Andrew: Hi everyone. My name is Andrew Warner, I’m the founder of Mixergy, where I interview entrepreneurs about how they built their businesses. And get this, today’s guest is the founder of Liquor.com. And you know what? When I first heard about that, I said, “Could he really have been the founder of Liquor.com? Could this story really be true of him almost, first of all, him launching it back in the early days before the internet was a thing and of him almost taking it public and so on?” And so I started going back in time because I get lost sometimes in research and I see his old articles about him, I see him trying to figure out what this business is, I saw the filing to go public. And is that painful for you?
Steve: It’s not painful because I think the final chapter is yet to be written, right? And frankly, we had the S1 filed and we were ready to go public in March of 2000. And of course, that was the beginning of the end there. And reality is if we had gone public, what would’ve happen? I mean, something very, very different would have happened. And look, with all due respect to those who have gone public and made a lot of money and done their things and whatnot, that’s not always necessarily the best thing to happen, especially let me think if that’s . . .
Andrew: It’s not?
Steve: Well, let me think about it. I mean, dude, at that point I was 24 years old. No, I was 20 . . . Whatever it was, I was young. So would that have been the best thing to be thrown a pile of money and take a company public? I don’t know. The honest answer is, I don’t know.
Andrew: Did you end up doing well from Liquor.com?
Steve: No.
Andrew: No?
Steve: No. I mean, the . . .
Andrew: At what point . . . Are you still part of Liquor.com?
Steve: I am. I am still part of Liquor.com.
Andrew: Okay.
Steve: So my pay day on it will be whenever we exit off of this current iteration and that chapter has yet to be written, right? So, no, man. I ran that thing, I’ve built that thing for nine years, ’91 to 2000. It started out as a catalog company, launched on CompuServe’s electronic mall for God’s sakes in 1993, build a fully functionally commerce site in ’95, which became Liquor.com in ’98. And so that iteration ’91 to 2000 ended up getting just decimated by the dotcom implosion there.
Andrew: You know what? Let’s take some time with this story. I want to spend the next hour talking about that and finding out about what you’re doing right now, which is, the voice, by the way, that you guys here is Steve Olsher, in addition to being a guy who created Liquor.com, he’s also the founder of New Media Summit. It’s a place where you could go if you want to be on podcasts. Frankly, you get to find the people who are actually producing these podcasts, get to know them. I’ve seen people say that they ended up with, I think it was like . . . There’s one woman who said she’s got a dozen bookings just from being there.
Steve: No, 33.
Andrew: 33?
Steve: The top woman at the last one ended up leaving with 33 bookings.
Andrew: Yeah, because the idea is that the podcasters, we want to get to know, are you someone who could speak on the podcast, you have a personality, do you have a background, right? And I usually that kind of thing takes time over days, and sometimes it works through friends and friends of friends. Well, the idea behind New Media Summit is you go there and in one fell swoop you get to meet a lot of these podcasters, get the sense of who they are, they get a sense of who you are, and you’re there to book.
All right, we’re going to find out about Liquor.com, we’re going to find out a little bit about New Media Summit, and it’s all thanks to two great sponsors. The first will help you host your website right, it’s called HostGator, and the second will help you hire your next great developer. And you know what? And also finance person. I got to tell you guys what I did with a finance person that I hired from TopTal, I’ve been updating everyone. Anyway, that company is called TopTal. But I’ll tell you about both those sponsors later. First, Steve, good to have you here.
Steve: Thanks for having me, brother.
Andrew: Have somewhere here in my notes, you talked to our producer, Brian. Somewhere here, it says $8 million 2018. What does the $8 million represent?
Steve: $8 million, 2018. Holy moly. What does that represent?
Andrew: What’s the revenue today?
Steve: Oh, you’re talking about Liquor.com.
Andrew: Yeah, Liquor.com.
Steve: Yeah, yeah. I was like, “Brian is going to write me a check for $8 million in 2018, sweet. Thanks Brian.” What does that represent? That represents, so projected for 2018 that’s about where we will be which for all intents and purposes is decent, but I think there’s a lot of opportunities they’re actually to grow that even more exponentially if we just put a couple of more initiatives in place.
Andrew: Are you still on that site? I don’t see you on the list of people in the team.
Steve: Correct. I’m not . . . I have no active day to day with it whatsoever. I am the second largest shareholder and have no active day to day with it.
Andrew: Okay. All right. And you know what? Usually I would save this for the end, but the book that you told Brian that you loved is one that no one on earth seems to know, but I read it as a kid. I loved it. You know what I’m talking about?
Steve: We talked awhile back. Remind me which book I said.
Andrew: “Kane and Abel” by Jeffrey Archer.
Steve: Oh. Yeah, yeah. Yeah. That’s . . .
Andrew: Listen, I do not read novels. This is such a fantastic novel for anyone who’s driven. Tell people what this is about and why you loved it.
Steve: You know, it’s interesting, man. I will tell you this, I like you probably read more than my fair share of business related books. And a friend of mine several years ago said this is one of her favorite books and I was like, “All right, I don’t typically read these historical fiction type books.” And that’s exactly what this is. I mean, it’s historical fiction, it’s based on these two characters who live two very, very different lives, obviously, Kane and Abel as a twist there. But it just . . .
Andrew: One rich, one poor.
Steve: Yep, one rich, one poor. One literally grows up just with the silver spoon in the whole nine and the other one survives concentration camps and living in dungeons and just a God awful life, but perseveres, and it’s the story of how their lives intersect. And it’s just . . .
Andrew: And perseveres in business. We’re talking about . . . The thing about Jeffry Archer’s books, at one point in his life, he was writing these novels of boys who wanted to make it big and had no reason to expect that they would and still they worked. And here’s the quote that I remember from his books, “More hours than most people know exist.” He loved that phrase, or maybe just stuck with me. And because of that, you’d see these guys just rise and triumph. It’s a book that fired me up. I don’t want to give too much away.
Steve: It was one of those things where he was like, “Well, what’s a book you think that most people have never read that that might be a good one for them to read?” And I was like, “How about that one?” You know, because . . .
Andrew: That’s a really good pick because no one would think of that.
Steve: Yeah, and I’m a storyteller.
Andrew: So good. So good. Also his other book, “As the Crow Flies” was really good. He has a bunch. His latest books, I feel like he’s just trying to make money. This is a guy who was in parliament in the British parliament, and then he went to jail, he wrote a book about that.
Steve: Yeah. It’s worth to read anyway. If you’re into business and you like good stories, it’s a really good story across the board.
Andrew: Yeah, and you are a guy who is into business. You did what I did growing up. You shoveled snow?
Steve: Oh yeah. Shoveled snow, raked leaves, you know, kind of going back to my NWA days of just trying to make a dollar to 15 cents. That was it, man. Played the drums, DJ’ed in clubs, actually opened up my own night club when I was 19.
Andrew: You talked about that in your book.
Steve: Yeah.
Andrew: It was a club aimed at who?
Steve: Non-alcohol club, because 19, I can’t own a booze club. And I had grown up in the days of there being a couple of decent teenage clubs. We were outside of Chicago, and there were a couple of decent teenage spots, Magrieves [SP] and Maducers [SP] and some fun spots there. And reality though, is where I went to school, which was Southern Illinoi University outside of Carbondale, or in Carbondale there, there was nothing for folks to do of that age bracket.
And so here I am 19, I’ve been DJing for a number of years, built up a really good following in the club. House music was my thing. And built up a pretty good following and I was like, “You know what? I want to put my own club together here,” but I knew it couldn’t be a booze thing, but actually thought that would work to our benefit because booze clubs had to close at 1:30. And when you’re 18, 19, 21 years old, 22, whatever, assuming you’re drinking of legal age in the clubs at a college, which is a big assumption, that’s kind of early, you’re not ready to go home.
So the general idea was, look, let’s cater to the teenagers early, so we’ll open from 8 until maybe 11:30 or so, and then we’ll close and we’ll clean up and we’ll re-open for those 18 and over, and we’ll be able to stay open so late as we want for 5-6 in the morning.
Andrew: And what do they do? They dance, and then I imagine do drugs in the bathroom.
Steve: Drugs, dance, they bring in their own booze. It was kind of like . . . It was like a BYOB kind of thing, the bottles. Fortunately, most of the money we made on the cover charges and the drinks and the food, but then we supplemented a lot of that income with our recycling program, because the bottles that we picked up from the floor there at the end of the night paid . . .
Andrew: Honestly?
Steve: Well, no, not honestly, but we picked a lot of bottles.
Andrew: Okay. Because you know what? I go through parts of San Francisco and the next day after the Friday mornings especially, full of people collecting these giant vats of bottles in these big garbage bags. So you just . . . I imagine what you did was you just went out, talk to a real estate broker and said, “I want to find a club,” and the person who owned it was willing to rent it to you a guy 19 years old.
Steve: So it was easier than that because there was a club that I was familiar with that had recently closed out. So again, being in the scene and having DJ’ed and be a resident at a couple of different clubs around town there, it was just simply a matter of, “Let me go talk to this guy and see what he’s thinking.” And the guy had bailed on and he wasn’t involved any longer, but he left all of his equipment there and the landlord owned it, so it was just a simple conversation. The landlord and all I had to do was basically write a plan, raised some money for it. And that’s what I did. Raise the money for it, we opened it about five months later.
Andrew: How much money did you raise?
Steve: At that point we raised all of $35,000.
Andrew: Okay. And did you make money off of this thing?
Steve: Oh, dude, we made money hand over fist.
Andrew: You did?
Steve: Oh yeah. Yeah, I mean it was . . .
Andrew: And what happened to it?
Steve: Well, it was, let’s just say like any business run by . . . Well, I think when it finally opened I was 20, so like any business run by a 20, 21 year old, etc., we hit our bumps in the road. Yeah, eventually I had a fall out with the manager and with my business partner and we parted ways.
Andrew: You know what? I’m looking for that section of your book. What’s your why? Right?
Steve: Yeah, The Funky Pickle, but . . .
Andrew: Or just like fizzle boarding room winding through all my highlights. What I . . . Oh, I do actually. Look at this. This is you in your book at your DJ days. Look at that hair.
Steve: No, that’s the ’87 graduation picture from high school, and there’s a good one on steveolsher.com. There’s a good one of me standing by a 280ZX in a Gold’s Gym shirt. I think that was after I did my second cycle of roids, so I was pretty stacked at that point. And those were the interesting days there, but it was The Funky Pickle, by the way, just in case anybody wants to look that one up.
Andrew: The Funky Pickle?
Steve: That was the name of the club.
Andrew: I think in the book you called it The Pickle. Oh, I see. The Funky Pickle, there it is. You also said a couple of pages later in the book, “I had my ups and downs, I went through financial ruin, divorce, battles of depression. When did you go through all that? What point in your story?
Steve: That was yesterday, actually. Sorry. No. It’s interesting, man. I honestly believe that in one way, shape or form I’ve battled with depression from my entire life, and . . .
Andrew:Like real depression, or clinical depression, or what? What type?
Steve: Oh yeah, oh yeah. Clinical depression like bottom out. November of 2013 was when I hit the lowest point in my life, although after high school I had hit a couple of low points as well. But, yeah man, I was too much of a coward to ever . . . There are people who say that suicide is like taking the easy way out and suicide is for cowards and all that. I don’t think so at all, man. I’m not encouraging . . . PSA, I’m not encouraging anyone to do this, but reality for me, man, is if you’ve got the courage to end your life, you are . . . I mean, because you’re basically saying you . . .
Andrew: You’re saying, you had no courage to your life but you wanted to?
Steve: I had definitely given it serious thought. I would never have put the gun to my head or that sort of thing, but I would drive . . .
Andrew: I’m wondering why. So I knew it. This book was copyright at 2013. So you were writing in this book about easy . . . Since you wrote this book, you hit an even deeper depression.
Steve: Correct. And a matter of fact, it was right around the same time that the book hit the New York Times’ list that I ended up dropping even farther down the hole.
Andrew: What was it that got you to hit that low?
Steve: You know, depression, it’s a disease. I mean . . .
Andrew: Right. For me to look for a cause is like to ask you, “What did you eat that gave you cancer yesterday?”
Steve: Yeah. And I will say this, which is after things really bottomed out, and I knew part of it was I had to get out of Chicago. I mean, I had lived in Chicago for 44 years. Seasonal Effectiveness Disorder, SED, I mean, it’s a real thing. Like people make fun of it, but it is actually a real thing. The cold, the gray, all of that it impacts certain people much heavier than others. And I don’t know . . .
Andrew: Still, I’m sensing that you went through something in 2013 that it was . . . There was internal stuff, the chemicals inside your system, but also external. What was it externally?
Steve: Externally, it was kind of a perfect storm of things. Number one. So it really came to a head in the Dominican Republic. I had gone down, I had been invited to speak at Vishen Lakhiani’s Awesomeness Fest. And so I was speaking there and it was . . . I mean, Jesus, it’s the Dominican Republic in November, so it’s beautiful, it’s sunny, it’s 90 degrees. The gig didn’t go as good as I had hoped it might. I just kind of had a . . . I don’t know. I just didn’t feel like the talk went as good as I might have liked. So I was in that spin, and then the spin of facing six months of winter coming back home and knowing that I was going to be facing that. And business was not great. I just didn’t feel like I had anything really powerful, empowering and anything that really put fire in my soul going on at that point. My wife and I were married for a long time and . . . You know, we got married in ’97, so it had been a number of years and we were going through our own ups and downs, and you put kids in the mix and it just complicates that as well as . . .
Andrew: Was it in a sense that you didn’t live up to your expectations of yourself in life?
Steve: It was a sense of, to some extent . . . You know, in author land they say that you write the book that you most need. And so for me, that question of, “What is my what?” So the book we’ve been talking about here it’s called, “What Is Your What?” And creating that framework around how to figure that out was really something that I needed, because having done the Myers Briggs and What Color Is Your Parachute, and all that, just left me with more questions and answers. And I really still didn’t feel like I had that answer. And when you don’t have something that really gives you that fire to jump out of bed every day, those days can be pretty long.
Andrew: I see. Interesting. So I was a little intimidated about you when I heard your backstory. And it’s interesting to see that you still felt, as recent as just a few years ago, that you hadn’t figured it out, that you didn’t have it. Let’s go back a little bit and see how we got here. You’re a guy whose grandfather was in the liquor business that kind of got you on this path. How do you feel about that, by the way? I’m checking in with the way you’re looking talking about depression. How do you feel about that?
Steve: So I will say that it is interesting because there are folks who feel depressed and have that sense of depression, and there are valid reasons why they feel that way. Some actually are in fact physiological, like there are things going on in the body. Like for me, after November 2013, and I got tested on the serotonins and the dopamines and the oxi- . . . All of those things that kick up the feeling good juices. I was literally off the charts low, like single digits, whereas most people walk around with those numbers being in the 50, 60, 70, 80 type range, mine was literally in the single digits.
And so I do think that there are folks out there who may be feeling depressed. I’m not sure exactly when this will air, but if someone’s listening to this in the winter, then they’re coming out of that feeling with the sense of just loathing of light. And I got to tell you that it’s not necessarily reflective of things that are going on in your life. You literally could be genetically pre-disposed to possibly being depressed and it’s just something I think you need to talk about more.
Andrew: You know what? I know I’ve never gone to that level, but I also accept that some external forces like the weather would’ve affected me. It’s weird to say it, but I know that when I lived in LA I was always happy and it’s because of the weather, is just so, so sunny and so happy. But whenever it’s an external force, it’s just basically pushing me to go into my negative thoughts, thoughts like, “You’re supposed to be so much more successful by now. You had this whole vision of yourself. You’re not working hard enough.” You know, those kinds of thoughts. What is it for you?
Steve: I mean, it’s certainly that, and I think just having an understanding of, we have a choice about being able to turn the light switch on or keep it off, and just that in and of itself, of knowing that that kind of talk in that kind needs . . .
Andrew: Now, I feel like that makes it worse. I’m sorry to disagree with you, but I feel like it makes it worse.
Steve: How’s so?
Andrew: Because now, not only do I feel this way like the lights are off, but also I have a choice to make that I could turn the lights on and I’m not doing it. I can’t give myself to it. So now this sucks and this little thing that I could do, like go for a walk, go for a run or something to get myself out of it. I’m not even doing that, and it’s my fault. So that makes it worse, I feel it.
Steve: It can, right? It can, but I will say this, which is one of the biggest turning points for me in terms of getting . . . And I’m not on medication now whatsoever. I was on medication for the better part of almost three years, but I have not taken any medication since very early 2017. And I do think that part of what really helped turn the corner for me, and maybe this will help someone listening now as well, is just the whole notion of personal responsibility. And the life that we create is a reflection of the choices that we execute.
And so sometimes you just have to make difficult choices, moving from Chicago to San Diego when I knew no one here and I knew that it would create strife for my wife and my kids and so on. It was a choice, and I had to recognize that if I stayed in Chicago, I would have made things worse for myself, worse for my family, worse for those around me, and I had to take personal responsibility around that and say, “Look, let the chips fall where they may, but at the end of the day if I don’t make this move, it will in fact make things worse.” And so I had to own that. I couldn’t blame Chicago anymore, I couldn’t blame my wife for not wanting to move. I couldn’t do any of that. I just had to make a decision that was right for me in that moment, and hopefully those who needed to continue to be in my life and I needed them to continue to be in my life, would make that transition with me.
Andrew: All right. Let me take a moment to talk about my sponsor and then come back in and talk about Liquor.com. My sponsor is a company called HostGator. Everyone listening to my voice has probably heard about HostGator because they’ve been around forever. Every time I do an interview with someone from the old domain hosting business, they say that they were clobbered by HostGator because these guys kept wrapping up all the competition. They’ve done well.
So why would somebody listening to my voice want a HostGator account as opposed to something else? Well, for one thing, hosting is frankly a solved problem. HostGator has got it. You just go pay. You don’t have to pay the top price to get good hosting service and HostGator will do it. So what do you do with it if you don’t have a host, if you don’t have an idea for a site? Well, dude, I freaking love your idea, Steve. How many times that I do interviews here and people say to me, “Do you know anywhere else where I could do an interview? I know that they’re out there to promote something, especially authors. They’ve got a brand new book out, they have their two months that they could do promotion, they want to get out there. And I could have just said, “You know what? I’m going to create a business that takes interviewees, people who have books or new launches or something and connect them with a bunch of podcast and put it together and get them the podcast that they want.
All it would’ve taken was just a website. Any idea that we have? All we have to do is just put together a website and see if people are interested in it and get them to sign up. I’d actually even say, a simple WordPress site is all you need and a form, just a basic form on there. So button, you want it, I’m going to press the button, you say, “Why do you want to sign up? What are you hoping to get from this?” Then they hit submit and then it comes to me via email and then I get to figure out, “Is there a business here or not?” So guys, if you have an idea for business . . . Did I just oversimplify your model? I did, didn’t I?
Steve: No, it’s good, man. I like it. And actually, I’ve been using HostGator myself with all my personal sites for like since 12 years.
Andrew: You have. Why do you use HostGator?
Steve: Simple, but more importantly, uptime. They’re reliable. I will say that I can count on a fingernail the number of moments that there has been downtime with HostGator.
Andrew: What websites do you have?
Steve: Oh Jesus. Steveolsher.com, whatisyourwhat.com, reinventionradio.com.
Andrew: Why do you need a different website for each one of these?
Steve: I believe that you should have an individual website when you have individual brands, like newmediasummit.net is its own site, the reinventionworkshop.com, right? So when you have your own brands, I think you can have a place to host everything like when you’re in the world like I am like steveolsher.com host everything. But I still think that each of those individual pieces should have their own site, but that’s my personal preference.
Andrew: I agree, and it’s so easy to do. And if you have the . . . By the way, that music that people heard, that was from your website. I was going to the sites as you mentioned them.
Steve: Yes.
Andrew: And if you have the unlimited hosting package from HostGator, you can just host as many domains as you want. All you have to do is go to hostgator.com/mixergy. When you go there, you’ll get unbeatably low prices. Frankly, the prices are low even without the discount that you get by using my URL. But you’ll get them even lower by using my URL and they’re going to give you unmetered disk space, unmetered bandwidth and unlimited email addresses. That’s another thing that adds a lot of professionalism to just have an email address at your domain. One for sales, one for booking, one for everything. And frankly, they all go to the same place, nobody cares, it just adds a lot of professionalism to it. People take it more seriously and psychological. All right. Go to hostgator.com/mixergy to create your new site with them and let me know about it. I’m andrew@mixergy.com if you want to send me your sites.
All right. Let’s go back to your dad. Your dad was in a liquor business. What did he do in the liquor business?
Steve: Yeah, so . . .
Andrew: That was grandfather, excuse me.
Steve: Yeah. So my grandfather, for those who were in the Midwest and a few other regions, California, Florida, etc. My grandfather started Foremost Liquor Stores in 1939, and he was definitely my first mentor. I mean, we actually had an opportunity to work together after the club thing when I came back to Chicago, we worked together for a few years before his passing, and just an unbelievable man. And I think a lot of the reason why, I’m still so attached to Liquor.com. It has nothing to do with me and loving liquor. I’m not a big liquor drinker. I mean, Grey Goose over the rocks, a few olives, call it a day is my go to. But I believe in my heart of hearts that I’m just compelled to do something with it to fulfill his vision of . . . I don’t know. I guess just trying to make it easier for people to know what to drink, where to drink and how to drink, and that’s really what Liquor.com is all about.
Andrew: Does the family still own this business?
Steve: Foremost Liquor Stores we sold out in 1994.
Andrew: And there are a bunch of locations in Chicago. I see it. All right. And so . . .
Steve: Yeah, I think it was like 80 something stores at our peak.
Andrew: And so did you think, “Hey, look, my grandfather’s doing this thing, I could bring it online,” not necessarily to your own website, but to CompuServe if I understand right? Is that the thoughts?
Steve: So the thought was there was a very small piece of the business called Foremost Liquor by Wire, which was basically just like FTDs is for flowers except for booze, right? So You’re in California, you just closed a big deal, you want to send a bowl of champagne to your buddy in New York, whatever it might be, you would call Foremost Liquor by Wire on our watts line. Yes, that’s what we used to call it, 800 numbers on our watts line, and we literally take those orders by hand and call our local retailer, and the local retailer would deliver that product. So that’s how it started out. And they were days that would go by without any orders, and maybe an order would come in. So it was a very, very, very small piece of the puzzle.
Andrew: CompuServe was this little world where you sign up, you get a number to identify you for your email address, not even a name, it’s not andrew@mixergy. It would be 12587 or whatever, right? You go in, I’ve never been on CompuServe. How would somebody know that they could go and order liquor from some area of CompuServe?
Steve: Yeah, yeah. So when I came on board then in ’92, let’s just call it ’92, I took that piece of the business and decided, “Let me focus on that,” because I thought there was a pretty big opportunity there, and that’s when we came out with our first full four color catalogue and started working with the biggest brands in the world and so on. And then I came across CompuServe. And, you know, you’re in the grocery store, you get those disk, the AOLs, the prodigies, CompuServe, etc. And for whatever reason, I was drawn to CompuServe and started digging into it. And they put out something. I don’t remember exactly how I found out about it when they put out something about an electronic mall that they were building and they were looking for merchants.
And so I raised my hand and said, “Look, let’s put Liquor by Wire on CompuServe electronic mall.” And so I remember, man, went out to Columbia, I was got trained on how to do it in the whole nine. And sure enough, within about six months or so, we had a store on their mall and it was their job to drive traffic to it. So it was one of those early sort of aggregation type sites, a portal, if you will. Yeah, where their job was to drive traffic to the mall and we got the benefit of the orders that came through.
Andrew: Did your grandfather own the business or was it co-owned?
Steve: No, my grandfather owned it, and actually my mom had worked for my grandfather since 1977, so I became the third generation in that business.
Andrew: I see.
Steve: And then in ’94, mom and I decided that we were going to sell off the business after his passing and just focus on the Liquor by Wire piece and that’s when we started doing some other things with that and solely focusing on that.
Andrew: So I’ve got an article here from January 12, 1999, from DMN. What is it? Digital Marketing News?
Steve: Direct Marketing News. Direct . . .
Andrew: Direct Marketing News.
Steve: Direct Marketing News. Because we were a catalog business and we had catalogs up until about 2000.
Andrew: And it said, at that point, you were starting to expand. And so in the story, there is an example of how you bought the keyword “liquor and champagne” on the top search engines AltaVista, Lycos, HotBot. So when someone typed it in, they would recommend Liquor by Wire. Is that right?
Steve: That is correct, yes. So by ’99 though we were Liquor.com and in . . . So in ’98 I tracked down the domain to a guy actually in San Fran area, was just a younger kid who was squatting on liquor.com and burbon.com at the same time and negotiated out to deal with them. Want to guess how much we paid for the two domains in ’98?
Andrew: I guess it’s just before things were heating up. I’m going to guess 25,000.
Steve: Yes. So $7,500. $7,500.
Andrew: Wow. For both?
Steve: For both. And, you know, look, man, reality is at the time, it felt like a stretch. In today’s dollars, it’s like what, 3 million or something like that. Right? I mean, it felt like a stretch. It did. But it was just one of those things and I was like, this is something we have to do. I just think it’s going to make all the difference in the world.
Andrew: And it did.
Steve: Yeah, it did good.
Andrew: It did a couple of things. First of all, it made you into a dotcom, which at the time was huge, and second, it puts you on the web in a more searchable way. So it’s function and also form, and also sending a message to the universe. This is what you’re about. Did you start to raise money? Did you try to raise money at that point?
Steve: We did. We raised money towards the end of the second quarter of ’99. And all in I want to say we raised about $3 million at that point to help take the company public. So somewhere right around there.
Andrew: What was it like for you to raise money back then?
Steve: On one hand it was easy because this is . . . Look, man. This is the period of time where ideas on a napkin were getting funded. It was kind of nuts. But on the other hand, Wall Street basically said, “Look, we need to see people with more experience. So if you’re going to take this time public, we need to see more gray hairs, we need to see more people who know what they’re doing, this, that and the other.” And so being blinded by the dotcom light, I mean, we bought into that hook line and sinker, sign away management rights, brought on the CEO, CMO, all these lettered saviors that was supposed to take us to that promise land. And raising money was not hard, but the market imploded.
Andrew: Because your whole plan was, “Raise money, go public as fast as possible.” That’s what companies were doing back then, and the market was willing to invest in a company that had no profits at that time.
Steve: Well, but that’s what made us very, very different, is we actually, we were doing millions and millions of dollars in revenue at that point. And so we actually, we had . . . We were profitable before we brought in all of these lettered saviors.
Andrew: Oh, I see.
Steve: So we were profitable. To me, it was just simply a matter of we just need people to know we exist. So it wasn’t as easy as it is now to be found, right? So the idea behind raising the capital was simply to drop it into marketing. That was 100% where all of the “heavy lifting” was done. I mean, the infrastructure was there and we just needed people to know we existed.
Andrew: So I got lost in your world as I was researching you. And I found the statement on the SCCs website. It’s actually not an S1, it’s an SB2 which I didn’t know what that was. And SB2 is a little bit different from an S1 in that it’s for people whose companies have a market float of 25 million or less. What was the overall value of the business if you were going to take it public?
Steve: That’s just one of those arbitrary terms of ignorance that people depending on where they’re sitting at that particular moment will help to dictate. So the honest answer is, I don’t know only because I know that at one point before we took it public, the valuation on that business was 118 million, so I’m not sure where that comes from.
Andrew: Yeah. And then I also see a valuation of $70,732,500.
Steve: Right. So there were various pieces of the puzzle there. And you’re right, maybe at one point it was with the value evaluation of under 25, and then I know it was as much as 118. And then what you’re looking at shows 70 plus.
Andrew: So you were at the height. Was there a number that you said, “I’m worth 25 million, I’m worth something?”
Steve: Oh yeah, dude. I mean, come on. Are you kidding? It was already spent just running the numbers on what we would go public at.
Andrew: Spent on what?
Steve: Well, in my mind anyway. I’m dumb but I’m not stupid.
Andrew: Yeah, yeah. But I mean, where were going to put the money?
Steve: Honestly, I had never even fathomed where the money would go, you know, in fantasy land, maybe pick up a decent car. I’m not an extremist, I’m not one of those. We live nicely, but we don’t live extravagantly.
Andrew: All right. And you told our producer, “At that point, I signed away everything.” All these C level people you brought on, they had power over the company. You now were just a board member and it seems like you didn’t even have a lot of board seats under your control.
Steve: Correct. Correct.
Andrew: So you couldn’t fire them unless you had other people to support you, you couldn’t decide where the company goes at that point. You basically are shareholder with a little bit of a voice.
Steve: Yeah, yeah. That’s exactly right. And this would be sort of lesson number one, if you will, around just business 101, which is never sign away your management rights to your baby. Just never sign away your rights to your baby. Just don’t do it.
Andrew: And these days entrepreneurs are not being forced to do it the way that they were. They’re accepted as the leaders of their businesses. Do you remember the day . . . Was there a day when your public offering was pulled or was it one of these things where you just kept postponing until the market gets better, until this company goes public, and then this, and then that, and then there was never a day to just kind of petered out?
Steve: No, there was very specifically a period of time there. I mean, it was over the course of perhaps a couple of weeks of discussions, but in March of 2000 when NASDAQ was sitting in 5500 then began it’s free fall, there were discussions around, “Look, let’s just wait this out,” to, “Let’s wait ’till things recover a little bit. It’s just probably a temporary hiccup.” And two weeks later, it was still in that state of free fall and it was just very clear that, “Look, we’re not going to be able to get out of the public.” Really, the public funds, if you will, just dried up. Everybody just got super scared, right? So it really wouldn’t have mattered if we waited six months or . . . What I mean, I think NASDAQ only recovered to where it was a matter of just a couple years ago at this point. So it took that long for the cycle to actually kind of come full circle there and get us back to where we were. So it was fairly quick within the matter of just a couple of weeks. We just made a decision, we’re just going to pull it.
Andrew: On the recommendation of one of my past guests, I’ve been reading a book called the “Principles” by Ray Dalio. It’s his lessons learned being one of the top traders in the world. The first part of the book is a biography where he’s talking about meeting people, watching them become billionaires, and then in a handful of cases watching them because of one market turn lose everything. It doesn’t often happen that in one change of the market, people lose everything. Do you remember what it was like for you? How did you handle it when one thing outside of your control, the market changed and you couldn’t go public and you couldn’t have these millions?
Steve: Yeah.
Andrew: What was it?
Steve: I mean, I’m not one to rest on my laurels. I’ve never really been one to sit still. And I remember I did not get along with the other people that we brought in, I did not get along with the CEO, with the CFO and whatnot. So the writing was on the wall pretty clearly after we couldn’t get out that I was going to have to leave. And I literally left after nine years of building that business to where it was. I walked out and I remember I bought the office building about three blocks from our house, and I walked home with a box in my hand and came home, sat on that front porch and was just like, a) “How am I going to break this to the wife?” and b) “What am I going to do to keep the lights on and put food on the table?” And so, yeah, it was . . .
Andrew: It was fear, not a relief, not, “I finally get to put this behind me, but . . . All right. What do I do now?”
Steve: Yeah. It was incredible disappointment, incredible sadness for sure beyond because again, that’s . . .
Andrew: Depression at that point too?
Steve: For sure. Yeah, for sure. Again, this is something that my grandfather started and so trying to carry on that legacy. My mom actually stayed on for about another 8 or 10 months after I left. But yeah, it was definitely super hard, man, because I felt like I let down my mom, I felt like I let down my grandfather, I felt like I let down my family, and of course, going from this position of, “Geez, I’m going to own world,” to basically having nothing to show for because we didn’t put any money to the side. Every dollar that we made over those nine years went back into the business. So there was no . . . There was no cash in cushion and there was nothing sitting there other than the need to do something else.
Andrew: All right. Over the years, I did see your name come back onto the website. I want to ask you about what happened afterwards. Let me take a moment and talk about my second sponsor and then continue on with this story. Wow. All right. Second sponsor is a company called TopTal. I’m looking here on my second computer where I got a text message from a guy named Chris Prichard which some people might have heard in past interviews. He’s the guy who’s been introducing me to the owner of Bitcoin.com and all these different cryptocurrency founders. That’s what his business is about, cointradepros.com.
He helps these people get . . . He helps people who are gurus in the cryptocurrency space. I’m losing all my words here. In the cryptocurrency space, promote themselves teach and so on. And he sent me a message and he said, “Andrew, I need somebody at TopTal, I need to get a kick ass set of team members.” And I’ve known him for a long time. And he’s hired people and work with people before, so why is he sending me a message now about TopTal? Because now his business is finally kicking into high gear.
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Look at what Google does. My friends have gone through the Google hiring process, now that I’m in San Francisco, I get to see it takes, it forever. We’re talking about not just weeks and weeks of going through the hiring process, but prep time to really be able to express what you’re doing. I got a friend who went from one Alphabet company, Google, to another. Even that, is taking him weeks. So if you’re an entrepreneur and you don’t have that kind of time, you want somebody who spent that time finding the best of the best and is ready to introduce you to them, and often get you started working with them within a matter of days.
And that’s what TopTal’s business model is. They are there to understand what you need and then find the best developers for you. I told you I was going to tell you about what’s happened with me with my finance guy that I hired from TopTal. I’m going to save it for another interview. This thing from Chris just came up and I had to tell you about it. If you want to go and find your own developers like Chris Prichard and so many others in the Mixergy community, go to toptal.com/mixergy. And when you go to that URL, they’re going to give you 80 hours of TopTal developer credit when you pay for your first 80 hours, and that’s in addition to a no-risk trial period of up to two weeks. That’s top as in top of your head tal as in talent, toptal.com/mixergy.
Steve, you know the reason I was like fumbling over that whole ad is, I was looking at you and I realized, I feel like I’m just hitting on the negative stuff in your story. And I’m wondering if . . . I’m looking at you and it seems like I am. Am I picking up on the wrong thing that you’re feeling like, “Andrew, what the hell are you doing here? You just bringing me down.”
Steve: No, dude. Look, I appreciate and . . . Look, as someone who helps people discover, share and monetize what it is that they’re truly compelled to do, sometimes we have to go through the muck to get to what . . . It’s like you look at the orchards, you look at . . . I mean, our dog’s name is Pama [SP] which lotus. You look at the lotus flowers it’s born from the yuck. I mean, that’s what happens, right? No, I don’t feel like that whatsoever. As a matter of fact, reality is, I think that one of the reasons why I’ve had as much success as I’ve had now, certainly in the last five years or so is because I’ve been able to own a lot of what it is that I’ve gone through which has led me to this point, and it hasn’t ended. After the Liquor.com thing, I got into real estate development. I ended up with the portfolio.
Andrew: Real estate was next?
Steve: Yeah. I ended up at . . . Just everybody and their mother was making money at that point in real estate. I mean, that was the next big bubble there, and I got into that. I figured, “Heck, if these guys can do it, I can do it,” and I ended up with a plot . . .
Andrew: Was that with the real estate development, not managed?
Steve: Real estate development, yeah. Development.
Andrew: So you get a plot or land and you’d build what on it?
Steve: So my area of focus was in what is known as adaptive reuse, which is taking an existing piece of property and converting it into its highest and best use for that particular piece of property. So if that’s taking an apartment building and converting it into condominiums, or if it’s taking them to warehouse building and creating loft apartments out of that, or I did retail, I did residential, I did commercial. I ended up with the personal portfolio over $50 million in real estate.
Andrew: How did you get the money to get started with this?
Steve: Raise money every time, every time.
Andrew: Raise money?
Steve: Yeah, every single time.
Andrew: Who did you raise money from?
Steve: Friends, family, people in second circles and so on. And I did a PPM for each of those projects, and . . .
Andrew: A PPM.
Steve: A Private Placement Memorandum for each of those projects. And there were times where I would do it on an equity basis where they would actually keep ownership of the property as we moved forward. There were times where I would just do it simply on a straight return most of my investors, but if we did it that way, ended up with the return of somewhere between 30% and 40% on money that they got in and out of the maintenance.
Andrew: And so how did you do it? You either say, “We’re all going in as co-owners, but I’m going to be the one doing the work. I’m going to be the . . . ” What is it called? The managing partner? The managing partner?
Steve: The managing partner, sure, you can say that. Yeah, absolutely. Or . . .
Andrew: Okay. Was it a partnership?
Steve: Not technically. Technically, we would do it as an LLC.
Andrew: An LLC. So you’re the person taking on the responsibility, you’re the person who gets the lion share, the . . . Actually, how did that work? So you’d collect their money, you put a down payment using their money, you’d use some of their money to improve the property. You’d use some of their money to go get tenants. Am I right?
Steve: Yeah. So basically in real estate, the best way to do it is you start with an acquisition and construction loan. So you do whatever it takes to get the money that you need based on the pro forma that you create to acquire and rehabilitate that property. And so you raise a certain percentage of that. Most of the raises that I did were around 20%. If it was a $10 million project, we’d raised about $2 million. And once we then get the property to where it’s going to be, and we stabilize that property, we then refinance that property based on the pro forma of stabilized cash flow, and that then usually will kick off another 2, 3, 4 million dollars something like that in that scenario of $10 million type development. And that, because you’re refinancing, all becomes tax free. And so that is then distributed to the partners and the project flows through.
Andrew: Wait. Why is that tax free?
Steve: In that the beautiful thing about debt, brother, in real estate, you take on additional debt, it’s tax free. If you have . . .
Andrew: Oh, because you’re taking on more debt, then, I see, it’s not a profit. Okay. And then if you took something that was, say, a commercial real estate and you turn into residential real estate, you would have to ask the people who have space in there to move out.
Steve: Well, sure, or . . .
Andrew: When you say stabilize, what do you mean?
Steve: So stabilized, meaning you get to . . . In most cases, 90% occupancy is considered stabilized. And so if you create a 100 unit apartment building, getting 90 of those units rented. And typically, they want to see that for a 12 month period, some want to see it for longer, but that would become a stabilized property that they can then predict what the cash flow is going to be from that, and so then they can back into, “This is how much we can loan you on that property.”
Andrew: But if you’re saying it’s adaptive reuse, are you saying that you have to wait till people leave or ask people to leave so that you can change what the property is from one thing to another?
Steve: Well, I’ll give you an example. So the last project that we did was 144,000 square foot concrete loft building in Chicago. That building was completely empty, and then it was zoned for warehouse or manufacturing use or something of that nature. So we had to get it zone. We had to obviously build out the units, we had to adaptively reuse, if you will, what was there, and we turned that into 68 residential loft units with 68 indoor parking spots and some commercial and so on. So in that case, Andrew, no. It was completely empty. We just had to go through the process of getting it well zoned and approved to be in the form that we envision it to be.
Andrew: You knew the process for getting it zoned?
Steve: I didn’t know jack. I knew nothing.
Andrew: So how did you get that?
Steve: That’s where the be . . . I mean, like right now, I’ve got one part time employee and a couple of part time coaches and contractors that we bring in as needed. That’s it. And I just have become very good at finding people and bringing them in on a contract basis as needed.
Andrew: So you would place somebody on a contract basis to help pre-zone it?
Steve: Hundred percent, yeah. Just get a good zoning attorney. Again, it’s about vision. I’ve always been one who’s had really good vision around what it is that I want to be doing, and the same things with real estate, I can see the finished product in ways that frankly, other people can’t.
Andrew: You know what? There’s some people here in the tech community who live in this place that used to be a video store. The guy is Sachit who sells our ads here on Mixergy. He was living in there with them. It used to be an old video store. You see like the back room where the guy used to go and sit and so on? They turned the back room into a bedroom for someone. There was a top room somewhere, they turned that into a bedroom. The porn room, where they used to rent porn videos, someone else took that as their bedroom. And there are no porn, no videos in there now, it’s just the way that it was structured. These guys were not supposed to be living there, but they did. So you’re tell me if I wanted to say like, “This is a good environment, this is a good area. No wonder these guys want to live here. If I want to turn it into hacker house, buy it from this person, and then get re-zoned from commercial to residential, that’s a thing.”
Steve: It is totally a thing. And . . .
Andrew: And I don’t even have to have all the down payment for it. I go and I raise a down payment from other people and then when I rent it out as a hacker house at full or 90% occupancy, then I re-finance it and at that point, I kick off some cash for me and others, and we keep making our money from the hacker house.
Steve: Absolutely. Yeah, happy to brainstorm with you on that anytime, bro.
Andrew: Freaking brilliant. Okay. So that’s one thing that you did. It sounds like that worked out well for you and you’re still doing that to this day?
Steve: Well, again, not focusing on the negative here, but I think it’s important to know that you mentioned the New Media Summit. Two days before we did the last New Media Summit, I had been in the throes of a lawsuit relating to one of the development projects that I did in Chicago before I left to move here to San Diego, and due to mis- and completely non-representation by counsel back in Chicago and some really bad advising guidance on something that was related to that project. In 2016, March of 2016, all of my assets were put into receivership. All of my accounts were completely frozen.
Andrew: Because of this lawsuit.
Steve: Because of that one lawsuit, because I thought I was getting represented and the plaintiff was going into court and getting everything they wanted because my attorney never showed up to defend me.
Andrew: But you were paying a lawyer, you were consulting with the lawyer, you were expecting the lawyer to show up, the lawyer didn’t show up, and as a result everything that the opposing counsel wanted, they got because there was nobody there to stand up for you.
Steve: Yeah.
Andrew: As a result, I heard that there was a personal judgment against you.
Steve: Correct. So . . .
Andrew: How much?
Steve: So they were able to walk in and get a personal judgment at that point. Now, mind you in real estate, there’s two types of loans. There’s a non-recourse loan where you have no personal responsibility and there’s a recourse loan where if things go to hell in a hand basket, you have to pay it back. This was a non-recourse loan, which means project fails, I don’t have to pay a dime, right? So this was one of those scenarios where it was a non-recourse loan and based on something that the guidance that I was given, it basically triggered full recourse. So only a moron in the first place would do anything to trigger full recourse. That’s what happened.
And then after that happened, they walked into court, the plaintiffs, got everything they wanted, got that judgment in Illinois because I was here in California. I didn’t know what was going on. And literally, they were able to enforce that judgment against me here in California to the tune of at that point, it was $5.8 million and a personal judgment took everything that I had and put it into receivership and froze all of my bank accounts. So three days before the last New Media Summit, that all came to a head that $5.8 million judgment actually ballooned over $7.3 million because of interest, default interest and penalties, and etc., etc. And that finally got resolved a couple months after the summit. But can you imagine trying to put on a huge event and having somebody come to your door and basically say, “Hey, you know that $5.8 million that you were already worried about? Well, now it’s 7.3 and we’re going to be collecting.”
Andrew: I couldn’t think about anything, and also you need your credit cards for last minute things like even if it’s just treating a guest to a drink.
Steve: I’d tell you what, man. And that’s the thing, is human beings would push, come to shove for the most part. I can’t say this for everyone, but I think for the most part, we are incredibly resourceful people, and having to live and take care of my family and run businesses and so on with handcuffs was probably the single most interesting exercise I’ve ever had to take on. But I’m here to tell you that in 2017, being completely handcuffed, we had one of our best years ever for my personal brand Steve Olsher, right? So I’ve got other things that I do, but I’m just saying the Steve Olsher personal brand with the coaching, consulting, and the things that I do around that, we had one of the best years we’ve ever had.
Andrew: Why? What did you do differently because you were handcuffed?
Steve: I just was so much smarter with where I invested my time, my energy and my resources, and . . .
Andrew: As you had to say no to things that didn’t make sense? Like what?
Steve: I had to say no to things that didn’t make sense and had to be very cognizant of every dollar that went out because I creatively had to finagle how the dollars came in and where they went out so that I could still live and so that I could still operate.
Andrew: You know what? I know I should be saving this question to later to create some tension, dramatic tension in the interview. But did you ever get that lawsuit resolved? Did they take your money? What happened?
Steve: So the final results on that story is it didn’t do . . . First of all, I obviously fire . . . I firing my council was a really important first step in that. And I know this sounds funny. And all of this stuff happens, and when you’re talking to . . . Can I swear on this or not?
Andrew: Yeah, yeah.
Steve: So when you’re talking to a bullshitter and someone that you’ve been working with for the better part of 18 years, you feel loyal to the person, you feel like you just don’t know that person who evidently that person is. So for the better part of a year, I stuck with him as my attorney because of all of the things that I was being told by him. And firing him, honestly, needed to happen a lot sooner, but when I finally did that, I think that showed them that we’re not in cahoots together, that this is not my guy and like there’s something going on here. So that was the first step. And then my new council and I were able to negotiate a settlement with them.
And it didn’t do the plaintiff. There was no benefit to them to drag this out. They needed to gain control of the real estate so they could dispose of the real estate. And so long as this hung out over their heads, they couldn’t do that. And so, yes, they were getting this money piled up against me, but worse case I filed for BK and it goes away anyway, right? So I did everything in my power not to file for BK, and I’m happy to share that we ended up paying about $260,000 to settle that out and the judgment was dismissed. But it could have been a lot worse I had I kept that attorney, I think they would have gone for full boat on that and seized my house, my real estate, my Liquor.com holdings, you name it. They would have been seized all.
Andrew: You still have the real estate.
Steve: I still have real estate, different investment properties and so on. Yeah.
Andrew: Wow. I still don’t fully understand. What was it that they said that you did wrong, that they were suing you about?
Steve: Yeah. I mean, we can go into detail about that. I’m happy to share it. It doesn’t have to be a long story, but basically in this case, this was a piece of property that was a multi-unit residential and commercial development that sat on a fairly large piece of land. Let’s just say that there were three pieces of land associated with this development, parcel A, parcel B, parcel C. When everything went to hell in a hand basket in the real estate world and the values completely fell off the table, well, that of course, impacted this property as it did many others, and the loan came due. And when the loan came due, we couldn’t refinance with another lender for anywhere near what the outstanding loan amount was. So the property went into default.
And during that period of default, someone reached out to me and said, “Hey, you know that parcel that you have over there? Well, you know that there’s three pieces, the parcel A, parcel B, parcel C. Well, I don’t know if you know this or not, but parcel C is completely unencumbered.” So during the last refinancing, their attorney, my attorney, the lender, no one noticed that in this legal description, parcel C was left off. And so I was like, “No, of course, I had no idea. I did not know that this was going on.”
And he’s like, “Well, it’s completely unencumbered. Would you be interested in selling that piece?” And so I’m thinking, “Well, geez, it’s in receivership or it’s back to the bank. It’s about to be foreclosed upon. Maybe this is a chance to make a little money on before the door completely closes.” And I asked my attorney about it and said, “Hey, is this something that we can do? Can we sell off that piece?” And he said, “Well, I’ll handle it from here.”
And that’s what he did, is he handled it from there to his own benefit where he kept a huge portion of what that was sold for. Well, it turns out that selling that one parcel violated all of the terms of the loan agreement because it was one entity and it was our responsibility to bring that to their attention in the case of something like this happening. We didn’t do that. We sold the parcel, that of course then triggered full recourse and that’s what pissed them off because we sold that from under them while we were in this process of giving it back to the bank, and it was completely and 100% the wrong thing to do. And I bought my attorneys pitch on it, hook line and sinker in terms of why we could do it.
Andrew: Wow. And it seems so easy as you were telling. It seems so easy as I was going back through the internet archives and looking at past versions of your site and your story. But just one example of a situation like that is scary. I was going to say enough to scare you away, but it’s not necessarily.
Steve: No, because it was just a stupid move, but I had to take full responsibility for saying, “Okay, let’s do it,” and taking his advice and not seeking other counsel. I mean, I have to take . . .
Andrew: And you’re still in real estate right now?
Steve: Still in real estate right now, and I’ll be doing additional development here soon now that my hands are uncuffed. It’s hard to do any new development projects when your hands are tied. So now that my hands are untied, I can get back into doing some development and now and I will be doing more of that.
Andrew: All right. I’m curious about New Media Summit. I really . . . I’m not kidding. Years ago I thought people are coming out to promote something, authors especially, I should be doing something. You did it. How did you start off? You actually created a business around it.
Steve: So I’ve had my own show, Reinvention Radio since 2009. And I’ve have always done it as a live radio so that we then repurpose as a podcast, took a liberate time on and off over the years or whatnot. But over the last three years or so, I’ve been doing it full time with a couple of co-hosts and I really love this whole industry. I think it is the single best medium for a number of reasons, none of which I need to get into because I’m sure you’ve covered this ad nauseum so I won’t get into that.
But I will say that on a continuous basis, people approach us and ask to be on the show because we cover . . . It’s more of the story of . . . It’s kind of my story, right, it’s the A to Z. How did you reinvent your life? You were a lower beat lawyer before and now you’re a professional surfer. I mean, these kinds of crazy stories of people who have just done amazing things in their lives. And so we get approached all the time with, “Hey, can we get onto your show?” And it occurred to me that on paper, it’s really hard to relate. I think you mentioned this earlier. I mean, but it’s really hard to tell on paper if someone’s going to be any good. And so . . .
Andrew: Because bullshit artists are artists for a reason. They spend a lot at a time on their craft. They know how to mislead you.
Steve: Yeah, absolutely. And so it occurred to me that maybe there’s an opportunity to, well, are other podcasters having the same sort of issue of being approached with a million different guests and not knowing who’s good, who’s bad as that in the other. And so anyway, I was talking to a couple of podcaster friends about it, and they’re like, “Yeah, we experience that all the time. And then there were even some folks, of course, that we don’t even know about who we’d love to have on the show, but we don’t even know that they exist.”
And so it was just kind of a marrying of the two. I mean, I’ve been doing live events for a long time, Internet Prophets Live, -P-R-O-P-H-E-T-S, Internet Prophets Live. I was in an event that I did for a number of years and we had just amazing people like Lewis Howes and Vishen Lakhiani and Jay Conrad Levinson before his death, and Russell Brunson, and Brendon Burchard. I mean, you name it, they’ve shared that stage with me. And so I love live events, and I was thinking, “Maybe I could do a live event where we’ll bring in, I don’t know, 10 or 20 or so podcasters and give a room full of people the opportunity to learn how to leverage and monetize the power of new media, and more importantly for them and even for the podcasters, give them an opportunity to pitch them on who they are and what they do, and literally get booked on the spot.”
And so that was kind of the origins story on it, and before I knew it, I had 40 podcasters who were like, “Heck yeah, call me and I’d love to be there.” And we ran the numbers on it, we figured we could do it for about 150 attendees. And so that’s what we do, is we bring in 150 attendees and 40 icons of influences, we call them, and we put them together and we break bread together and we drink and we dance, and we learn and we pitch.
Andrew: Why? Why did you do it as an event? Why didn’t you say, “I’m going to do it online, I’ll create a directory online that people could buy access to or I’ll create something?”
Steve: Yeah, and I have that, it’s called the Ultimate Directory of Powerful Podcasters, Big Time Bloggers and Social Media Stuff. So I have that directly. And as a matter of fact we’re coming out with a new version that’s just the Ultimate Directory of Powerful Podcasters, which will have 610 podcasters in with all their contact details and so on. You’re on there, my brother.
Andrew: I see it now. But I’m still wondering why event?
Steve: I hate being online.
Andrew: Events are so tough.
Steve: I hate it.
Andrew: It takes forever. Sorry, you go ahead.
Steve: I’m a club dude, man. I’m a DJ. I like to dance, I like to hang out, I like to get to know people and like . . . We got to get out from behind these devices of choice and like actually break bread together and hang out and meet one another, and there’s nothing more powerful.
Andrew: But that’s fun. I get then why you might do a dinner party for people.
Steve: Business should be fun. Business should be fun.
Andrew: But it doesn’t . . . I wonder what the business model is.
Steve: I’ll be honest with you is say for people. Online someone is lazy.
Andrew: Why . . .
Steve: Online is for lazy people.
Andrew: It’s what?
Steve: They are.
Andrew: Or people who just want to grow their email list fast. It’s a good way to grow list.
Steve: Exactly. It’s a great way to grow. If you’re putting on a summit, it’s great. As a matter, I will be doing it Profiting from Podcast summit. But I got to tell you, it’s . . . I look at it and I go, “I’m lazy for doing this,” because coming with an event is hard.
Andrew: But you’re doing it because you love it, but it’s also a ton of work.
Steve: It is.
Andrew: I’m saying it because I’ve considered events over the years, and it always feels like a ton of work. Is it really going to produce the revenue that pays for all that work?
Steve: Yes. So here’s the thing, right? You have to look at your business model. And for me selling a $97 summit doesn’t mean jack. Like I don’t want to be selling things at $97 a pop. When I spend three days with people and they get to know me, they get to know who I am, I get to know them, I get to understand their business. We do six pre-event training sessions so that people hit the ground running by the time they get to the event. I know these people by the time that they get there. The top, if you will, the last step on the path in my revenue model is our yearlong programs. So we sell $38,000 yearlong programs. We have less expensive programs than that as well, but we sell $38,000 yearlong programs. The only way that I can get someone to say yes to a $38,000 program is for them to be able to spend enough time with me to really be able to get to know who I am, who I run with, what I stand for, what my capabilities are and so forth. You cannot do that online. You can sell the package.
Andrew: I see.
Steve: Yeah. So it’s clarity around what your revenue model is. Maybe that’s not part of your revenue model, and if it’s not, I’ll tell you point blank, you’re leaving a shit ton of money on the table.
Andrew: You know what? So who was it? I guess he owns capitalism.com, this guy, Ryan. He does this beautiful looking events. And I ask people, why . . . How’s he making money from it? And it seems like it’s not about the ticket sales, it is about these long-term relationships that he sells long term, the programs like that. So you’re saying that’s what I would need to have. Something where for $35,000 or so a year people get to work directly with me and my team and in order to do that, they need to meet you first.
Steve: Yes, that’s part of what we do, but I will never go into event . . . I will never go into an event in from losing . . . I will be in the black by the time those doors open. So like our events, if you don’t enroll in anything with me, so that’s fine. Come there, get booked on shows. Obviously, it’s not going to be for everyone there. There’s going to be a small handful of people they’re going to want this type of guidance over the course of a year. So don’t get me wrong. I look at the event as a profit center in and of itself in terms of we sell tickets to the event, you go on newmediasummit.net right now, you’ll see it’s 29.97, I believe it’s going up to 39.97 here soon, and it’s worth every dime. You hire a PR agency, you try to hire an assistant or somebody to get you booked on shows.
Andrew: That is the worst. Let me tell you why that’s the worst. You know what? In some cases, it’s good. I actually have seen some good PR agency, some good bookers who do it well. The problem is, some people will get booked on Mixergy and they never heard of Mixergy. They don’t know. They’re just looking for some link backs, an easy win where they just get to tell their story and they don’t realize I’m going to hit them with certain kinds of questions because that’s what I’m about because they never met me. And so then that’s when they’re in the shock situation where they’re upset with me, they’re upset with the booker, they’re all over the place for regretting they ever got involved in podcasting. So what you’re saying is, just get out there, see the person in person. Yes, it’s tough to go out to a lot of events to meet these podcasters, but I got one event you meet them all. One spot.
Steve: Yeah. Well, I’ll tell you what. It is hands down. I mean, I’m not the one saying this. This is from the people that have attended this event. It hands down the best networking event that you will ever attend, because if you go to other events, I’m not going to name names here, but I will tell you that they are very cliquish. You try to break into circles. It’s hard to meet people, especially people . . .
Andrew: I know because I’m creating the cliques.
Steve: Right.
Andrew: And I need no question. I create the cliques.
Steve: Especially people of influence, you want to try to get time with someone, it’s super hard. And so our event, no iron curtains, everybody breaks bread together, everybody dances together, everybody hangs out together. So you’ll not only get to meet, of course, the 40 icons of influence in a deep meaningful way, but the other attendees as well. It’s just a very different event, and for me, that’s what’s most important. Yes, the money is great, but the opportunities that are created by giving people just this chance to connect with one another on a deep, meaningful way over three full days, they leave with real relationships that you just cannot create anywhere else.
Andrew: All right. The website is newmediasummit.net. Man, this cold has got to be making people crazy. I’m going to be the person . . . I told my team . . . I was a little late to a meeting and they said, “Well, Andrew, we thought that you weren’t going to show up because maybe this is a holiday and you’re going to take some time off.” I said, “Look, if I’m in a freaking hospital sick, I will show up and the fact that I didn’t show up here means there’s a problem. Check in with me and make sure that everything’s okay with my connection or something.” Same thing here. I will be the person, if I can’t do these interviews from my desk standing up fully feeling well, I’ll be in a hospital room. I’ll continue to do these interviews. So yes, I do have a cold. No, I will not stop doing these interviews just because of a cold. Man, it’s so weird. These colds are not going away this year. All right.
Steve: San Diego. Two words, “San Diego”, makes everything go away.
Andrew: You know what? You’re absolutely right. But here’s the thing, I go nuts . . . Hang on. I got to meet [Romeo 01:08:47]. I’m almost done. I go nuts. Here’s the thing that I do. So I’m going to come to a conference in San Diego. I was invited to speak at a conference. I got a room to myself. I told you this morning in 6 o’clock, my kids woke me up, I couldn’t even sleep in because I’m not feeling well. They still, “Daddy, will you play with me?” “I love it. I went and play.” I finally get to San Diego. You know what? I’m planning, you know I’m going to do dinners because you’re coming to one of my dinners.
Steve:[inaudible 01:09:09]
Andrew:You know I’m doing scotch nights.
Here’s the other weird thing. There’s this guy Caleb I worked with awhile back, I said, “Hey, Caleb. Do you have the room to stay at?” He goes, “No.” I go, “Stay with me.” I’d learned that you could stay with people and hang out with them. So now, instead of getting to sleep in at this freaking conference, I got Caleb in my room, and he and I are going to go out all night, then I’m going to get up in the morning and go for a run. I’m not even going to get there and enjoy it, I’m going to basically . . . There’s someone on your website, I forget which one of your 50 sites, it was, who said, “Are you burning the candle at three ends?” I said, “This is a goofy thing.” And yes, I am burning the candle at three ends.
Steve: Oh man. Yeah. Well, look, again, I don’t want people to think that it’s just an event where you’re going to come there and you get pitched to. It’s not that at all. Yes, you’ll be invited because podcasting is not a business. I’ll tell you that, hands down. Being a guest on podcast is not a business. It’s just a piece of the puzzle. So there will be an opportunity, of course, presented to help you build a real business and use that as a piece as a component of what you do. But the main reason why you want to come there is to meet people like Nathan Latka, who we had at the last one and J.V Crum and Dana Malstaff and so on and so forth. Those folks are all looking for guest.
Andrew: Nathan Latka is going to be at this one.
Steve: Nathan was in the last one, but I’m just saying that’s the caliber of people that we bring in.
Andrew: Got it, yeah. I’m looking at your website, I see all these different people. All right. The website, newmediasummit.net for any who wants to check it out. If you want more about Steve, check out steveolsher.com. And I should also say Liquor.com since we mentioned it, but they already know that. I’ve got my two sponsors. If you want your website hosted right, go to hostgator.com/mixergy, throwing that /mixergy at the end gets you a discount and also gets me a pat on the back from the people at HostGator. And number two . . . Oh, here’s something Nathan taught me. He said Andrew if you’re ever speaking in a conference, when you’re done speaking, say, “Guys, I’m looking forward to talking to you. I’ll be right here off stage, but if you want to talk to me later, I’m going to be at the HostGator booth. HostGator always has a booth because this is a way to thank your sponsors and also have a private space. I wanted to do that.
Steve: Nice. Sweet.
Andrew: And then if you guys want to hire . . . I love Nathan Latka. I love talking to these people because they’re so freaking clever. They come up with all these different ideas. This is a little one that I just gave these bigger ones that I shouldn’t say, but freaking out, these guy is clever. All right. Number two sponsor is toptal.com/mixergy. And finally, you know Art of Charm, don’t you Steve?
Steve: I do. I know Jordan and the boys well.
Andrew: Of course, notice how you said, “Jordan and the boys.” Jordan is no longer with the Art of Charm. He created his own new podcast from scratch.
Steve: He did. He did?
Andrew: I’m getting on board with supporting him right from beginning. I’m going to tell everyone who’s listening to me. I don’t even know what website to go to. But here’s the deal, he doesn’t care if you go to the website, he cares whether you subscribe to his podcast or not. Oh there it is, it’s jordanharbinger.com. You’re going to misspell it. Don’t even bother doing that. Look at this. This guy looks good on his website. He’s good at getting his photos done. Anyway, he doesn’t care whether you look at his photo, he doesn’t care whether you go to his website. He’s got a new podcast out, he’s a good interviewer. If you’re done with this interview and you’re looking for another guy with some attitude, go check out Jordan Harbinger’s podcast on whatever podcast app you like. Or just throw out a hey to whatever device you have, to your Echo, to your Google HomePod, to whatever, and just say, “Play me some Jordan Harbinger,” and let’s see if they can do that for you. Go check him out. Thanks so much for doing this interview.
Steve: Yeah, my friend. Appreciate taking the time, man, and just keep up the amazing work, bro.
Andrew: Thank you. I going to go take a pill to feel a little bit better.
Steve: All right, all right.
Andrew: Bye. See you.
