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Hello and welcome, everyone. I'm Patrick O'Shaughnessy, and this is Invest Best Like the Best. This show is an open ended exploration of markets, ideas, stories and strategies that will help you better invest both your time and your money. Invest like the best is part of the Colossus family of podcasts. And you can access all our podcasts, including edit the transcripts, show notes and other resources to keep learning at join Colossus Dotcom.

Patrick O'Shaughnessy is the CEO of O'Shannassy Asset Management, all opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shannassy asset management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of O'Shannassy Asset Management may maintain positions in the securities discussed in this podcast.

I guess this week are Jesse Jacobs and Mike Kearns, partners at TKG, also known as the Chernin Group, a multi-stage investment firm dedicated to building consumer businesses. Many think of TKG as some of the best media and technology investors in the world. And in this discussion you'll quickly see why. In our conversation, we cover how to identify creators that they can help build businesses with how established companies should think about influencers and media today, and what innovations they are most excited about in the creative space as they become more heavily involved in building new media properties.

Jesse and Mike have always been my first call for advice, so I'm excited to share this with you. Please enjoy my conversation with Jesse Jacobs and Mike Girds.

Suggesting, Mike, I think an appropriate place to start this conversation is with the very unique history of TKG itself, because you're not A, B, C, you're not a private equity investor. You're just an investor. And I think because you came at it very organically, the history of the firm itself is important for everything else that we're going to talk about. Jesse, maybe we'll begin with you. Since you were there sort of day one back in 2010, can you tell us how this business got started and what is unique in the DNA of the place?

Peter Chernin, who obviously is the churning of the churning group for those that don't know, he spent 15, 20 years at the most senior levels of media industry running FOX and News Corp for a long period of time. He left in 2009 myself. I started my career and sports TV production actually at Fox. I was I like to see the most junior person at Fox when Peter was the most senior person at the advent of Fox Sports and then the early days of digital media around nineteen ninety nine to 12 two.

I ran content for a business called iFilm that most of your listeners probably won't remember having heard of. We were the first company to ever sell a video ad online. We're one of the first companies ever stream video online. We coined the term viral video. We were just way too early. We sold that business to Viacom when the bubble burst and I ended up like Goldman Sachs for a while, doing investment banking, investing all within media, sports, content, consumer, digital, etc.

. And when Peter left, he had been running about Fox News Corp largest set of international cable networks in the world, one of the major broadcast networks in the US, the most successful film studio, the most successful TV studio. He created Hulu, and he was their second to ESPN, the biggest sports media business in the world. And I think what he saw and what I saw from my experience as well was that technology was going to have this massive impact on the media industry.

As interesting as people think of these as consumer brands, ESPN, HBO, MTV, but they're not consumer business. They had not been consumer businesses at the time. They're all distributed through intermediaries like ESPN didn't know who their customers were. HBO didn't know their customers were their customers were Comcast and DirecTV and Time Warner Cable. Our thesis was that was going to change as broadband mobility became ubiquitous and that content was going to be delivered directly to consumers. And we wanted to invest against that trend and build our business investing against that trend.

For the first year or two, we invested just with Peter's capital and then we raised outside capital in about 2012, 2013, not in a fund structure, but in a holding company structure, which is atypical. Today we thought to give us a lot of flexibility in how we would invest so we could take minority stakes, we could take majority stakes, we could potentially pursue larger deals. We didn't have the typical hold period that investors have. We didn't have concentration caps that investors have were more than six percent of the fund can't go in any individual deal.

And we went to work looking for these businesses and brands that we're delivering content directly to consumers and we're very thematically focused. So the two themes that we were focused on, first and foremost one, and this was in 2010, we're sort of influencers and creators on the Internet, as we've been talking about, is quite in vogue again today, 11 years later. And I think ultimately we were the first one to really invest against that trend. There was a really talented executive at YouTube who was in charge of their creative program at the time he left.

And we backed him to start really the first business working with influencers and creators. Business was called Fullscreen. The second theme that we were very focused on was subscription streaming video. We bought a business called Crunchyroll in 2013, which at the time was actually the third largest subscription video service after Netflix and Hulu. We grew that from one hundred thousand subs to north of four million subs. What Fullscreen and Crunchyroll represent are these areas where people can get extremely passionate about a particular thing.

They're passionate about animated, passionate about this creator on YouTube. We thought they were interesting ways in this sort of new media economy to build businesses around them. I'll turn it over to Mike, who we tried to bring on as a partner in twenty thirteen, and he rebuffed us, eventually came on board.

So Mike, what were you doing to rebuff them in twenty thirteen. And then what, sealed the deal in twenty fifteen.

I will never forget my first meeting with Jesse. We're down in Santa Monica. I was at Yahoo at the time. We had a big group down in Santa Monica and Jesse and I were on this beautiful cafe on the beach. And Jesse's got like nice looking hair. And I'm I'm kind of like a it's a big deal for me, have been off shirt on and I'm like kind of central casting after having run like a digital startup built on Facebook and mobile.

And I presume Jesse's working for like this big media. This is chalk and cheese. And then I was saying we completely hit it off like we were just talking about our families. We had similar interests in sports with similar interests in business, really just clearly saw the world the same way I was introduced to Peter after getting to know Jesse and I go into Peter's office and I'm expecting a bunch of Graeter's and screener's and security people and this and that.

And he's sitting in jeans and sandals and we end up talking about Twitter for literally an hour. And I wouldn't talk about anything else. He was on the board of Twitter. Little did I know that he was somewhat in the middle of all the Twitter succession plans during that time. And I was actually managing our relationship with Twitter at Yahoo! At the time, which was a big deal for Yahoo! Twitter was a really important signal in Yahoo's search algorithms, the firehose.

And I had a lot of opinions about Twitter in terms of like discovery and engagement. And so everyone's got an opinion on Twitter. We had a great time talking for an hour and a half about the future of content distribution, discovery, creation. I could tell that we all cared about the same things. And I basically went to Marissa Mayer. Yahoo! I'm like, look, Marissa, it's been great. Welcome to Yahoo! But I'm at my two year mark.

I got to know the Chernin group and feel like the right fit. And she kind of came way over the top and really gave me a life changing package. And so I signed up for another tour of duty at Yahoo! And ended up leading a couple of years after that and then called Peter Jennings, said, hey, are you still interested? Because I am. What struck me about them was they are remarkably ambitious and clearly experienced and successful, but at the same time genuinely humble and genuinely didn't know what we were going to be when we grew up.

I liked that. I liked the concept of actually joining people I could learn from and who I respected immediately, who and clearly had shared vision and shared values. But I wasn't joining KKR or Kleiner Perkins or the that it had been built. I was joining people who had momentum, had a capital base and had ambition. But we didn't know whether or not we were going to start buying Twitter or buying Hulu or investing in the next crunchyroll. And any of those options would have been fine.

And I felt like we would have figured it out ultimately. And now, six years later, we're finding our groove.

One of the things that's to me so interesting, having talked to each of you guys about how the firm is structured as its flexibility, minority investments, early stage, later stage majority investments, piecing stuff together like you sort of have an open mandate just to make great investments and build great businesses. One of the original sort of founding unique insights you've already referred to a few times, which is these rabid fan bases around unique media properties. Just to throw examples out there, like Crunchyroll, I think was in the news recently.

It's a big business last year, anyway, barstool sports was a very famous one day. Portnoy Meat Eater is another that people may be familiar with, very different from each other. But I'd love to explore and understand what each of these things shares in common.

We're going to talk about your concept of content to commerce a lot as sort of like a model for the future. But before we do commerce part, I'd like to focus on the content part to understand what unites the properties that you guys find that get you really excited.

We use a line, Patrick, which you appreciate a couple of different isms. One is if you look at our portfolio page on our website, most of those brands represent a component of a person's identity. If Crunchyroll Headspaces Bar Stool Meat Eater Food 50 to Dinkie Surf Line at these companies disappear tomorrow, people would literally not know what to do with meaningful parts of their free time. They are companies who people want to buy the logo and wear it. They represent true identity and passion.

There's a lot talked about the passion economy and that is fundamentally the core thesis of what we look to invest in. Conversely, there are tons of direct to consumer commerce companies, the vast majority of which we have avoided because we worry about the dependency on paid marketing, the risk they have to larger, better distributors, but our manufacturers attacking that and driving down margins. And on the flip side, we've avoided the ad based media digital media space for ultimately not being able to compete at scale with the platforms.

They don't have as good a technology, get a data and they ultimately can't reach ongoing scale with advertising. I'd like to joke I ran at the time the second largest display media business in the world at Yahoo! Only after Facebook. And I was fighting every quarter to get another page view and get another piece of data on an exchange. And it was a pretty unfulfilling race to the bottom. We love these brands in these businesses that people are attracted to organically have been built over a long period of time and who have proven the capacity to get consumers to pull their wallets out and ultimately put their money where their mouth is in support of the brand.

And in dedication to the products of these brands, distribute as brands that people self identify with. Sometimes people like, well, how do you guys know who's enemy? How do you know who's hunting? How do you know who is watching? How do you know is cards? And there's not like some specific passion we had for those particular things. If I say who are you? And you say, I'm Patrick, I'm six years old, I live here, I have one number of kids and I love the New York Yankees and Crunchyroll or something.

It's how you self-identified. And if you can get one of those brands, it's powerful.

Is it fair to say that something shared in common amongst the originators of the company was that they weren't necessarily trying to build a big business? Like, did you find that in common that you mentioned? Oftentimes these things are built over a long time of these most familiar with the port. And so now everyone knows bar stool. But there is a long period where he was just sort of doing his thing without what we would call a huge commercial success. Is that common in the densest affinity media properties that you find?

Absolutely. We call them sometimes accidental companies. Your question was, are they trying to build big businesses? I'd even go a step further. Are they trying to build a business? You look at these situations, food. Fifty two was started by two journalists from The New York Times. Joe Dinkie was started by a journalist, a meat eater was started by a journalist, a writer and a hunter. Exploding kittens was started by a game designer. And somebody does art and illustration online.

Our firm gets five, ten pitches a day. So you do the math and how many pitches we get a year. Most of them are. Here's my polished deck. Here's the white space. Here's the total addressable market. Here's how I'm going to approach it. Zero of these companies have decks. When you walking? I remember exploding kittens. There was no presentation. I was talking to one of our founders recently, Ken Golden, from Golden Auctions.

In terms of how they communicate internally, there's no like Slavek, it doesn't exist. In fact, I just found out they get 450 customer service calls a day that are all logged on a yellow lab. You know how hard it is right now.

Call customer service for anything. They will hide that number. They'll make it so hard for you to call customer service golden. They're putting the number out there on their Instagram and everything. But we were talking to him and somebody said, hey, you should use slack. You didn't know it was. And then I was like a twenty, thirty million dollar company. And it's like, well, I don't fucking understand how this works.

None of these people, they were just so passionate about hunting, about watches, about food, and they end up starting something. And lo and behold, they're not doing a quote unquote series or series B thing.

It's a very common thread, like when you encounter one of these white hot affinity brands, accidental businesses. I like that. How do you get to decide whether or not there is something to be built around it? Like, I imagine there's got to be some of these where the degree of difficulty is just too hard or for some set of reasons you decide there's nothing to do here. But for the ones that you do decide, like, yeah, we can start attaching commerce to this.

Walk me through the strategy from the accidental business through to a thriving business, because you've run this playbook many times.

In truth, in all of the cases, the entrepreneurs who started it out of a passion have truly done the hardest part. I like to say people were just the dumb investors behind the scenes or helping the business grow the attachment with the audience and that connection with the audience and then ultimately having evidence of being able to convert that audience to whether it be commerce or marketplace in the case Goldener subscription. In the case of Headspace or Crunchyroll, that's the hard part.

We are above average at worst at helping improve management teams, helping identify subsequent acquisitions, helping expand into new business lines. Portnoy and Barstool is a great example. He had a great brand, he had a great set of talent and he had the vision to move them all to New York and create this twenty four seven Saturday Night Live. He didn't have the appetite or interest and building the infrastructure to be able to support what's now over one hundred twenty five people on the talent side.

At the time there are eighteen. But in order to bring in one hundred twenty five people who create content, you need to have production, editing, distribution, sales, partnership, digital product, engineering, data science, finance, legal. None of that was I mean, literally, when we say none of it particularly, we're not exaggerating. They've had the personal checking account, which was the same as the business account when we were finalizing diligence.

I'll never forget driving down the road. I call I said, Dave, like, what is bla bla bla bla bla bla bla bla bla. He's like, oh, those are three horses. He owned horses, the company. So we had to make a deal where he had to keep the horses because we didn't want that in the company anymore. And in exchange he gave us the company van that we were able to put into the company with.

Personally, and what's interesting, Patrick, is there isn't a situation where we believe the audience engagement is real and that takes data and we quantify it and we believe there's evidence of conversion and we believe it's a valuable market vertical. There's no situation where you're going to scare us off with too much work. We actually thrive on finding situations like games where the management team is not built out. It is a mass product. And tech wise, because we can attempt to kind of operationally arbitrage that's completely solvable based on our experience is what's impossible to replicate is the connection with the audience in that position within that vertical, Jesse.

So when you're in this phase of testing, conversion or understanding conversion and the commerce that might exist around a business, what does that look like? What is the difference between how one of these types of brands converts versus the average median brand out there? And how do you get comfortable that that's possible?

I think it's a few things. I mean, I think one is is looking at how much are they spending on paid marketing, if anything. So you look at a lot of these hot direct to consumer commerce brands that have emerged over the last five years. The amount of money that are spent to spend on paid marketing is shocking. I mean, and it is it is in often cases like north of 50 percent, in some cases north of one hundred percent for a period of time of revenue.

We like to see where people end up buying things because they read an article, they've listen to a podcast, they've watched a video, read a tweet, they've saw an Instagram post. That's all content. And then we can track if we had access to the data, what percentage of those people who listen to that podcast or who watch that show or who read that article then end up buying? The other thing we do is we spent a lot of time looking at engagement metrics.

I'll give an example of a really important metric email open rate percentages and email Openreach percentages and then click through rates after that so you can get a really good sense of somebody may say, hey, I've got five, seven million people on my email list. But if you see that seven percent of them open every day, that seven percent, only five percent of that seven percent then end up clicking through to buy something. That's not a good metric.

We'll spend a lot of time looking at number of comments, number of shares, a number of social actions per post, not just the number of users per post. And the other thing we're looking quite a bit odd is repeat rate on the buyers. Two fifty two is a great example there where one of the things that really struck us was not only that people who were coming and buying things for the kitchen after having read an article on from fifty to or after having been part of the community or after having seen a recipe, but then a meaningful percentage of those people were coming back again.

What do you think is the largest thing that most companies don't understand about the nature of media today and the opportunity that it represents? Because there's this popular trope that every company needs to be a media company in some way, shape or form. And most of the time it just feels very forced beyond just the tag portfolio. What do you think are the most important things happening in media in twenty twenty one at the big, big picture media companies, Patrick, they're increasingly not media companies.

HBO is effectively being bundled to sell data wireless. Amazon Prime's being bundled to drive higher throughput and retention for their e-commerce business. And the list goes on and on and on. Netflix might be one of the few actual pure play media companies, but they'll eventually get more and more into commerce. And they just hired one of the top Nike ecommerce executives to over time, presumably build out more and more of their own content and commerce experience. Right. Disney is effectively intellectual property, commerce, business.

So it's a long way of saying pure media as a standalone business is a challenge. Frankly, unless you're going to run it like a lifestyle business, it's probably not a good standalone investment category. It's certainly not a category that we are excited about. Ironically, given the fact that we're often thought of as media, investors, media, when coupled with a valuable bottom of the funnel business, we believe improves efficacy of customer acquisition, strengthens retention, improves long term conversion, and ultimately is a great wedge and hedge against competitive risk.

So that if Amazon or Wal-Mart or Target or some other group tries to compete with you, you as a brand can lean back on that loyalty and relationship you've built over time by establishing a relationship with them as a media community and in order for brands to evolve in the media. They've been like about that since I was in school. They're going to have to get completely uncomfortable with the way they've done business and how they've spoken to and maintain relationships with their customer.

And I think that's incredibly unlikely for big established brands and more and more likely for emerging brands that are built with that type of relationship with customers at the foundation level.

I always find it interesting before you look back 20 years ago, if you look at television, you look at radio or you look at newspapers, if you owned a network, if you had TNT, if you had USA network, if you had CBS, there's only a fixed number of television networks. That was it. You picked up your remote control and you were going to scroll through them and you're going to end up on TNT or USA or ESPN regardless or like radio.

There's a fixed number of frequencies in each market in the US and those are the only radio stations you have to understand your audience, but you don't really have to understand your audience because they were going to show up inevitably. And I think that the amazing thing that exists right now is like unless you have a brand that people really give a shit about, you're just going to disappear. Ever know you exist and no one is going to pay any attention to you.

And it's one thing is like you really have to focus on whether people actually give a shit about your brand. And then the second thing I think about is experimentation, which is will often meet companies like, well, I'm going to start a podcast studio and I'm going to do this and I'm going to do that. I'm the beauty of barstools. The best example out there is they just try stuff. It's just like, OK, that gal that guy's got an idea.

Here's an iPhone, here's a microphone. And by the way, if a podcast is work, nobody cares if they do something one week and then they cancel it the next week. It doesn't matter if a blog post goes up and no one reads it. It doesn't matter just trying stuff without going to hire my creative brand agency and I got to hire my production team. The best companies we see are where the executives, where the people working, they are creators and makers themselves.

I'd love to tell maybe like two stories, Meat Eater and how Dinkie or something, just to keep it kind of different from some of the more well-known examples of this content to commerce concept. Maybe we'll start with Meat Eater. I was especially interested by the pairing of that brand with something like First Light. I would love to hear that story, how you came across it. What was interesting, the story of how you moved from content to commerce. I just thought that was a fascinating example of the model that you guys have employed.

We were originally introduced to the brand through the production company, which is the same production company that produced Anthony Bourdain No Reservations and had been on Netflix. It's now entering its 11th season on Netflix. So it has been a long running, successful show on Netflix. And we met Steve Rinella, who was effectively the main talent in the show. After several meetings with him and understanding his perspective on the world and hunting and ethics and conservation, we got really comfortable with his capacity to be someone that we wanted to be in business with, both in terms of his ambition, but also what he stood for in terms of his values and his willingness and interest in ultimately owning a little bit of a lot versus a lot of a little, which is critical for these talent, personality based businesses.

We don't invest in Kim Kardashian next makeup line. That is not an investable enterprise. But if Steve Rinella is passionate about creating the next enduring long term outdoor media and he is interested in building a world class management team, a diversified product set a global brand and business, then he's the exact type of person who represents authenticity and credibility in that market and that vertical, which GCG has none and would never aspire to try to earn credibility or respect in the outdoor category.

We then helped him build a business plan. We recruited a founding CEO. We went out and actually helped negotiate contracts for a half dozen other influencers in this category who he felt aligned his message and vision. He identified a company First Light, which he mentioned Patrick and I'd already had a relationship with the founders, wore their attire on the show, and we got to know the founders before we ever made the investment in media. And we let them know that when and if they're interested in selling that we want it to be the acquirer.

We ultimately didn't make the investment media contingent on first light, but at first light didn't happen. We had already agreed with Steve that we are going to go and acquire other businesses in the category that aligned to his interests and that we could ultimately build a bigger and bigger digital media audience to complement the Netflix audience that he'd already established in order to drive commerce revenue through that digital funnel that we would then own. And it's not a secret in that industry.

All of the money is in that stuff you'd go buy to pursue your outdoor adventures. We knew from the outset, as we do with all of our investments, that we were not going to become an advertising based digital media outdoor brand. We want to be a commerce based and we didn't want to start from scratch and take. Three or four years to design, manufacture and then ship our products, we want to go buy, we now bought three companies, we bought two more since first light and we're about to acquire our fourth.

And it's a very intentional strategy of finding products that are largely bootstrap. Oftentimes, it's one to four people. I mean, first, it was a bigger example and bring those products into the commerce suite that we've now built out and continue to invest in top of funnel personalities. You'll see us in two thousand twenty one, expand more aggressively and fly-fishing deep sea fishing, getting more aggressively into cooking and outdoor culinary as categories that Steve's always written about and included in his programming.

But now we're going to get more intentional about both the media gadgetry, the personalities to accompany with it and the commerce associated.

So is it fair to sum this up as on the media side, slowly replacing your sponsors with your own owned companies? Like obviously sponsors are willing to pay because they get Norelli. So there's a gap there that you could just earn yourself. And then from the first light side or the commerce side, lowering your cost of customer acquisition either entirely or a lot. Is that basically what makes this strategy so interesting?

Yes, I mean, I think that's a fair characterization. Again, you're using media and content as your customer acquisition and retention tool. You're not building media for the business of media. As we say. Oftentimes, the media itself can run at a nice margin and you can do licensing. You can do advertising, you can do distribution partnerships. But the media is ultimately most effective in helping build that funnel. That, again, is defensible against competition as well.

Jesse, when I talked to Peter, he used this term the really interesting term, phony aggregator. And we talked a lot about eBay and the opportunity to attack verticals within eBay built marketplaces that are way more purpose built around the passion or the interest of the buyer. eBay can't be all things to all people can't be perfect. And I thought Joe Dinkie and Watches is just like a fascinating thing that you've been involved with. It's also an excuse to maybe talk a bit more broadly about collectibles, but maybe you can begin by telling the same arc of your experience with Dinky.

One thing that's kind of interesting is when I got married, I guess my wife's parents got me a watch wearing right now. See, only watch I've owned since then and only watch I had before then was like some really obscure Japanese thing that I bought on the street in the Lower East Side. I didn't think people like wore watches. And why would you need to watch? Right. I mean, you got your iPhone and I don't know if you'd maybe have an Apple Watch or something, but frankly, I thought the same thing before we got into anime.

We look at something in the classic car space here now, obviously in a collectible space. And then you get into these worlds and it's like all of a sudden you just think everyone you meet must be a watch collector or a car collector or an anime fan, a hunter. It's just because you realize, like, the emotional impact that these brands in these products have on people profound. So we had been looking quite a bit on these big categories on eBay.

I mean, obviously, sneakers is one. There's been a bunch of companies that have done in the automotive space. And we stumbled upon Dinkie, which was started by a guy who had really started a blog because he loved watches. What I often find is interesting is like the companies we invest in, they end up being the new kid on the block in there, sometimes quite staid and formal industries. So the watch industry is about the three of us were to sit here and stack rank.

What industries have the highest penetration of e commerce and what have the lowest penetration of ecommerce watches would be towards the bottom. The Swiss watch manufacturers are not keen to sell watches on the Internet. Then climber who a really talented founder and executive chairman of Dinkie, had started to convince the Swiss watch companies, hey, people actually use the Internet and people actually buy things on the Internet. And we don't just have a Rolex shop in the Four Seasons, but there are people who might be searching for these things on Google and you should probably have a solution for him.

So he became one of the first, if not the first authorized e-commerce companies selling watches in the US the same way to your question, Mike, about media. He had the Omega's in the Great and all these grand. Sago's sponsoring his articles and they would call him up. And every time I sponsor something, I sell a lot of watches and then like a light bulb goes off. It's like, well, maybe I should be selling watches, not competing with him, but rather selling their watches.

So they do vintage, they do a limited edition, they do new watches. And then for us, the big unlock was, is there a way to expand them into the market, which now, particularly with the younger generation there, is as comfortable, if not more comfortable buying something that's pre owned almost any category, then they are something that's new. And if you think about the amount of watches that are sitting in people's attics and drawers and apartments and parents houses and grandparents houses.

A lot of inventory out there for us. We saw it is a really interesting way to use the content to drive towards not just commerce for new limited edition and vintage, but now importantly, CREON watches.

What about the collectible space, more generally speaking? What do you think is behind this just crazy explosion of interest in all of these things versus, say, five years ago?

And no one is talking about this, so we're obsessed with it, as you know, I think it's a few things. I mean, one is just the alternative investments in general. Mike often says, well, we were always taught stock all your money in a four one K or Roth IRA and stick it in some fidelity index. Don't worry, you'll get six percent compounded every year and you'll wake up and you'll retire and you'll go to the bank or whatever.

Nobody wants to do that anymore. So, yeah, everybody just wants to have control over their own investments. There's this notion also of like wanting to be emotionally connected to it in some way. So whether it's the Wall Street bets GameStop thing or whether it's Bitcoin or whether it's sports cards and collectibles, there's like this emotional commerce connection to it that I think is very important that the Internet has enabled one thing, a second thing, and this is very specific to cards, is I think sports betting has exploded, although for some of us like Mike and me who have been betting before is legal, like it hasn't really changed our behavior.

Right. But we're not allowed to do that now because we're not allowed to bet. That is correct. We were on the board of a regulated company. Yeah.

There was a bunch of states that have our fingerprints. We know that people are. Am I going to bet on who's going to win today, Duke, or whoever they're playing or who's going to win the Super Bowl, Tampa Bay or the Chiefs? And what's the line that that's super interesting. It's also interesting to be a fantasy football, and I'm a better GM than you are. And I'm going to prove it to you by drafting my team and making better trades.

There never really been a way to speculate on your view of the performance of a player. So, OK, Tyree's Halliburton was drafted. Whatever was drafted this year in the draft, I think he's going to be the next, you know, whatever, Yanis. And to prove that I'm right, I'm going to buy his card. And if he performs well, the value of that will go up. And I think that's a that's a big part of it.

And then the final thing I'll say is I think it's also correlated with the Bitcoin crypto stuff. The whole cash is going to become less and less valuable. And I want other places to invest that I think will will will grow in value. And in particular, those things that have limited supply goes back to wearing the t shirt of the brand.

Right. And being part of your identity. I went to dinner at a friend's house last night and he walked me into his garage and I sensed that I was there to meet his new daughter. But he and I spent a bunch of time in his garage looking through literally thousands of cards that he still had. He's my age. Are you buying these cards in the eighties and nineties? And it is something that he's passionate about and he can't consume enough information about the cards, the market, how those cards are changing in value.

If you look on the Internet right now and look at the way that sports collectibles, NFTE, even like Pokemon and Magic, the gathering and these like Super Nesh, but rabid communities of enthusiasts and collectors, the way that they consume information about unboxing sports cards or going to conferences around magic, the gathering or congregating with fellow Pokémon aficionados on Dischord Channels, it's super distributed. Produced very poorly and not like you and I have talked about the beauty of Yahoo!

There's two businesses that were magical in being able to convert to mobile and really only two and every other business. Yahoo! Got their lunch in by Facebook and Twitter and Snapchat. But the two that maintained were sports and finance because people who use sports and people who use Yahoo! Finance personalize their fantasy team, personalize their portfolios. And every day there's another game. Every minute there's another home run, there's another three pointer and every minute in finance. And now three sixty five, twenty four seven Krypto.

Something's changing. There's news, there's a trade, there's a speculation. There's a community whisper. That same phenomenon occurs in collectibles. And the capacity to cover it and serve that passion and serve that interest is really being done quite poorly today.

You mentioned finance and this is something that we've talked a lot about and I'm especially interested in because I still have the Buy Vanguard. Don't do anything else stupid, like you're wasting your money, blah, blah, blah, which probably is the right advice if you're maximizing wealth over time. But it just seems like, wow, that is just wrong. The world, especially the younger generations, millennials and Joneses, are going the exact opposite direction, like they're way more hands on their way, more interested.

The job to be done does not seem to be maximized. Return, even if there are great returns to be had along the way. How do you think about an opportunity at the intersection of technology and media and finance? Most specifically?

I think it has to be a service that converges on editorial content, personalities, people of opinions with data insights, analytics tools. There are examples of that being done well in equities. There are not examples yet that are doing that across stocks, across collectibles, across NFTE, across even futures markets. Sequoyah recently back to company. That's going to let you start speculating on the next presidential election and what the global temperature is going to be in twenty, twenty five in these kind of more macro futures events.

That is all going to be consolidated in a platform that creates content, community and insights into these different markets, but allows you to capture and trade in those in one place. It doesn't exist yet. And Coinbase and Robinhood are both best positioned to capture that because of the growth in their retail customer bases. And all they would need to do is expand one layer up and start covering those industries more effectively. You could also argue you could start out the coverage and work your way down to the brokerage and trading, but it's unclear how that's going to play out.

I think there's a lot of analogs actually. When you look at the disintermediation in the media industries, ESPN used to sell its content to Comcast, who sold it to you, and then all of a sudden like, what the hell do I need Comcast? Right. I'll just go straight to Time Warner Cable or DirecTV or Dish or whoever it is. You need them now for the broadband. But I think it was interesting and similar in the finance world, which is like I want to go buy a stock from the Mekons and I have to call Jack Johnson at Merrill Lynch was going to get twenty five dollars for facilitating.

That seems kind of ridiculous. Hey, by the way, if I want to get information on that company. Oh, now Merrill Lynch is going to publish a report once every month or something. How do you give people more? At least one of you on this podcast agrees. Like you get your best news information from Twitter, you always get your best news information from MSNBC or something. And I think that's the same for this stuff. You're going to read a message board.

You go on Twitter, you're likely to get better information that is more relevant for you about what to invest in than if you turn on a finance news network or read something in a traditional publication.

The golden deal, I think, has been announced fairly recently. What's been the most surprising thing you've learned about that space sports collectibles specifically? What was most shocking to you as you investigated and did diligence on that space?

If you think about when we were all growing up, there were people who are like how to side business among a hustle. It started with a lemonade stand. And then I'm going to go, I don't know, shovel snow when it's snowing or I'm going to go in New York washing the windshields or something like that. And then you had people I certainly didn't grow up who were like, I'm going to go scalped tickets outside the US, stop in or outside the stadium.

And there were also people who are buying and selling cars. Almost everybody that we met in the industry, they haven't really grown up from when they were buying or selling cars when they were 13 years old. It is still to them, just like they're just total street hustlers. The fascinating thing about the industry was just like how much it still is. The people in the industry can be a good example. They love it. They love the trade.

They love the action. They love the movement. They love the people. They love being able to secure that car. They love being able to. Somebodies house, those boxes that Mike was telling us about, that's really interesting. And the other thing is I underestimated how many people still care about cards. I think I really did. I mean, maybe might get a different perspective, but it's shocking to me. You meet these people and it's it's something that lifts their moods.

You can see the endorphin or the rush when they start talking about it. So one of the great things is seeing who's bidding on these things, because you do get insights into and they're from pop culture, big finance, international money, athletes, musicians that I think hasn't yet fully been out there yet. And I think when it is and you start to see some of this stuff more transparently, I think it will be fantastic entertainment for people, frankly.

I mean, imagine you could see a live auction for a Jordan card you knew and it was Liberti experts, billionaire. Why? Going back and forth and you're watching the auction.

This begs the question around NFTE, people sold a piece of digital art for, I think, sixty nine million dollars, which I think made him the third highest paid living artist ever at auction, which is a pretty remarkable thing. Feels like a landmark moment in this NFTE art space. But I think nets are much bigger than that. In your guy's view, how do you approach this area? If this is the technology that enables digital collectibles, what is your view on how to approach this for your own capital and your investor's capital?

I don't mean to be hyperbolic on this, but I will be. It's the biggest thing, in my opinion, that's come around since maybe the browser and maybe mobile. I think it's that big. I remember when Andriessen and Union Square invested in crypto kiddie's. He and I were texting about it that day. Being like, this is wild. And we knew that this was going to be meaningful. Not we didn't know it was going to explode into NBA top shots.

We didn't know that benchmark was going to lead a fifty million dollar round in essentially a soccer trading platform, which is reminiscent of the startup that Jack Ma and I co-founded back in 2003 of a real money daily fantasy sports stock market. But it's happening now because of the blockade. So rare can have people buy and sell cards for hundreds of thousands or millions of euros because the block chain secures the ownership of that digital entity. And then that security can enable scarcity, which can then be applied towards the utility.

In this case, if the fantasy game and diaper's case of presumably other games and events, that will happen. So there's one pathway into that journey of like, OK, and if this is the consumer gateway towards mainstream blockin and crypto adoption, that's one perspective, which is, I think increasingly will become less argumentative or all that controversial. The second is, if you think about our heritage Padget, back to the early beginning, the conversation we've been investing in influencer based businesses.

When Peter and Jesse first started this business, one of their first investments was backing George Stephanopoulos, who just left YouTube, who created the creator program. The fact that I got a New York Times alert for my New York Times app about people selling a sixty nine million dollar piece of digital elements is fascinating. You're right. And maybe it's the tipping point. What's more fascinating is when that artwork gets sold in two years for one hundred fifty million, he's going to get another 10 percent of the cut.

And if there was a physical piece of art, people wasn't going to get incremental secondary transactions. But because this is being tracked and being securitized and being secured by the ownership on the block chain, the artist will forever be able to participate in the ongoing economic value being created by the creation, and that it's going to have profound disruption and benefit towards the creator and will expand into music, will expand. Obviously, it's in collectibles is already an art.

And I think we are not even thinking through the impacts on things like crowd sourcing and the Kickstarter side of the world are all going to be built on the block chain. And then the tokens that come from these businesses will allow consumers to have greater and greater equity in the communities and in the arts and in the brands that are participating in these transactions or in these creations. It might be hyperbolic. It might be look back on this and be like, OK, that was a really stupid thing that Mike said on this podcast that your audience is listening to.

But I do think it's more likely than not going to be saying that as a firm TKG can't miss the ball on this one. We're fundamentally investing in consumer trends. We're investing in ways that people are creating content, distributing content and monetizing content. And at this moment in time, the biggest thing that's happening right in front of our faces is how that. Occurring on the block chain and what that means for creators, IP holders, technology companies and ability for consumers to feel greater and greater equity ownership and monetary involvement in their artists and brands of choice.

Jesse, when I first talked to you, you talked a lot about this ongoing disintermediation. Anyone in the middle, you've talked about it today as well is just kind of screwed. There's going to be more and more direct connections between the creators of value in the consumers of that value. And AFTRS represents perhaps yet another step in the direction that you talk to me about. How do you square that with trying to earn a return in Delaware, C Corp in equity in businesses, if the trend of NFTE is more just complete end to end creator to consumer.

How do you think about that? Like how do you think about where there could be opportunity in something like this, given that it is a disintermediation force?

I think the interesting opportunity is and I look at it from a creative perspective, if you're a creator, you could say, well, I'm going to start a business, I'm going to start a Deleware LLC or C Corp or whatever, and I'm going to go raise equity. And ultimately, we as investors will be investing equity into that, into barstool sports, into thinking you could see a situation at some point, which I find really fascinating around a creator saying, OK, I'm going to issue tokens in myself.

Right. And let's say I'm going to issue, I don't know, one hundred tokens in each of them or one hundred dollars. And if you buy one of those tokens, you get the right to have a call with me or video with me or whatever. Text with me x number of times a week, a month. You get a t shirt, you get a digital art thing that I'm doing. And because everything I do is on the block chain, you get for each token point five percent of everything that I make moving forward.

And to Mike's point, because it's not just a primary market now, it's a secondary market. I think that model sort of the patriarch model of being a supporter of that creator, getting the emotional benefits of, all right, now I'm connected. I'm part of the fan club, getting some tangible benefits because I get some personal connection or I get a t shirt and then potentially getting the financial reward where that's traded over time. I think that model playing out, it'll take a while before anything like that is disruptive to thinking about how equity is works.

And I don't think that's any time soon, but I think it is a super interesting model. The other thing I think about entities is it boggles my mind when people are like, well, I don't really get it because that LeBron clip where he was doing the Kobe dunk, I can find that on ESPN. I could find that on YouTube. And then I read it. I could beat it anywhere. And I'm like, OK, well, let me ask a question.

If if I had ten versions of the Mona Lisa right here and one of them was real and none of them was replicas and we did a taste test, you have 10 percent chance of getting it right. That's it. You could put a replica up on your wall, but it's not the real one. I always find it sometimes like we're a little bit too old for the generation that's probably finds those types of things patronizing. I imagine the younger generation is like laughing when people say that is like if they have an emotional connection to it, who are you to judge?

They're probably looking at you and saying it's ridiculous that you bought that piece of physical art, which is made on eight cents of cardboard. The same people are saying, oh, you got to, like, put in an index fund or you've got to put in fidelity or something. An investor. Give me this analogy, which I love. It's like that same person is buying Amazon stock. Why are you buying Amazon stock? You're not buying Amazon stock because the dollar that you put in is going to get ten cents of dividends for the next 20 years.

That was on his delivered zero cash back to shareholders. Zero. You're just making a bet, a wager on how human behavior will evolve and whether Amazon and its management team will be able to increase their revenue or their profit in the context of that. So all of this stuff to me is just on the same spectrum. It's ultimately in the eye of the beholder, given that you guys are willing to do later. Stage companies have been around a long time, early stage, traditional technology companies, minority stakes, majority stakes, et cetera.

How do you view the valuation landscape today across the board? What does it feel like to you to be in a competitive search for the best businesses? I think if you look at your history, part of the beauty of the accidental business is that you can get it probably at a pretty good or fair price and really participate in the growth of the value in a meaningful way. What's your view today? Like, just give me a sense, given your unique style and perch, what valuations seem like to your point?

The majority of what we've done over the past decade have been these majority stake investments and the accidental company nature of them leads them to not be flying to Silicon Valley or getting cold calls from. To Tyga and one regularly as a result, because we are oftentimes finding them through kind of top down thematic research and cold calling them increasingly they are aware of who we are based on our success. A decade ago, they're taking our calls, thankfully, and they are not oftentimes looking to maximize the day one dollar because they're not in a place where they're looking to exit or looking to transact back to Jessy's or they're coming by not having decs.

In most of the cases, they're looking to make sure that we will follow through on the business plan that we helped build with that. And then they reference us extensively and that they want to make sure that their equity and their employment agreements with us are structured in such a way where they're completely incentivized with our exits in the future so that they can maximize their second bite at the apple. Now they care about what the entry prices are. Typically, they're not hiring bankers.

Typically, they're not running broad processes. And frankly, even if they did, most institutional investors would not want to deal with the states that we often find the entry point of these companies back to the barstool example about Dave owning horses with his checking account. Conversely, in the venture and growth landscape on the minority investments that we participate in, you don't need to hear it from us. It is unprecedented. There was a company that we met with.

We are going to follow up with an email. Thank you a little bit about us and set up a follow up. By the time we did that, which I think we were their first meeting, they had already received an offer after a first meeting with a multi hundred million dollar offer at a multibillion dollar valuation. You can talk all you want about the outside and diligence that technology can afford private investors now and how they can come so prepared. That's nonsense.

These investors, they did not meet with anyone on the management team. They did not look at the company's financials or metrics, and they made an offer based on a meeting and based on a playing a trend and playing momentum in a space and in this environment for those investors, so long as this environment maintains itself, there's relatively little downside because they're top of the cap table. They've put a bunch of money in the company. So no matter how high the burn is, they've got years of runway.

There's kind of infinite passive liquidity given what's going on with the Spaak landscape, the direct listing landscape and that convergence of private and public markets. I understand the rationale as to why it's happening. I understand how these crossover funds want to deploy capital aggressively into private, and I understand the logic around paying it forward and the multiple expansion that's occurring. That being said, it's not our cup of tea. We certainly have a history of investing in the early stage and we will continue to invest in growth stage companies.

Maybe you look at the companies that we have invested in, they're pretty intentional and directly aligned with the themes that we've been invested in for 11 years. When it is a company or entrepreneur who's most motivated by top price and speed and maybe the brand name of the VC firm investing in it will take our ball and go to another field. It's not how we operate in general.

What have you seen define success when trying to form a win win relationship with what I'll call an influencer? We've talked a lot about this already today of the importance of these people, creators, artists, whatever you wanna call them, with rabid fan bases. And it just seems like you've been doing this for ten plus years before it was cool and everyone was talking about the passion or creator economy, et cetera. But it seems like more and more everyone just needs influencers in their company plan, in their startup, in their whatever.

How have you seen an equitable almost contract be structured if BASTABLE is trying all these different things? What lessons have you learned there about just fair and equitable relationships between influencers and companies?

I think a couple of things. One is this is not going to exactly answer your question, but then I will. I do think it's important that these content companies, the people who work there, the writers, the journalists, people on the podcast, they themselves have to act. I use the word influencers or not, but I'll use it for lack of a better one that I could think of right now. But they have to think like that.

They have to think about how they're going to grow their audience. You've seen some journalists do it affect that really? Well, New York Times, New York Times journalists have done an exceptionally well where they effectively have become influencers to some extent. So I think that's important where the team feels like they have to do it. We've structured a lot of deals with people. We're doing it right now in a few portfolio companies where it's like, OK, there's somebody out there we're not going to hire X, Y or Z person as a full time writer, as a full time podcast or.

But that person could probably be incredible to write about watches through the lens of sports or write about watches through the lens of diving or write about watches through the lens of space. So what's. Figure out a way to have them, that person to audio the video and do social and do written text with us. Their obligation is they're going to do X number of times a week or a month or a year. And not only are we going to pay them for that, but importantly, they are going to get unlimited upside on how they perform.

So if they end up actually creating this vertical that's around watches and sports or watches and diving, that ends up resulting in a whole bunch of sales of watches, they should participate in that. And the other thing, I think you got to stay the hell away from their creative do not opine on it. And that was our deal up front with Dave and that's been our deal with everyone out there doing the hard work. And I think we're doing the easier work, but just let them do what they do best.

And I think it's why so many creatives we've had success working with them, Patrick, because we are the last person to ever even consider providing an opinion as to what and how they should be creating. We'll give him advice as to how to measure it. We'll give him advice as to how to distribute it. Well, give him advice to your other question about how to bring on talent and structure upside creatively in the form of equity revenue share, etc., to make them feel empowered and have uncapped upside.

But I joke, I can barely cook a grilled cheese. I can barely pump my own gas. I'm like the least handy outdoorsy person in the world, that meat eater. I don't strike myself as Dean. All that funny or relevant in terms of pop culture with barstool at the same time, like we're involved with all these companies, which gives me great pride because the people on the front end are experts in our building, the audience. We're just the people trying to make sure they don't screw up behind the scenes.

For both of you guys, what is the trend that you're not yet engaged with in terms of having made an investment that you're most excited about in the world?

I think it's around this and at this base. I'm almost having to pull myself out of reading about Daming entrepreneurs, talking to their investors about it, because I don't want to wake up in four years and have every one of our investments. So we need to figure out how to get exposure to this trend in thoughtful ways, with the right entrepreneurs, with the right structure, with the right plan. But we can't let this shift occur right in front of us and TKG and not be in a position to help those entrepreneurs with our experience with influencers, with intellectual property, with new technology platforms.

That seems like it's an important area for us to be focused and spend a lot of time on.

I'll give you two others, one of which we have exposure to that I just like and Peter spent a lot of time thinking about and it's how we can get more exposure to is this whole notion of if it's like the quantifiable self, if you will. But I'm wearing an orange right now. I mean, how are you able to use information about what's going on with yourself physically and emotionally to make better decisions? And I think we're going to look back 10, 20 years and say, like, oh, you had a ring and a strap and you got like these four pieces of data, which we're probably off by some like wild standard deviation as people look back at like a rotary phone right now and the things that are being done right now.

I was talking to somebody last night about like looked at this space, continuous glucose monitors, people putting clothes on their body to try to test it. Like if you actually try to use them right now, which I have through looking at some of these companies, it is barbaric, almost experience. I think the innovation that's going to happen there is going to be quite interesting. The other thing, I'll throw it out there, and this is a real niche area, but one that we found interesting, I think does harken back a little bit to Atama is webcomics.

I don't know if you've paid any attention to them now.

Great. I love this. What's that?

They're basically the idea of reading comics, but all online is taken off huge in Korea, Japan, in the US, it's an area where they're basically vertical comics. You read them and if you want to read the next chapter, either wait a week or you pay, I think that whole space is quite interesting. We look at the size of that space engagement and the demo. I mean, it's very young. It's across all genders, across all races, and there's a built in monetization and is a really interesting and fertile source of IP is quite interesting.

I'll throw one more paycheck.

Everything's becoming a game and there are platforms emerging that are enabling lower to no code game creation. And there are kids there are millions of creators, robotics. Right. Not players, creators. And in our opinion, if you think about the way we view the world with creators, top of funnel audience and bottom funnel, increasingly there will be millions of bottom of the funnel games that will spawn from top creators, top brands, top influencers. And you think about Mr.

Beast launching these burger, which will probably end up becoming like the fastest growing fast food restaurant in. Bar should be launching the next Domino's global competitor and pizza out of Dade's pizza reviews, you can imagine entire media companies, entire game universe is being created with relatively low cost of development and technical capabilities around brands and personalities. I think that has some crossover towards micro economies and being able to buy things and transact them with virtual wallets. But that low code and no code gaming environment and how pervasive that's going to be around identity payments and in app in game economies.

I'll give you one more. I haven't seen any thing out there other than maybe Pokemon go. But the idea that the integration of gamification and life, one of our portfolio companies, one of the executives there, has this idea. I won't name him or go into too much detail because I'm passionate about it, but is around how your life becomes a game. You earn points for doing certain things in your life. I could see that certainly becoming a thing.

And I think it's pretty bold, the whole idea. But the generation of people where everything has become a game, everything they do, not just gamification of games, but the gamification of apps and stock trading and everything.

I want my life to be a game jessee. I want to get points. I want people to be able to invest in me. I want people to bet on my future and I want to be electable.

I think that when guy is more valuable and then the future, the convergence of all, I just want to be like an assistant basketball coach for a high school classroom.

Divisions, actually, where guys talk to you guys is always a highlight of my week. And we connect, I think, just in so many of the same things. And and also the approach the firm has taken is so differentiated at proven at this point and unique. I think, you know, my closing question I get to ask both of you this week, maybe Mike will start with you. What is the kindest thing that anyone's ever done for you?

Unquestionably. Ron Conway, having met me through a family connection and me graduating undergrad looking for really an introduction to one of his portfolio companies was my only ask him spending three meetings with me after the third meeting, sending me nine emails in a row. The first eight emails were read this, read this, read this, read this. And it was Red Herring Industry, Standard Business 2.0. These things people were reading in nineteen ninety nine in the ninth email was we want you to come work at Angel Investors and unquestionably accelerated my career and opened my eyes up to this entire world.

And I'm forever grateful and still a friend. And it really changed my life watching him work 24/7 for the other one hundred ninety nine plus portfolio companies that were not Google, most of which were going to end up zeros due to the twenty one crash. And now seeing him two decades later, having invested in stripe, Airbnb, Dropbox, Pinterest, Snapchat, Coinbase, what he hasn't invested in impacted and being there, carrying around his emails for a couple of years because he was kind enough to take the time to invest in me was definitely the biggest.

Thank you.

I'd give Jesse a mentor of mine. A guy by the name is Skip. Paul was the chairman of iFilm I there when I was in my early mid twenties, Gibbon sort of Lew Wasserman, the kind of the famous Hollywood movie mogul that MCI and Universal. He had been his right hand guy. You ran Atari for a period of time. He was the chairman of the company. And I kind of built a relationship. And the number of things that he's done for me over the course of the twenty years since then, whether it's always know, OK, I'm kind of worried about this or thinking about this, what's going on?

My personal life, my professional life. And he'll be the one who will reach out. And he just has like a sixth sense for kind of just knowing what's going on. And then we'll go for a walk and he'll always give me the most sage and honest advice is not technically my family or anything, but he's always kind of looking out and always trying to connect me to people. And the things he says about me always I always tell him to stop saying because they start embarrassing me.

But he's somebody throughout my life. Even more on a personal level has just always been there to give me the right advices. I'm thinking through these big life decisions, in particular how they interplay with my professional, with fantastic guys.

This was so much fun. Thanks for the time and thanks for all the insight.

This episode was brought to you by Catalyst. In this four part mini series, I sit down with Canalis co-founder and CEO Dimir Hot to learn about the origins of Catalist, the problems it solves for professional investors and what the future of Canalis looks like. And this week's episode, Daumier and I discussed the origin story of Catalyst and the original problem it set out to solve.

So Daumier, when you and I met, I think we were having lunch. New York City and the auspice of our introduction was I was trying to learn about enterprise software distribution, very quickly learned that your business, even though you did teach me about that, was also very investing specific. And it's a good excuse to ask about the origin of. So already a very popular service with our audience and our listeners very, very focused on professional investors. What was the original insight or problem that led you to start the business?

The original thing was watching my co-founder James, who I've known for a long time since undergrad and really smart guy, successful career on the buy side. And it kind of started building himself a tool he always wished he had, which was at the time I met him. He had about 600 companies that he had modeled and a bunch of Excel spreadsheets on a Dropbox and had some junior analysts helping him keep things up to date. And when you see an individual that smart going through something that looks like a pretty unique motion, you tend to dig a little bit more deeply into it.

What I saw there was an opportunity to potentially commercialize something, and he was happy just kind of doing his thing and keeping his models up to date. And so I called a number of funds, call about ten of them and eight of them actually wanted to try it out. So I literally shared a Dropbox folder with them and have them kind of take a quick couple of weeks later, close that Alpha project down and got some feedback. And the eight of them that tried it, I've said how much to keep it.

The fact that real professional investors were willing to pay real dollars for a bunch of at the time fairly rough Excel spreadsheets built by a couple of people in a basement. There was obviously a game there to talk a little bit about what the available solutions were when you started.

I remember using Bloomberg, in fact, said and there's other places that give you information on companies financials. But what I think is unique about what you built was not viewing what the SEC required the companies put out, but actually putting data in the context that an actual investor would think about a business. So that's obviously important that you're in their world versus something else, but also that you encountered duplicative work that was just staggering. And so talk through duplicative work and sort of framing the product around the actual user.

Yeah, absolutely. You have some of the smartest folks with the highest opportunity cost and basically most of the business world having all these very relatively rudimentary challenges, like I need to go to six different filings to pull together a single row of irrelevant KPI, because none of the platforms that I subscribe to have that KPI and sell side models have it one quarter and not the other. I download a comp table and all the share counts are wildly off because nobody does the correct Treasury method on them.

And so my comsat is actually completely useless and I blink. And I've wasted three days holding PDF documents and manually entering numbers into very similar spreadsheets to what all of the rest of my colleagues are doing across the entire capital markets. So that's the pain point we solve. What we're really aiming to solve for is we want to be that first 80 percent of the fundamental model for anyone who's looking at public equities, that first 80 percent of the model, it just has to get done really, really well.

It has to get done really accurately. There's a right or wrong way to do it. It's not art. It's fairly repeatable. It's a science. What if you could start from eighty percent? What are the other things that you can do with all that free time? You can have more conversations with management. You can get much more throw on a broader shadow coverage universe. We're trying to give you back that most precious commodity in the capital markets. Would you?

If you enjoyed this episode, check out join Colossus Dotcom there you'll find every episode of this podcast, complete with transcripts, show notes and resources to keep learning. You can also sign up for our newsletter, Colossus Weekly, where we condense episodes to the big ideas, quotations and more, as well as share the best content we find on the Internet every week. Oh.