From selling ACs to becoming the tourism king of Jamaica

From selling ACs to becoming the tourism king of Jamaica Speaker 1: If you're like me, you're going to get inspired by this story. A white dude from Jamaica who built an incredible, you know, multi-billion dollar business and lived life on his own terms. That's the headline. Unknown Speaker: This is my Billy of the Week. Speaker 1: So this is a guy who created something called Sandals. Now, let me tell you, let me tell you the story. First, we just got to look at this picture because I'll be damned if this doesn't look like a young Sam Parr. Look at this guy. Is this not you? Speaker 2: Yeah. This guy's you. Is he actually, he's Jamaican? Speaker 1: So he lived in Jamaica. Okay, so here's the story. So his name's Gordon Stewart, and he's born in Jamaica, white kid born in Jamaica. His mom calls him Butch because he was chubby. So he becomes known as Butch for the rest of his life, which is amazing. As a young kid, he does all kinds of odd job little hustles. So he's like helping out the fishermen, then he buys a boat. Then he starts making money boating the fishermen around and repairing boats. And he would skip school altogether. He was like, he's like, I just want to be on the water. And he goes, he said later, I didn't want to be a businessman. I want to be a fisherman, just a rich fisherman. And that led him into business. So I love this guy. So he's like, along the way, he's living in Jamaica. Obviously, Jamaica is super hot. And he realizes as air conditioning becomes a bigger and bigger thing that, you know, air conditioning is going to be huge in the Caribbean. You know, things take time to diffuse, right, from different places. And so maybe it was normal in the States, but it wasn't as normal in the Caribbean yet. And so he saves up $3,000 and he starts a company called Appliance Traders Limited. And the idea is he's gonna import AC from the US, AC units, and he's gonna go door-to-door selling them himself. And he decides, I'm gonna do this B2B. I'm gonna convince business owners that they should have AC because for them it's not just about their own comfort, but they're gonna have more sales. If their store has AC and the other store doesn't, customers are gonna wanna spend time in their stores. So, great idea. Now he's like, how do I differentiate myself? So he tries selling door-to-door. He makes some progress just hustling and he hires some other island boys to come like help him sell, but he's going up against General Electric, right? So he's going up against like Westinghouse. He's going up against these huge companies that have much bigger sales forces than him. So he's like, he asked himself a better question instead of How do I outcompete them on sales where they're excellent and have more resources? How do I do something they would not dare to do? So he goes, what can the big guy not do? Speed. And what does the big company not care about? Service. So he decides to differentiate his offering. So he says, if you call me, I'll have AC installed within eight hours. And he just starts with that vision and he works backwards to figure out operations. Like, how could I possibly do that? Well, I guess I'd need boys over here. I'd need a call dispatcher. I'd need to prioritize the most recent call, not the oldest call, and deliver this eight-hour service. And then the second thing he says is, look, these ACs, they break. They're running them all the time. Here's the deal. We will fix all the ACs, no extra charge. Like, if it breaks, we fix it and we fix it fast and nobody else is gonna offer you this. And because of these two things, speed and service, he dominates the Caribbean market. He takes over Jamaica. He builds a powerhouse. And so out of this, he makes, you know, that's his first kind of fortune that he makes. Speaker 2: How much did it make? Speaker 1: I don't know his net worth at this time, but it's enough where he could go to Montego Bay and buy a rundown hotel that everybody else ignored. And so 1981, he buys this resort called Bay Rock. And at the time, people think he's crazy because tourism is not that popular in Jamaica at the time. Crime was super high. This hotel was run down, had a bad rep. And so he was buying kind of like a rundown distressed asset. But he has this vision. So he's like, I love it here. I think people will love it here. I just have to find a positioning for this. And this is where Butch, the marketing genius, starts to inspire me. Speaker 2: What's Montego Bay? I mean, it's a city in Jamaica? Speaker 1: I think it's a city. It's an area. I don't know if it's a city or town or whatever you call it. But yeah, my sister got married there. I should probably know this. Speaker 2: But it's in Jamaica. It's a Jamaican thing. Speaker 1: Okay, so he has this vision. He's like, I want to give Americans a carefree, luxury Caribbean vacation. And so he's like, What's the worst thing about like a vacation? He's like, you know, you don't know where to go. You don't know what you're going to get. And then you sort of the cost add up and you get nickel and dimed and people feel like they may not be able to afford it. That will stop some people from coming. So he's like, let me do it instead this way. Up front, you get one price and everything is included. And I'm going to standardize luxury. So he's like, there wasn't luxury in this area. So first thing he does, he rebrands the Bay Rock to Sandals because he's like, that already? Sandals embodies relaxation and being on the beach. Then he goes and he starts studying. So he's a shameless copycat. So he's like, I'm gonna go study all the other hotels in this area plus other islands and I'm gonna steal the best ideas from each. So he goes and he sees Club Med and he's like, ooh, it's good, but it's a little too Spartan. I feel like I'm gonna make a mess here and I'm in trouble if I do that. So I want luxury, but still you should feel like you can have a good time here. And then he's like, ooh, I like the way they serve this champagne. Ooh, what is this thing, a whirlpool? We're going to get one of those over here. So he starts importing innovation from all these different places. Speaker 2: Wait, really quick. Have you seen that meme where it's like, you know, if you're going up against a deal or you know, if you're going up against this guy in a deal, you're going to get screwed. And it's like a guy with a fat wallet wearing like, you know, Wrangler blue jeans and he's kind of fat and chubby and with a fat watch. You know that meme? Speaker 1: And New Balance. Yeah. Speaker 2: Yeah. New Balance. Bush Stewart looks like this guy. And I could see him like doing research where he's like at a bar and he sees something interesting. He goes, Hey, Miss, you've been a lovely waitress. Can you bring over that song, bitch? Let me look at that margarita maker. What is that? Tell me about that thing. Hey, can you do me a favor, doll? Go ahead and order me about 20 of them. Will you please, darling? Speaker 1: Exactly. It's the famous Sam Walton story where Sam Walton did the same thing. He would study every other retailer. Sam Walton who created Walmart, of course. But on the way, on the rise, what helped make Walmart so great is that he stole anything good any other retailer did, he would steal it. So there's this great story of Sam Walton in Brazil and someone is walking down the aisles of a store and they see a man dead on the ground and they were like, oh my god, help, this guy's dead here. He's just passed out on the ground. And that man was Sam Walton and he was not dead. He was measuring the distance between aisles using his body length. He didn't have a ruler with him, but he's like, I like this spacing. What is this? So he laid down and used his body to measure. Speaker 2: It's about from shoulder to knee. Speaker 1: They didn't understand what he was doing. And so, so Butch was basically doing this. He decides to rebrand it as Couples Only because one of the things he realizes that like a lot of these resorts, it's like you look around, you see the people who are here, the lovebirds who are here, then you got the families who are here, and they're kind of interrupting. The families don't want to see these two making out and the makeouts don't want the kids running around. So he decides, what if I just made it instead of just okay for everybody? What if I made it great for one killer use case? So he rebrands it as Couples Only. It's adults, it's romance, it's no kids. And this was a radical positioning at the time. Nobody was really doing this, but he gave it a clear identity. And then he pours millions of dollars into advertising, which again, most people would not do. He had not proven out the concept. It's not like he was taking profits and reinvesting them. He was reinvesting because he just had a belief. Speaker 2: Well, had he raised money for this? Speaker 1: No, this is the money he made from the AC company. And so he's like, spend bigger to earn bigger. And later he had this great line, which he goes, because he built, he ends up building, I don't know, 30 resorts or something like that in Jamaica. And he's done all, you know, millions of square feet. And he says, the most valuable real estate and the hardest real estate to build is the one in the consumer's mind. And that's always where I start. And I was like, oh, I love this guy. Just an old school ad man. Just a just a classic ad man. Speaker 2: Like the type of guy. He's like never read a book in his life on advertising, but like listen to one TED talk and that's what he bases his entire education on. Speaker 1: Yeah, yeah, exactly. Speaker 2: All right, so a lot of people watch and listen to the show because they want to hear us just tell them exactly what to do when it comes to starting or growing a business. Now, a lot of people message Shaan and I and they say, all right, I want to start something on the side. Is this a good idea? Is that a good idea? And again, what they're really just saying is just give me the ideas. Well, my friends, You're in luck. So my old company, The Hustle, they put together a hundred different side hustle ideas, and they have appropriately called it the Side Hustle Idea Database. It's a list of a hundred pretty good ideas, frankly. I went through them. They're awesome. And it gives you how to start them, how to grow them, things like that. It gives you a little bit of inspiration. So check it out. It's called the Side Hustle Idea Database. It's in the description below. You'll see the link. Click it. Check it out. Let me know in the comments what you think. Speaker 1: And the other cool thing he does is he basically revitalizes Jamaica. So he ends up employing like 10,000 Jamaicans. He's like loved in Jamaica for what he did for the local economy, how he treated people. There was a big change that happened when he brought tourism. And so he goes on a buying spree, basically, as this happens. And he starts buying more and more failing hotels across the Caribbean. He would Be super hands-on. So he'd go stay there, he'd eat the food, he'd sleep in the bed, he'd check the pillows, and he'd basically make detailed notes about anything that needed to change. So like if a customer complained about the temperature of the champagne, it wasn't chilled enough, he would make sure by the next day, like all the fridges are recalibrated to the right temperature, and he would let the customer know like, you know, thank you, we changed it for you. Speaker 2: So he was always tweaking. Speaker 1: It was one of his core philosophies. It was like, I'm not going to get it right right away, but I'm going to tweak and tweak and tweak until I get it there. This kind of works. Hotels are known for their repeat rate. You could tell the quality of a hotel not by the number of stars that it's rated, but by how many guests come back and stay again. Sandals would have, for decades, a 50% repeat rate, which was unheard of in the industry. People loved going there. This guy would just take all these crazy measures to build this business. He's like, after he ran out of buying the distressed hotels that already existed, he's like, I need to buy New great properties on beachfronts. And so one thing he realizes that there's so many beaches that people don't even really know about. So he would rent a helicopter and fly over the island and look for undiscovered beaches and then find them, scout them, buy the land and then build the hotel on that, which is just like, again, just a sort of a brute force, first principles approach to building a luxury hotel. Speaker 2: And now his kids are running it. So is it an independent business? Speaker 1: Yeah, he passed away in 2021. I'm not so sure what's going on with the business since then. But yeah, he kind of left that as his legacy, basically, in Jamaica. His kids, they said all these wonderful things about him, which is Another great test, you know, how great of a man are you? Sort of like, you know, do your kids want to be around you? What do they have to say about you? And, you know, it seems like, at least from the outside, that he did a good job there. He also did this crazy thing with the airlines. You know the story? Speaker 2: Well, on his Wikipedia, it says that he owned Jamaican Air. Speaker 1: Exactly. So he realizes at a certain point, he's like, it's pretty, he's like, I'm telling you this is paradise. But the experience to get to paradise is hell, right? This is heaven. Well, that's hell. So he's like, Air Jamaica was this failing airline. The brand sucked. The service sucked. And so, you know, you sign up for this vacation. I give you these glossy ads. He was buying ads in Playboy and Cosmo and like anywhere that he could sell the idea that If you're in love, you go to Sandals. So not just like, it's a nice vacation. It's a symbol of how much you love each other is that you do a Sandals vacation. And like, you know, the way that sort of diamonds are a girl's best friend or like diamonds are forever. Diamonds became this symbol for, do you commit? You know, are you all in on this? He did that with basically the vacation. So he's doing this, but he's like, the airline experience sucks. Getting here and going home sucks. That's kind of the first impression and the last impression that the consumer is gonna have. So what does he do? He buys the airline, takes full control, like vertically integrates the experience. And he's like, look, the airline was a tough business. It's a bad business. But he had an advantage, which is he owned the resorts. So he basically used the airline as a giant flying billboard to the resort. And he's like, I will just market my resorts. I will bundle the flights and hotels. I will use it to advertise my resorts so that you want to stay there. I will do service and kind of like lose a little money or break even on the airline as long as I give you a first-class experience down to my resorts where you're going to spend a lot of money. He's like, if they get off the plane angry, then it doesn't matter. I've already lost the game before they step foot on the beach. Again, I love this guy. Speaker 2: Brian Chesky, my wife used to work at Airbnb and Brian Chesky, We'd give this talks about like, I think he called it a 10-star experience where he was like, he has this famous like way of... Speaker 1: 12-star, yeah. Speaker 2: Is it 12-star? Where he was like, well, what's like a one-star experience? One-star experience is like you book, you do a booking and we leave the key under the mat and it's just fine. Speaker 1: And there's rats and it doesn't look like the pictures. Yeah, that's one-star. Speaker 2: And a five-star is like Michelin restaurant like style service. He's like, but what's six stars? And like people start getting creative. They're like, you get picked up in a limo and whatever. But what's eight stars? What's 10 stars? And he goes all the way up to 12 stars. And for him, it's a really cool exercise to think about what's like extreme hospitality. And he made this argument, and this was pre-COVID. COVID changed everything at Airbnb because they had to focus on different stuff because it was an existential crisis. But he used to say that he wants to launch an airline. And I was thinking, I was like, what could the tagline be for that? And it would be like, when you fly with us, the vacation starts at the airport. Right. And I was like, oh, that's so interesting. Like, we could actually make that a thing. Like, like, because when you if you're if you're flat or he said that I said that not to him. I was just like thinking in my head. Speaker 1: That Airbnb job offer might come back around 20 years later. Speaker 2: That's a good one, right? Because I was thinking about like when, you know, if you fly first class or fly or you go to the lounge, you're like, it's pretty cool. The vacation started now. So like I just got, and if you sometimes get there early and you got to wait three or four hours, because I'm a, I'm an early, early arriver at the airport. Like it's kind of like. Speaker 1: Three or four hours early? Speaker 2: Like three hours. But like if there's a delay, I don't know. Dude, I get there early. Speaker 1: Are you crazy? What are you doing? Speaker 2: I've never missed a flight in my life. The time with you was the closest I've ever gotten. But no, I don't miss flights. How early do you get there? Now I guess I get there, TSA kind of changed things, but yeah, I'm always at least a two-hour early guy. Speaker 1: I like to slide in at 50 minutes before the flight and see if I can get to TSA in the next 20 to 30. That leaves me another 20 to 30 to get on the plane, easy. Speaker 2: But if I have lounge access, I'm like, look, I'm just going to eat there. I'll eat my lunch or dinner there and then we'll get on the plane. But that's my slogan. The vacation should start at the airport. Speaker 1: All right, we need a trademark. We need a trademark on this. Speaker 2: That's pretty good, right? Speaker 1: That's really good. Speaker 2: Yeah, that has a ring to it. I enjoy reading about hotel businesses. I had a fling with my own little hospitality business. It was called an Airbnb. That went horrible. But I read a bunch of books on this. Have you ever heard about Harrah's Entertainment? Harrah's was a casino. Speaker 1: Like in Vegas? Speaker 2: Yeah, so it was a casino, but this was before casinos became hotels. I was reading this book called The Caesar Palace Coup. In about 2018, all these hedge funds had owned little bits and pieces of Caesar Palace, which I think was the largest casino hotel management company in the world. And it's about like the greed and all the stuff of like what it took to bike by it and how like the downfall of it. But they talk about the founding of it. And it was founded as Hare's Entertainment. And then there was another hotel. They merged. They created Caesars Entertainment. But up until like the 1990s or early 2000s, hotels were just like the hotel and casinos were just like really simple businesses. But then Harris and thus Caesar, when it merged, hired a guy who was a 40-year-old mathematician from Harvard. He had no management experience, no experience running a company. His name is Gary Loveman. And he comes in and he just makes this his math playground. And he dials it in within two years of him being CEO. They dialed this in, I think, in like the year 2001, before the internet was like super popular, to where when you called and booked a hotel, based on all types of math, they would know to offer you an upgrade or offer you 50 bucks in free gambling because it was all math to them. And they knew that if they get you a free room, they got you hooked on gambling. It was all like a statistical thing. And he basically invented this idea of I actually don't know what the phrase would be, but this idea of using data and math like a money ball type of way for hotel guests. Speaker 1: Dude, this is sick. I've never heard of this guy. Gary Luvman. So he's, after nine years at the faculty of Harvard Business School, he left to become CEO of Harrah's, then became the CEO of Caesars for 12 years. That's crazy. He's a minority owner of the Boston Celtics. The use of analytics to influence customer behavior. Speaker 2: Yeah, up until him it had never been done. But he was a famous faculty member at Harvard and he would teach all this methodology and then one day Harris was like, hey, We will hook you up big time. We'll give you access to the private jet so you can fly down on a Monday, come home on a Friday. We're going to roll up the red carpet for you. Just do what you want." And he did what he wanted. And eventually they go, all right, brother, you're now CEO. It works great. And so it was crazy. Within three months of him joining the company, they saw massive improvements. And then within a year or two, he implemented. It was all data-driven. Speaker 1: He's like, cherries in the vodka. We're going to put cherries in the vodka and everyone's like, we don't know. The data says put cherries in the vodka, slot machine sales are going to go up by 3.3%, right? I mean, a casino is one of the most well-optimized. It's like you are the sponge, and the casino is wringing you out. Speaker 2: Well, he's the guy who did that. And so now, I think he's chairman or VP chairman, something like that, of Aetna, one of the largest insurance companies in the world. Speaker 1: Yeah, yeah. Speaker 2: Perfect. Speaker 1: Just what we need. Speaker 2: It's the same math. If your goal is just maximize profits, you do this math equation. Speaker 1: This is like when I learned the tobacco companies own Kraft food or whatever. It's like, oh, the children's food is owned by the cigarette company? Oh, great. Speaker 2: Annie's Goldfish is owned by the same guy who's making the cigarillos. Unknown Speaker: Yeah, exactly. Speaker 1: Today's episode is brought to you by Hubspot. Did you know that most businesses only use 20% of their data? That's like reading a book but then tearing out four-fifths of the pages. Point is, you miss a lot. And unless you're using Hubspot, the customer platform that gives you access to the data you need to grow your business, the insights that are trapped in emails, call logs, transcripts, all that unstructured data makes all the difference because when you know more, you grow more. And so if you want to read the whole book instead of just reading part of it, visit Hubspot.com. So this guy is kind of a genius. I want to tell you about this genius thing that I've been thinking about. Not my idea, just the idea of geniuses. Let me just tell you a story here. I'm going to read from, I think this is a Financial Times article, but I'm just going to read you a couple of the intro here because it's amazing. All right, Sam, I want you to imagine you are Stacey Tang. You're a Chinese woman, like you've always wanted to be, a manager at a pharmaceutical company in Beijing, and you receive a phone call on some Squid Game shit. An unknown number calls you and says, we like your son. You have a 15-year-old son. It says, we believe that he might be qualified for the Genius Program. And we'd like to give him a test. Now, it's also COVID. It's peak COVID 2022. People can't meet in person. So they said, Stacy, I know you might be concerned about COVID. You're a good mom. Fear not. We're going to put him in the back of this van and we're going to drive around the city. And he's going to do math problems in the back of this van. And we'll know by the end of the ride if he's qualified or not. And we'll dump him off on the street if he's not. And if he is, you'll see him in a couple of years. And like Stacey would feel, you might be... Speaker 2: I would say, what color is the van and what corner should I leave them at? Speaker 1: Exactly. That's exactly how Stacey felt. She says, I wasn't worried about an abduction plot. In any other country, I would, but not here. She goes, I was weeping with joy. Speaker 2: Not mid-COVID. Full trust in China, mid-COVID. Speaker 1: I was weeping with joy and I sent my boy right away because I knew what this was, a golden ticket to the best educational resources of China. Speaker 2: Stacey is a very optimistic woman. Speaker 1: So Stacey and her son were part of this program that China is running right now where they have a hundred thousand kids that they've identified as like possible geniuses and they put them through what they call the genius program. What they do is at a young age they sort of identify a certain aptitude for math, for science, etc. And they say, we'd like to invite you to the Genius Program. The RSVP says yes or yes, and then you go, you send your kid, and it's a few-year intensive study program. You get to skip all your normal school. You get to skip the college entrance exams. You don't have to take any of those, but you're in basically math boot camp, and you are going to be studying with the brightest and the best, and they are trying to produce incredible talent in China. And so you might be wondering, well, like, how does that work? Is it working? Speaker 2: Right? Speaker 1: Natural questions are working. Sam, do you like TikTok? Genius program. Sam, have you ever heard about Taobao, which is essentially their PayPal? Genius program. Have you heard about their Groupon? Genius program. Have you heard about their super app? Genius program. Have you heard about the brothers who are behind their big NVIDIA competitor? Genius program. You ever heard of DeepSeek? They were in the news recently. Created that big algorithm, didn't even have access to the best chips and somehow outperformed all of the OpenAI models. Genius program. Speaker 2: It's like a Thiel Fellowship run by the government. Exactly. Speaker 1: So China already has this incredible population advantage where they produce We have 5 million graduates in math, computer science and engineering compared to, I think we have like half a million that are in technology, the technology and science fields in the US. So 10 to one, already they're 10 to one, us just in normal college graduates, but now they're looking for the cream of the crop. And they are basically trying to create this talent pipeline, homegrown talent pipeline Math geniuses, computer science geniuses, et cetera. And it's working. So they started this program many years ago. And at the time, China didn't have a very notable math or science achievement record at the international level. So there's these things called the Math Olympiad. It's sort of like the Olympics for math. And so the first year, they sent a team of three, and they got the bronze. And they're like, yes. And then the next year, they sent six teams. And they got two medals. And now, basically, they just sweep all the medals every year. They just dominate these programs. They have the most players and the most wins. And their AI program, like, you know, if you go walk into an open AI office, you're going to see tons of Chinese PhD AI researchers who now work in the U.S. But for everyone that you see here, you know, there's a hundred that are still in China working at the Chinese companies, the Chinese labs. And I was just pretty inspired by this whole thing. There's one anecdote in the story where it says that if you go into a normal Chinese public school, there's a blunt slogan on the wall. This is not even the Genius Program. This is just a normal elementary school, public school. And it's a reminder for the teachers and staff there. And it just says, produce talent quickly and early. And I thought about that because I send my kids to school. And the teachers and the staff do not have a philosophy about producing talent quickly and early. What's our slogan? No child left behind, right? That was the famous education program that we launched, I don't know, when Bush was president or something like that. Speaker 2: It's the exact opposite. Speaker 1: It's the exact opposite. It's about don't discriminate, don't make anyone feel left out. In San Francisco, they were doing this thing where they were getting rid of the gifted in honors programs because it made the other people feel bad. And we basically are taking the exact opposite with the inclusion focus and the no-child-left-behind focus. Whereas if other countries are taking this idea of your job is to produce talent quickly and early, and that the goal is greatness, and let's be competitive about it. What's going to happen over a 20-year arc? You're going to get more and more. They're going to win. And so I just thought this was pretty interesting. I wanted to hear your thoughts on this. Speaker 2: It kind of begs the question, why doesn't Facebook have, what's it called? Well, yes, but what's it called? The D-League for NBA? G-League, yeah. The G-League? Or what's the minor leagues? Speaker 1: AAA baseball, yeah. Speaker 2: Yeah. Why doesn't Google and Facebook And the top 200 schools have like a farm team where they identify 14-year-olds that are promising and they go, hey, would you like to come to school here forever or for free? And you can choose to work at us. We're at our company afterwards. But just so you know, you have like a job here if you choose to, and we will educate you and get you up to date, up to speed on all the stuff. Speaker 1: Totally. I actually, when I first moved to San Francisco, this was the thing I was pitching investors. I was like, I think I should go create Google You. And my dream would be to be the dean of Google U. I was like, I think it's crazy that these giant companies don't have their own talent farms, right? Why wouldn't they try to produce talent? Speaker 2: We wrote a story at The Hustle about this kid named Michael Prasman. Michael, if you hear this, what's up? And he was like a 15-year-old who had this rag to riches story where he somehow got Mark Zuckerberg's attention at the age of 14 because he wrote like a viral app. And he made the news because Zuck was like, hey, do you want to like an internship here? And then that led to a full time job when he was only 16. And now I think he's doing I think he's on the. The AI, what's it called? The super team, the super intelligence Facebook team, which is like the hundred million dollar a year salaries, insane stuff. And it was like, we wrote a story because of how remarkable it was that Facebook hired a high school kid. Speaker 1: We need more Doogie Howser shit, right? Speaker 2: Like, why don't we do that? Speaker 1: Where's our competitiveness? So you have the Teal Fellowship, right? That's like a thing. And obviously there's like little programs all around. Dude, I remember when I was in seventh grade, Duke University did what I didn't realize was essentially just a marketing campaign, but they had created something called the Duke Tip Program, and it was called the Talent Identification Program. And I lived in Texas, and suddenly Duke University did this thing where my school in Texas had us all go to the cafeteria and take a little test. And then you got like a little merch bag with it of like Duke gear, and then the results came back and was like, we think you're talented. And bro, I think I rode that for like seven years and then I went to Duke. That thing really influenced me in some weird subliminal way that like maybe I am special and maybe I can do this and maybe I should go pay Duke $200,000 to go to school there. And I did all those things and I'm surprised that more of that shit doesn't exist. I kind of want to create something like this because I think it actually Now, the China one is more like boarding school, right? And there's been other countries that do that, but I feel like we need our own versions of these. What does the American talent pipeline look like? And where are we identifying the best and the brightest on some ender's game shit and inviting them to the academy and then letting them duel and compete in a pretty hardcore way? Because look, hardcore is not for everybody. But there's some people that only thrive on hardcore situations. They want to play the game at the competitive level. Basically what we do with youth sports, with AAU and travel ball and shit like that. But do that for the genius kids. Do that for the makers. I think that is, maybe it exists and I'm just not aware of it. Speaker 2: Have you heard of Birthright? I love Birthright. Crazy. So for those listening, I learned about it because I was dating a girl who went on Birthright. I don't remember what age. I was like 21 years old. Speaker 1: Do you remember what she told you about it? What was your reaction? You were like, what? Speaker 2: Yeah, and she wasn't even Jewish. She was like ethnically Jewish, I guess. But basically, Birthright is a program. It's funded, I think it's funded a little bit by the government, but a lot of it is Wealthy Jewish people, but also I think a lot of wealthy Christian people who believe that when the end of the world, according to the Bible, when the end of the world happens, the Jews need to rise first, then the Christians go behind them. That's like what the book of Revelation says. And so they believe for a variety of reasons that we need to keep Israel strong. I don't care about the politics. I'm just telling you guys the facts. And so a lot of Christians, I think, but also like Bernie Madoff was a huge funder. A lot of people are funders. Speaker 1: It says 67% of the funding for birthright is individuals, 27%. It's The Government and then there's like a couple percent of other things. Speaker 2: And it's basically a free trip to anyone who could prove, you'll have to tell me the exact measurement, but I think it's like if you have like a great grandparent who's Jewish. So you could be like not Jewish at all. Does it say what the requirements are? Speaker 1: Well, I just asked, does it count if I have a Jewish friend, and it said no. That's not going to get me there. Speaker 2: Like, do you identify as Jewish? But basically, it's like a very small percentage, and they bring you on something like a three-week all-paid-expenses trip. All Expenses Paid Trip. Speaker 1: At least one Jewish birth parent or a recognized conversion. Speaker 2: Okay, so just a parent. They bring you for like two or three weeks. I forget how long it is. But they give you a tour and you see all the type of stuff. I remember when I was dating this girl, we broke up afterwards because she was like, they introduced us to all these Israeli soldiers and I was like, All right. Like, this guy's really ripped. Why did he take his shirt off? Like, you know, like, why do you have photos? Anyway. And like a small percentage of them then, you know, become like our good buddy Siava, like become more in touch with Judaism and in touch with Israel and thus support Israel more. Speaker 1: Yeah, it's how culture lasts through generations, right? It's cultural experiences and exposure. Any culture can do this. They've just systematized it in this really like cool like opportunity for people. Speaker 2: Yeah, it's awesome. And like it's pretty great. Like I would because I think you have to be like 18 between there's an age limit. I think it's like 18 to 25. I forget what it is when you're like prime to like want to go on a free trip. You're like, yeah, okay, I'll go. And then you like it's free trip. Hell yeah. And then you get there and you're like, okay, I actually do like this or like that. And so it's pretty cool. And I think that's kind of a good example. Speaker 1: The world's best timeshare presentation. Speaker 2: Yeah, and I think that's like a really good way, and this sounds bad, I don't mean it bad, to indoctrinate someone into like a cause and get them long-term bought in, and it is kind of like an interesting model. Unknown Speaker: Yeah, I love that. Speaker 2: What do you do with the money once you've already made it? This is a question Shaan and I ask our successful guests all the time. And the reason we ask it is because if you are successful, if you do have a little bit of money, information on how to spend or invest your money, it's actually really hard to come by. And I know this because inside of Hampton, which is my community of founders, people ask this question all the time. People have made $10 or $50 million. How do you spend it? How do you invest it? And so to help solve this problem and answer this question, I actually interviewed 80 plus founders, guys like Scott Galloway, Alex Ramosi, Brian Johnson, people who are worth 50, 100, even billions of dollars. And we got them to reveal everything. So their net worths, how much they pay themselves, their monthly expenses, their portfolio, things like that. And we turned these 80 interviews into one document. And I don't think you can find this type of information literally anywhere on the internet. And it's completely free. So if you want to see behind the net worths of people who are worth billions of dollars and their portfolios, their expenses, everything, you go to joinhampton.com slash reveal. Again, joinhampton.com slash reveal. Check it out. Speaker 1: So what are you saying? We need our own birthright? Where are you going with that? Speaker 2: Well, no, what I'm saying is, two, I actually do think that America should have mandatory, I think Scott Galloway said this, I've agreed with this for a long time, we should have mandatory service for American military. I think that would be great. But number two, I think that's a really good example of how you have like whatever we're calling this, like a farm league of like getting in with people at a young age. Like it is, I wonder like, It worked really well with Duke and you. I mean, I didn't go to a good school. I was from Missouri. I didn't go to a good college. But it is interesting why you aren't promoted to a little bit earlier on to buy into a certain movement like going to a good university or joining an interesting company. Speaker 1: Well, we're kind of saying three different ways that you can produce this talent farm. So the first one was the China one, which is you identify promise and potential early. And then you invest in that and they do deliberate intensive practice and those people who had potential, they build the skills in a more intense way in a more hardcore environment. Okay, that's one way you could do things. Second thing we talked about, let's say the Duke example is sometimes just creating a test or something like that just to do talent identification, if nothing else, makes people feel like they're special and that they're talented. And literally that self-belief It's worth something. It's not the same value as going to an intensive boot camp and capitalizing on it, but it's not nothing either. How do you get that sense of pride, cultural ties, and enthusiasm at one idea's birthright or something like that? So there's all these different ways you could do it. I started studying. I was like, who else has done things like this? Have you seen the story of the Soviet, or are you familiar with the story of the Soviet Olympic program, basically, how they did this? Speaker 2: Yeah, and how they were just like the shit. Well, they also drugged them. That's why they won all the... A ton of the women track and field records are from the USSR in the 80s, like still. It's like the longest standing records. Speaker 1: So I didn't know the whole story. So I was kind of looking into this. It's pretty interesting. So Soviets were kind of famously independent. They were kind of like, we don't need to be a part of the Olympics. So they actually had their own Kind of like fitness games. They had what they called physical culture, which is like Fiscal Tura. And then they had their own thing called like Sparta, something Spartacus, that was like their Olympics. But at a certain point, it was kind of like the Olympics had the network effect. It had the brand, it had the prestige. So even if we were winning our local thing, it kind of didn't hold. We couldn't do this. And so they basically built a machine. So they decide, all right, we're going to enter the Olympics. But the way they did it was just so Russian, so incredible. They built an incredible machine that I respect. So what they did, they did the same thing, talent identification. So they go at age six to 10, they start measuring how long are your arms? How big is your wingspan? What's your reaction time? What does your body composition look like? What's your flexibility like for gymnastics? And they basically didn't wait for greatness to appear. They went on a talent search and they searched for greatness. And once they did that, they basically hacked the system. So at the time, I think until like 1988 or something, 1986 or something like that, the Olympic Charter said that you couldn't be a professional athlete. Speaker 2: One of our past topics, Dupree Fontaine was one of the biggest advocates to abolish that. Speaker 1: Okay, great. So the Russians basically just worked around it. So they're like, this gymnast, she's a student. This guy, this hockey player, he's an officer. And like, you know, they had these job titles that were only on paper, but actually there's training full time for this, whereas the U.S. would be like, I'm juggling school and my training. And obviously somebody who's only training is going to get further ahead. Speaker 2: Well, you remember Mirko Krokop, one of the best UFC fighters? Speaker 1: Yeah. Speaker 2: Yeah. He was supposed to be an ex-police officer. That was like the shtick. But he was really trained, I think as in, I forget where, a former USSR state as a fighter. And he trained full time. Speaker 1: He's like, I'm the can man. Anybody can get it right now. Speaker 2: That's funny. Speaker 1: Different boxers. All right, so they do that. Then they start drugging, right? So they're like, okay, what else can we do? PEDs. So that became obviously a thing. They also did like world-class, you know, I guess like progress and innovation in calisthenics and training programs and regimens that were like progressive loads and deloads. How do you peak at the right time? Stuff that's today standardized. They invented and kind of created it and we had to go steal it from them basically of like, how are they doing this? Speaker 2: In running, there's called periodization, which is like you start with heavy miles and then you slowly taper off or you go to speed. They helped invent that. They also helped invent the idea of training, lifting weight in cold atmosphere with the AC down to like 60 and 55. What does that do? It just makes you stronger. I don't know the science behind it, but that was like one of their theories. Speaker 1: I love how I ask as if that's my problem. It's been the temperature this whole time. Speaker 2: No, they just came up with all these really weird, I mean, they were lab rats and so they came up with a bunch of stuff for volume training for weightlifting. They were the best weightlifters and so a lot of the best, they're now old guys, but a lot of the fathers of bodybuilding in the 90s and 2000s, they're all in their 80s now, were USSR guys. Speaker 1: And so they ended up dominating the Olympics. They were either, you know, first or second in medal count. And then, you know, it just sort of like there was a period of time where they really dominated. And it was also cool, like, why did they care so much? And it was basically, let's send a message. It's like physical dominance was like a signal for dominance and other things. And this is why I thought the China thing is so interesting because. Speaker 2: Because it's the exact opposite. It's brain. Speaker 1: It's brain dominance. But even more, there's more stakes. Like this was symbolic. It's like, we'll show the world what we're capable of. And there's always been these symbolic victories, like the first to climb Everest or the North Pole or the South Pole, things where there's objectively no value to be gained by being the first guys to reach the South Pole, aside from bragging rights. And countries cared a lot about these bragging rights. And now with the AI thing, it's like, it's not just a symbolic victory. It's actual, like, total domination of the world's most powerful technology and will probably create the next global power. All of the same national pride bravado stuff from the Olympics multiplied by actual real-world tangible benefits and dominance. Speaker 2: Dude, I think it's great. Like Blue Angels, bravado stuff. This is the greatest thing ever. I think it's wonderful. Speaker 1: Sam's all in on bravado. Speaker 2: Well, I just think that having a common enemy is really good for bringing people together. I remember post-9-11, I distinctly remember the week after, I remember walking around the street and I was like, there's something about this that I just feel like a bond with strangers. Do you remember that feeling? Speaker 1: Well, a little different as a brown guy, but yeah. Speaker 2: Yeah, you actually had the exact opposite of experience. I forgot about that. Speaker 1: Oh wait, I'm the common enemy. Speaker 2: You were the enemy. You were the other. Speaker 1: You think, right? Speaker 2: Yeah, yeah, yeah. What did I do? I was the us and you were the them. Have you heard of this thing? This is related to what you were saying about planting a seed in someone that they're good. Have you heard of this thing called the Michelangelo effect? Michelangelo effect? It's this like psychological phenomenon where basically there's been a bunch of tests that have proven it to be true. And we use this phrase with Hampton all the time. It's like a gift from the gods, this phrase. So the Michelangelo effect, it basically just says that if you have two romantic partners or a peer group or a friend group, As long as they affirm each other and plant the seed in you, like for example, I'm like, Shaan, you are the man. You will be fit. You will achieve this. You will do whatever you want. And we keep affirming each other. Every time you say that to one another, it's as if when Michelangelo was doing the Statue of David, someone said, how did you make this amazing statue? He says, The statue is there. I just chipped away at all the stuff covering that beautiful statue. And so it's as if like the greatness is in you because I have put that label on you. And each time I affirm or congratulate or say how you're amazing, I'm chipping away at the stone that's going to unveil this beautiful like thing inside of you, which is whatever the goal is that you want to become. And they have found that basically like If you are raised around fat people, you are more likely to be fat. If you are raised around depressed people, you are more likely to be depressed. If you're raised around rich people, you're more likely to be rich. And it's not just because of like, you know, what your parents do. It's just like you become what you are affirmed and what you are told. And it's called the Michelangelo effect. And it's a really cool idea. And like this has been studied by psychologists. Like there was a where they looked at like a group of 50,000 people and they were like, what words are you using to To talk to this person and how do they end up and where do they become and it's like really telling and so it's a really cool idea that if I tell you at a young age that you are special, that you work hard, that you're going to be great, that you belong in this category, you are more likely to actually become that simply of me like telling you that you are. Speaker 1: That's amazing. My dad told me this story about something his dad did for him that's always stuck with me. And so this is a little dad nugget of gold to pay forward. Speaker 2: I don't want to cry. Speaker 1: I'm emotional today. It's not that emotional. But maybe you're in that phase where, you know, the hormones. Speaker 2: Dude, having little girls, man, I feel like I want to like tear up all the time. Speaker 1: So my dad was telling me, so my dad grows up in India, right? Like, and if you look at, you know, today he lives in San Francisco and he's had this great life, but like, you know, it's kind of unheard of from a village in India, right? It's like hard to imagine starting there and ending here in one lifetime. So he tells me the story and he's like, you know, there's one thing my dad always did for me. And he goes, my dad always, he's like, he planted the seed in me that I was special, that I was different, that I was gonna go do great things. And he goes, it didn't make any sense because I was not doing anything. We lived in this little dirt village, right? Nobody in our family had ever done anything. So his dad worked at a factory. And he told me the story how his dad would bring him to the factory and the boss would be there like, oh, hey, kiddo, like, you know, who's the kid? You know, and he put a hard hat on him and be like, you know, one day like you can, you know, you can be here with us, you know, when you grow up. And then his dad, to his boss, was like, are you kidding me? He's like, no, this boy, this boy's special. This boy's not gonna be here. He would take the hard hat off of him. Be like, he's not gonna be here. He's not gonna be in a factory. He's gonna be in America. This boy's special. You don't know. This guy's really special. He's really smart. He's really special. He's gonna do something amazing in America. And he told him that since he was like age four, five years old, six years old, seven years old. He's like, he put this in me that like, I was special. I was going to do something. I was going to go to America. He's like, my dad had never been to America. He doesn't even know what America is at the time. He'd never been on a flight, never been on an airplane. But he had this idea and he put it, he just said it so matter of factly and he said it in front of other people to his boss. And he's like, I just had to take that as like, this must be serious. He wasn't even telling me. I just overheard it. I eavesdropped on that. And I thought that was great. I was like, I'm going to do that for my kids. Speaker 2: How great is that? Is that the best? Speaker 1: That's the best. Speaker 2: I do that with my kids all the time. We do daily affirmations in the morning. We say, I'm bold, I'm tough, I'm smart. Speaker 1: Yeah, we do this. I'm brave, I'm strong, I'm happy and I can do anything. We run that all the time. I tell you about the tennis little victory I had with my son. When he would go into new classes, he would always get scared to like new soccer class, new tennis class, anything. And as a parent, it's very frustrating, right? You pay, you drive through traffic, you go there. And then your kid doesn't go in. And then in front of you, all the other kids are like doing it happily, blah, blah, blah. I'm like bartering and bribing and threatening and then ignoring and then trying again. And then I'll go in with you and then I'll jump on the trampoline. Let's do this together. And then the teacher's like, hey, can you leave? The parents aren't really allowed to be in here. So there's been this situation over and over and over again. So we go to a tennis class, new tennis class. And sure enough, doesn't want to go in. And I'm like, OK, I decide I'm gonna try this a little differently. So we just we hang out and we're just talking. I decide we're going to stay here. We're not going to try to force you to go in. We're just gonna sit here and talk. And I start telling them, I'm like, you know. I get pretty afraid at doing new things, too, actually, so I totally get that. And I realize that it's not that the other people aren't afraid. They have the scared in them, too, right here, right in your chest. And I was like, but you get to decide, like, does the scared win? I was like, and sometimes the scared wins. And like today, the scared won, but it doesn't always have to win. Sometimes you get to win. So I tell him this. I forget about it. He doesn't really even really give me, you know, kids are always like verbally affirmed. Speaker 2: What a wonderful lesson. Speaker 1: Like he's just like, you know, looking at his like car that he's playing with or whatever. So three weeks later, we go and we go to class and my wife takes him and he goes in. She's like, oh, he went into tennis. No problem this time. After, you know, three weeks. And then afterwards is like, you know, what? Good job. Like, you know, so proud of you. How'd you do it? And he was like, I didn't want to let the scared win today. And I was like, yes, total and complete victory in life. I did it. I did it. I'm not a terrible dad. I actually taught him something. It was like this huge, like, you know, great moment of my life that I was just hearing that that that little seed Watered enough, like eventually did bloom, in his own words. And I had actually forgotten about that whole thing and he remembered it. Speaker 2: What a wholesome episode. Right? That's what fires me up. Speaker 1: Thank you for dad corner. Speaker 2: Yeah. I want to go and hug my kids. All right. That's it. That's the pod. Unknown Speaker: I feel like I can rule the world. I know I could be what I want to. I put my all in it. Speaker 2: All right, my friends, I have a new podcast for you guys to check out. It's called Content is Profit, and it's hosted by Luis and Fonzie Cameo. After years of building content teams and frameworks for companies like Red Bull and Orange Theory Fitness, Luis and Fonzie are on a mission to bridge the gap between content and revenue. In each episode, you're gonna hear from top entrepreneurs and creators, and you're gonna hear them share their secrets and strategies to turn their content into profit. So you can check out Content Is Profit wherever you get your podcasts.