Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy, where I interview entrepreneurs about how they built their businesses for an audience of entrepreneurs. And joining me today is Dave Nemetz. He is the co-founder of Bleacher report. It’s a sports media company that he and a few of his high school friends started.
And then they sold to a time Warner based company. And then he went on to found inverse a what I’ve seen it called Dave is a content site for men that you’ve said over the years wants to take an opposite approach or an opposite view on things. Does that sound right?
Dave: Yeah. That’s that’s. Uh, I would say in verse it’s it covers a site for very geeky topics for kind of the fringe, the fringe geek topics that, that then reach the mainstream, whether that’s crypto, whether that’s, uh, you know, kind of Saifai and, you know, kind of, you know, out in the, a really out there science, uh, whatever it is.
Andrew: And lately what he’s been doing is spending more and more time investing in other startups and projects. And so I invited you Dave here because I’m in the content space and I’m feeling a little bit, um, yes, I’m watching everyone get excited about the creator economy, but the fact that everyone’s in the creator economy makes me feel like maybe.
This is the wrong place to be. Maybe this is the, like everyone trying to be a pop star in the eighties. And one of the things that I’ve noticed about you going back in time and seeing old wall street journal articles and other articles, political and so on is number one, the price that you sold your company for Bleacher report seems to change from article to article.
But the one thing that’s consistent is. Then saying media has no future you saying I see something here that you don’t and I don’t feel like they let you explain it well. And so I’m wondering, what do you see here today? So here’s the plan. I thought we talk a little bit about that. Like what do you see, podcasting and media and content in general.
Number two. What about the investments that you’re making in web three? Where do you see the potential? And number three, I would like to get the story of how a person did it. Trying to understand what’s to come based on what’s happened and we could do it all. Thanks to two phenomenal sponsors. The first, if you’re a content creator, you’re going to love them because they’re our host gate or this site that will make it easy for you to host your own website and create your own content.
And if you use my URL, I, I get a pat on the back from my sponsor, but you also get a big discount and it’s a HostGator available hostgator.com/mixergy. And the second, if you’re doing email marketing, you should check out, send in firstname.lastname@example.org slash. Dave, what gives what’s the bottom line number one 75 million new sold for 200 million.
What was it?
Dave: So let’s, let’s clear the air on that once. And for all the total consideration, uh, when, uh, when time Warner bought Bleacher. Was it a little over 200 million, the reported number often gets pegged at 1 75 because that’s the actual amount of cash they shelled out for it. So they paid all cash, uh, which, you know, well, number one was a phenomenal, uh, thing to get.
Uh, but we, at the time that, uh, that we closed the deal. We had about 20 million or so in the bank. So that got included as part of the, kind of the total consideration, as opposed to just going into their bank account. So when you add it all up, it was it?
was 200 million and change. Uh, but the reported number I’m sure, but you know, they, they took the lower number on kind of what got put out there.
They’re in the official press release. So it made it look like a better deal for them.
Andrew: I feel like I’m all things D had an article at the time about how your investors were disappointed because they put something like, what was it, 50 million in? And they were expecting a lot
Dave: over 40 million. Yeah. A little over 40 million in total.
Andrew: Were they disappointed?
Dave: Uh, I don’t think so. I mean, look, the, there were, there were, there, wasn’t a ton of disagreement in the room, uh, when we were deciding whether to sell it. Uh, I will say, you know, some of the investors who had come in more recently, of course, you know, they took the point of view of let’s, let’s talk it out.
What would things look like if we, if we, uh, stayed the course, Um,
but when it came down to it, it was a unanimous decision to sell and everyone was supportive and even, even Oak, uh, ventures, which put in 20 million, like a year before we sold. They, they doubled their money in a year. So they got, they put in 20 million, then walk away with 40 a year later, they had a huge fund.
So it’s not like that that made her break or, you know, that was a big difference maker in their fun, but it was, uh, it was still a good return for them on the time that their capital was deployed. I, you know, I’ve, I’ve talked to some investors after the fact, you kind of said, oh, look at, you know, especially I think like a year or two later, uh, maybe it was a little bit more than that, but a few years later, business insider sold for like 400 million and their numbers were not quite as great as ours.
And there was some people saying, oh, we should have held out. But my point of view is. It’s not about the numbers always. I mean, and our numbers were great. We were profitable. We were growing, but it really was, that was the right partner at the right time. And you never know if something like that is going to come around again.
And when you get a good deal like that, you just, you know, you don’t always have to take it, but you really got to think about like the, you know, just continuing to go forward with, without knowing, you know, if, if all the stars are gonna align again, uh,
Andrew: What was your share of that?
Dave: So, uh, less, less than you would think. Uh, and, uh, you know, this is something. You know, I, I, uh, of course we all deal with our, our Twitter haters or just, you know, people kind of don’t don’t think things through, they see 200 million and think I’m, I’m sitting on the whole thing myself. So we raised about 40 million, uh, over multiple.
Um, but you know, with part of the, one of those was a tough round. We had to raise in like 2009 when early, you know, literally 2008 when the economy was in the toilet. So we, you know, we, I think investors owned, uh, you know, around 50% of the company, but maybe more than that at that?
point. Um, and then I had four co-founders.
So, you know, between. The co-founders between the employees who owned a good chunk of the company. You know, they have 20% ish, uh, and the investors, that’s a lot of ways to slice up the pie. You know, I still, I still walked away with enough to be comfortable for, for, and will offer the rest of my life is as long as, uh, I don’t, I don’t, uh, throw it all away or do something stupid with
Andrew: More than 10 million for your share.
Dave: uh, less, less.
Andrew: Less. Okay. And
Dave: just a, just a tad shy of that.
Andrew: okay. And so it should get into your story first, but I’ve just been watching you, like, even when you were doing the Twitter spaces, getting into the conversations, getting into thoughts around, uh, audio, as someone who looks at content, what do you see here in podcasting and content in a year?
Almost 20, 22.
Dave: So, uh, I feel like I’ve got an interesting perspective on it. Cause I’ve seen it from all sides. I’ve, I’ve built a full content operation with a massive editorial team. And then I, you know, I went and did Twitter spaces and started a newsletter and tried to do the whole thing just as a one person from the ground up.
And I think, you know, you, you kind of alluded to this earlier. The bottom line is content is really hard. Uh, and it’s really hard to produce consistently at a high quality output. Um,
and that, that’s just, that’s the reality of it. Doesn’t, it doesn’t necessarily get easier. You know, that even as you grow, even as you, uh, your audience grows, you’re making more money.
You’ve still got to put in the work, uh, to produce new high quality content. Yeah. And maybe if you’re doing something that’s, it’s purely evergreen and you’re building an archive of stuff that you, you kind of, you’re building search equity around and it doesn’t really change. That’s a little bit different, but if you’re, if you’re putting a podcast out every week or, you know, some people I know doing it multiple times a week or a newsletter or a YouTube video, It’s a grind, it’s a major grind and it doesn’t scale.
It doesn’t the creation of it. Doesn’t scale the way that software scales, you know, you write software once and deploy it, you know, as, as many times as, as people will use it, the consumption scales, which is the exciting part and which is the possibility in it. And I think that’s what, but in order to. Get the benefits of that you have to put in that, that work and that grind of creating it over and over and over.
Uh, so there’s a big payoff, if you can do that, but the, you know, the, the work and the sweat and the frustration and ups and downs required to get there is immense, which I think is why, uh, a lot of people try and don’t, you know, don’t get there. Um, but. The what, what does excite me or what is interesting about the creator economy is I think there are more ways and more possibilities for individuals to do that and to kind of reach their own audience in a, in a, a more focused way.
Uh, but it’s you still have, you got to do the work and it’s, it’s tough work.
Andrew: Would you invest in a Bleacher report of 2022.
Dave: Uh, it depends. I don’t, I don’t invest in a lot of pure play media company. Uh, I think they’re challenging business there. I mean, they’re, they’re great businesses. If you can get them going, if you can get them to scale. And I think for like the, you know, the solo creator, it could be a really, a really interesting living in career.
If you get it going the way you have the way, you know, kind of some of these, you know, one, one person in a newsletter businesses have gotten up and running. That’s not really in my eye, an investible business. It’s a lifestyle business that someone builds. It’s great. The way, I mean, Bleacher report, when it started was much more of a, the concept was a more of a platform and more of a community.
Uh, you know, that where content could, in theory scale, we were leveraging, uh, a user generated model. Uh, so I would potentially look at something like that, especially layering in maybe some interesting web three mechanics around it, where you could, you could kind of Dole out the value created by the community to those users and kind of build that value.
Overall. I think something like that is interesting to me, if it was someone saying I’m going to try to recreate what Bleacher report is today. Do it with a slightly different tweak? I don’t think I would invest in that.
Andrew: Now it feels like there’s more possibility for more people to make a good living, like a really solid living from content. And the killing opportunity is just not, not nearly as big. Right.
Dave: Yeah. Yeah. I would say so. I mean the,
real value of content. oh, go ahead. I was going to say you know, something, I think that, yeah, the real value of content and something that was kind of exposed in the, the rise and fall of digital media. Um, but Bleacher report was a part of, and verse was a part of, uh, you know, I’ve been a part of some, some other players in that is that the real value is.
building a deep connection with an audience.
And I think in, in kind of the, the hype cycle of digital media, where you saw back in like the mid, uh, teens, where there was a ton of VC money flowing into it, and a bunch of like, you know, just really high expectations around the space as people started to believe. But investors, the operators, the, I bought into this for a while.
It wasn’t about the connection with the audience that, that the value wasn’t just building the biggest audience you could and building scale. And I think with the companies that got exposed were the ones that maybe they did that for a while, but they really weren’t building a connection. And what’s interesting about the creator economy.
Is it kind of, because of its constraints? Maybe a few creators will break out and build massive, massive audiences. And I’m sure we’ll see something like that. And there’s some that probably already do, you know, even that are under the radar, but like in reality, have tens of millions of people, you know, hanging on their, every word.
But most of them they’re going to be more limited and focused and the people they’re trying to reach, they’re focused on niches. They’re focused on a, a, a smaller audience that really, really cares about what they have to say. And so. All they’re doing is building that, that loyal, authentic connection with an audience.
So it’s kind of more value, just distributed, much more broadly across all these different creators.
Andrew: Okay. And so you were talking about the web three mechanics. I think there’s something there, but I haven’t seen anything yet. That makes me feel like I I’ve got a clear vision of what that is. The, the thing that’s interesting is how with an NFT, if you sell it. You can get perpetual royalties on it, as it gets sold and changes hands that’s the part that feels like there’s, that’s where the potential feels, but it seems to exist, but I haven’t really seen any good examples of it.
What have you.
Dave: Yeah. I mean, I think it’s, it’s, it’s a cliche, but it’s, it’s still early it’s and I think it’s true. I think the, the NFT royalties, uh, it is a huge. Uh, a feature that has a ton of potential, uh, you know, you’re seeing more platforms come out around music with that. I’ve seen some, uh, focused or. Around film.
Um, and then, you know, even with the, you know, kind of the, the more hyped PFP in Ft is, you know, for the creators, they’re, they’re getting royalties off the resell. And even if you own it, you could potentially build things around that where you can get royalties from developing that IP. Um, I, you.
know, I, it just, the, the kind of whole concept of, of web three, uh, and smart contracts as, as kinda money Legos and being to plot, being able to plug in, Uh,
you know, kind of programmatic ways to move money around and, and either designate ownership or attribution really is pretty groundbreaking.
I mean, there’s still. That you could have done, you know, in web two with older platforms, but it just, it, it would, it requires kind of more, more trust around us, centralized arbiter of, of kind of how that value is determined. And there’s just, there’s more friction involved, I would say. Um, so even thinking back to like, uh, a, a Bleacher report, uh, in the early days, you know, we were.
But in the early days, you know, very, you know, uh, transparently completely dependent on free content from a community. Uh, and we, you know, we didn’t make false promises that community, so that w we’re going to create this platform. You’re going to be able to meet a bunch of other fans, right. Writes stories, you know, about your team, get comments and get people to read it.
And we’ll provide that all for you. And it’s, it’s yours to do what you want with it. And we’ll. Yeah.
provide some, some help and support, you know, familiar kind of a community management standpoint. Uh, and, and we built a community that loved it. Uh, and ultimately as we, you know, it was, we tried to think it was starting to think about monetizing.
We, we ended up changing that and kind of going more professional content primarily because that’s what the advertisers wanted. Uh, and they wanted higher quality content and we kind of shifted. Uh, but before we got that far, we, we did kind of think about these questions of like, oh, well, what if we shared revenue with.
The community, if we could, we, could we track, you know, what advertising ran on different articles and share a piece of revenue with our community? Or could we, could we, uh, you know, we thought about giving equity to our top community members and kind of raise that with the, our startup lawyers hated the idea and they’re like, oh no, no way you don’t want to do that.
Like that’s, that’s, uh, you know, just be a huge headache. And so we kind of, you know, we, we didn’t really go down any of those paths. And ultimately, instead of doing like a rev share, we just decided to shift to pain writers and we hire the best writers for our community. We hired and put them on salary.
And then we went out and hired people away from, uh, you know, other, you know, newspapers and sports illustrated and whatnot. Uh, and, and that worked great. And the business kind of took shape. If you built something today and you did it in you, you kind of leveraged what you could build with web three. You could track that attribution of everything that someone writes, look, you know, kind of track the revenue that’s generated and, and compensate them, you know, in tokens and kind of give them a share of something that could then grow over time, you know, as the, the value of the community grows.
And, and so you’re starting to see things like. Take shape. It’s still, it’s still a little bit early. I don’t think I’ve seen anyone build out like the exact version of that, but it’s all there. It’s all possible. Uh, and I think that’s, that’s what excites me.
Andrew: micro payments through dollars is a pain, micro payments through coins is potentially easier,
Dave: Yeah. As long as you don’t do it on a, the Ethereum chain where you’re paying
Andrew: Right where the gas fee is high, but you can imagine somebody creating their own coin just for micro payments based on views, based on ad revenue, based on something. And that’s, that’s the part that’s interesting.
Dave: Yeah, definitely. And it’s a,
Andrew: you seen anyone do that? Yeah.
Dave: I, I haven’t yet exactly what that, so we actually back in 2017 when crypto first caught fire, we actually were. We’re thinking about doing that at inverse. Uh, and we covered, we covered crypto as a topic and my engineers were all obsessed with it.
Uh, and we kind of, you know, we got really excited about it. And I talked to some, some people who were, were real, you know, early evangelists for what smart contracts could do. And they were talking about this kind of stuff. Like you could, you could start to reward your readers for the more engaged they are, you know, create a token, you know, reward your readers, the more engaged they are, the more they share, uh, the more, you know, It basically incentivize the community to participate and, and help grow the site and grow along with it.
And we kind of scoped it out and we were thinking about doing. And then the crypto market crashed and kind of the world seemed to move on and like the investors that I had mentioned it to seem to cool off on it. And we were still a pretty early startup at the time and just decided we didn’t have the, you know, the resources to go that far, uh, down that path.
Uh, so it’s really fascinating to see it all come back now. And I think we will see this. I thought, you know, I saw a really interesting article, uh, by, uh, by Jori DeBruin recently on, uh, Uh, about, uh, why the New York times should tokenize. Uh, and instead of, you know, so many people subscribed to a publication like the New York times.
Because they want to read the content, of course, but also because it’s a signaling thing, it’s a status and identity thing to them. I am in New York times reader. Therefore I pay for the New York times, whether I, whether I’m going to go to the site or not. Um, and so for that, for those reasons, you could build out a token where you’re not.
Paying for subscription, but you’re buying that, that membership and, you know, kind of that, that piece of the New York times economy. And I think you could, you could say that for, uh, for quite a few publications or content creators.
Andrew: Yeah, there is something about being able to show what you have, what you care enough about to spend money on. In a digital format. The example I come up with all the time is when my wife came over to my house for the first time before we got married, obviously one of the things that you noticed was my bookcase with all those books, with all the underlines and the highlights and the selection.
And she got to know me much more through the books that were on my shelf. Then through talking to me because we barely talked until then and there isn’t the digital equivalent of that. And so I could see saying that you’ve subscribed to the New York times is a good one saying that you’ve gone to an event is a good one and so on.
But I like the idea that you have about, um, Somehow sharing revenue with the people who’ve created the content, um, based on how much revenue their content is generating like a Facebook of crypto would also share back the revenue from advertising. There is a DSO which has decentralized social networking, where everyone has their own coin, but it doesn’t do that ad model part where they’re sharing a back.
That’s the part that feels like it’s missing.
Dave: Yeah. Yeah. I think DSO is interesting. Uh, and obviously, uh, you know, big cloud caught the world by storm, uh, for a little while, or I guess the Twitter world, I don’t know how many people outside of Twitter were paying attention. Uh, and, and kind of died down. I feel like that’s, that’s just kind of like the indication that it is still so early days, like you’re kind of seeing these, like, you know, these, these foundational pieces get built out in real time and it’s like, all right, the, the idea is there, or like, You know kind of the right intention is there, but it didn’t have all the right elements to.
Let me share revenue with the users or to kind of really convinced people to move their social graph over. But I it’s only a matter of time. It’s I kinda like it. It’s back in.
Andrew: Sorry, we’ve got such a delay here. It’s driving me nuts. I don’t mean to drop, you know what though? The, um, the thing that stands out for me as I talked to you about that is that. Twitter and Facebook and the other social media platforms are all based on advertising. So it was Bleacher report that maybe just as we’re getting rid of centralized platforms, we’re also getting rid of advertising as a monetary.
Like truism or necessity that you and I are thinking about how somebody could split the revenue from an ad that appears in a social network or on a publishing platform. But maybe that’s not the answer, maybe advertising. For a long time and we accepted it because people weren’t willing to pay, but in a world where people could play with micropayments, where there’s NFTs, where there’s crypto coins that are not directly related to visa, MasterCard, transaction fees, maybe there’s a way to even do away with that.
Dave: It’s possible. My, my perspective on it, people have been predicting the death of advertising for a long time. And I think advertising is very, very hard to kill and. at the bottom line, it works. Uh, and I mean, there’s that old adage that.
oh, you know, uh, you know, 50% of my advertising budget is, is, uh, you know, goes to waste.
The problem is I just, I don’t know what 50%, uh, which is, which is maybe true in some respects, but you know, all these, these companies that spend a lot of money on, on marketing or are doing it Because.
Um, it’s how they reach their audience. You know, people, people wouldn’t be ordering pizza hut pizza as if, uh, FITO wasn’t advertising, uh, or, you know, certainly a lot less.
Uh, and I think. The, you know, what, while there’s a lot of problems with the advertising business model, it can be very parasitic and, you know, P you know, a lot of people hate it. Uh, and it’s directly, or indirectly led to a lot of problems that we have currently on the web. Uh, you know, it does work and it also does drive so much of it, of, you know, kind of how commerce works on the, on the web and, and in real life.
I think what we may see is just different, you know, different forms of advertising. You know, a lot of people have assumed that, oh, web three is going to be the end of advertising because it’s all going to be based on like, you know, direct peer to peer transactions. And it’s all de-centralized. But while we haven’t fully seen it yet, I believe that that we will see new forms of advertising.
Maybe, maybe instead of advertising, it’s going to be airdrops, you know, instead of, of interruptive ads, you know, brands are going to find ways to draw. Tokens with value into your wallet. Uh, you know, as a, as a way to, to convince you to buy their product or, uh, you know, maybe it’s, it’s, it’s other, you know, kind of unique ways of, of, uh, you know, kind of creating value for an audience.
So I think there, there may be a little bit more of a level playing field where hopefully some of the more parasitic, uh, uh, and kind of skeezy sides of advertising, uh, go away. But, uh, Advertising. It’s gotta be there.
Andrew: Speaking of advertising. My sponsor is HostGator where people can host content. If you were to create today a brand new site, Dave let’s suppose Dave’s coming out of high school. Gonna be an entrepreneur. Doesn’t have development. Chops wants to start with content and then figure it out later. How would you go about say using HostGator to create a content site today?
Dave: well, I think is, is so great about creating a content site is your there’s endless niches out there that you could cover. And that’s, you know, that there’s just always, always some new angle. Uh, if you’re, uh, a, you know, aspiring content mogul to find that topic that’s on the fringe of culture or that you, or you, and only a small handful of people to care about.
And, but you think is going to keep growing and, and, uh, and keep gaining traction and to just be the expert on it or become the expert on it and, and just cover it better than anyone else. And, uh, you know, I think the more, the more niche, the better, uh, in most cases, uh, it’s better to be, you know, the best in the world at a very, very narrow topic than, you know, to be just okay at, at, uh, you know, kind of broad over cover topics.
And the great thing is now you, you know, you got HostGator, you, you can throw together some, you know, there’s, there’s all sorts of platforms you can use to build, you know, build out your site. I’m a big fan of ghost, open source platform, uh, that, you know, has a, a, a very low cost, uh, you know, version that’s a managed version, or you can, you can set it up, all your stuff.
Uh, you can, you can use that. You can use convert kit. You can use beehive, which just launched, uh, for email. Uh, so there’s, there’s just so many tools.
Andrew: you know, I’ll ask you a beehive in a moment, but, um, I should say one of the examples that I’ve seen is this, uh, guests that I had on years ago, Nick O’Neil, he created something called I think it was all Facebook where he created a blog about Facebook. Frigging thing
Dave: remember Nick
Andrew: You remember him?
Dave: yeah, yeah. For
Andrew: Did you, do you know what he’s up to now?
Dave: No idea.
Andrew: It’s like trying a bunch of different things. He created this like text to get a developer platform where you could just text the developer to do stuff for you. So a bunch of different things. The thing that took off was he got into NFTs. He created a site called the nifty. Since you were talking about niche based content sites about whacked out stuff, or without seem whacked out people who are buying and selling images.
He created a content site where we was just kind of tracking that created a podcast on there. The thing took off. He now became the guy who was like at the center of NFT conversations. And, uh, it all started with the nifty, which is just a content based site. All right. So I should close out the ad for HostGator by saying if you’ve got some whacked out idea, like my friend, Nick O’Neill just go and create a site where I feel like Nick learned a lot and got connected with a lot of people because he was the guy writing about it.
And that’s always a great way to learn, be the guy writing about it.
Dave: A hundred percent,
Andrew: And if you need a place to
Dave: be that. you be, you be, you be the expert by first learning the topics. So you talk to everyone who knows more than you. And then all of a sudden you’re the expert that everyone wants to come to.
Andrew: Right. And it’s the greatest hack. It’s still not used enough because too many people want to write about what they know. Instead of saying, I just I’m figuring it out. I’m going to go talk to other people, create content about it, and the way Nick did that. And if you want to do a two on whatever topic you have, if you go to hostgator.com/mixergy, they’ll give you a discount on their already low price, and they’ll really take great care of you.
hostgator.com/mixergy. What is that? What was that service that you’re talking about for.
Dave: Uh, beehive.
Uh, so just launched, uh, Tyler dank, a friend of mine, uh, part of the early morning brew crew. Um, he was, he was on the development side, kind of built out a lot of their in-house tools. And then, uh, recently left to start his own thing. It’s a kind of a creator focused. Uh, email platform. Um, so I’m actually, I’m not on it yet, but I’m looking to kind of move my, my email service over to it.
I’m not an investor yet at least, but, uh, you know, just a fan.
Andrew: What’s different about his email newsletter subscription based company from all the others that are out there. Like what does it review and, um, sub stack.
Dave: Uh, so, you know, they’re there kind of pitches that they’re just, they’re trying to be the most creator friendly platform. Uh, I know that at least kind of at the, the initial levels it’s free to use. I think they don’t, I don’t, I think they don’t take a cut of your subscription revenue, the way that sub-sector.
Andrew: They don’t take a percentage. They just do straight up fee per user. Got it. And so if you want to charge more, why should they get paid more? Just for doing the same amount of work?
Andrew: All right. Um,
Dave: and they’re smart guys. Who’ve been, you know, they built, built all these tools for morning brew. So they’re kind of bringing like that same level of tooling to the standalone newsletter.
Andrew: I didn’t know that morning brew had a lot of, uh, software built for it.
Dave: They didn’t have like a ton. I mean, they were using, I think a lot like morning brew, the hustle, which, you know, I was also involved with kind of, you know, used third-party ESPs. I can’t, you know, they probably both like use multiples of them, but then they use the API APIs to kind of build like layers on top, which is similar to what we did at Bleacher and what I did at inverse.
I mean, you know, these ESPs are fairly hard to. Differentiate between they all kind of sell you on the slight difference in feature difference in pricing. But at the end of the day, they’re just sending a lot of emails. Uh, but you know, You can do with them is then take the API APIs and then kind of build things that are a little custom.
Uh, we built at inverse, uh, we use Amazon’s, uh, email, uh, service, uh, Amazon SES, uh, which was just kind of the cheapest and like the, the most low frill. But, you know, if you just tell them where to send the emails and they send them, uh, but they have great API. So we can build tools that kind of allowed us to do some like custom analytics and, and, uh, you know, kind of a little personalization and things like that within the emails.
Andrew: Um, what’s your connection to morning brew? I think morning, Bruce started out as an email newsletter for business. Same with the hustle, the hustle turned into subscription for content, and of course their podcasting took off morning. Brewed just expanded into content on, on the webinar, on email, right?
Dave: Yeah, they’re doing a lot of things. They’re doing like courses now. Um, so I have no formal connection.
to morning brew. Uh, other than I’ve, I’ve known the founders, Austin and Alex for, uh, several years now. They, they kind of. Kay came to New York as young, fresh out of college, uh, you know, media founders, and somehow we got connected and so, uh, would get coffee with them and, and kind of share, share some advice and, uh, you know, have, have ended up in that position with the handful of founders, uh, um, Yeah.
After kind of being, being that same young, uh, you know, fresh faced founder myself, uh, back in the day. Uh, but yeah, never had a formal relationship within other than just being a big fan. Um, I was, uh, the hustle, uh, I was, uh, an early advisor, uh, to them and to, to stay on par of their founder and invested, uh, in, uh, in their, their early rounds.
Uh, so yeah, happy, uh, happy. There are growth and outcome and exit and, uh, their podcasts. Uh, the, the Sam does, uh, saw some stuff.
Andrew: I just saw Sam last night. That guy Jack now he’s getting bigger. Every time I see him.
Dave: I know, I know, I don’t know, like, as he’s kinda like giving me some like fitness, inspiration, you know, not to like go that far, but like, I gotta, I gotta respect him.
for just, she’s really going hard after it. You know, he’s, he’s living that, uh, that, uh, post exit founder life. And like,
Andrew: You know what
Dave: you can go in one of two directions
Andrew: or really fit.
Dave: exactly, exactly.
Uh, and he’s, he’s doing it, man. And he’s doing the whole, the whole fitness influencer thing. And. Yeah, I tip the cap to.
Andrew: I don’t, I guess I’m sorry. I don’t know if I’m supposed to say this or not, but, so he bought a house in Austin that I guess he’s tearing down and he and Neville, Madora another advisor to accompany a guest, went in there and start. Shooting it up with paintball or something. My kids are dying to go in there with him and shoot it up with paint ball and just see what they could do.
A ninja stars, their imagination is going. Um, but he is living the post-sale life. Totally
Dave: Yup. Wow. That’s that sounds, uh, either amazing or like the beginning of a plot of a horror movie or something.
Andrew: amazing. I’m going to say amazing. A hundred percent. I have to say. I would like to be part of that experience with them. You didn’t get to do anything like that. Did you, did you get to do anything like horribly amazing the
Dave: Horribly amazing.
Andrew: now what’s like the craziest thing that you got to do,
Dave: The crazy thing that, that we did. I mean, I did a lot of cool shit, uh, after, I don’t know if I can say that on the
Andrew: you can
Dave: stuff. Um, great. Uh, after, after selling Bleacher, um, the coolest thing we did, that’s kind of legendary, uh, is we took the whole company to Vegas. Uh, for a blowout weekend.
Um, and this was, it was like 150 person company. So it’s not like, you know, a little like gang of, of, uh, you know, little, little group going around. it.
was like w kind of a takeover. Um, you know, we. Basically chartering a whole Southwest flight from San Francisco, uh, where the company was based out there. Uh, I took a different flight cause I, I didn’t want to be responsible for what was going down on that chartered flight.
So, uh, you know, I’ve, I, I flew separately just, uh, to keep a little distance, but Yeah, we, we did that. a month or so after we sold. And it was something that my co-founders and I, we, we paid for out of pocket and we kind of did it without telling that we were going to do it because, you know, you ask for forgiveness, not permission. uh, so, you know, it was just, uh, it was kinda everything you, you expect, people, you know, taken over the tables at the clubs we had. There’s one story about one guy who supposedly blew everything he made on the acquisition, you know, both at the blackjack tables and maybe at the strip club. I don’t know if that’s true or not, but I hope not. and. It was, I mean, it was just, uh, I mean, it was great. Luckily, no, like nothing extremely bad happens. Fortunately we avoided any, anything scandalous. Uh,
but that was like the big blow out. And then I, you know, I did. Personal stuff just to like go blow off
Andrew: what’d you do?
Dave: uh, uh, traveled around my wife and I was before we had kids.
So we went and traveled around Asia for like two months. Um, and that was like, I wrote my, it was right after I left Bleacher and I wrote my resignation letter, like from the tarmac of, of the plane taking off to go to Japan, it was a very. Poignant moment there. Um, and then like later we went and went on this, this big sailing trip around the Mediterranean on a, like a 50 foot sailboat and, uh, with some friends.
So we kind of just like, did I got to check out a little bit and just like, you know, I was, I was 29 when we sold the company. So. Do some crazy travel and experiences that, uh, uh, you know, w w just, you know, had, had the unique opportunity to do in that moment and kind of live that life.
Andrew: Do you feel like you lived a good life as, as a high school kid? Cause I’m looking at you, you don’t look like you were broken as a child and needed to fight back. Just talk to an entrepreneur. He was Ruben told me that he, he didn’t know that he was. In the U S illegally until later in life, when it came out that he couldn’t get health insurance, couldn’t go to Harvard because his family was undocumented and it’s like, he was like, he’s ready to fight the world and fight for people like him because of that.
You don’t have any of that, that broken on the inside, got a fight to fix.
Dave: Yeah. Yeah. I mean, I, I wouldn’t say, you know, I lived a comfortable life growing up. I grew up in the, in the bay area, uh, you know, south of San Francisco and, uh, had a, you know, a nice suburban life and, uh, you know, good, good family life for, I think if anything, I was, I was just kind of a geeky kid, um, you know, a little, little geeky, little dorky,
Andrew: What was your geeky thing? Do you sell baseball cards? Was that one of the things.
Dave: Uh, with very like huge comic book nerd, like collecting X-Men cards and that kind of stuff. And like, uh, you know, I did like one thing I did, I think of when I was in like fifth grade, I tried to like start like a perfume company. And when I like collected, like, Just plants from like the backyard and try to like grind them down into perfumes and like mix them with water and sell them door to door.
So that was my first entrepreneurial experience. Uh, uh, it didn’t didn’t go so well, other than the people that took pity on me. Um, but yeah, you know, it was kinda geeky, dorky, you know, had a group of, you know, similarly darkish friends and you know, who, some of them whom became my, my Bleacher report founder.
Co-founders. That’s kind of for my like entrepreneurial, you know, my, my, the two companies I’ve built, you kind of reflect that background. Like I grew up kind of a dork. Getting becoming a sports fan was a way to like try to become cooler and like be a little bit more, more of a bro. Uh, and you know, I became like really hardcore into sports in high school and that kind of transitioned into Bleacher report.
And then when I started in verse, it was a little bit more of a throwback to the stuff I was into before that and the stuff I used to geek out on. Um,
you know, I used to love this, this magazine, Omni magazine. That was kind of like a precursor to wired. I don’t know if you ever, ever read it. Uh, but it Was like out there science and science
Andrew: science and super expensive.
Dave: uh, really, I, I don’t remember.
Uh, it was, it was, it was, uh, it was published by, uh, it was Bob Guccione.
Andrew: Yeah. The guy who published penthouse magazine had it.
Dave: Yeah. Yeah. And he was, he was like a big, like, you know, kind of site, you know, extreme science and like longevity, uh, you know, kind of, uh, uh, uh, nerd too. So that was like his whole thing. But Yeah.
I was, I remember like really being affected by that when I was young.
Uh, and so inverse was kind of a throwback to that, uh, in a way, and also recognizing. A lot of those ideas, which work we’re kind of fringe and out there and, and really, really nerdy at the time have now become cool and mainstream and like people hang on, Elon, Musk’s every word and all that kind of stuff.
Andrew: I should say this interview is also sponsored by sending blue. When you need email marketing, that will not Jack up the price on you. As you build up the. just fair from the beginning. Fair at the end with marketing automation so that you can tag people based on what they’re interested in and only serve them the content that makes sense.
Like the example I always give is. If somebody buys, don’t send them endless messages, trying to get them to buy. They audit now send follow-up messages, well marketing automation, software done. Right? We’ll do that for you. And if you go to send in blue.com/mixergy, they’ll give you a discount on their already low price.
And they’ll keep that price from getting jacked up. As you build up your business, a lot of companies will like get you stuck on them and then raise prices, not send them blue, not, uh, it’s always fair. Go to send in blue.com/. I am looking by the way to see what did Omni magazine costs. You know what? I might be wrong looking at a 1984 cover image of it.
And it’s, it’s only three 50, so not that much, but it is very computer, very futuristic, always things that I think even to this day have not come, not come to fruition, but I, I liked that kind of dreaming. Um, I’m looking at your, I’ve got so many tabs open here. I’m looking at your angel list profile. It links to your reverb ventures, which is your syndicate on angel list.
I freaking love Angeles by the way, um, which everyone just used them. And it says that you, that you’re investing in web three, you believe web three will transform the relationship between creator and fan and create new forms of expression and new economic models from. Do you see any now, is there any web three company that you’ve invested in that we can talk about here to understand how, how you’re seeing the future?
you know, the, the ones that, you know, there’s, I think every. Now is still a little on the stealthy side, but I can, I think I can talk kind of generally, Um,
about, you know, kind of what I’m seeing, like the themes that, that, uh, that I’m starting to see, uh, you know, come up, uh, you know, pretty regularly, uh, you know, I think the, the big one is just, you know, building communities by, you know, Incentivizing your, your community by sharing the upside with them.
Uh, you know, you see that this, you know, with a lot of the NFT communities, which I’m not like, I, I believe in NFTs the long-term potential of an MTS. I think there’s a lot of hype and noise around kind of the current space of an FTS, but like the ones that are doing it well, are. Selling a community community of people on a vision that if you buy into this NFT, you’re not just getting a, you know, a JPEG or, you know, kind of the, the, the rights to a picture or whatever.
You’re getting membership into a club. You’re getting, you know, IP that we’re gonna, we’re going to develop. And you’re gonna, you’re gonna share on the upside of that, you’re going to get access to future assets. Or, you know, future opportunities that we’re going to deliver just to this community. So I think that’s, that’s a really powerful idea, uh, and that just hasn’t really existed, uh, in that same way, you know, for, for most people in, in, you know, kind of cultural artifacts that they, they get into.
I mean, you know, most people are not investing in. In art or in fine art or in, you know, kind of high-end collectibles, you know, maybe you see that a little bit with, with, uh, you know, sports cards now and kind of the way that’s come back. But, um, I think that’s, that’s just a really powerful concept, uh, that, uh, And we’re going to see play out in different ways.
I think I’m really excited about kind of collaborative creation, uh, and the, and what that can empower for through web three, um, you know, collaborative creation, collaborative action. Like there’s this, the big story right now is this constitution Dow and, uh, you know, this group of people that are banding together to, to pool money, to buy a copy of the constitution, uh, Really cool.
In theory, at the end of the day, you know, just, I dunno, owning a piece of the constitution is cool if you want to do it. Um, the interesting thing to me is they, one of them partner with, uh, you know, an institution like a Smithsonian, put it on display and use that display to promote the power of web three and to kind of get the word out there for more people, uh, you know, to, uh, to be aware of.
That’s something like this is even possible. Uh, but you know, I think I like to think a few steps further around, right. Well, you know, could you, could you get a group of people together and, and create something that, you know, could they. You know, whether it’s a product, whether it’s a, you know, some, some kind of intellectual property where the everyone who’s who’s contributes is then able to, to get a declared ownership share in that and kind of, you know, share it, share in the growth of that over time.
When you think about like the, the classic concept of, you know, these like fan fiction communities and all these people who. Kind of toil away, building worlds around, uh, other people’s IP. Like all of a sudden you could, you could do that and you could own a piece of it. And if the idea that you contribute really becomes the idea that takes off, uh, you, you can get rewarded for that.
Uh, I think that’s a, that’s a pretty powerful idea.
Andrew: No. I saw an example from Greg Eisenberg. He’s um, the founder of late checkout, which is this, uh, this design studio. Um, and what he did was I think he created. A FinTech class. I can’t find it where he said, look, I’m selling this. Here’s how much you have to pay in order to get in less money, to be one of the first people you get the early bird pricing, more money if you’re, if you’re coming in later.
But I think the way he did it was, he said, you’re getting a community in addition to the education and you can sell your ticket to somebody else after you’re done with it. Which to me made sense. If I understand this, right? I think he, he does a bad job of marketing his own stuff, a better job of marketing, other people’s stuff.
So I don’t fully, I don’t think I fully get it, but the beauty of that was that if you help him be a better teacher, if you help the community, Get more out of the program, then your ticket into the program becomes more valuable when it’s time for you to sell it. And so there’s an upside for community members and they’re not just sitting back with their arms crossing.
All right, Greg, what he got for me? I paid you all this money. Now you better show me that this is all worth it. It’s more like I paid you all this money now let’s work together to make it worth even more so that I could sell it to the future student for more money than I paid for it. It feels like that’s that’s on the verge.
Dave: Yeah, no, it’s, it’s, it’s there and you see people doing it and there’s yeah, it’s a pretty. Hmm, kind of mind blowing concept when you step back and think about it. Like, you know, usually you, you know, you pay for access to something that’s, you you’ve paid. You, you get, you know, hopefully you get value out of it, but that’s kind of done to be able to do that, to get value.
And then to be able to have just the, you know, the, the, the ownership, the piece of it that you, you acquire by paying for it then becomes something that is liquid and tradable. It’s pretty incredible. And, you know, I like something that just kind of starting to see now, but I’m excited about some, I’m a huge music fan and live music fan, uh, is kind of the, how this applies to.
Uh, to artists and musicians, uh, you know, you see it with royalties as we talked about before, but I was thinking about kind of the idea of like the people who get into the band before they were big, who were like the early hardcore supporters and, you know, the way that they used to get, you know, kind of, that’s a status thing in itself.
People like to brag about it. People like to share that they were at one of the first concerts or that they got. The early tour t-shirt or whatever. Um, and that’s clearly something that people value already. Uh, And if you think about being able to then harness that and create an economic component where a band can have a token or an NFT collection, uh, that they’re releasing, you know, when they’re early and if you’re a believer in them, if you’re an early supporter, you can buy into that.
And that’s something that can actually grow in value and you can either later sell off and actually profit from that, or. You can push continue to, to own it and share it as a badge of honor. Um, and by doing that, you’re also supporting the band and supporting their growth. Um, it creates a really, really interesting incentive structure, um, that, uh, that plays off kind of feelings that people have already and motivations they have already.
But, you know, then adding this extra component,
Andrew: Yeah, I’m seeing, uh, that the idea that you can invest in creators for example, is starting to come. Come together. No, one’s got a real platform. I think for doing it. We were talking about diesel and big cloud. They were trying to do that, but it’s not exactly working. Yes. You could invest in a creator on those platforms, but they don’t get all the money.
So what’s the point. All right, let me close out with this. I went to inverse, uh, on similar web to get a sense of how much traffic is inverse.com getting, and I thought it’d be small. It’s 13.5 million in the last 30 days, dude. Where’d you get all that traffic? How did, how did so many people show up there?
And I had no idea how big it was, and I know you’re not with them now, but still.
Dave: Um, yeah, I’m not there anymore. So I don’t know the latest numbers. I mean, when I was, you know, I don’t think they’ve fallen off cause you know, similar web, I don’t think similar attracts mobile. I think that’s just desktop traffic
Andrew: No, they do track
Dave: I don’t know any other do well, the w the numbers, I mean, we were averaging like 20 to 30 million, uh, a month, uh, users when, you know, kind of the last year when I was there.
Um, I mean, that’s, that’s kind of what I do build
Andrew: what do you do? Give me, give me a sense of what you do to get more people to come to contact.
Dave: so, so both inverse and Bleacher report are primarily built off search audiences. Uh, and it’s, it’s a pretty basic formula. It’s use SEO for growth and acquisition and use email for retention. Uh, and, uh, SEO is, is. It’s a numbers game and it’s a time game. It’s just, you have to create a lot of content. You have to create the right content and kind of be the best authority on the topics that you cover.
And you have to be extremely patient. You know, for that, that content to rise up the rankings and, you know, for it to get, uh, you know, to kind of grow in value in the index and you have to do a lot of other little things. Right. But like that’s the basic level. Um, and we did. First at Bleacher report for years, it took us years to kind of rise up those rankings.
And then we did it in verse and it took years and it’s just, you know, kind of a game of like, you know, slowly rising until you, you kind of hit that inflection point. Uh, and, and that’s, that’s the kind of growth lever for reaching new people. Uh, and then the channel to. Retain people and bring them back and, and, and make them loyal is email is getting people in to get, getting to the site, asking, you know, waiting for the right time to ask them for their email and kinda, you know, presenting them with a compelling offer.
We’re going to send you an email with all the best stories about your favorite sports team or your favorite, uh, you’ll comic book, cinematic universe, uh, and, and then delivering on. Uh, and creating a compelling, uh, email product that people want to keep opening and keep clicking on. And that’s, that’s basically, uh, you know, a very basic level what built Bleacher report and what built-in.
Andrew: I looked it up in SEMrush and yeah, it’s it gets millions a month from search SEMrush has 6.7 million from. But I had no idea. All right, David, thanks so much for being on here
Dave: Yeah, no, Andrew, this is great. Thanks for having me. and uh, it’s been, uh, a very fun conversation. Uh,
Andrew: and I want to thank two sponsors made this interview happen. The first, if you’re into content, need a good publishing platform. Uh, you can do it right on HostGator and it will scale with you. Go to hostgator.com/mixergy and second email marketing done, right. At a price that won’t just get jacked up on.
You go to send in blue.com/mixergy. Dave, everyone. Thanks.