# Money, Wealth, and Personal Holding Companies with Michael Karnjanaprakorn

Channel: Greg Isenberg
Video: https://www.youtube.com/watch?v=8TJndZbjxP4
Duration: 48 min
Language: English
Words: 8809
Transcript page: https://viewrankai.com/tools/youtube-transcript/8TJndZbjxP4

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[0:00] welcome to the show yeah thanks for having me first time here uh Michael carton now for corn how do I how do I pronounce no you got it right Carnation apricorn okay cool we are in some group chats together uh we've never actually chatted I followed your work a bunch you know you created skillshare which obviously is a you know huge education business you created Otis which was acquired by you know public.com where I'm actually an advisor there newer B hands which got acquired by Adobe and uh friend of the Pod Scott belski started that and then hot potato which was an OG New York startup

[0:41] acquired by Facebook so you've been around the block and seriously and I've really been interested in your work recently because you're basically trying to figure out what's next and you're writing you're starting a YouTube channel about creators and why I wanted to bring you on the Pod is to talk about how you're thinking about what's next and how are you thinking about money something that we don't talk too much about on this podcast but like straight up like let's talk about money today let's talk about money [Music] I would say on what I'm doing next I have like a documentary in the top it's like rest and recover and rejuvenate so

[1:29] it was just like a constant reminder for myself to like don't Sprint right now just like have fun and recover but as I had a lot of free time I started thinking about money and just my relationship with money you know I didn't really come from a lot of money so it was really important to me to have money and I remember when I started skillshare like the mission was a the big motivator and I kind of told myself that money wasn't but it really was I mean if you you know if you really think about what makes the internet kind of run it is people making money you know their

[2:02] content creators posting because they can make money and we start businesses because it makes money but it also makes us money so I think the big change for me was thinking through like what happens after you get to a certain amount and why accumulate more money when it's very marginal so I've been very fortunate to you know work in text charge for a long time to be an angel investor to be early in crypto so I've had a couple windfalls and through that it just kind of flipped everything I understood about money so personally I don't want to become a billionaire I think every dollar over

[2:43] for most people 10 million is pretty marginal doesn't really add anything else I've done a lot of research into like what they call Hector millionaires so these are people that are worth over 100 million Network liquid you know either through Reddit or just talking to people there that much and I heard a couple themes that people just don't talk about like one is you literally physically cannot spend that amount of money it's just very difficult so after you buy all the toys you go through all the the you know hedonic treadmill of you know buying something and then buying the next thing to get that same feeling

[3:15] there comes a point where you just don't have things to buy anymore and you get really bored and you start questioning you know what your purpose and your mission is and um I realize a lot of these people are dealing with questions around self-actualization and I've I noticed that they all dealt with that in a very very different way um so some people went back to work and I would say that's a sub bucket it was either because they were very Mission driven so they felt like they're really making huge impact in the world and that was what they wanted to do and some people went to go make more money

[3:47] because you know they were flying first class and then they were flying like small private jet life and they rode on their private jet with their billionaire friend they're like oh I want that so they went back to work to pursue that or it was like related to their ego or what have you but the short answer is I think money is good and we should talk a lot about it but it does become pretty marginal at some point how would you recommend people think about what their number should be and should they even have a number in the first place I think people yeah for sure should have a number I

[4:22] think everyone has a few number which is basically the number you would reach where uh you have complete control of your time you can do whatever you want I think you know for those of you that haven't read my newsletter I decided to dedicate a few bullet points to money and at a high level here's kind of what I wrote about so I just pulled it up so one is money does buy happiness so I found this research report that says you know we've been told that happiness doesn't increase above 75 000 and all you really need is 75 000 and every other dollar after that's marginal but

[4:54] there's this new research that shows that you know the well-being Rises with income and doesn't really Plateau so they weren't really tracking billionaires but I would think that a plateaus at some point and what money can provide is financial Independence you know which ultimately gives you freedom and allows you to choose and pick what you want to do with your time which I think is one of the biggest factors for happiness in life is when you can wake up and say and financially independent and I could work on my own terms I could work on whatever I want with whoever I want and I don't have to worry

[5:27] the third thing I wrote about tied to that was most people when you read about money it's usually related to like flexing right it's like yo I just got this new rolly or you know I'm just traveling around the world I'm you know flying in these Jets and you know like in the Maldives you know I'm human like I like having nice things but most people should look at money as a tool to becoming financially independent in my opinion which gives you the ultimate luxury in life is freedom and time so what is the right amount so uh I think a couple weeks ago Jason calcaneus

[6:00] wrote like a couple million you're good 10 million is your Fu number for pretty much everyone and 25 million you're really dangerous anything above that who cares I totally would agree with that I would tweak this for the average person so I think he was referring to like people in Tech because with 25 million you could start any company you know if you have that much you know you could do whatever you want I think it's like 5 million if you live in a small town 10 million if you live in a medium-sized town like Phoenix and 20 if you're like in a major city like

[6:25] New York um if you look at like the current you know treasury bills rate it's a little under five percent but if you have like 10 million that's like half a million a year in passive income which covers like let's just saying you don't have like a lifestyle like inflation or not that's not the right word you're not like your expenses aren't really really high that covers most expenses for most people but I do like I said earlier I do think that money has a diminishing return so I think for most people the goal shouldn't be to make as much money as possible it's figuring out your numbers and and

[6:58] hitting that and then figuring out what your mission or purpose is basically and what you want to be doing with your time if you want to just be relaxing in spending to your family do you if you want to start another company you can if you want to become a content creator if you if you just want to dabble on projects you want to become artists I think that is what most people should kind of reach and it's not easy right so I'm not saying five or ten million dollars is an easy number to get to but it kind of flips the notion on its head

[7:25] that you know because everyone like our society idolizes billionaires but it's much more realistic to become a millionaire and I think that should be the goal for most people not to buy more things but there's like an acronym called Phi woot because there's like fire which is financially independent retire early and that didn't really Vibe with me because I was like I'm not trying to retire early I have a lot of ideas a lot of energy and I found another acronym was like f-i-w-o-o-t which is become financially independent but work on your own terms or work on own terms I was like dude that's that's pretty dope that's that's

[7:59] definitely what I want to be doing that's our generation version of retirement yeah which is like to us retirement isn't exactly go hang out on a beach and join a golf club or something and do nothing yeah we want to be creative and we want Outlets but one of the reasons why we want money or I'll speak for myself like when something unexpected comes up maybe there's a medical emergency maybe there's you know I just got a letter today that My Condo building is increasing their condo fees the feeling of in your stomach like oh like you know that that bad feeling I think we've all

[8:44] had that bad feeling of like something unexpected comes out or something's expensive when you have money you care less about those things yeah that that's like the second order effect of having money is I think we all everyone has challenges in their life everyone runs into problems that's just that's just life but you can have obviously a life of a lot less stress when you don't have to worry about all those little things that kind of pop up on a day-to-day basis and I've seen that in my own life where yeah that comes across and kind of like okay that's not a big deal where when I

[9:17] was much younger and much poorer I was like dude that that sucks like oh like that's that's a vacation out the door or that's like a reset on savings like I have to start over again and go from zero back up to a thousand or five thousand so money does help and I actually think it's a good thing if used correctly I I think a lot of what we see in in in culture today is money being used incorrectly like when you watch people you know on social and celebrities and how they're using it it's obviously like if you grew poor and you want you know a

[9:53] new car or whatever a Porsche is like yeah you're gonna go buy it and you're gonna show that off and you're gonna feel good about that being a reminder of like where you came from but doing that constantly is not in my opinion the best use of money yeah I think you know there's money and then there's there's wealth and yeah I think they're different to you what's the difference between money and wealth I kind of view a new version of wealth right which is all the intangible things that are valuable let's say something as simple as like having great relationships with people developing great experiences learning constantly

[10:31] improving I like to like having a sense of purpose working on things that you want to be working on and I kind of view that being wealthy whether you're a millionaire or not right so I kind of view that as a new form of wealth where money is just a toll that gets you there right so you don't need money to have that version of New Wealth but money does make it easier so that you don't have to go work a job you don't want to work or things along those lines but and I like that distinction because from a wealth standpoint you don't need to be rich to

[11:00] have that life and I do see a lot of people with all different networks that are very wealthy but uh that's kind of how I view the two like one makes that version of wealth easier but you don't need to have the money to get there you recently moved from from New York City which I think is one of the most expensive cities in the world definitely top five to somewhere in North Carolina did did did the the concept of what Jay cow was talking about which is you know a couple million dollars for a small town 10 million dollars for a medium town and 20 or 25

[11:41] for you know top tier City or whatever did that play a role into your move or was it strictly personal strictly personal I think it was in the middle of Covenant pandemic we're living New York we didn't we weren't planning on moving it was just kind of like white families North Carolina let's just kind of go there for a few weeks and a few weeks or in a few months and a few months we're like okay let's just find a temporary house and then we're like oh this is actually not that bad it was kind of cool um and then it went from like are we

[12:11] going to stay here to like or move back to New York well let's just stay here and now it's kind of like okay let's plant root so you know life throws curveballs like that and you just kind of have to move with it but what's funny is that um while I live in like a like I would call it like a medium like somewhere between small and medium like my expenses I would argue would probably be a little bit less than New York it's like you have a house and then you have cars and you have to put gas in the cars and you know like because in New York

[12:42] you don't need to own a car do you just take Ubers or Subway or bike so it was just kind of like on a monthly basis it's yeah not it's cheaper but yeah New York is way way more expensive but all those little things add up like you send your kids to like school and that your private school and that costs and yeah so it definitely adds up if you wanted to there's definitely a jump in like some quality of life that you're seeing by you know your dollar goes further in North Carolina than that for sure no I mean the trade-off for us was like being

[13:16] close to family yeah close to Nature because in New York there isn't and we have today you know at the time we had like a three month old so now the triath is like you know where we live is a lot more family friendly there's a lot more things to do outdoors because New York is a very social City it's like most Gatherings or drinks food and you know cultural events but it's not like you go on a hike you know in the you know to the top of the mountain within New York if you're trying to make your your first you know million dollars five million dollars 10

[13:50] million dollars do you recommend that person go to New York and network a lot get those connections or do you recommend they go to somewhere like North Carolina where you know cost of living is a lot cheaper they keep their costs down their their saving rate you know doubles or triples or quadruples I think they should start something and own equity in something that compounds over over time and I think they should have a push versus pull strategy so yeah you can go to event and network but if you're not working on anything you know like that networking could lead to something one out of 100 People You Meet

[14:30] could change a path that could change your career but if you start something you would be kind of like a magnet that pulled people towards you it's much easier to network when you're building something I think people younger should take a lot more risk I think as far as where you are in that risk restroom is really up to you like I tuck the go after a billion dollar outcome unicorn you know there are only a thousand of them and the the odd to getting there very low you could also buy business you know like a boring business you could become a content creator you could

[15:01] dabble in and try a new thing every year until something hits there's nothing wrong with getting like a 10 million outcome like getting some Savings in your your bank account and taking a much bigger swing like if you want to build some a some crazy AI blockchain space spaceships like go for it but I think it really comes down to like where you are in your career and what your risk spectrum is what level experience you have but if I were in my 20s I would start a company or own equity in something and I would try to become you know a millionaire as quickly as possible

[15:33] the challenge with startups is like your liquid for some two seven to ten years minimum the odds of you building a unicorn are very slim and you can spend a decade of your life down that path and exit with nothing or you know a little bit above nothing so I think it's not for everyone and that's not what's often talked about it's like kind of glamorized to build this billion dollar company and swing for the fences but yeah they're like a lot of companies that just don't make it through so yeah and they don't they also don't make it through sometimes not even because the founder or the team didn't do a good job

[16:14] but because like the macroeconomic environment changes or you know their particular space falls out of Vogue one example of that is like friend of the Pod Julian Smith who co-founded breather and breather had raised it was basically like an on-demand office product you know they'd raised like I don't know a couple hundred million dollars and ended up selling for scraps because you know we were imploded yeah people don't realize how much luck and timing goes into like majority of success especially for what we do as within Tech startups you can have a great idea but the timing is off and it just will never work no matter how hard you try

[17:01] like it just won't work and then sometimes like you just work really hard and you're just around for a long time where it just starts working because the timing just kind of shakes out to in your favor or can work really hard and like you know I'm thinking like bad running gambling or poker it's just like things just don't go your way and three five years later you're like that didn't work and you have to like pick yourself back up and try again so I don't think people really factor in luck in timing because most people believe that if they work really hard they will become successful

[17:35] but that's my opinion just not true like I know a lot of people that work really hard that are just really unlucky and you know it's just the way it is could we could we talk about the business of creators I know this is something that you're really you're really into right now it's definitely in the category of like investing in yourself because there's more control at least with an audience like you know why are you interested in in the business of creators and yeah let's start with that yeah I would actually re redo my answer if I were in my 20s I would either take three paths I had a really big idea

[18:14] that was really impactful for society I would go after that knowing that like okay it might not work but I have to try secondarily I would say I don't have an idea but I want to just make money right now and then figure out what's next I would probably do like a boring business or you know some you know something that was like low risk with like medium sized returns and if I was creative and it had like a very unique point of view then I would become a content creator and the reason is I think there is going to be a shift you know from like people trusting

[18:46] celebrities to then trusting influencers to then trusting like like very Niche content creators and the reason is because for businesses there's usually like two big factors or three obviously first at the product second is marketing and third is obviously teaming culture from my experience marketing has just become more difficult over time as it gets more saturated more competitive you know looking at all the chat GPT stuff that they do like this AI can like write better content than most content you know SEO Specialists so if you look at like any content creator or YouTuber if you build an audience you can kind of Leverage that into anything

[19:28] you want to do like Leverage it for recruiting for fundraising or for like marketing a business that you launch and that is something that you can do over and over and over again forever so that's why that's what I would do and that's actually what I'm considering doing next to my career is like providing value building audience and then kind of figuring out how I can leverage that later and not even worrying about that right now so let's talk about that so you haven't really been a Creator I mean you you've been you've been tweeting you know you tweet thoughts and and you haven't taken it a professional approach

[20:05] to creating and then recently I saw you know you got a sweet YouTube setup you created a YouTube channel you know you're creating Clips like you're you're doing it so how are you thinking about your 2023 content strategy so taking one step back I you know when I stepped down from doing Tech startups I was like you know everything in my life to this point has been very very planned right I was like okay I'm gonna do this I'm gonna do that after that I'm gonna do this and then I was like you know what maybe for the next six months to your I'm just gonna

[20:38] see where things go I'm not gonna have any grand plan the only plan I'm gonna have is I'm going to protest my health and spending time with my family having fun outside of that I'm not gonna really Force anything I just want to see where things go and the YouTube channel just happened on accident saffron emailed me he used to work with Sean Perry and he wrote this really good cold email and I was like okay this is interesting and the first thing I told like look I'm not I don't want to start a YouTube channel and I definitely want to start one with someone else you know and then you know

[21:07] he kind of convinced me and then convinced me and I was like look maybe I'll do it just to learn but I'm only going to commit to like five episodes you know they just kind of one led to the other so the train to your question is uh for 2023 I don't know I'm just kind of like I think what I'm struggling with right now is if I'm trying to figure out what my Niche is and what I'm going to focus on talking about but I I do plan on creating a lot more content in 2023 so the way I'm thinking about it is I want to create uh similar

[21:33] to you like my own personal holding company within that starter incubate something every 12 to 24 months or 12 to 18 months first business is content in audience building because I don't really have any ideas I'm excited about right now but I am excited about content and I do look at that as giving back and if I could like you know change someone's perspective about money or help someone take a different path to become a millionaire like dude that's so impactful so for 2023 I do plan on creating my own YouTube channel possibly a podcast um and then keep doing what I'm doing with just Twitter and my newsletter and

[22:13] and trying to do it in a way where I can be very authentic to myself and not dip too far into the cringe you know threads where it's like hey I read I watch a thousand hours of blah blah blah and here's what I've learned because I don't even you know that's not even who I am like I don't spend a thousand hours researching but um what I'm trying to do right now which is why my Twitter my newsletter are so Random is trying to figure out like yeah where what is the intersection multiple things that I'm interested in that can help people right now it's money because

[22:44] that's just what I'm thinking about but I don't know maybe three months it could be something completely different from an outsider perspective I mean I love all your stuff oh thanks and I'm really interested in it and to me it's like the niches that you're in are personal holding company money and The Business of creators like that's what I see oh I like that I'm gonna write that one though I think though and we can use this as just like a live jam session I think that if you want to be a you know a successful Creator you have to be known as the ex-gal or why

[23:22] guy in one Niche yes because like in people's brains they just like bucket you as someone oh Mike he's like the personal holding company guy uh oh Greg he's like the community guy yeah and I think that you'll start seeing a lot more compounding once you commit to one one of those categories so thought about this you know I've been you know for doing a live brainstorming but I kind of look at like a major in minor like you have to be known as the X guy but you can have like a couple minor things that you talk about you know secondarily and what I actually want to talk about

[24:04] is like how can one person live a really great life and what does that mean but you know what I've learned is that nobody really wants to read that or click through it and it's just not that exciting for people because I was like that's why I've learned because I've written threads and articles or tweets on happiness and all those things and like I think when you know people are dealing with their own they're like dude I don't want to read this stuff then I started then I flipped and I was like okay what am I the most uncomfortable talking about and it was money um and I was like okay why is that one

[24:38] is like from an ego standpoint I want to be known as a money guy like what does that even mean like I don't have I have money but it's not like I'm like that rich you know so that was like one she was like okay where do I even take this from her because I don't want to become like a fintech influencer on YouTube and promoting like stocks you know like like stocks and like you know how to flip your house on Airbnb and all this other stuff but then I realized it's like okay um people seem to like that content and it could back into that secondary minor

[25:10] stuff around how to live a good life or how to be a good parent or you know how to like live healthy or you know because I am going to probably do a personal holding company and I might do startups to be within this I could talk about that stuff too because it's all related money so I think I am leaning towards the money angle and just doing it that's not like how to make a million dollars you know Drop Shipping or buying boring businesses but doing it you know becoming content creator or startup Studio or you know basically like how I would make money or how I am going to be

[25:40] making money and just talking about that I think this is a really good exercise for everyone which is if you believe that content is important I mean 99 of us would agree that having an audience and creating content is really important thinking about a Venn diagram of where you want to hit so you you know in the middle you need my opinion like be known as the x or y guy or girl right so like for me it's like the community guy and but I also have some minors so I also have like I'm interested in web3 I'm interested in you know product design that's why we run an agency like

[26:24] and and you kind of like have these other interests um and for you maybe it's like living a wealthier happy life and maybe there's these tools and minors like you know personal holding company rolls into that I've never been happier in my life and I've like you I've done the Venture back startup thing but the the personal holding company has has been so fun for me and it's helped me live a happier healthier and wealthier life so it all rolls up to it you know what I mean yeah so maybe a couple follow-up questions to that is like how did you land on being the community guy and was

[27:08] that something you've resisted and have you ever thought about changing that like as you have grown and then the second is like why like why don't you why don't you talk about your holding company more online because I'm like I think when we're chatting about what to talk about in the podcast you're like oh let's go through some holding coming I was like dude I don't know that many examples like this is not a a thing yeah I think that's why people like the concept because it's interesting and most entrepreneurs are very creative so I'll just always I was just curious about those two things like

[27:42] how did you land you know Community have you ever thought about changing it and why not talk about your holding company a lot more so I landed on community when I had some you know in 2020 2020 I guess I left wework uh whereas ahead of product strategy uh be an acquisition and I had some time like you to think about what's next and I looked at what is the common denominator of my entire career and literally everything I had have done both professionally and personally at the core of it was community I have never done anything that hasn't had community at its core and I had a list of Theses and ideas in

[28:32] that space and I was just like okay I'm gonna make a conscious effort in 2020 to put out more content related to community and I am completely okay being known as the community guy why because it's a small enough Niche that you know at the time no one was not many people were you know focused on it but it's a big enough Niche that literally Community is at the center of everything on the internet like if you're a Creator community's at the center of it if you're a web 3 product community's at the center of it if you're a cult-like brand communities at the center of it so

[29:14] I think it's important for folks to pick something that is small enough that you can own but large enough that you can kind of grow with it have you ever thought about changing or like reposition yourself out of community like when you're deep into what three becoming like the web three Community guy or I don't know like AI now or right I just feel like I would look like a child wearing really big like a really big suit like I would look silly I wouldn't be able to wake up in the morning and just like yeah put it another way like it's just not authentic yeah and although I

[29:54] would probably be able to grab another few hundred thousand followers if I would you know pivoted my way into something else I yeah I wouldn't be excited about it yeah yeah and that goes back to the whole like quote unquote retirement like in my mind I'm retired in that sense right yeah you know I'm doing things for for style points more than money and it's a good place to be and the style points on doing something that I'm not excited about content-wise especially because you're putting yourself out there would not be cool yeah for me and then why not talk about your personal holding company more because I I remember when I

[30:38] like went to your Twitter I was like oh there's an interesting click on it and it's just like oh I kind of understand it but I feel like you could be a lot more vocal about it because you are working on a lot of interesting things and you are doing a lot of interesting things and you could also be a great example for other entrepreneurs to follow so why not talk about it a lot more I wrote a post in 2020 which was why the future of startups are Studios welcome to the Golden Age of product Studios and I talked about my decision to create a studio but more more

[31:17] importantly a personal holding company because I talk about you know service businesses and this is up on my sub stack for people to check out you can just Google Google that and it'll come out and I talk about like why you shouldn't raise Venture and why service businesses is actually a really good place to start and how to think about launching experiments and how to think about a thesis for your startup Studio I got some people excited about it but then when I like compare that to like a post I a popular post I did like the unbundling of Reddit like that got a hundred times more or a thousand times

[31:55] more traffic than the studio stuff so I should the short answer is I should write more about personal holding companies because I'm learning about it in real time and because there's not enough it doesn't feel like there's a lot of information out there this reminds me of like Tech startups like 15 years ago when I when I first like entered that space in my career there was just not a lot of information on the internet right so it wasn't like it wasn't a y combinator there's very little written about like even like how to analyze a term sheet and then today it's like dude there's so much there's like too much

[32:29] information and I kind of feel like holding companies are kind of similar right so holding companies like you Google it it's like a lot of legal definitions and corporate holding companies but there's not examples you know just hearing you talk about like a SARP studio and then the service business to start to then you know generate cash flow to then reinvest into all these other things you want to do I'm like oh that's pretty cool like and it's not a theory anymore because you've already done it for a couple years now so like what did it work you know what part didn't work what would you do

[33:00] differently you know save me two years of making a mistake so I have written a lot online and the holding company definitely over the past six months has been one of the bigger surprises because I kind of wrote it like walking down the street oh personal income and that's you know because I'll try and think of something to explain to someone without what I'm thinking about doing next and that one tweet well didn't like get a lot of traction it got enough where I was like oh man there's definitely interest in this especially in 2022 coming between yeah I I totally agree I like I'm I'm feeling like I don't know

[33:35] if it's the coffee or the conversation or both but I'm feeling like actually pretty excited to talk about this more publicly there is a lot I've learned um yeah especially around the service service business stuff like for example we run this design agency and in the beginning we were doing a lot of like short-term two-week design Sprint type deals now we've moved to you know I'd say 90 of our Revenue is long-term 12 month plus deals with the largest companies in the world and why does that make sense well it's just predictable cash flow you know one of the bad things about an agency model is you're kind of

[34:20] you know always on the hunt quote-unquote for your next deal yeah and I think what I love about our model is you know when you're signing these long-term deals like it's not that case at all and that's like a lesson I would love to talk more about yeah there's more of that so if the money comes in from these big corporations I'm assuming there's like a percentage of that that's kind of left over our profits do you reinvest that where do you where do you reinvest that do you take it out of the business do you invest to companies or buying companies or starting like how are you thinking

[34:57] about I guess reinvesting that cash within the holding company it's like super old school uh if you think about it but we do a good old-fashioned profit share two times a year which is actually really awesome for folks because like you you know this like when you work for a startup and you talk about it like you don't see liquidity for 7 10 plus years sometimes um so it's pretty awesome that folks who join like check out like every six months they're getting a check I noticed like the Gen Z younger folks like they love the instant gratification of like cool like I'm gonna go on vacation or

[35:34] I'm gonna go buy this like whatever we do uh want to compound the money and that's why we have you know a pretty big budget for our startup Studio where we're incubating our own products and companies as well as a budget for companies to buy and I actually think that like right now going to 2023 there's you know going to be more and more distressed assets there's going to be more and more companies that are uh Venture funded that are not going to make it and there's opportunities to pick them up for reasonable and fair prices so I'm trying to keep that cash so that we can be opportunistic and pick

[36:24] up several of those companies you know I feel like we grew a whole other hour or just talk through all this stuff because I'm like so curious now how big is how big is the holding company and have you found it like a pain in the ass to like manage like all these people again I have an incredible co-founder in CEO who is like keeps the Train on the tracks so I don't even need to you know really think about the Train on the tracks how big is the team now and because I imagine if you're like got an agency you're going to be buying companies so

[37:00] you're going to be scouting those and someone has to run those and then you're incubating things so there's probably like a whole process around coming with ideas vetting them and kind of like you know like V 0.1 just to like dip your toe in the pole and they're like oh that kind of worked and then you have to like in vest more resources and time into those things so that's that's a lot of things to be doing it is it's a lot of things and that's the hard part about this model I think is the focus you know when you have a team you know I

[37:30] think we're like 40 plus team members so when you have a team you can do anything in terms of like you can build a startup you can you know work on this you can work on this agency you know I think that's the hardest part about building a startup Studio or personal holding company is the fact that I think it was uh Scott belski actually who once told me constraint fuels creativity uh for sure it definitely does sounds like a bellskyism it's completely right and I think that that's another lesson I learned from personal holding companies and startup Studios is that you do need to create

[38:09] some constraints on the business so that people basically don't work on anything and that also you know one other thing one of the constraints that we put on are our agency business for example is we only accept one new client per month uh that's awesome and we started doing that you know a year ago because we realized like we had a lot of inbound for for client work and we would just take client work and it's about taking the right client work so just in general I think like having constraints on your service business and then having constraints on your studio is really really important I'm I am

[38:50] really passionate and excited about phds personal holding companies because it allows me and my team I think to be the most creative version of themselves what I didn't like about working at a tech startup was that like I was like pigeonholed into this like space for seven years or six years or whatever and the Achilles heel that we talked about around you can do anything is also the most fun part about it I can definitely relate kind of similar to you I did the whole Tech surf thing and well this is like a limiting belief I would I told myself was like there's a very narrow definition of what a Founder CEO

[39:33] should be very operational very analytical like super Visionary blah blah like conscious leadership and all this stuff and over time you know I guess my career in the world's like 15 years but over time as it become less creative it it was just not fun anymore so I I that's what I like about the phcs is man you have this like whole spectrum of things that you can possibly do but it's so hard and you know it's like kind of what we're talking about becoming content creators like figuring out what your ex you're going to be known for same thing with like what you're going to build dude there's so

[40:13] many things you could possibly do and speaking of another belscheism um which is like the idea to idea syndrome where you get so excited by the idea you kind of start working around like oh this sucks what's really exciting is coming with a new idea and then going down that path and when it gets hard you just keep flip-flopping and then you know over a year or two you don't actually execute anything so um I think that's probably the balance and the challenges nearing in and focusing within a world where you have like unlimited things that you could possibly doing um but that's also what I love about it

[40:46] is it just becomes so personalized to what you want to do and it's not going to be a one-size-fits model for anyone I agree and I also think that while starting a phc is very much playing freestyle points there are also incredible businesses oh yeah and for sure I feel like most entrepreneurs should probably do that because one you're Diversified and the problem with text Harps is you're not like still like you know majority of my net worth is tied into very liquid stock so you can diversify you get cash along the way to reinvest or pull out for your personal use is extremely creative you

[41:30] know if something does take off great you know like you know that's also the problem with a lot of like really early investing for pre-seed pre-ideas like um you don't really know what's going to take off and like if I were to spin something out of a personal company I would want to do it after I feel very confident that it has a great a good probability of scaling not this Grand idea I have that I'm convincing myself in you that it's going to be big it's like oh no it's totally going to work because you know we already test out and this is like the 42nd idea that we've

[42:03] launched so I know and then I know you and I have talked about this on Twitter too which is um raising zero outside capital or yeah you know I talked about raising one round and keeping the team as small as possible which is like every entrepreneur's dream it's like I'm a super small team they're all like great what they do good work on multiple things and if something takes off and just blows up great like we could you know triple down on that but uh I hope that more entrepreneurs like take a different approach you know I think right now it's very popular like repeat founders

[42:38] have some type of access so you do have that time freedom but I do hope that people that are content creators can then you know they're perfect I think for it's like repeat Founders from Tech world and content creators are perfect today for a PhD totally yeah I think uh the biggest PhD Founders are going to be content creators oh I mean we're already seeing that with Mr Beast yeah um and I think I don't know why all these YouTubers do d2c businesses because I'm like dude like there's a whole world out there that's like like digital where you don't have to ship like physical items

[43:20] so I think what I think distribution should do in the team General I think you should launch a gaming studio um or something that's more digital Than Physical products but I think we will see a billion dollar phc I mean I think I guess we've already seen it with Mr Beast I think we'll see a lot more over the next couple years Mr Beast is like he's involved with night media right yes so I don't know if he's a co-founder there is he a co-founder there I'm not sure but from the light and analyzing I've just done on all Critters like you know Silicon Valley is Northern California

[43:59] Hollywood's obviously based in Southern California a lot of like the incubation star studio is comes more from like the Hollywood model versus the Silicon Valley model so if you're like a YouTuber and you have like million plus you know tens of millions of subscribers I would follow a more Silicon Valley model that's that's definitely what I would do versus like uh d2c or do both well I mean for D to see like Mr B's for example you know what's called feastables his chocolate bar is that what it's called like it's cool it's really cool and I love how it is yeah like he did the Willy wall healthy yeah

[44:37] exactly it's really cool but I think you know what's even cooler is like 97 margins on game on game yeah and a gaming company because he's also in the gaming too he's like dude like launch the next Fortnight Pro like you're in North Carolina like epic games is down the street from you like launch a gaming company down the street from epic recruit like all the top people there and just create the next Fortnight yeah partner with someone like he can yeah definitely don't do it in-house like don't do it in house buy a studio I agree though like he should you know Mr Beast if you're listening or team like

[45:18] please go digital yeah you get higher multiples of your evaluation yeah you don't have to deal with I mean yeah I feel like he's pretty diverse and like if I was like looking as partially like dude you're pretty deep into physical products let's let's try to do digital one next let's just diversify um all right man well predictions for for Content creators like where does the world of content creation and creators look like in in five years from now I think we'll see a lot more billion dollar companies that are phds from content creators I think I don't want to make predictions on like Tech with AI

[45:57] and all the you know but I do think we'll see sizable businesses evolve out of it and I can see a lot more creators taking that path versus what I call like the traditional Playbook which is like build audience drop a course drop some merch you know you know I could see them moving be like okay that that kind of worked for a Time oh that guy launched a business and it sold for three billion let's do that and I could see that becoming more and more normal um I could see that being a clear path for a lot of a lot of content creators you know once they kind of build an

[46:31] audience I love it all right and uh if you want to hear more from Mike where can we where can people find you websites Mike carnge mikk m-i-k-e-k-a-r-n-j.com or just Mike crunch on Twitter cool worth the follow uh great content and if you're listening to this and you want more PhD content from from me and Mike honestly just tweet us um and uh comment on this YouTube video with any questions you have about PhD uh we can we can use that as sort of a discussion ground um and of course subscribe if you haven't subscribed already to the where it happens pod thanks for coming on Mike

[47:16] you are the goat I feel like we're gonna be hearing a lot more from you on on phe's content creation money wealth not enough people talk about this so thank you for speaking up oh thanks for having me

[47:39] [Music]

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