long as the first 95%. We could be year years away from seeing any ramifications from this.
Cause it's so hard to dial in that last bit of data. Yeah. Well, I do think that there are two and this is like off the fly. So this isn't very well thought out, but I think that there's two different search results that we're talking about. There's a knowledge result. I have a question. Hey, Google, what's the best recipe for pizza.
And then there is like a services related question, which is I need my roof fixed. Where can I find this in my area? I don't see how it disrupts the services related searches as much, because I think that you need it locally. You're searching for something locally. I don't see how that is necessarily hurting you locally.
I see it more on this side where it's like. In the past, you would say, what's the best pizza recipes? And then all of a sudden you get led to Laura's pizza blog, three links down because it had the most content. And then you click into that and you're like, Oh, I really like her. And it turns out she sells a course.
So she sells a cookbook or she sells like she's relying on those searches in order to fund other services that she's. That she's that she's selling that are incidental to it, that aren't really the primary driver. So I do think it's bifurcated between the two. But I think it's also only a matter of time before this one gets disrupted as well.
Cause aren't there, that's better than me. Aren't there a lot of businesses that function that way, where it's like somebody just asks a question, they start reading on their site. They get, down a couple of things. And all of a sudden they're purchasing something separate than what they originally Googled, but it's because that site showed up on that original Google.
And that's how they track traffic. Is that a fair way to look at it? Or am I like way off? Yeah. I think it is. And I think we could also see a boon to companies like duck, duck, go where they can, they could zig where we're Google zagging and they could be like, Hey, if you like getting 10 search results when you search for something, that's us.
That's always us. That's going to be us. Right. That'd be interesting. They could just take a hard stance on search needs to stay as it is. Google could also do this. Google could also say. That could be a service. Hey, pay me 5 a month and I'll answer your questions or I'll just give you what you traditionally know as Google.
And how many people would say like, no I like this because right now it's like beta testing almost right at some point if they offered a paywall to it, like I would look at that and be like, no, I'd rather just get the question answered then have to go through all the links. It's like on, on google.
com it, you can hit search, you can hit show me or get lucky. Where it'll just take you to the first result. Instead, it could just be like, give me 10 search results versus give me the AI answer and people could choose. And it's like an, it's like a living AB test. And they're going to see over time what people prefer.
This does definitely make me nervous about the digital services companies, but in particular, the SEO, even the pay per click stuff. Cause you just don't know. But the flip side is they're going to figure it out first, right? People who are in that space are going to figure out where the arbitrage is to find those opportunities.
It's just, when we're talking about a business, it doesn't, 1. 8 a year, and it's a 5 million purchase price. Do you want to take that big of a swing? It's three years until we pay back the note, but I don't know that would be, that feels like a risky strategy. Think of a UI agency, a user interface agency.
Let's say, how far away is AI from this right now where you say, Hey Make me a website. Okay. Lots of sites can already do that. Boom. Website. Okay. I want it to look like this website. Okay. Done. All right. Now I need the function on the backend to look more like this done. That's UI and UX.
How far away from, are we from that right now? I feel like we're really close. Did you see this, the demo with chat GPT four? Oh, like the way that they're, yeah. The multimodal stuff is. They have a kid who's like trying to work on geometry and she's looking at the picture. Mm-hmm. And telling him, well, okay, which one's the hypo news?
And he guesses the wrong one. And then it walks him through why that wasn't the right answer and wish I was high on pot news. There it is. I knew you were thinking that the second I saw you, he saw my smile key and peel. It's a key peel. S That's a great sketch.