Sam Parr: Natural Born Hustler – Below the Line with James Beshara

Key Takeaways

  • If you’re vulnerable or open with someone about what you’re struggling with and they see you trying to get better, they’re more likely to help 
  • Start an email list ASAP
    • “With an email list, you could have a $25 million/year business with just two writers”
  • Great entrepreneurs are very often no different than your average Joe 
  • The worst-case scenario often isn’t as bad as you make it out to be – so take the “risk”
  • In 2014, to celebrate one year of sobriety, Sam rode his motorcycle from SF to NY and back
    • “Your headlight only has to see 200 feet ahead of you to get from here to NY, which is a 3500-mile trip” – THAT’S life
    • Know where you want to end up, but realize you only need the answer for a couple of months in front of you – you can figure out the rest later
  • A quote too good not to include:
    • “There’s a direct correlation to your willingness to tell someone to f*ck off if you don’t like what they’re saying and how many months of savings you have. There’s another correlation to you being willing to tell someone to f*ck off and how much income you’ll probably have.”

Books Mentioned

  • Reading How to Win Friends and Influence People by Dale Carnegie in 6th grade taught Sam the importance of vulnerability 
  • Sam recommends The 50th Law by 50 Cent and Robert Greene
    • Sam recalls a line from 50 Cent – “He goes, ‘I think my power is that I can turn shit to gold.’ When I read that I realized that’s totally the way to live.”
  • The Mythical Man-Month by Brooks Jr, Frederick
    • This is a book which breaks down how putting more engineers on a project actually extends the runway at which it’s delivered

Intro

  • Sam Parr (@theSamParr) is the founder of The Hustle, one of the fastest-growing media companies in America
  • James is speaking at Hustle Con, Sam’s conference in Oakland Ca which runs from December 2nd-3rd
    • Use the promo code “belowtheline” for $50 off a 2-day ticket
  • Today’s Below the Line drink of choice – Matchabar Hustle

Sweet San Francisco

  • Sam lives in Glen Park (James lives about a half-mile away)
  • “I always say San Francisco has lots and lots of cons and lots and lots of pros”
    • Pros: 
      • Natural beauty
      • There are people from all over the world (resulting in a ton of different cuisines)
      • The density of intelligence
    • Cons
      • It’s VERY expensive
      • It’s too left-wing politically
    • James adds:
      • “The baseline warmth of the people just isn’t as great as other places”
      • “It’s hard for me to think of another city where you’d meet, interact, and connect with these incredibly interesting people doing incredibly cool things”
        • And there’s SO much positive serendipity because of this
  • Tim Ferriss is an investor in The Hustle
    • Sam and used to run into him quite frequently while walking his dog (before Tim’s move to Austin)

The Power of Vulnerability

  • James notes how candid Sam is on Facebook
    • Where did this come from? 
      • Sam read How to Win Friends and Influence People in 6th grade
        • “I learned early on that if you’re vulnerable or open with someone about what you’re struggling with and they see you trying to get better, they’re more likely to help and contribute”
          • Similarly, people are much more likely to stop and help you with a broken-down car if they see you pushing it (rather than if you’re sitting on the side of the road with a thumb out)
      • “Maybe I just have a low threshold for being embarrassed. My feelings don’t really get hurt and I don’t mind looking like an idiot.”
  • James notes that with his podcast, he’s also been trying to drop the filters and be vulnerable 
    • The responses have been nothing but positive

Build a Network

  • Before moving to SF, Sam didn’t know a soul
  • He remembers emailing a ton of people, like Kevin Ryan – founder of MongoDB, Business Insider, and DoubleClick saying:
    • “Hey, I want to start a media company but I have no idea what I’m doing. Here are the steps I’m about to start taking. Let me know if you have any feedback.”
    • And… no reply. But Sam kept trying:
      • “Here’s my progress. We’re now 6 months along. I’m struggling with X. If you ever want to swap stories, let me know.”
  • “I did that with a handful of other people and after a while, they started to open up. Now I have this amazing network and it was formed by doing this with loads of people.”

Ditching Alcohol

  • Sam quit alcohol when he was 23. He wrote a post about it – 6 Things I Learned From Not Drinking For 1 Year, a few of which were:
    • It was still very possible to have fun and meet girls
    • “It felt as if I had bad eyesight and I was able to put glasses on. My senses heightened.”
      • In a way, Sam became addicted to this clarity
    • Sam used to fear he would put a damper on others by not drinking – that wasn’t the case
  • James, who’s also cut back on drinking, has begun to notice how much avoiding alcohol improves his sleep

The Similarities Between Entrepreneurship and Addiction

  • “Entrepreneurship is very all-consuming and at times obsessive. It very often feels like an addictive behavior.” – James
    • For this reason, James wants to attend an Alcoholics Anonymous (AA) meeting to see if there are any principles he can pick up on (Sam actually went to a few as part of his journey to give up drinking)
  • “People who try to be great at anything; it doesn’t matter if it’s business, sports, or art; anyone who wants to be high-achieving is kind of a weirdo. You’re just really far on one end and that tends to jive well with getting addicted to food, alcohol, or drugs.” – Sam
    • “I embrace my ability to get addicted to things. I just try to choose what I’m going to give into”

The Hustle

  • They now have 30 employees and last year generated 8 figures in revenue (7 figures profit) 
    • These financials are expected to double in 2019
  • The business is only 3-years-old
  • It all started when Sam created a conference, Hustle Con (essentially TED Talks geared towards entrepreneurs) 
    • Sam popularized the conference by promoting it on a growing email list he had created
    • The first conference made ~$40-50k in profit (Sam spent ~$10k on expenses)
    • The second made ~$250k in profit
  • How did Sam grow the email list?
    • He originally just added everyone he knew (~200 people) to it
    • Sam would create content based on each conference speaker
    • The list had an automated sequence, so anything Sam had written in the past would get emailed to new subscribers
    • “I was able to get 10,000 emails relativity quickly. Those 10,000 emails collectively made close to $300k.”
      • Sam adds – “With an email list you could have a $25 million/year business with just two writers”
  • The Hustle has well over 1 million readers/day

The Hot Dog Stand

  • Read more about Sam’s hot dog business in this Twitter thread
  • In college, when Sam was 20, he randomly met Mike Wolfe, from American Pickers, on the street one day
    • Mike said he was opening a store in town – Sam arranged to help work part-time
      • Because of Mike’s popularity, the store would get quite packed and without any food nearby, Sam had the genius idea to open a hot dog stand to sell hot dogs to hungry customers
  • The stand took off – Sam got even more business by parking the stand outside various bars at night 
  • Still in college at the time, Sam set up his schedule so he only had classes on Tuesdays and Thursdays which ran from 3 PM – 9 PM
    • He’d work from 11 AM – 3 PM, go to class, and then work again from 9 PM-midnight
  • On a slow day, he’d make ~$150 in profit
    • On a busy day… $1k

What Sam Learned From a Move to Silicon Valley

  • After college, Sam moved to Silicon Valley to interview with Airbnb 
    • His first impression: A “scheme,” like a hot dog stand, didn’t have to be small. Airbnb was a “scheme” too, just on a larger level.
    • One of the most important realizations – Famous entrepreneurs, like Joe Gebbia of Airbnb, weren’t that much different than Sam himself 
      • James adds – “Being a great entrepreneur is doable. It’s not some superhero gifted with flight or laser vision. Those people just started doing it and took a risk.”
      • At the end of the day, there are a TON of average people who are really successful
        • “Once you realize that… you realize you can shape your own reality” – Sam
        • “Meeting all these people, the people shaping the world and building these companies… they’re nice and smart, but they’re not world-class.”

Most People Don’t Understand Risk

  • When Sam moved to SF, he was without a job and had just a few thousand dollars to his name (he spent all the hot dog money on “dumb stuff”)
    • But he asked himself – “What’s the worst thing that could happen?”
      • He concluded: ending up homeless 
        • “I would do that for a year if I had to when I was young”
  • The takeaway – the worst-case scenario often isn’t as bad as you think
    • “For many people listening to this podcast or those trying to start an internet business, the likelihood that your worst-case scenario is pretty good… is quite high. So take the swing.”
    • And if you’re not comfortable with the worst-case scenario, fix it
      • Maybe the worst-case scenario isn’t being homeless, but instead working as an Uber driver making minimum wage – totally doable!
    • You also have to consider the cost/risk of INACTION
  • “One of the things I think about is safety. If we all consciously knew how safe we actually were, the world would be very different.” – James
    • When you think about and compare the current times to those of the past, we’re amazingly well off
  • One of James’ favorite quotes, from Jeff Jordan of Andreessen Horowitz – “I think my superpower is I can get over pretty much anything in 24 hours”
    • “I think most humans can get over almost anything in 3 days. When you recognize that, it really does free you up to take some risks.” – James

Life Design 101 | Constructing Your Own Reality

  • Sam has always had a knack for creating his own reality
    • Whether it was talking his way backstage at a concert or moving to SF without a job AND without having ever been west of Colorado
      • “People ask me, ‘Why are you doing that?’ Because I want to and I’m going to figure out how to do it. That’s why. There’s no other reason other than I just want to.”
  • It comes down to this:
    • Asking himself – “What would make me happy?’
    • Then – Making that true 
  • For example:
    • Sam pays someone off Craigslist to do his laundry

An Important Philosophy Lesson

  • In 2014, to celebrate one year of sobriety, Sam rode his motorcycle from SF to NY and back – it took 6 weeks
    • “Your headlight only has to see 200 feet ahead of you to get from here to NY, which is a 3500-mile trip” – THAT’S life
      • Stop worrying about the big picture, take it day by day
      • Know where you want to end up, but realize you only need the answer for a couple of months in front of you – you can figure out the rest later

The Hustle – Round 2

  • The Hustle is bootstrapped
    • Just for comparison, James’ former company, Tilt, raised a total of $70 million
  • When Sam started the company, he had $300k in the bank (all income from the conferences)
    • Year 1 – they did ~$2 million
    • Year 2 – they doubled it
    • Year 3 – it should double again
  • BUT – $2 million is $160k/month
    • A team of 4 employees in San Francisco costs ~$40k/month
    • Basically – “You don’t have a lot of room to screw up. I would often go to bed at night thinking we were going to go out of business next month… I was paranoid, constantly paranoid.”
      • *Sam felt this way up until last year*
      • James adds – “I remember the constant paranoia too. My wife says, “For those 6 years [of Tilt}, you were just different.'”
        • “For the 6 years of running Tilt, there were 4 months where I thought, ‘Oh we got something here!’ For the other 5 years and 8 months, it was falling way behind the eight ball.. constantly.”
      • “But I don’t think there’s any way to get passed this. I think you have to go through that to do something great.” – Sam
  • Sam paid himself <$30k/year during the early days of The Hustle… in SF!

What’s on the horizon for The Hustle?

  • “I think we could build a business that makes a $1 billion/year”
  • What might this look like?
    • Hosting large events and trade shows
    • Having affordable subscription services (like Trends, which they just launched – it costs $300/year)
      • With Trends, a team of analysts writes stories about different company business models, P&L case studies, interesting data points, etc.
        • An example of something which might be explored: The searches for online plants are growing FAST. Home Depot makes $1 billion/year selling plants. 1-800-Flowers recently reported young people are “ordering succulents like crazy.”
    • Then – doing the above across different verticals (lawyers, oil workers, teachers, etc.)
      • When thinking about a new vertical to explore, Sam likes to ask:
        • “In what verticals does there exist a high number of people?
        • “Who would want to advertise within this vertical who wouldn’t want to advertise on Facebook or Instagram?”
        • “In what verticals would companies pay for their employees to subscribe or attend these events?”
    • “I think we could build many different brands that potentially make hundreds of millions in revenue”
    • Something else Sam is exploring – creating a subscription product or community for the hundreds of advertisers who have advertised with The Hustle

How has Sam become so self-aware?

  • Read tons of spiritual/philosophy books
  • He also has a “CEO coach who we pay a lot of money for”
  • Sam has also been seeing the same psychiatrist, periodically, since 2014

The Mythical Man-Month

  • This is a book which breaks down how putting more engineers on a project actually extends the runway at which it’s delivered
  • Sam adds – “When you add more people to something, it makes it WAY slower. It’s so frustrating.”
  • Related: Happiness = experience – expectations
    • When you hire more employees, the expectation increases (raising venture capital also causes it to increase)
    • Long story short – be very sure you want to raise VC, lots can be done by bootstrapping nowadays

Is there anything Sam thinks a lot about that he rarely gets to speak on?

  • Saving money/personal finance
    • Sam regularly uses Personal Capital which he linked up with his bank account, credit cards, and Wealthfront
    • Tip: Keep a monthly budget!
      • Sam recommends using My Weekly Budget (AppleAndroid) for help
    • Sam also uses Robinhood – he mainly buys S&P 500 index funds in addition to some Facebook stock
    • Sam uses Simple and Ally for banking (they’re both at the top end of interest rates offered across all banks)
    • Another tip: Use Zapier – it allows you to link your bank account to a spreadsheet (thus enabling you to see how long your savings will last at your current burn rate)
      • “There’s a direct correlation to your willingness to tell someone to f* off if you don’t like what they’re saying and how many months of savings you have. And there’s another correlation to you being willing to tell someone to f*ck off and how much income you’ll probably have.”

Additional Notes

  • James loves Indian food
  • Sam is an amateur beekeeper – he has bees in his backyard
  • “As an angel investor, being on the other side of a conversation where they say, ‘I don’t know.’ Those 3 words are so powerful.” – James
  • Back in the early days of The Hustle, Sam read the biographies of Ted Turner and Rupert Murdoch (versions unknown)
  • Sam recommends The 50th Law by 50 Cent and Robert Greene
    • Sam recalls a line from 50 Cent – “He goes, ‘I think my power is that I can turn shit to gold.’ When I read that I realized that’s totally the way to live.”
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