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As property managers you likely know a little bit about mortgages. But do you know about non-QM loan strategies and how your clients and investors can utilize them? In this episode of the #DoorGrowShow, property management growth experts Jason and Sarah Hull sit down with Matt from Nexa Mortgage to talk about using non-QM strategies to unlock your portfolio's potential. You'll Learn [05:46] QM loans VS non-QM loans [16:14] Why Jason and Sarah went with non-QM [22:07] Which one should you choose? [26:46] Why should property managers know this? [32:23] What about long-term rentals Tweetables “If you have a great manager, it makes sense to get as many properties as you possibly can, knowing that they are in good hands and they are being taken care of because all you're doing is printing money.” “If you have a way that you can help your investor clients get what they want, which is more deals, it's a win.” “If you are a property manager, you should also be an investor in real estate.” “It's great to manage properties and let's do that and build wealth ourselves.” Resources DoorGrow and Scale Mastermind DoorGrow Academy DoorGrow on YouTube DoorGrowClub DoorGrowLive TalkRoute Referral Link Transcript [00:00:00] Sarah: He said, "I am not joking. I had to submit over 100 documents to the company in order to just see if I'm qualified to get this additional loan. And he's like, I just feel like there has to be an easier way." And there is, but sometimes people don't know about that.   [00:00:20] Jason: Welcome DoorGrow property managers to the DoorGrow show. If you are a property management entrepreneur that wants to add doors, make a difference, increase revenue, help others, impact lives, and you are interested in growing in business and life, and you're open to doing things a bit differently, then you are a DoorGrow property manager. [00:00:39] DoorGrow property managers love the opportunities, daily variety, unique challenges, and freedom that property management brings. Many in real estate think you're crazy for doing it. You think they're crazy for not because you realize that property management is the ultimate high trust gateway to real estate deals, relationships, and residual income. At DoorGrow we are on a mission to transform property management business owners and their businesses. We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. We're your hosts, property management, growth experts, Jason and Sarah Hull, the CEO and COO of DoorGrow. Now let's get into the show.  [00:01:23] All right. And today we're hanging out with Matt Dean of Nexa Mortgage, and we're going to have an interesting conversation about financing and loans and I don't know, and some other stuff, but Matt welcome to the show.  [00:01:36] Matthew: Good morning. [00:01:37] Good morning. Thanks for having me.  [00:01:38] Jason: It's good to have you. So give us a little bit of background of how you got into the whole real estate industry and give people a little bit of background on you.  [00:01:49] Matthew: Sure. So, after I graduated from college, which I went to college in Missouri, I ended up moving to Austin, Texas, and one of the first jobs I got was with a commercial finance company and that landed me in Lakeway, which is where I reside now, and have been for over 15 years. But the commercial finance company that I worked with was was a fairly new company that came in from California. The owners Had a mortgage background and had gotten into this commercial finance division. [00:02:15] They had sold off a couple of mortgage companies opened up this division and Lakeway. They were also land developers and commercial finance guys. So they saw a lot of opportunity out here and opened up this company. So anyway, I got in on the ground floor. They were relocating the company here and had a couple year run with that. [00:02:31] And then in early 2000, the .Com kind of came in and blew up that whole industry. So what we were doing was commercial finance, equipment finance really, and at the time it was a lot of computer equipment and I was working with a lot of Dell sales reps that were taking over some of their overflow that Dell didn't want to finance. [00:02:49] So, when all that happened, and it blew up the owners who had the mortgage background really saw that "hey, we're going to see a refinance run here. The market's going to crash rates are going to come down. There's going to be a run." And so they immediately just flip. They had a mortgage company here, but it wasn't early. It was dormant. Yeah. And they flipped it open and and just started building that company out. And so that's ultimately how I got into the mortgage business. And, right after that, we had this really big refinance run. We grew that company very quickly to about 35 employees where we were doing 300 to 400 loans a month with a fairly small company. [00:03:27] And that just, jump straight in and learn the business. And so then in about 2007 ish, 2006 ish, I really got exposed to the investment world, so to speak. I got partnered up with a real estate brokerage here in Austin that focused on investment properties and primarily what they were focusing on was duplexes. [00:03:47] And so that year in 2006, I believe it closed 152 duplex transactions, and it was mainly California investors coming into Austin. And it really just changed my whole perspective of the mortgage industry as opposed to first time buyers or veterans, which I enjoy working with all those folks, but the commercial or the investment world, it's a different animal in that it's less emotion and more about business. And so I really just gravitated more to working with investors, started buying properties myself managed a few properties myself and then, evolved from there. But I worked with that same group and Lakeway for about 12 years and then moved around a couple of places and work for a builder and and a couple other companies. [00:04:29] But anyway, that's how I got in it, got started.  [00:04:31] Jason: Yeah, so you've seen it from a few different angles than the whole real estate investment industry, sounds like. [00:04:37] Matthew: Yeah, I've been through a few of these cycles of ups and downs. Obviously the refinance run early on was, really interesting, but a lot of good, easy money on the table, so to speak, but then we had the crash, which was a very difficult time for a couple of years, although, Austin weathered that storm pretty well relative to a lot of other areas of the country. [00:04:56] So, even though our volumes were down, our real estate didn't see as big of an equity loss and the job market here in Austin's always been really strong. So, it pulled us back out of it fairly quickly. We're in a situation now where rates are high and property values have gone up. [00:05:11] And it's a challenge for some folks here to purchase. A lot of folks are just priced out of the market and can't afford it. And property taxes aren't helping that situation.  [00:05:19] Jason: Yeah,  [00:05:20] Sarah: It's so pricey here. So pricey.  [00:05:22] Matthew: But we're starting to see a little bit of pull back on the values and the houses. It's a little bit more of a buyer's market now, but it still needs to come down a little bit, I think in my opinion, it's to balance the market again.  [00:05:34] Jason: Interesting. So the topic today is unlock your portfolio potential, non QM strategies for real estate investors. And for those that don't know what QM is, which I don't. So educate me. What's QM?  [00:05:47] Sarah: So I handled all of this stuff and Jason got to the closing table and he's like, "I'm an owner in the LLC, right?"  [00:05:54] Matthew: It's like, yeah, I barely talked to you along the way, but anyway, yeah, so let's talk a little bit about QM and how that all started. So, after the real estate crash in the 2006, 2007, eight ish area the CFPB was formed a consumer finance protection bureau, which took over the regulation with the mortgage industry. [00:06:12] It took them a few years, but in 2014 they implemented what was called TRID, which you may have heard that word, but it was where we got rid of the good faith estimate and integrated the new loan estimate and closing disclosure took over. And at that same point in time, the regulations came out and then classified conventional loans or reclassified them as qualified mortgages. [00:06:35] What that means really is the CFPB was trying to put protections in place to protect consumers and also strengthen guidelines to make sure that people or buyers had the ability to repay. So what that really meant was additional restrictions on ability to repay, debt ratio requirements, reserve assets, et cetera. [00:06:55] So, if you do a conventional loan, which is Fannie, Freddie. Those are considered qualified mortgages. They have additional protections in that you're maxed at the amount of fees you can charge a buyer. The APR has to be within guidelines within a maximum. So all those things are really for consumer protection, right? [00:07:14] At the same time, what caused the market crash before was what subprime mortgages. And so at the time, subprime mortgages initially had a place in the market. They really were good for investors because investors were putting money down, they had good credit typically, and they had reserve assets. [00:07:35] When the market shifted, and they started using subprime loans to qualify buyers for primary residences that really had no business buying homes is where it got in trouble. So after QM was announced or came out with CFPB, then they also had non QM loans. What that means is any loan that falls outside of the qualified mortgage guidelines, for whatever reason, can still be funded or it would fall within non QM. [00:07:59] Non QM just meant if you're a lender who does those type of loans, you're now required to hold additional reserve assets in your bank or your mortgage company per loan to cover for the potential higher risk and default.  [00:08:12] Jason: Okay.  [00:08:13] Matthew: And it took a few years from 2014. The market started to come out with products in 2015. [00:08:18] The industry was really not sure how to handle it. A lot of banks didn't want to even dive into it. And then it started to evolve. And "okay, there's a big market here." So now it's one of the fastest growing segments of the market and banks have realize or figured out how to meet the ability to repay guidelines with alternative methods, right? [00:08:41] So you don't have to have W2s and tax returns and pay stubs, which a conventional QM loan would require. Now, they look at different factor, like, 12 months business bank statements. I can look at a CPA prepared profit and loss statement, I can look at just the rent income on the property and that's what's classified or called DSCR. [00:09:03] And then also it's asset based loans where we just look at the asset and we turn the asset into a revenue stream. So that's really how non QM started and really what it is. It's just an alternative way of qualifying the mortgages that falls outside of the Fannie Freddie conventional type of loans. [00:09:21] Jason: Got it.  [00:09:21] Sarah: So what does that mean for investors? Because we have some investors that listen to us and we have some property managers who work with investors. So what would that mean for an investor that is looking to get into more investment properties?  [00:09:39] Matthew: Yeah, absolutely. So, the challenge that a lot of investors run into is a lot of them are self employed and a lot of them start accumulating property. [00:09:48] So if they fall into either one of those categories, either they're self employed. Or they've accumulated a lot of properties or both, right? The challenge becomes with qualified mortgages is from an income perspective, right? So good CPAs are going to try and shelter income for self employed borrowers and for investors by showing, minimal profits or minimal or losses on their properties. [00:10:11] And so, as investors start to accumulate more properties, it becomes more challenging to qualify for conventional loans, because for every property on a conventional loan, Fannie and Freddie want additional reserve assets. So that means you start getting 6 properties, you need assets for each one of those properties on top of down payment funds for the purchase property and the reserves on that property. [00:10:33] So, from two perspectives, either an income perspective, where we have a challenge again, a self employed borrower shows losses on his tax returns for the last 5 years by design, because he doesn't want to pay taxes, or we've got multiple properties also showing losses when I'm looking at income on a conventional loan basis, I have to use the income from the tax return. [00:10:52] So losses can be a problem. Also, the reserve requirements, so, taking into those two scenarios, you've got a self employed borrower that, let's say they, they have gross revenue of half a million dollars, but they're showing losses of, 50-60-70,000 dollars. We're just looking at 12 months bank statements in that case, which gives us gross revenue and then we back out of a factor of say, 25 to 30 percent for taxes and we use that as revenue or income to qualify. If we have an investor that, let's say, not necessarily self employed they have multiple rental properties that are basically just, showing losses and now their income is diminished to where they can't qualify. [00:11:32] Then we have the debt service coverage ratio programs. Like, we utilize with your property where we're looking at just the rent on the property. Right? So the rent the market rent or the short term rental just needs to cover the principal interest, taxes, insurance and fees. And so those are 2 products that we use and that's really how, I would say it helps investors in those scenarios. [00:11:54] The other products that we could look at are P& L products meaning that ACPA provides a P& L statement, and then we can use that income, or if they have significant assets just in investment funds and whatnot, we can turn that into a revenue stream. But the bottom line is it just eliminates the need for W 2s, tax returns, or pay stubs, and we look at other alternative income sources to qualify. [00:12:18] Sarah: It's funny. I was actually on Instagram the last week, I think. And there's this guy, he has a very large account and I can't remember his name. And he's very big on investing in real estate. And he said, "guys, like, I just need some help. I like I'm going through this whole process and you jumped through 10, 000 hoops." and he said, "I am not joking. I had to submit over 100 documents to the company in order to just see if I'm qualified to get this additional loan. And he's like, I just feel like there has to be an easier way." And there is, but sometimes people don't know about that. I still talk to investors and property managers and they don't know. [00:13:02] They're like, "I'm just too conventional. That's like what you do. That's like the normal thing that we're all trained and used to doing." So just knowing that there are other options that don't require all of these crazy hoops to jump through and all of this documentation and lots of red tape and underwriting. [00:13:22] It's not that it's eliminated. It's just that it's a lot easier of a process and especially if you're a savvy investor that takes a loss on your taxes, just because your tax return shows a loss, it doesn't actually mean that you're losing money, right? So there's a big difference there. So that plays a big part too. [00:13:43] Matthew: Yeah, there are investors. Sorry. I didn't mean to jump in there, but there are definitely investors that lean on that from a documentation standpoint. Right? They've been down this road. They have multiple properties and more properties, you have the more documentation you need to provide to try and qualify for those conventional loans and it just becomes more and more challenging. [00:14:00] And, even more so if you have a loan officer on the front end of that's trying to originate a loan, that isn't really versed in investment properties and doesn't know how to underwrite the tax returns, they can get in trouble. They look, "oh, I got good credit. I've got down payments." But when you try and pull together tax returns and the income from multiple properties and business losses and this and that, it becomes very complex. And it's honestly, a lot of loan officers don't even know how to look at that correctly. And so they just throw the file up. It goes to underwriting. And then 2 weeks later, they've got a problem. But I just closed a deal actually yesterday and it was ended up going non QM short term rental. And the gentleman is great credit owns his own businesses, owns multiple properties and schools here, but the documentation, because he owns, like, 8 companies and probably 7 or 8 rental properties, and he had a partner in this particular property that, It became so complicated with trying to pull some of that stuff together and also with the partner who wasn't necessarily as strong as him where it just made sense for us to go short term rental and move on. [00:15:07] And that's what we did. So we just made it easy. He was happy that he didn't have to continue to jump through all those hoops. And we were able to get the property done and close in about two and a half weeks.  [00:15:17] Jason: You said it made sense to go short term rental. You meant to go non QM. Is that what you meant? [00:15:21] Matthew: To go non QM. Yeah. We went short term rental income, which is non QM to qualify the income on the property. This happens to be a short term rental down on the Comal River and it's got great income. It just he had a private money loan on it when he purchased it needed to refinance the note was coming due and he just has a very complex financial situation. [00:15:43] And he got involved with a partner on this property that also created some challenges with that particular situation and just made it a lot easier to use him and go non QM short term rental income only and just get it done.  [00:15:54] Jason: So, would that be a DSCR loan going on the short term rental income? [00:15:59] Or is that different?  [00:15:59] Matthew: Yes, it is technically a DSCR loan, which means debt service coverage ratio. And this is what we utilize with your property as well, by the way. we're looking at either long term rents.  [00:16:10] Jason: We should tell that story, by the way, everyone listening has no clue. [00:16:13] Sarah: I know, right?  [00:16:14] Jason: Why don't we have Sarah explain like why we went this route, how we ended up talking with Matt and like how this all worked out.  [00:16:21] Sarah: Okay, let's do that. So, Jason, oddly proudly, he's like, "I've never owned a rental property and I've never managed a rental property. And I do this now." And I said, "this is nothing to be proud of. Like you're 46, you should own things. You should have assets." So like I, on the other hand, like I had, in my twenties, I started investing in real estate. So, Jason and I for a while have been saying like, "when are we going to get one together?" [00:16:48] Because we didn't have one yet and he never had one.  [00:16:51] Then also our circumstances in life have changed a little bit. And we thought " we need an additional property at this point." And we were in a unique situation where right now in Austin, I'll just start by saying long term rental is hard to make it make sense financially. [00:17:10] You're probably not going to cashflow.  [00:17:13] Jason: Yeah.  [00:17:13] Sarah: Not right now. Anyway, it's just, it's really hard because prices are high. And interest rates are also high. This is where we are. So we couldn't have possibly done a long term rental anyway, because we needed the property to have some personal use on it. [00:17:28] And we decided, "Hey, let's also use it for some of our DoorGrow events." Because every time that we do an event, We pay somebody else.  [00:17:37] So let's pay ourselves through that. So for that reason, it only can really be used as a short term rental property. So we decided, "Hey, there's these kind of three components." [00:17:48] And I'm really big on asset protection, meaning I need the property to be owned and deeded and financed in an LLC. So originally I was working with another agent. We've worked with him before on our primary home. He's a really great agent. I had asked him about, "can we fund it in the name of an LLC?" [00:18:09] And he said, "no you can't do that. It doesn't really work that way." And it seemed like he was just trying to talk us out of it. I even talked with that he typically uses and that we used on our, Home that we live in. And he said, "Oh no, yeah, we don't do properties in the LLC. It'll be in your name. And then after closing, we could do a quick claim and then like change the deed and put the deed in the LLC name." And I said, "okay, what about the mortgage?" And he said, "no. The mortgage stays in your name." And I said, "I'm out." Like that is where I'm out. You're piercing the veil. [00:18:44] All of my personal assets would now be exposed and on the line. And that completely defeats the purpose of having an LLC. And he was like, yeah, we just don't do that. I really don't think that's going to be a problem. So I said, "okay, do you know anybody now he's been in this business for like 20 or 30 years?" [00:19:02] "Do you know anybody that can do that?" And he said, "Oh, not really." So that was time to start looking for somebody else because I know that it can be done. I've done it in Pennsylvania. So there's no way that Texas can't do this. Texas is far ahead of Pennsylvania in a lot of different ways.  [00:19:19] Jason: So we found another agent. [00:19:20] Sarah: So we found another agent who then referred us to Matt and he said, "Hey, I know a guy. He's really great. And I'm pretty sure he can do what you need." So I said, "great. What's his information?" I had a conversation with Matt and he's like, "Oh, well, yeah, we can do that." And I said, "so you can put the loan in the LLC. Not my name, the LLC. He said yeah, we can do that." Like it was easy. So it can be done. Sometimes you just have to look around a little bit. So that was how our deal was structured. So we went non QM and we ended up doing, since it is a short term rental, we went DSCR so that the rents would cover essentially your PITI. [00:20:00] And this is how we made our deal work. So we closed PITI. [00:20:06] Jason: PITI for the listeners is...  [00:20:07] Sarah: principal interest taxes insurance. [00:20:11] Matthew: Yeah, so, I know that was how our conversation started was, " can we do this in the LLC?" And we walked through that and the pros and cons a little bit, I think, and that's one thing that conventional QM loans don't really not really, they don't allow that. You cannot fund in an LLC. [00:20:25] Now, what happens is a lot of people like you were advised, "hey, fund it in your name, slip it to the LLC later." That can cause some problems because Fannie Mae does have due on sale clauses in their loan documents. So, technically, if there's an ownership change, that note can be called due. Typically, you can just flip it back into your name and stop that process, but it becomes a cat and mouse game back and forth if you have a servicer that's trying to, exercise that for some reason, it doesn't happen very often. It's not a very high risk, but it's definitely something you need to be aware of. On the non QM side, the lenders want these, or most of them prefer them to be funded into LLCs because non QM as a whole is considered business purpose lending. [00:21:11] It falls outside of the consumer protection, finance protection Bureau oversight. So, it's considered or classified more of like a commercial loan. And so most of them require, or want you to fund into an LLC. There are some that will do them in their personal names. It's interesting. They follow more of a conventional loan program, which I'm not really sure I understand, because they issue a closing disclosure and they look at loan estimates, even though it's considered a non loan. So they just handle a little bit differently. Those companies will allow you to do it in your name and some of them are doing a lot of those companies are also doing primary residences under a non QM basis. So bank statement products for somebody who may be self employed also trying to buy a primary residence. That's where I see it more. Most of the the LLC stuff is for investors and those lenders are going to. Really prefer or require it to be in an LLC. [00:22:07] Jason: Got it. Okay, cool. So what should investors know in order to make the decision as to which way they should go? Like, how do you make the deciding factor? Like, what are some of the things that kind of weigh into this?  [00:22:20] Matthew: Yeah, I think really it's a conversation initially of can they qualify for a conventional loan? Do they understand what non QM loans have to offer? A lot of investors aren't familiar with the details of non QM loans, how they work, how they can help them. So it's really an education conversation of, what options we may have available. Right? I would always start with the conventional loans typically and, see if we can qualify. If you can go that route and you're putting 25 percent down you're going to get a little bit better interest rates. And then you don't have some of the other key factors that come with non QM loans. So most non QM loans do have some sort of prepayment penalty because they're selling these to a secondary hedge fund investor that wants a minimum return. So, in most cases, you're going to have a prepayment penalty in a conventional loan. Stay out of point. A QM loan legally cannot have a prepayment penalty. [00:23:14] So there's a big difference there. But as far as qualifying them, it's a really, like I said, an education and a conversation about what their profile looks like. Right? They self employed. Do they own multiple properties? Are they showing losses or profits on those properties? And then, really documenting that, 9 times out of 10, what I'm told on a verbal conversation doesn't match what I get on the documentation that way. [00:23:38] "Oh, my business makes this," but they're talking about gross revenue, not net income. They're talking about gross rent amounts, not the net income they're showing on their tax returns. So it needs to go the next level. But that initial conversation may determine quite quickly that, hey, we need to go non for what reason or, because they want to fund it in an LLC, because the property is really a short term rental, but it doesn't but they don't have any history of short term rental management. [00:24:07] And let's talk just a little bit about, how you look at the short term rental. I know that's what we were talking a little bit about before we talked about your loan, right? So there's 2 ways to look at that short term rental and it's either from well, the rental income short term or long term can either come from an appraiser. [00:24:23] Or from a software program that some lenders are now using. So a lot of lenders will lean on a typical, appraisal to an appraiser to come up with whatever that market rent may be. And like, like, you said, it's difficult to cash flow properties in Austin or in Texas. On long term rents simply because the property taxes have escalated and now with higher interest rates. [00:24:48] So a lot of times, the short term rental is really from a lending perspective an easier way to qualify the property for 1. But we do have the ability to look at it from two different perspectives and this is what we utilized on your loan. So I'll just talk about a little bit. So I have a couple lenders that will look at the short term rental from a software perspective. [00:25:05] Right? So in your case. When we had the discussion, it was really a matter of, yeah, "I really want to put 20 percent down. I don't want to put additional money down. That would be more important to me than a little bit higher interest rate. Right?" And so, when we look at different lenders that may be leaning on an appraisal. [00:25:21] I don't know what that number is for 2 weeks and me personally I feel like appraisers, especially in the short term rental market. Are a little bit lazy and sometimes they just don't have the data. So what happens is I submitted to the lender based on an 80 percent loan to value. And then all of a sudden, my short term rental income comes back low or lower than what we may have expected. [00:25:42] And now that's requiring you to put an additional 5 percent down to meet their guidelines of a debt service coverage ratio less than one or go no ratio, right? We still have an option, but the option is going to require you to put a little bit more money down. And so. Again, we have two ways to look at it either an appraisals given us that number or with some investors. [00:26:00] And this is why I like working with some of those in that case. Like I said, your most important factor is 20 percent down. so I took it to a lender that gave me that short term rental number within 48 hours. They ran it through their system. They gave it to me immediately and said, "this is where we should be." As soon as we submitted the loan to underwriting within 2 days, we had an approval and this was confirmed short term rental amount. We didn't have to wait on the appraiser and it didn't matter what the appraiser's opinion was. They already confirmed what we were going to use, which confirmed that I could get your loan approved with just 20 percent down. So, that's a preferred method in a lot of ways, especially if we're trying to keep that 20 percent down number. [00:26:38] If we have somebody that's putting 25-30 percent down, then it's. A little bit less relevant and we can, decide what option might be best for them at that point.  [00:26:46] Jason: Got it. So why should property managers who are constantly wanting to do more deals, help more investors, why should they have somebody like Matt in their back pocket? [00:26:57] Sarah: Oh, that's such a good question. Well, I want to think of it kind of twofold. One, I feel like if you are a property manager, you should also be an investor in real estate. Real estate agents just by having access to the MLS. No, that's not where all deals come from. I know that, but just by having access to the MLS and the connections that you have as a real estate agent and property manager, there's no chance that you don't come across amazing deals all the time. [00:27:23] There's no chance. So capitalize on that.  [00:27:26] You should also be an investor yourself. It's great to manage properties and let's do that and build wealth ourselves. Yeah. So that's number one. But number two is if you're like, "well, I like, I don't know, I'm unsure, or maybe I have one property or two properties and I don't know if I'm ready to continue to build a portfolio." [00:27:46] Or you're like, "Hey, I have X many properties and I'm happy right here. I don't want any more." I don't know why, but maybe you are. So if that's the case and you have investor clients that very likely would love to get into more deals themselves. And it would be great for you because now if you have an investor and they manage five doors, but that same investor can now manage 10, 20, 38. [00:28:11] That's fantastic because now your business is growing. So if you have a way that you can help your investor clients get what they want, which is more deals, it's a win because yes, the savvy investors, they're always looking for more deals. Jason's hooked now. He said to me, we closed and he was like, "how do we do another one? like, how do we do another one?" He's like, "how fast can we do another one? Like Sarah, is it possible if we do like one property a year," right? And he did. Yeah, he did. There's a lot of investors like that because once you get it. Once you really get to see all of the benefits and just how freaking beautiful it is to be a real estate investor and make money and get all of the tax benefits that you don't get in almost any other sector. [00:28:54] It's amazing. So why would you not want more of that? So if you're a property manager, it would make so much sense for you to just be able to educate your investor clients. "Hey, have you ever thought of picking up more properties?" The answer probably is going to be "yes," especially if you're doing a great job for them as a property manager. [00:29:14] Because that's a tricky part is, "well, I could buy a bunch of properties, but who's going to manage them?" If you have a great manager, it makes sense to get as many properties as you possibly can, knowing that they are in good hands and they are being taken care of because all you're doing is printing money. [00:29:30] So if you want to grow your portfolio by adding additional deals to the clients that you already have. It's like so simple, right? Why would we not do that? So having options. that not everybody knows about. It's fantastic.  [00:29:47] Jason: So in short, this just gives them a lot more options to work with because investors want to invest, and they may think, "Oh, well, I've only got this much down or I can only do a conventional, I can only do it this way. I need to meet certain criteria" or "I've just declared all these losses."  [00:30:04] Sarah: "Like I have too much debt." Maybe their like debt to income is a little maxed out because we're, keeping up with the Joneses. This is so normal, right? So that and Matt's laughing. He sees it all the time. [00:30:15] I bet he's like, "Oh, we went a little too high on that one." [00:30:18] there's good debt and bad debt though as well, right?  [00:30:21] Correct. However, if you own five properties or six properties or seven properties, every additional property that you have that is leveraged, meaning that you have a mortgage on it, that's counting against you and your debt to income ratio. [00:30:35] Jason: Right. So it gets harder and harder using conventional to get into more property.  [00:30:40] Sarah: Unless you're the Fed and you can just print money.  [00:30:42] Jason: Well, I don't know if they're buying  [00:30:44] Matthew: a lot of money.  [00:30:44] But you bring up a good point and just to clarify when we do a debt service coverage ratio program, I'm not looking at any of your debt. [00:30:52] I'm not looking at a debt ratio calculation at all. And if you own multiple properties, I'm not even looking at any of those other properties for any sort of rent, income, verification, mortgage, anything. This one is a business, right? Correct. It's it. Well, it's just debt service coverage on that subject property, right? [00:31:10] Does the rent cover the note? And do we have enough money for down payment and reserves on that property alone? We don't look at reserves for those additional properties like you would a conventional. So you got five properties. I don't care about reserves on those. I'm only looking at the subject property. [00:31:24] So, yes, debt to income is a big factor and I think, if we're talking to property management companies, it's really just an education or a knowledge of what potentially could be out there. Right? Like you said, they have opportunities to buy all the time. I would think that the savvy property manager is going to scoop those up if they can, but are they aware of these programs? [00:31:44] Or do they think that? "Oh, my debt to income is too high or I have losses on my tax returns that I'm going to have trouble qualifying." And then you also have your network of investors that you manage those properties for that potentially are looking for additional doors, but they're not aware of these programs in some cases. [00:32:00] So, yeah, it's just a matter of, I think, education and just getting the information out there. So that some of these people know what options are available.  [00:32:09] Jason: Well, it sounds like it shifts the conversation from, "can we?" Yeah. Maybe it's a no, in their thought, in their mind to "how can we?" Like, there's other creative ways that things could be done instead of saying, "Oh, it's gotta be this one way we've always done it. That's the only way." So, what about for long term rentals? Which like some of the investors listening and a lot of our clients listening may not do a short term.  [00:32:32] Sarah: You can still do a non QM on a long term, especially in Austin. Now, other markets, you might find a cashflow. Like I have a cashflow property in Pennsylvania. [00:32:40] It's a rare gem guys, but in Austin, it's hard to get something to cashflow, especially right now.  [00:32:47] Matthew: Okay, so there's two ways to look at it again. There's, or I guess, multiple ways to look at it. Not just two, but bank statements if I'm looking at it. So, if they're self employed, and they have a business that we can lean on the bank statements, right? [00:32:59] That's my income qualifier and no longer care about that negative potential cash flow on the property in the rent. Right? So that's one way. If I'm doing debt service coverage and I'm looking at long term rental, I have a client that wants to long term rented. They're not going to be comfortable stating short term rental on the application. [00:33:17] They really have no desire to do that. Then I have to look at the short term rent. Now, what that's typically going to end up, at least in Austin, what's typically going to end up happening is that property is going to have a problem cash flowing at 20 percent down or 80 percent equity. Right? So what happens is it now pushes us to. [00:33:34] A bigger down payment, a larger down payment, 25 percent 30%. And then we have the options with those lower loan values to do either no ratio or lower debt coverage ratio loan programs. Right? So. If it falls below 100%, meaning 100 percent rent coverage with PITI coverage which principal interest taxes, insurance and HOA fees all come into that play. But let's just say it's a little bit short. I've got a PITI of 2000 dollars of my rent's 1800. well, the lender is going to do one or two things. Are you going to say, "well, we need more down to get that to 100%." Or "we're going to reclassify it as a higher risk and we'll do, some of them will go down to 75 percent debt coverage, but it's a little bit higher rate." [00:34:18] Or "we have to go to a little bit larger down payment and go no ratio, right?" No ratio means we just eliminate that altogether. And it's typically 30 percent down. So, we have options to look at but it is definitely a little bit harder if we're looking at long term rents simply because it's harder to cash flows at 20%, unless again, unless we have larger down payments or larger equity positions, for refinances to soak. [00:34:42] A lot of these let's talk about that too, you have some of your property management clients that may want to purchase more properties where they could extract equity out of these homes to use to purchase more property. So there's a lot of the refinance going on with those properties to under a non QM basis, because they again, they can't qualify for a full doc for whatever reasons. [00:35:03] Right? But there are options to pull cash out under a non QM basis and utilize those funds to reinvest.  [00:35:09] Jason: Got it. So say they've got five, 10 properties, it's getting really difficult for them to qualify for a QM loan. They could maybe pull some equity out of their existing properties, do like a cash out refi, and then use that money to fund a bigger down payment to do a non QM scenario. [00:35:28] Matthew: Absolutely. Absolutely. The challenge right now in the market with refinances in general is a lot of these people have really good rates on those properties. And so they don't necessarily want to refinance and lose that low rate understandably. Right? So. In other states, you have a the ability to do HELOCs or he loans, which are second liens, Texas, it's a little bit limited. [00:35:47] There's not as many products available, especially on the investment side. There are ways to extract some of that equity and reposition it to be reinvested in other investment opportunities. And I will say that we do have the ability to do the same type of loans on small commercial properties. [00:36:04] Like, up to I've got one lender that kind of specializes in that small commercial that goes up to 24 units. So, between 5 and 24 unit apartment buildings, we're also looking at a non QM type debt service coverage loan, which is what commercial loans look at in general anyway. Commercial loans are based on cash flow, right? [00:36:23] It's all debt service coverage based on that. But in that small apartment complex arena, you've got a lot of these kind of more residential lenders that are focusing and specializing in it. Because it's a piece of the market that's left out, right? Your commercial lenders don't want to touch something that's a few 100, 000 dollars. They have minimums of 5Million dollars, 3Million dollars. And so you have these smaller properties that are great investments in some cases that also have challenges getting loans, not because of the property, but because of the size of the loan.  [00:36:55] Jason: It's just not big enough for him. [00:36:56] So Matt what areas do you cover personally? And then how do people find somebody like you, how did they find somebody like you? Like, this was a challenge we had to ask around what do people look for to find somebody that can help them with some more creative options?  [00:37:11] Matthew: That's a good question. I wish more people would know how to find me. So maybe you can help me with that. But yeah, it's just, it's interesting. There's a lot of loan officers that just don't, I guess maybe they're scared of the non QM space. They don't understand it. They're scared of change, so to speak, and so they just go, "I've never done that. And I don't know anything about it and they don't want to learn about it." it's the fastest growing segment of the market right now. Fannie Mae is pushing a lot of the paper towards non QM from a risk perspective. They want to get away from it. They're making investment rates in terms unattractive, so to speak, so they're offloading it that way. But, I think it's really through the real estate agents is probably the best way to get in touch with somebody like me, if they're familiar with it. But what's interesting is even your agent from McLean that I work a lot with Brett. [00:38:00] He wasn't 100 percent versed in these products either. So. Fortunately, he got me, right?  [00:38:05] Sarah: Yeah. Thank you, Brett.  [00:38:07] Matthew: But, yeah, as far as if you have somebody that's questions, I'm always available to potentially educate people in regards to these programs. As far as where I do business, I'm legally licensed in Texas and Arizona, meaning national mortgage licensing, which is the, the CFPB license. [00:38:22] Now, with non QM loans about 35 states don't require you to have a license within that state. So I can do non QM debt service coverage all these type of loans that we talked about in about 34 different states. Just with my national license and because they consider a business purpose use, it's classified as a commercial loan in those states, and they don't have these overbearing laws like California does or Nevada. So there are some states that it's difficult unless you want to jump through a bunch of hoops to do it. And unless there's enough volume, there hasn't made sense for me to do it. [00:38:55] I just focus on the ones that I can, which is a big piece of the country and we can help folks in those 30 some states, 34 states, whatever it is.  [00:39:03] Jason: So there's maybe 15, 16 states that you can't cover.  [00:39:06] Matthew: It's the New York the Pacific Northwest and California, most of the middle of the country around Texas we can do. [00:39:14] I know you, you referred me to somebody in Utah the other day, they happen to be a state that requires licensing, but their licensing is pretty reasonable. So, if there was an opportunity or a reason, for some volume to come out of there, I could get licensed fairly quickly. [00:39:28] And some of these states, because I already hold a national license within them. I passed the test for that, which means you just have to take the state piece of that exam to then get licensed. Be able to do loans there, which is fairly simple. And as long as you're not in New York or California or somebody that has these crazy laws,  [00:39:44] Sarah: What's to invest there anyway, come on, like squatters and all this, like? [00:39:48] Matthew: I know, right? [00:39:49] I don't know how everybody does loans in New York. I hear it takes 90 days to close a loan.  [00:39:54] Jason: There's plenty of investors in those markets. I'm sure people listening. All right. Cool. Well, Matt, it's been great having you here on the DoorGrow show. Appreciate you being our guest. How can people find you or get in touch with you? [00:40:06] If they're wanting to reach out and find out if they're one of those 34 states.  [00:40:10] Matthew: Well, my number if you want my phone number is 512 415 6142. You can Google Nexa my name. I think if you Google my name and Nexa mortgage that come up quite a bit on the Google nexahomelending.Com is my personal website. [00:40:27] That's probably the two best ways to reach out to me just text or email and I'm more than happy to help you in any way that I can.  [00:40:34] Jason: Perfect. Well, it sounds like this is at least a key or just a tool or an idea that every property manager listening should probably have in their back pocket. [00:40:44] You should have some sort of connection to a more creative lender than you may have currently. And so, connect with Matt or maybe, I don't know, start Googling non QM lenders in your market. I don't know, but find somebody or ask around to some real estate agents, but see if you can get somebody that can help with getting some of these deals because investors, they have money, they have equity and, but they're not doing deals and they want to probably do more deals and they just need somebody creative enough to help them find some solutions or interesting ways to make it happen. [00:41:13] So, all right. Well, again, Matt, thanks for being on the show. Appreciate you.  [00:41:17] Matthew: My pleasure. Thank you very much for having me.  [00:41:19] Jason: All right. Well, everybody, if you are interested in growing your business, your property management business, reach out to us, you can check us out at doorgrow.Com. And until next time, everybody to our mutual growth. Bye everyone.  [00:41:30] Matthew: Great. Thank you. Talk to you guys soon. Bye. [00:41:32] Jason: you just listened to the #DoorGrowShow. We are building a community of the savviest property management entrepreneurs on the planet in the DoorGrowClub. Join your fellow DoorGrow Hackers at doorgrowclub.com. Listen, everyone is doing the same stuff. SEO, PPC, pay-per-lead content, social direct mail, and they still struggle to grow!  [00:41:59] At DoorGrow, we solve your biggest challenge: getting deals and growing your business. Find out more at doorgrow.com. Find any show notes or links from today's episode on our blog doorgrow.com, and to get notified of future events and news subscribe to our newsletter at doorgrow.com/subscribe. Until next time, take what you learn and start DoorGrow Hacking your business and your life.

Matthew Bonig, Chief Cloud Architect at Defiance Digital, joins Corey on Screaming in the Cloud to discuss his experiences in CDK, why developers can't be solely reliant on AI or coding tools to fill in the blanks, and his biggest grievances with AWS. Matthew gives an in-depth look at how and why CDK has been so influential for him, as well as the positive work that Defiance Digital is doing as a managed service provider. Corey and Matthew debate the need for AWS to focus on innovating instead of simply surviving off its existing customer base.About MatthewChief Cloud Architect at Defiance Digital. AWS DevTools Hero, co-author of The CDK Book, author of the Advanced CDK Course. All things CDK and Star Trek.Links Referenced:CDK Book: https://www.thecdkbook.com/cdk.dev: https://cdk.devTwitter: https://twitter.com/mattbonigLinkedIn: https://www.linkedin.com/in/matthewbonig/Personal website: https://matthewbonig.comduckbillgroup.com: https://duckbillgroup.comTranscriptAnnouncer: Hello, and welcome to Screaming in the Cloud with your host, Chief Cloud Economist at The Duckbill Group, Corey Quinn. This weekly show features conversations with people doing interesting work in the world of cloud, thoughtful commentary on the state of the technical world, and ridiculous titles for which Corey refuses to apologize. This is Screaming in the Cloud.Corey: Welcome to Screaming in the Cloud. I'm Corey Quinn. And I'm back with my first recording that was conducted post-re:Invent and all of its attendant glory and nonsense; we might talk a little bit about what happened at the show. But my guest today is the Chief Cloud Architect at Defiance Digital, Matthew Bonig. Matthew, thank you for joining me.Matthew: Thank you, Corey. Thanks for having me today.Corey: So, you are deep into the CDK. You're one of the AWS Dev Tools Heros, and you're the co-author of the CDK Book, you've done a lot, really. You have a course now for Advanced CDK work. Honestly, at this point, it starts to feel like when I say the CDK is a cult, you're one of the cult leaders, or at least very high up in the cult.Matthew: [laugh] Yes, it was something that I discovered—Corey: Your robe has a fringe on it.Matthew: Yeah, yeah. I discovered this at re:Invent, and it kind of hit me a little surprised that I got called out by a couple people by being the CDK guy. And I didn't realize that I'd hit that status yet, so I got to get myself a hat, and a cloak, and maybe some fun stuff to wear.Corey: For me, what I saw on the—it was in the run-up to re:Invent, but the big CDK sized announcement was the fact that the new version of Amplify now is much closer tied to the CDK than it was in previous incarnations, which is great. It sort of solves the problem, how do I build a thing through a variety of different tools? Great, and how do I manage that thing programmatically? It seems if, according to what it says on the tin, that it narrows that gap. Of course, here in reality, I haven't had time to pick anything like that up, and I won't for months, just because so much comes out all at the same time. What happened in the CDK world? What did I miss? What's exciting?Matthew: Well, you know, the CDK world has been, I've said, fairly mature for a while now. You know, fundamentally the way the CDK works and the functionality within it hasn't changed drastically. Even when 2.0 came out a couple of years ago, there wasn't a drastic fundamental change in the way that the API worked. Really, the efforts that we've been seeing for the last year or so, and especially the last few months, is trying to button up some functionality, hit some of those edge cases have been rough for some users, and ultimately just continue to fill out things like L2 constructs and maybe try to build out some L3s.I think what they're doing with Amplify is a good sign that they are trying to, sort of, reach across the aisle and work with other frameworks and work with other systems within AWS to make the experience better, shows their commitment to the CDK of making it really the first class citizen for doing IaC work in AWS.Corey: I think that that is a—that's a long road, and it's also a lot of work under the hood that's not easily appreciated. You've remarked at one point that my talk at the CDK Community Day was illuminating, if nothing else, if for no other reason than I dressed up as a legitimate actual cultist and a robe to give the talk—Matthew: Yeah. Loved it.Corey: Because I have deep-seated emotional problems. But it was fun. It talked a bit about my journey with it, where originally I viewed it as, more or less, this thing that was not for me. And a large part of that because I come from a world of sysadmin ops types, where, “I don't really know how to code,” was sort of my approach to this. Because I was reaff—I had that reaffirmed every time I talked to a developer. Like, “You call this a bash script? It's terrible.” And sure, but it worked, and it tied into a different knowledge set.Then, when I encountered the CDK for the first time, I tried to use it in Python, which at the time was not really well-supported and led to unfortunate outcomes—I do not know if that's still the case—what got me into it, in seriousness, was when I tried it a few months later with TypeScript and that started to work a little bit more clearly, with the caveat that I did not know JavaScript, I did not know TypeScript, I had to learn it as I went in service to the CDK. And it works really well insofar as it scratched an itch that I had. There's a whole class of problems that I don't have to deal with, which include getting someone who isn't me involved in some of that codebase, or working in environments where you have either a monorepo or a crap ton of tiny repos scattered everywhere and collaborating with other people. I cannot speak authoritatively to any of that. I will say it's incredibly annoying when I'm trying to update something written in the CDK, and then I have touched it in a year-and-a-half, and the first thing I have to do is upgrade a whole a bunch of dependencies, clear half a day just to get the warnings to clear before I can go ahead and deploy the things, let alone implement the tiny change I'm logging into the thing to fix.Matthew: Oh, yeah, yes. Yeah, the dependency updates are probably one of the most infuriating things about any Node.js system, and I don't think that I've ever run across any application project framework, anything in which doing dependency upgrades wasn't a nightmare. And I think it's because the Node.js community, more so than I've seen any other, doesn't care about semantic versioning. And unfortunately, the CDK doesn't technically care about semantic versioning, either, which makes it very tricky to do upgrades properly.Corey: There also seems to be the additional problem layered on top, which is all of the various documentation sources that I stumble upon, the official documentation, not terrific at giving real-world use case. It feels like it's trying to read the dictionary to learn how English works, not really its purpose. So, I find a bunch of blog posts, and all of them tend to approach this ecosystem slightly differently. One talks about using NPM. Another talks about Yarn.If you're doing anything that involves a web app, as seems to be increasingly common, some will say, “Oh, use WEBrick,” others will recommend using Vite. There's the whole JavaScript framework wars, and the only unifying best practice seems to be, “Oh, there's another way to do it that you should be using instead of the way you currently are on.” And if you listen to that, you wind up in hell.Matthew: Oh, horribly so. Yeah, the split in the ecosystem between NPM and Yarn, I think, has been incredibly detrimental to the overall comfort level in Node.js development. You know, I was an NPM guy for many, many years, and then actually, the CDK got me more using Yarn, simply because Yarn handles cross-library dependency resolution a bit different from NPM. And I just ran into fewer errors and fewer problems if I use Yarn along the way.But NPM then came a long way since then. Now, there's also a PNPM, which is good if you're using monorepos. But then if you're going to be using monorepos, there's another 15 tools out there that you can use for those sorts of things. And ultimately, I think it's going to be what is the thing that causes you the least amount of problems when dealing with them. And every single dependency issue that I've ever run into when upgrading any project, whether it be a web application, a back-end API, or the CDK, it's always unique enough that there isn't a one-size-fits-all answer to solving those problems.Corey: The most recent experience I had with the CDK—since you know, you're basically Mr. CDK at this point, whether you want to be or not, and this is what I do, instead of filing issues anywhere or asking for help, I drag people onto this show, and then basically assault them with my weird use cases—I'm in the process of building something out in the service of shitposting, because that is my nature, and I decided, oh, there's a new thing called the Dynamo table v2—Matthew: Yes.Corey: Which is great. I looked into it. The big difference is that it addresses it from the beginning as a global table, so you have optionality. Cool. Trying to migrate something that is existing from a Dynamo table to a Dynamo v2 table started throwing CloudFormation issues, so my answer was—this was pre-production—just tear down the stack and rebuild it. That feels like that would be a problem if this had been something that was actually full of data at this point.Matthew: There's a couple of ways that you could maybe go about it. Now, this is a very special case that you mentioned because you're talking about fundamentally changing the CloudFormation resource that you are creating, so of course, the CDK being an abstraction layer over top of CloudFormation and the Dynamo table v2 using the global table resource rather than just the table resource. If you had a case where you have to do that migration—and I've actually got a client right now who's very much looking to do that—the process would probably be to orphan the existing table so that you can retain the data and then using an import routine with CloudFormation to bring that in under the new resource. I haven't tried it yet—Corey: In this case, the table was empty, so it was easy enough to just destroy and then recreate, but it meant that I also had to tear down and recreate everything else in the stack as well, including CloudFront distributions, ACM certificates, so it took 20 minutes.Matthew: Yes. And that is one of the reasons why I often will stick any sort of stateful resource into their own stack so that if I have to go through an operation like this, I'm know that I'm not going to be modifying things that are very painful to drop and recreate, like, CloudFront distributions, which can take a half an hour or more to re-initialize.Corey: Yeah. So, that was fun. The problem got sorted out, but it was still a bit challenging. I feel like at some level, the CDK is hobbled by the fact that under the hood, it really just is just CloudFormation once all is said and done, and CloudFormation has never been the speediest thing. I didn't understand that until I started playing with Terraform and I saw how much more quickly it could provision things just by calling the service APIs directly. It sort of raises the question of what the hell the CloudFormation service is doing when it takes five times longer to do effectively the same thing.Matthew: Yeah, and the big thing that I appreciate about Terraform versus CloudFormation—speed being kind of the big win—is the fact that Terraform doesn't obfuscate or hide state from you. If you absolutely need to, you can go in and change that state that relates your Terraform definitions to the back-end resources. You can't do that with CloudFormation. So CloudFormation, did release few years ago, that import routine, and that was pretty good—not great, but pretty good; it's getting better all the time—whereas this was a complete and unneeded feature with Terraform because if it came down to the point where you already had a resource, and you just want to tie it to your IaC, you just edit a state file. And they've got their import routines and tie-in routines as well, but having that underlying state exposed was a big advantage, in my mind, to Terraform that I missed going to CloudFormation, and still to this day frustrates me that I can't do that underlying state change.Corey: It becomes painful and challenging, for better or worse.Matthew: Yep.Corey: But yeah, that was what I ran into. Things have improved, though. When I google various topics, I find that the v2 documentation comes up instead of the v1. That was maddening for a little while. I find that there are still things that annoy me, but they become less all the time, partially because I feel like I'm getting better at knowing how to search for them, and also because I think I'm becoming broken in the right ways that the CDK tends to expect.Matthew: Oh, like how?Corey: Oh, easy example here: I was recently trying to get something set up and running, and I don't know why this is the case, I don't know if it holds true and other programming languages, but I'm getting more used to the fact that there are two files in TypeScript-land that run a project. One is generally small and in a side directory that no one cares about, I think it's in a lib or the bin subdirectory. I don't remember which because I don't care. And then there are things you have to do within the other equivalent that basically reference each other. And I've gotten better at understanding that those aren't one file, for example. Though they seem to sure be a lot in all the demos, but it's not how the init process, when you're starting something new, spins up.Matthew: Yeah, this is the hell of TypeScript, the fact that Node.js, as a runtime, cannot process TypeScript files, so you always have to pass them through a compiler. This is actually one of the things that I like about using Projen for all of my projects instead of using CDK init to start them is that those baseline configurations handle the TypeScript nature of the runtime—or I should say, the anti-TypeScript nature of the runtime a little bit better, and you run into fewer problems. You never have to worry about necessarily doing build routines or other things because they actually use the ts-node runtime to handle your CDK files instead of the node runtime. And I think that's a big benefit in terms of the developer experience. It just makes it so I generally never have to care about those JavaScript files that get compiled from TypeScript. In the, you know, two years or so I've been using Projen, I never have to worry about a build routine to turn that into JavaScript. And that makes the developer experience significantly better.Corey: Yeah, I still miss an awful lot of things that I feel like I should be understanding. I've never touched Projen, for example. It's on my backlog of things to look into.Matthew: Highly recommend it.Corey: Yeah, I also am still in that area of… my TypeScript knowledge has not yet gotten to a point where I see the value of it. It feels like I've spent far more time fighting with the arbitrary restrictions that are TypeScript than it has saved me from typing errors in anything that I've built. I believe it has to come back around at some point of familiarity with the language, but I'm not there yet.Matthew: Got you. So, Python developer before this?Corey: Ish. Mostly brute force and enthusiasm, but yeah, Python.Matthew: Python, and I think you said bash scripting and other things that have no inherent typing built into it.Corey: Right.Matthew: Yeah, that is a problem, I think… that I thankfully avoided. I was an application developer for many years. My background and my experience has always been around strongly typed languages, so when it came to adopting the CDK, everything felt very natural to me. But as I've worked with people over the years, both internally at Defiance as well as people in the community that don't have a background in that, I've been exposed to how problematic TypeScript as a language truly can be for someone who has never had this experience of, I've got this thing and it has a well-defined shape to it, and if I don't respect that, then I'm going to bang my head against to these weird errors that are hard to comprehend and hard to grok way more than it feels like I'm getting value from it.Corey: There's also a lack of understanding around how to structure projects, in my case, where all right, I have a front-end and I have a back-end. Is this all within the context of the CDK project? And this, of course, also presupposes that everything I'm doing is effectively greenfield, in which case, great, do I use the front-end wizard tutorial thing that I'm following, and how does that integrate when I'm using the CDK to deploy it somewhere, and so on and so forth. It's stuff that makes sense once you have angry and loud enough opinions, but I don't yet.Matthew: Yeah, so the key thing that I tell people about project structure—because it does often come up a lot—is that ultimately, the CDK itself doesn't really care how you structure things. So, how you structure, where you put certain files, how you organize them, is your personal preference. Now, there are some exceptions to that. When it comes to things like Lambda functions that you're building or Docker files, there are probably some better practices you can go through, but it's actually more dependent on those systems rather than the CDK directly itself. So I go through, in the Advanced CDK course, you know, my basic starting directory structure for everything, which is stacks, constructs, apps, and stages all go into their own specific directories.But then once those directories start growing—because I've added more stacks, more constructs, and things—once I get to around five to maybe seven files in a directory, then I look at them and go, “Okay, how can I group these together?” I create subdirectories, I move those files around. My development tool of choice, which is WebStorm—JetBrains's long-running tool—handles the moving of those files for me, so all of my imports, all of my references automatically get updated accordingly, which is really nice, and I can refactor things as much as I want to without too much of a problem. So, as a project grows over time, my directory structure can change to make sure that it is readable, well organized, and understandable, and it's never been too much of a problem.Corey: Yeah, it's one of those things that does take some getting used to. It helps, I think, having a mentor of sorts to take you under their wing and explain these things to you, but that's a hard thing to scale as well. So, in the absence of that we wind up defaulting to oh, whatever the most recent blog post we read is.Matthew: Yeah. Yeah, and I think one of the truest, I think, and truthful complaints I've heard about the CDK and why it can be fundamentally very difficult is that it has no guardrails. It is a general-purpose languages, and general purpose languages don't have guardrails. They don't want to be in the way of you building whatever you need to build.But when it comes to an Infrastructure as Code project, which is inherently very different from an API or a website or other, sort of, more typical programming projects, having guardrail—or not having guardrails is a bad thing, and it can really lead you down some bad paths. I remember working with a client this last year who had leveraged context instead of properties on classes to hand configuration value down through code, down through stacks and constructs and things like that. And it worked. It functionally got them what they needed, up until a point, and then all of sudden, they were like, “Well, now we want to do X with the CDK, and we simply cannot because we've now painted ourselves into a corner.” And that's the downside of not having these good guard rails.And I think that early, they needed to do this early on. When the CDK was initially released, and it got popular back around the 0.4, 0.5 timeframe—I think I picked it up right around 0.4, too—when it officially hit a 1.0 release, there should have been a better set of guidelines and best practices published. You can go to the documents and see them, and they have been published, but it really didn't go far enough to really explain how and why you had to take the steps to make sure you didn't screw yourself six months later.Corey: It's sort of those one-way doors you don't realize you're passing through when you first start building something. And I find, especially when you follow my development approach of more or less used to be copying and pasting for various places, now it's copying and pasting from one place which is Chat-Gippity-4, then—although I've seen increasingly GitHub's Copilot has been great at this and Code Whisperer, in my experience, has not yet been worth the energy it takes to really go diving into it. Your mileage may of course vary on that. But I found it was not making materially better or suggestions on CDK stuff then Copilot was.Matthew: Yeah, I haven't tried Code Whisperer outside of the shell. I've been using Copilot for the last year and absolutely adore it. I think it has completely changed the way that I felt about coding. I saw writing code for the last couple of years as being very tedious and very boring in terms of there weren't interesting problems to solve, and Copilot, as I've seen it, is autocomplete on steroids. So, it doesn't keep me from having to solve the interesting problems; it just keeps me from having to type out the boring solutions, and it's the thing that I love about it.Now, hopefully, Code Whisperer continues to get better over time. I'm hoping all of Amazon's GenAI products continue to get better over time and I can maybe ditch a subscription to Copilot, but for now, Copilot is still my thing. And it's producing good enough results for me. Thankfully because I've been working with it for four years now, I don't rely on it to answer my questions about how to use constructs. I go back to the docs for those. If I need to.Corey: It occurs to me that I can talk about this now because this episode will not air until after this has become generally available, but what's really spanked it from my perspective has been Google's Duet. And the key defining difference is, as I'm in one of these files—in many cases, I'm doing something with React these days due to an escalating series of weird choices—and—Matthew: My apologies, by the way. My condolences, I should say.Corey: Well, yeah. Well, things like Copilot Chat are great when they say, “Oh yeah, assuming that you're handling the state this way in your component, now…” What I love about Duet is it goes, and it actually checks, which is awesome. And it has contextual awareness of the entire project, not just the three lines that I'm talking about, or the file that I'm looking at this moment. It goes ahead and does the intelligent thing of looking at some of these things. It still has some problems where it's confidently wrong about things that really shouldn't be, but okay, early days.Matthew: Sure. Yeah, I'll need to check that out a little bit more because I still, to this day, despise working with React. It is still my framework of choice because the ecosystem is so good around it. And so, established that I know that whatever problem I have, I'll find 14 blogs, and maybe one of them is the answer that I want, versus any other framework where it still feels so very new and so very immature that I will probably beat my head more than I want to. Web development now is a hobby, not a job, so I don't want to bang my head against a hobby project.Corey: I tend to view, on some level, that these AIs coding assistants are good enough to get me almost anywhere I need to go, to the point where a beginner or enthusiastic amateur will be able to get sorted out. And for a lot of what I'm building, that's all I really need. I don't need this to be something that will withstand the rigors of production at a bank, for example. One challenge I have seen with all these things is there's a delay in something being released and their training data growing to understand those things. Very often it'll wind up giving me recommendations for—I forget the name of it, but there was a state manager in React that the first thing you saw when you installed it was, “This has been deprecated. This is the new replacement.” And if you explicitly ask about the replacement, it does the right thing, but it just cheerfully goes ahead and tells you to use ancient stuff or apply poor security practices or the rest.Matthew: Yeah, that's very scary to me, to be honest because I think these AI development tools—for me, it's revitalized my interest in doing development, but where I get really, really scared is where they become a dependency in writing the right code. And every time I ever use Copilot to fill out stuff, I'm always double-checking, and I'm always making sure that this is right or that is right. And what I worry about is those developers who are maybe still learning some things, or are having to write in-line SQL on to their back-end and let Copilot, or Code Whisperer, or whatever tool they pick fill this stuff out, and that answer is based on a solution that works for a 10,000 record database, but fails horribly on a 100 million record database. And now all of a sudden, and you've got this problem that is just festering in through a dev environment, in through a QA environment, and even maybe into a prod environment, and you don't find out that failure until six months later, when some database table runs past its magical limit and now all of sudden, you've got these queries that are failing, they're crashing databases, they're running into problems, and this developer that didn't really know what they built in the first place is now being asked, “Why doesn't your code work,” and they just sort of have to go, “Maybe ChatGPT can tell me why my code doesn't work.” And that's the scariest part of me to these things is that they're a little bit too good at answering difficult questions with a simple answer. There is no, “It depends,” with these answers, and there needs to be for a lot of what we do in complex systems that, for example, in the AWS world, we're expected to build complex systems, and ChatGPT and these other tools are bad at that.Corey: We're required to build complex systems, and, on some level, I would put that onus on Amazon in many respects. I mean, the challenge I keep smacking into is that they're building—they're giving you a bunch of components and expecting you to assemble them all yourself to achieve even relatively simple things. It increasingly feels like this is the direction that they want customers to go in because they're bad at moving up the stack and develop—delivering integrated solutions themselves.Matthew: Well, so I would wonder, would you consider a relatively simple system, then?Corey: Okay, one of the things I like to do is go out in the evenings, and sometimes with a friend, I'll have a few too many beers. And then I'll come up with an idea for I want to redirect this random domain that I want to buy to someone else's website. The end. Now, if you go with Namecheap, or GoDaddy, or one of these various things, you can set that up in their mobile app with a couple of clicks and a payment, and you're done. With AWS, you have a minimum of six different services you need to work with, many of which do not support anything on a mobile basis and don't talk to one another relatively well. I built a state machine out of step functions that will do a lot of it for me, but it's an example of having to touch so many different things just for a relatively straightforward solution space that is a common problem. And that's a small example, but you see it across the board.Matthew: Yeah, yeah. I was expecting you to come up with a little bit of a different answer for what a simple system is, for example, a website. Everyone likes to say, “Oh, a static website with just raw HTML. That's a simple”—Corey: No, that's hard as hell because the devil is in the details, and it slices you to ribbons whenever you go down that path.Matthew: Exactly.Corey: No, I'm talking things that a human being would do without needing to be an expert in getting that many different AWS services to talk to one another.Matthew: Yeah, and I agree that AWS traditionally is very bad at moving up that stack and getting those things to work. You had mentioned at the very top of this about Amplify. Amplify is a system that I have tried once or twice, and I generally think that, for the right use case, is an excellent system and I really like a lot of what it does.Corey: It is. I agree. Having gone down that, building up my scavenger hunt app that I'll be open-sourcing at some point next year.Matthew: Yeah. And it's fantastic, but it has a very steep cliff where you hit that point where all of a sudden, you go, “Okay, I added this, and I added this, and I added this, and now I want to add this one other thing, but to do it, now all of a sudden, I have to go through a tremendous amount of work.” It wasn't just the simple push button that the previous four steps were. Now, I have this one other thing that I need to do, and now it's a very difficult thing to incorporate into my system. And I'm having to learn all new stuff that I never had to care about before because Amplify made it way too easy.And I don't think this is necessarily an AWS problem. I think this is just a fundamentally difficult software problem to solve. Microsoft, I spent years and years in the Microsoft world, and this was my biggest complaint about Microsoft was that they made extremely difficult things, far too simple to solve. And then once those systems became either buggy, problematic, misconfigured, whatever you want to call it, once they stopped working for some reason, the people who were responsible for figuring those answers out didn't have the preceding knowledge because they didn't need it. And then all of a sudden, they go, “Well, I don't know how to solve this problem because I was told it was just this push-button thing.”So, Amplify is great, and I think it's fantastic, but it is a very, very difficult problem to solve. Amazon has proven to be very, very good at building the fundamentals, and I think that they function very well as a platform service, as a building blocks. But they give you the Lego pieces, and they expect you to build the very complex Batmobile. And they can maybe give you some custom pieces here and there, like the fenders, and the tires, and stuff like that, but that's not their bread and butter.Corey: Well, even starting with the CDK is a perfect example. Like, you can use the CDK init to create a new project from scratch, which is awesome. I love the fact that that exists, but it doesn't go far enough. It doesn't automatically create a repo you store the thing in that in turn hooks up to a CI/CD process that will wind up doing the build and deploy. Instead, it expects to do that all locally, which is a counter pattern. That's an anti-pattern. It'll lead you down the wrong path. And you always have to build these things from scratch yourself as you keep going. At least that's what it feels like.Matthew: Yeah, it is. And I think that here at Defiance Digital, our job as an MSP is to talk to the customer and figure out, but what are those very specific things you need? So, we do build new CDK repos all the time for our customers. But some of our customers want a trunk base system. Some of them want a branching or a development branch base system. Some of them have a very complex SDLC process within a PR stage of code changes versus a slightly less complex one after things have been merged into trunk.So, we fundamentally look at it like we're that bridge between the two, and in that case, AWS works great. In fact, all SaaS solutions are really nice because they give us those building blocks and then we provide value by figuring out which one of those we need to incorporate in for our clients. But every single one of our clients is very different. And we've only got, you know, less than a dozen right now. But you know, I've got project managers and directors always coming back to me and saying, “Well, how do we cookie-cutter this process?” And you can't do it. It's just very, very difficult.Not in a small-scale. Maybe when you're really big, and you're a company like AWS who has thousands, if not potentially millions of customers, you can find those patterns, but it is a very fundamentally difficult problem to solve, and we've seen multiple companies over the last two decades try to do these things and ultimately fail. So, I don't necessarily blame AWS for not having these things or not doing them well.Corey: Yes and no. I mean, GitHub delivers excellent experience for the user, start to finish. There's—Vercel does something very similar over in the front-end universe, too, where it is clearly possible, but it seems that designing user interfaces and integrating disparate things together is not an Amazon's DNA, which makes sense when you view the two-pizza teams assembling to build larger things. But man, is that a frustration.Matthew: Yeah. I really wonder if this two-pizza team mentality can ever work well for products that are bigger than just the fundamental concepts. I think Amplify is pretty good, but if you really want something that is this service that works for 80% of customers, you can't do it with five people. You can't do it with six. You need to have teams like what GitHub and what Vercel and other things, where teams are potentially dozens of people that really coordinate things and have a good project manager and product owner and understand the problem very well. And it's just very difficult with these very, very small teams to get that going.I don't know what the future of AWS looks like. It feels like a very Microsoft in the mid-2000s, which is, they're running off of their existing customers, they don't really have a need to innovate significantly because they have a lot of people locked in, they would be just fine for years on years on end with the products they have. So, there isn't a huge driver for doing it, not like, maybe, GCP or Azure really need to start to continue to innovate stronger in this space to pick up more customers. AWS doesn't have a problem getting customers.And if there isn't a significant change in the mentality, like what Microsoft saw at the end of the 2000s with getting rid of Ballmer, bringing in Satya and really changing the mentality inside the company, I don't see AWS breaking out from this anytime soon. But I think that's actually a good thing. I think AWS should stick to just building the fundamentals, and I think that they should rely on their partners and their third parties to bridge that gap. I think Jeremy Daly at Ampt and what they're building over there is a fantastic product.Corey: Yeah. The problem is that Amazon seems to be in denial about a lot of this, at least with what they're saying publicly.Matthew: Yeah, but what they say publicly and how they feel internally could be very, very different. I would say that, you know, we don't know what they're thinking internally. And that's fine. I don't necessarily need to. I think more specifically, we need to understand what their roadmap looks like and we need to understand, you know, what, are they going to change in the future to maybe fill in some of these gaps.I would say that the problem you said earlier about being able to do a simple website redirect, I don't think that's Amazon's desire to build those things. I think there should be a third-party that's built on top of AWS, and maybe even works directly within your AWS account as a marketplace product for doing that, but I don't think that's necessarily in the benefit of AWS to build that directly.Corey: We'll see. I'm very curious to see how this unfolds because a lot of customers want answers that require things that have to be assembled for them. I mean, honestly, a lot of the GenAI stuff is squarely in that category.Matthew: Agreed, but is this something where AWS needs to build it internally, and then we've got a product like App Composer, or Copilot, or things where they try, and then because they don't get enough traction, it just feels like they stall out and get stagnant? I mean, App Composer was a keynote product announcement during last year's re:Invent, and this year, we saw them introduce the ability to step function editing within it, and introduce the functionality into your IDE, VS Code directly. Both good things, but a year's worth of development effort to release those two features feels slow to me. The integration to VS Code should have been simple.Corey: Yeah. They are not the innovative company that would turn around and deliver something incredible three months after something had launched, “And here's a great new series of features around it.” It feels like the pace of innovation and face of delivery has massively slowed.Matthew: Yeah. And that's the scariest thing for me. And, you know, we saw this a little bit with a discussion recently in the cdk.dev server because if you take a look at what's been happening with the CDK application for the last six months and even almost a year now, it feels like the pace of changes within the codebase has slowed.There have been multiple releases over the course of the last year where the release at the end of the week—and they hit a pretty regular cadence of a release every week—that release at the end of the week fixes one bug or adds one small feature change to one construct in some library that maybe 10% of users are going to use. And that's troublesome. One of the main reasons why I ditched the Terraform and went hard on the CDK was that I looked at how many issues were open on the Terraform AWS provider, and how many missing features were, and how slow they were to incorporate those in, and said, “I can't invest another two years into this product if there isn't going to be that innovation.” And I wasn't in a place to do the development work myself—despite the fact that you can because it's open-source and providers are forkable—and the CDK is getting real close to that same spot right now. So, this weekend—and I know this is going to come out, you know, weeks later—but you know, the weekend of December 10th, they announced a change to the way that they were going to take contributions from the CDK community.And the long and short of it right now—and there's still some debate over exactly what they said—is, we're not going to accept brand-new L2 constructs from the community. Those have to be built internally by AWS only. That's a dr—step in the wrong direction. I understand why they're taking that approach. Contributions in the CDK have been very rough for the last four or five months because of the previous policies they put into place, but this is an open-source product. It's supposed to be an open-source product. It's also a very complex set of code because of all of the various AWS services that are being hit by it. This isn't just Amplify, which is hitting a couple of things here and there. This is potentially—Corey: It touches everything.Matthew: It touches everything.Corey: Yeah, I can see their perspective, but they've got to get way better at supporting things rapidly if they want to play that game.Matthew: And they can't do that internally with AWS, not with a two-pizza team.Corey: No. And there's an increasing philosophy I'm hearing from teams of, “Well, my service supports it. Other stuff, that's not my area of responsibility.” The wisdom that I've seen that really encapsulates this is written on Colm MacCárthaigh's old laptop in 2019: “AWS is the product.” That's the truth. It's not about the individual components; it's about the whole, collectively.Matthew: Right. And so, if we're not getting these L2 constructs and these things being built out for all of the services that CloudFormation hits, then the product feels stalled, there isn't a good initiative for users to continue trying to adopt it because over time, users are just going to hit more and more services in AWS, not fewer as they use the products. That's what AWS wants. They want people to be using VPC Lattice and all the GenAI stuff, and Glue, and SageMaker, and all these things, but if you don't have those L2 constructs, then there's no advantage of the CDK over top of just raw CloudFormation. So, the step in the right direction, in my opinion, would have been to make it easier and better for outside contributions to get into CDK, and they went the opposite way, and that's scary.Now, they basically said, go build these on your own, go publish them on the Construct Hub, and if they're good, we'll incorporate them in. But they also didn't define what good was, and what makes a good API. API development is very difficult. How do you build a construct that's going to hit 80% of use cases and still give you an out for those other 20 you missed? That's fundamentally hard.Corey: It is. And I don't know if there are good answers, yet. Maybe they're going in the right direction, maybe they're not.Matthew: Time will tell. My hope is that I can try to do some videos here after the new year to try to maybe make this a better experience for people. What does good API design look like? What is it like to implement these things well so they can be incorporated in? There has been a lot of pushback already, just after the first couple of days, from some very vocal users within the CDK community saying, “This is bad. This is fundamentally bad stuff.”Even from big fanboys like myself, who have supported the CDK, who co-authored the CDK Book, and they said, “This is not good.” So, we'll see what happens. Maybe they change direction after a couple of days. Maybe this is— turns out to be a great way to do it. Only time will really tell at this point.Corey: Awesome. And where can people go to find out more as you continue your exploration in this space and find out what you're up to in general?Matthew: So, I do have a Twitter account at@mattbonig on Twitter, however, I am probably going to be doing less and less over there. Engagement and the community as a whole over there has been problematic for a while, and I'll probably be doing more on LinkedIn, so you can find me there. Just search for Matthew Bonig. It's a very unique name.I've also got a website, matthewbonig.com, and from there, you can see blog articles, and a link to my Advanced CDK course, which I'm going to continue adding sessions to over the course of the next few months. I've got one coming out shortly about the deadly embrace and how you can work through that problem with the deadly embrace and hopefully not be so scared about multi-stack applications.Corey: I look forward to that because Lord knows, I'm running into that one myself increasingly frequently.Matthew: Well, good. I will hopefully be able to get this video out and solve all of your problems very easily.Corey: Awesome. Thank you so much for taking the time to speak with me. I appreciate it.Matthew: Thank you for having me. I really appreciate it.Corey: Matthew Bonig, Chief Cloud Architect at Defiance Digital, AWS Dev Tools Hero, and oh so much more. I'm Cloud Economist Corey Quinn, and this is Screaming in the Cloud. If you've enjoyed this podcast, please leave a five-star review on your podcast platform of choice, whereas if you've hated this podcast, please leave a five-star review on your podcast platform of choice along with an angry comment that you will then have to wind up building the implementation for that constructs that power that comment yourself because apparently we're not allowed to build them globally anymore.Corey: If your AWS bill keeps rising and your blood pressure is doing the same, then you need The Duckbill Group. We help companies fix their AWS bill by making it smaller and less horrifying. The Duckbill Group works for you, not AWS. We tailor recommendations to your business, and we get to the point. Visit duckbillgroup.com to get started.

What you'll learn in this episode: How Kentshire's partnership with Ulla Johnson came about and what they hope will come of it Why Matthew doesn't want his clients to keep their fine jewelry in a safe deposit box Why “Do I love it?” is the first question Matthew asks when looking at jewelry, and why things like designer or carats may not be as important as you think How Covid changed the vintage jewelry market How dealers work together to source the best jewelry for their clients About Matthew Imberman Matthew Imberman, along with his sister Carrie, are the co-presidents of Kentshire Galleries. Established in 1940 and spanning three generations of family ownership, Kentshire Galleries is one of the foremost dealers of fine period and estate jewelry. In 1988, Kentshire established a free-standing boutique in New York's premier luxury store, Bergdorf Goodman. Their antique and estate jewelry department continues to occupy a select location on the store's seventh floor. As the third generation of the family to lead Kentshire, Matthew and Carrie continue to refine the gallery's founding vision: buying and selling outstanding jewelry and objects of enduring design and elegance. Additional resources: Website Facebook Twitter Instagram Pinterest Photos Available on TheJewelryJourney.com Transcript: Through a partnership with fashion designer Ulla Johnson, Kentshire Fine Jewelry will have a permanent presence on the West Coast for the first time. While other dealers might change their approach to appeal to a new market, co-president Matthew Imberman continues to buy jewelry based on one criterium: whether he loves the piece or not. He joined the Jewelry Journey Podcast to talk about the history behind the collaboration with Ulla Johnson; why following trends isn't the best way to buy jewelry; and how Covid changed his business in surprising ways. Read the episode transcript here. Sharon: Hello, everyone. Welcome to the Jewelry Journey Podcast. This is the second part of a two-part episode. If you haven't heard part one, please head to TheJewelryJourney.com. Today, my guest is Matthew Imberman, who, along with his sister, Carrie, is Co-President of Kentshire Fine Jewelry. Welcome back. And that's what you look for in the jewelry you're purchasing, whether it's Bergdorf— Matthew: Absolutely. Look, it's not to say there aren't some things that excite that are unusual or might be something we've had before, but we still love them. There are certain archetypes of jewelry, like a great French tank bracelet. Those are out there, but there are great ones and then there are O.K. ones. I think we're always looking to find one of the best or better versions of what we can find in the category. Are we going to say that every single item we get is unique? No, that's not the case. These things were made in stereo even in their lifetimes, so we're looking for the best examples, in the best condition and the best materials for those kinds of items. Sharon: Do people bring you jewelry and say, “My mother died, and I want to sell this”? Matthew: Yes, we certainly get that, or “This was in my safe deposit box.” Certainly, it's part of it, which is a good part of it. There are times when we are able to source good pieces from our clients. I think it depends, because we deal in nostalgia and people who come to us with pieces that were left to them by family members. There's a nostalgia link, and there can sometimes be a bit of telephone between what they were told. Let's use, for example, if they say, “My grandmother left this to me, and my grandmother told me that this is where she got it. This is what it was.” The stories sometimes change over time, not from any evil intentions, but just because people didn't save receipts or they don't know exactly what it is. So, somebody will come up and say, “Oh, I have this piece. It's just like what I saw in your store, and my grandmother left it to me. I want to bring it in.” They'll bring it in, and when you hold what they brought and what we're selling next to it, they're very, very, very distant cousins. It's not that theirs is inherently bad, but it's not exactly the same thing. But people tend to look at items through a nostalgic viewpoint. So, they say, “Oh, I was left this,” “My grandmother told me this diamond ring is worth X amount.” It puts us in the awkward position of saying, “Well, it's a lovely thing, but it's not exactly what you were told it was.” Those are some of the stories, but by and large, we're given the opportunity to see wonderful collections from our clients. We're fortunate enough to have them be loyal, if they have more pieces, and to come back to us. We don't frequently buy from the public, but it's not something we never do. Sharon: Where do you source a lot of your things from? Do you ask? Do you source it from abroad or whoever walks in the door? Matthew: We mostly work with a small group of dealers like ourselves. They're people who have been in the trade a long time. Trust is still a big part of our business. We have to know each other. We're dealing in valuable items, things where trust is important and you want to know who you're buying from. I think that's the case in any business for the most part. But we mostly buy from dealers like ourselves who are in this world. Whether or not they're retailing, they're dealing with other jewelers to sell pieces they understand so they can place them. For instance, I might have a client for a piece and one of my colleagues in England I know might have a version of what I need and I can call them up. In that way, it allows me to have a greater reach than just my inventory. The colleagues are not competition in the sense that we need each other to stay in business. It's a small group of goods that we all admire and we all like to buy and sell, but we also have to do that with each other so we can have the inventory we need to service our clients. One of my colleagues in France can have something if they need it. So, it's really an old-world business that way. Then auctions are really hyper-retail, at the end of the day, for a lot of pieces. I think they've done a great job of convincing people that there's a steal to be had, but when you look at the prices and how they land, if you're buying a bracelet, it's going to end up for around the same price, if not more, than what you'll pay in my store or one of my colleague's stores. But it comes with a three-inch-thick binder about why, if something's wrong with it, it's not their fault and how they don't offer any post-sale service and yada, yada, yada. We all deal with the auction houses to a certain extent out of necessity, but we're not very bullish on them, and I think for pretty understandable reasons. Every once in a while, we look at estate sales. People who buy estates are buying the entire thing, and we're cherry pickers. We're looking for the three or four really interesting items, and to do that, you usually have to buy the entire estate. So, we rarely do that, given that we're working with a specific and small group of goods. Sharon: Have you always been involved? You had a career before this, right? Matthew: At this point, I've been in the business for about 22 years, I think, if I'm doing the math right. Not always on the jewelry side, although always around it. Like I said, we also had a large business in antique furniture, English and continental furniture and decorative arts at the same time we had jewelry. I was originally on that side of the business. Before that, I did a master's in art history, so I was gone for a while. That was part of what made sense in terms of coming in the business, but also in terms of lending itself to jewelry. The specific studies we did, it was in decorative arts. You're covering a lot of the different motifs and the techniques that were also happening in jewelry at the time. So, that planted the seed. I spent some time in contemporary art before that, working at the Met on their website, but that's ages ago now. Sharon: In the past few years, you mentioned people being less formal. Out here we're so casual. Here you can wear nice jewelry, but a pair of shorts and a T-shirt. Have you seen a change in the kinds of things people buy? What are the trends you see? Matthew: I think it's challenging sometimes for people like us, who aren't dealing in manufactured goods, to look at the trends and to understand if these are actually sales-driven trends or things that are catching an eye on social media. Instagram will load your feed with them, but does that translate to what is actually being bought and sold meaningfully? It's interesting when I see little trends pop up on Instagram and people start running with them. Whether it's a designer or a type of good or it's the newest thing, they're talking about vintage jewelry. They're talking about something that people have been buying and selling for decades, if not centuries at this point. It's always the phase of, who is deciding which trend is in? For us, we're trend agnostic. I don't buy something with the idea of “This is going to be the next big thing,” or “Everyone right now is focused on this.” There's been a moment of people buying Georges L'Enfant jewelry, but people have been buying Georges L'Enfant jewelry for a long time in America without knowing necessarily who the maker was. They're just now catching up on, “Oh, that was a maker who was making for Hermès, VanCleef, Cartier, and who in their own right was an incredible designer who was making pieces for bigger houses.” They may know the bigger houses without knowing the maker. That can raise the price of L'Enfant overall, but for us, it's not going to change specifically how we buy because we have to find a piece. If I walk out tomorrow and see three L'Enfant pieces, and those three L'Enfant pieces don't belong in a collection, it doesn't matter that they're buying L'Enfant. It doesn't matter that that may be trendy. If I don't think they belong in a collection, then they don't belong in the collection. My sister has extremely rigorous standards, and I do too, so we buy the best examples of what we like. People say that all the time. They say, “What do you buy?” and we think “We buy what we like.” We wish we could explain it better, but it's just how we are. Every couple of years, people will launch an article and say, “Oh, the brooch is back,” and I think, “That's a bit lazy. The brooches never got away.” Some people will feel less comfortable wearing them, some people will feel more comfortable, or people might say, “Oh, it's old-fashioned,” and this or that. But for dealers, we all buy and sell brooches. It doesn't change my feeling. If I see a beautiful one, a beautiful pin, we want to buy it. If my sister sees a beautiful 18th-century brooch and she thinks it's great, she's not going to say, “Huh, well, brooches don't sell.” Is it the right brooch? Does it represent something we think our clients should own? One of my friends who's out on the West Coast said, “Oh, so you're going to bring a lot of astrology signs,” and I said, “If we have nice ones, absolutely.” I understood what they were saying. There certainly is a great market on the West Coast if you have a wonderful Cartier zodiac collection, for sure. We're not going to buy that because they could do well out there. That's not who we are. If we see one that's particularly interesting and has a great weight and represents an acceptable value given how those have crept up in price over the years, yes. But just because we're there, we're not going to be doing that, if that makes sense. Sharon: If somebody brings you a pair of earrings that don't fit with what people are going to wear today, but in your opinion they're well-made and well-priced, would you be interested? Matthew: Absolutely, because we don't approach it through other people telling us what people won't wear today. We have clients in a lot of different areas of the world, different ages, different price points for what they're buying. We can just look at it and say, “You know what? We think this is a good looker.” If there are 10 articles tomorrow by somebody in the know saying, “No one is wearing this kind of earring anymore,” that's not going to affect our thinking because we're not buying pieces retroactive to what trends are happening. We're buying what we like, and we like to think that anyone, whether they're trend-driven or not, can come and see our collection and find something that might speak to them. Sharon: Have you seen a decrease in the age of people who come in and can't find anything because maybe they're looking for something that isn't jewelry? Matthew: I think for us, the understandable barrier to entry is always going to be price, withholding our costume collection, in which you can find pieces that are in the hundreds of dollars range. Fine jewelry in our collection by and large starts at $3,000-ish and creeps upwards to millions of dollars. We understand that not everyone puts the same value on jewelry as we do. So, for some people coming in, if they're looking to buy a piece of jewelry, they might have a totally different price point in mind than what our collection is, and that we certainly understand. We've always tried to have a range of prices. Part of the challenge, though, is because we deal in pieces that are made up of commodities, gold, diamond, things like that, and those commodities have prices that fluctuate. As gold has gotten very strong, the price for us to buy good gold jewelry has gone up because the gold is more valuable, so the price for our clients is more expensive. That's also a good insurer for them, in that if you own gold jewelry, the value has continued to grow as the price of gold goes up. We don't really buy that way. There are some dealers who will buy very specifically based on what the piece weighs if they have to scrap it and what the value of gold is today. We're not buying pieces that we hope anyone would melt down at any point, especially when you're looking at antique pieces. The amount of gold in an antique piece, because of the way they were constructed for the most part, they're not going to be particularly heavy in terms of how much gold is going to come out of them. So, the value isn't in the actual materials there. I think it just represents something a little bit different. Certainly, on Instagram we get more information about what our younger clients are looking for. Everyone sees value in different places. How they want to spend it changes, and how we're able to conduct the business in terms of skewing towards younger clients changes, but we've been encouraged to see our client base on Instagram start to fall in line toward what we see in the store. It really represents the spread of ages. Sharon: There's all this talk about younger people. I'm not talking about 18-year-olds or younger. Everybody in the world is younger than I am, but you hear about younger people not wanting to buy jewelry. They don't buy as much jewelry even though they could afford it. They just don't buy as much. Matthew: I will say that our main client was never a “young” client simply because of the prices we're talking about for most people. Even if they didn't want these things or maybe were saving for a house, I think what's different is if you look at the advent of how handbags have become such a status symbol, the prices of handbags are commensurate, if not much greater than a lot of fine jewelry. That creates a really interesting secondary market for handbag resale. I think the story people got in the pandemic was everyone saying, “Oh, they just want experiences,” but we're talking about a time period when everyone was fetishizing experiences because we were all locked inside and couldn't do anything. We had robust sales, surprisingly, during Covid, and when we were coming out of Covid, too. We had a steady increase in new clients because I think people were excited to be out again, excited to be wearing something, excited to not just be dressed for a Zoom meeting. I think jewelry plays a part in that story most remarkably. It's wearing your sculpture around and drawing attention to yourself in what we'd like to think is a unique way, hopefully wearing something that not everyone else has. Sharon: You answered the next question before I asked it, which is did you see a change? I heard from jewelers that they were seeing an increase during Covid because people weren't going to fundraisers or whatever, but they were spending their money. Matthew: It's interesting I answered something where there is sort of a long family story. I have a meandering way to answer any question, I know, but I'm glad I had one at least. Did we speak during Covid or right before when we had our first interview? I can't remember, but I do remember thinking when Covid hit, “We had a really good Christmas. If we don't sell another piece of jewelry for a year or so, we'll be fine. We'll just batten down the hatches,” but like anything else, people still wanted to collect. People wanted to look at something new, boost their spirits, what have you. People weren't going to fundraising dinners or vacations, so this was something where they said, “Normally I would spend X amount eating out, but now it turns out I've saved all this money not eating out. I can afford a beautiful bracelet.” We were surprised that happened. During Covid, the real challenge became finding goods. We could sell things and send them, but it became very challenging to see our colleagues, to find pieces, to do all that. That's where we had to get a lot more clever and targeted for how we acquired things. Coming out of Covid, I think we're all playing catchup, and not just from our business' standpoint. Everyone is. Everyone's calendar has changed a little bit. A lot of our clients who would go out to the Hamptons for the summer but would be here during the year realized that their job is more portable than they thought, or they've changed how they work altogether so they're out of their house a lot more. So, they're shopping on our website now instead of coming into the store. Or, they're out at their houses, which they're fortunate enough to have wherever they are, at other parts of the year, so when summer comes, they're in New York at times and we don't expect them. Weirdly, our summers used to be rather quiet but tolerable at Bergdorf, and we would expect to get some of our bigger administrative projects done. Now we find that people are coming in and tourists are coming in in the summer, when it used to be very slow. We have to change when we take our vacations, when we need to do our projects, how we plan for the fall season, which has come and gone in terms of when the planning has to happen. It keeps us on our toes, but part of what's good about being a small ship is that we're nimble, so we're able to course correct pretty quickly if we have to. We've been in Bergdorf long enough to know the rhythms of the store. What I don't think any of us anticipated was what tourism would be like in New York, especially with the story being what it was elsewhere. We found ourselves really blown away with the reaction of people coming back to the city and how many people were coming through. In my short walk between Rock Center, where we have our offices, and Bergdorf, which our staff will do multiple times a day bringing goods back and forth, it got to a point where you couldn't walk down Fifth Avenue. I'd go to Sixth Avenue and walk down there because it was so busy. It's been interesting to see the resurgence of people visiting the city. We have more people coming to Bergdorf, which leads to more sales. We keep ourselves busy trying to find new pieces. Sharon: That's very interesting. I hadn't thought about that, especially when you say the jobs are more portable. I think I'm the only one who's at home on their couch looking at Instagram. Matthew: I can tell you from behind-the-scenes looks at our Instagram numbers, you're not. Even for us, we have to be in our offices because we work with a physical, tangible good. I couldn't be a person who works from home all the time. I also don't think I would be well-suited to the routine of being in an office. But we need to be in and around the jewelry district to see new pieces as they come in, to run a repair. We physically have to be there, but even in the realm of what we do, we're more flexible. If I need to work on the road or work from home or do something here or there, the technology has made it so we can do that, too. For all our clients, it's the same thing. The social calendar in New York has changed dramatically as some events have changed over and come and gone. What people feel they need to go to, how people are dressing for them, that's changed a bit, too, so it's changed how people buy. Obviously, the holiday season is always a very strong season for people in our world and when we do a lot of business, but we find it's spread out around the year a lot more now as people are not buying for occasion-specific pieces. They're not just saying, “I've got this birthday, this anniversary.” The pace of their lives has changed it. Sharon: That's interesting. You preempted my question. I was going to ask you about changes. Does that impact how you think about Los Angeles or the West Coast, where there are no seasonal changes really? Matthew: In terms of seasonal changes, I have friends who work in different areas, whether they're in a hifalutin financial position or they're consultants at luxury groups, and they come and say, “We want to help with this.” They'll look through and figure out how to optimize or create a strategy. When they spent time with us, they realized, “We do not know how you do what you do.” It doesn't really subscribe to the more traditional models of how somebody might run this kind of business. I understand that if you are Tiffany and you're doing things on the West Coast, you might change how you skew your line sheet for what kinds of pieces people might wear, because that kind of style isn't going to work when somebody is wearing a shift versus a sweater. We are not clever buyers like that. Again, we look at things and think, “This is a great thing. We can see one of our L.A. clients wearing this. Let's send it out there.” So much of what we do is by feel and a kind of very educated guess. It's easier in some ways, the variety of pieces we can send out West because we're not worried about people taking gloves on and off when it's a ring. When you're in the city and you're taking a ring on and off, maybe it could get caught. I don't know how much they're concerned about that in New York now. We tend to think the same way. If you're a collector of vintage cars and you understand you're buying a vintage car, you know it's going to require special handling at times. You can't drive it down every road. You might need to bring it to a different mechanic than where you bring your daily driver. We expect, to a certain extent, that people buying fine vintage jewelry understand the spirit of that too. They're not bringing it to the person at their mall to have it fixed. They're not wearing it in the pool. There are parts of these changes we're happy to walk people through, but whether you're East or West Coast, there's a certain sensibility we think goes with wearing the pieces. Sharon: Do you think people gear up for the holidays? You said you also do during the year, but do you gear up? Matthew: We acquire year round, and we put out a catalogue usually in the fall. That's always a challenge for us in that we love doing it and we spend a lot of time putting it together, but as we finally get to finish the product and it goes in the mail, the pieces have already been available. So, you get this heartbreaking moment when a client calls and says, “I got this catalogue. I'm out in California. What's on page three?” and we say, “I'm so sorry. It's sold.” But it allows you to start the conversation and say, “We can try to find you something you like. Maybe we have something that wasn't in the catalogue that's new, and we can talk you through it.” We have a sense for how people respond, but in terms of the West Coast specifically, I don't know. We're curious to see what that's like. I assume that titans of retail who also make their money on the West Coast around the holidays are doing things somewhat in lockstep with what we're doing on the West Coast. People still celebrate holidays and buy gifts out there. We think it's probably going to be the same way, but again, we don't live or die based on holidays. People come every day and say, “Oh wow! That must be crazy,” and I say, “You know, we're not the right lid for that pot.” Not to say we don't sell things based around that, but we're not specifically holiday-driven dealers. We're not looking to get in a million hard pieces for Valentine's Day and have everyone get something for their sweetie. Our core client is women who are buying jewelry for themselves. It creates a different experience than when you're making a gift purchase. Sharon: That's interesting. Matthew, thank you very much. I hope we all get to come out to Bergdorf and see your stuff. I hope you're not deluged with people coming to your administrative offices. You can direct them to Bergdorf. Thank you very much. I learned a lot today. Thank you. I really appreciate it. Matthew: Thank you for having me. We look forward to seeing you out West soon.

What you'll learn in this episode: How Kentshire's partnership with Ulla Johnson came about and what they hope will come of it Why Matthew doesn't want his clients to keep their fine jewelry in a safe deposit box Why “Do I love it?” is the first question Matthew asks when looking at jewelry, and why things like designer or carats may not be as important as you think How Covid changed the vintage jewelry market How dealers work together to source the best jewelry for their clients About Matthew Imberman Matthew Imberman, along with his sister Carrie, are the co-presidents of Kentshire Galleries. Established in 1940 and spanning three generations of family ownership, Kentshire Galleries is one of the foremost dealers of fine period and estate jewelry. In 1988, Kentshire established a free-standing boutique in New York's premier luxury store, Bergdorf Goodman. Their antique and estate jewelry department continues to occupy a select location on the store's seventh floor. As the third generation of the family to lead Kentshire, Matthew and Carrie continue to refine the gallery's founding vision: buying and selling outstanding jewelry and objects of enduring design and elegance. Additional resources: Website Facebook Twitter Instagram Pinterest Photos Available on TheJewelryJourney.com Transcript: Through a partnership with fashion designer Ulla Johnson, Kentshire Fine Jewelry will have a permanent presence on the West Coast for the first time. While other dealers might change their approach to appeal to a new market, co-president Matthew Imberman continues to buy jewelry based on one criterium: whether he loves the piece or not. He joined the Jewelry Journey Podcast to talk about the history behind the collaboration with Ulla Johnson; why following trends isn't the best way to buy jewelry; and how Covid changed his business in surprising ways. Read the episode transcript here. Sharon: Hello, everyone. Welcome to the Jewelry Journey Podcast. This is the first part of a two-part episode. Please make sure you subscribe so you can hear part two as soon as it's released later this week. Today, my guest is Matthew Imberman, who, along with his sister, Carrie, is Co-President of Kentshire Fine Jewelry. At Kentshire, fine jewelry encompasses almost everything that you would categorize as fine jewelry: bridal, engagement rings, signed pieces, retro and even fine costume jewelry. They're the third generation to be involved in jewelry. Their administrative office is on Fifth Avenue in New York, and their retail location is on the seventh floor of Bergdorf Goodman. Matthew is a returning guest who was with us several years ago in the pre-Covid days. Now, I'm excited to hear about his collaboration with the designer Ulla Johnson in their new store in West Hollywood. It's not often that New York jewelers come out this way, so I'm looking forward to hearing all about it. Matthew, welcome to the podcast. Matthew: Thank you for having me. Sharon: I'm so glad you're here. What about the West Coast clientele surprised as you were doing the store? Matthew: We have deep roots on the West Coast despite not having our own Kentshire branded store out there. We've been longtime exhibitors at the San Francisco Fall Show. The show has had some changes through the years, but we've been exhibiting for more than three decades, easily. Because of that, we've tracked with some of the West Coast feeling of our clients. Throughout the years, we've done different shows in L.A. At one point, we did have an agreement where we sold our pieces at Gump's. It's not that we are new to the West Coast, per se, but we have taken a bit of a hiatus. So, we were interested in getting out there and bringing what we have to our clients who are there. But by and large, it's not that we have a different sensibility about what we do for the West Coast versus the East. Kentshire has its viewpoint, which is a simple one. Carrie and I buy things that we think to be interesting, made well, rare. Whether it's from a famous designer or not, something that's not something you see every day and that we think will please a variety of our clients' sensibilities, but primarily it also has to please ours. At the end of the day, we end up looking at the pieces, whether they're with us for just a day or whether they're with us for a few years, so we buy things we like. We think that's a good viewpoint for anyone. So, for our West Coast clients, we are not such nose-in-the-air New Yorkers. We love our West Coast clients. We have family on the West Coast. We've spent a lot of time there, so for us, it wasn't like, “Oh, my god! We have to think through a whole new client type.” It was, “No, we're so excited to bring something we do to clients that, in some cases, do know us because we've been out there or they visit us at Bergdorf, but also clients who we haven't seen and who are friends of friends or know us through Ulla.” So, we touch all bases there. Sharon: I think you mentioned earlier Gump's San Francisco Show. I don't even know if they're still having that show. Matthew: It did take a few years off during Covid. It is happening again. I believe it's the 14th or 15th of October—I'll have to look back on the dates—at the Fort Mason Complex in the Festival Pavilion. I know this year Lauren Santo Domingo from Moda Operandi is attached as one of the social chairs. They have a fantastic gala evening. The show is run by Suzanne Tucker's entertainment team, who is just a consummate professional. What a combination of taste and savvy there. So, we're excited to be there, but we did the show when it was at the Santa Monica Air Hangar in the years back. We've done different shows off and on. It's been harder, I think, for a show to stick there, so to speak, but we also think it's a good fit for us. We've certainly started and stopped a few different shows in L.A., but it's been a long time since we've been in the city proper. I should add, actually—I'm leaving out the most glaringly obvious thing we did there. When Opening Ceremony had their larger line with accessories before the company went through restructuring during Covid, we also had our fine jewelry in Opening Ceremony. That both had a fashion bent and had a lot of store-within-a-store feeling, similar to what we're doing with Ulla. We had a targeted collection that was there in L.A. that represented us on the West Coast. We did that for, oh gosh, at least five years, I think. Sharon: I must have missed that because there's not any fine jewelry, except for maybe the big, commercial jewelers that are out here in Los Angeles. From what I've been told and from what I see, the clientele is very different. Matthew: It's funny. You know more because your boots are on the ground. We have a different feeling, but I'll say even looking at clients reaching out to us through Instagram or our website, we find that certainly the West is very well represented. The information, the data behind it, can sometimes be skewed because we have clients who come into Bergdorf, and they must happen to mention to us, “Oh, I'm visiting from the West Coast.” Maybe we'll get a little more granular detail, but I do know that when we look at the information, which we try stay up on for how people approach us and our work, we certainly feel that the West Coast is no slouch when it comes to looking at jewelry. I think that also shows with some of the dealers out there. Sharon: There's money out here to buy it. Maybe it's because I'm not really wild about the kind of jewelry they tend to wear. Who did you work with in terms of Ulla Johnson? Did they come to you, the designer? Matthew: I wish Carrie were here for a number of reasons. She's my business partner and obviously brings a tremendous wealth of knowledge and experience to the business, but she and Ulla have been longtime friends. I've known Ulla for a very long time, too. Ulla's husband and her family have been close for a long time because my sister and I share a friend group, and she's got some really wonderful friends. They've just had an affinity for each other and known each other, came up through a variety of different jobs together, and have always been very close. Ulla has always had a fantastic eye and really understood antique pieces, understood how a combination of design, manufacturing and color all come together to set some of these pieces apart. Throughout the years, she has grown in her notoriety, which now is incredible to see looking at the store on the West Coast in a picture, which we don't get to see in person until we go out in September. We're going to do a little trunk show, which I'll do a shameless plug for, on the 20th of September. We'll have more info for you as plans come together. Ulla has been a client of ours and borrowed things from us. We've worked together because we're friends, but sometimes friends don't always work well together. In this case, it's been beautiful because she's got such a clear vision of what she designs. It suits our inventory. Again, there's a reason she and her are friends. People tend to share a visual vocabulary. It's been a really good, seamless blend of both being in allied fields, jewelry and fashion obviously marching together to the same step, but also our viewpoints of what matters in terms of how things are designed, how things are proportioned, how colors work together or don't work together, how these things can interplay. We've been fortunate to count Ulla as a client, but much more fortunate to count her as a friend and somebody who inspires what we do when we look at things and address clients. What is she looking at?  How are those things playing together? There's a lovely synergy there. Sharon: Were you involved in picking the jewelry, or was it Carrie and Ulla who picked the jewelry to go in the store? Matthew: I take a much more hands-off approach in terms of that because Carrie and Ulla do not need to hear from me. I'm always happy when my opinion is asked for, but I also understand, and given that Carrie and Ulla are old friends—really, friends are not the same. They're very, very close. My influence is surplus to their needs. They've got it beyond spades, what they need to do, and they play off of each other. Ulla has a very clear vision of what she wants. She'll look at our collection or see things as they pop up on Instagram and get in touch and say, “What about this? What about that?” Similarly, when Carrie and I shop—because, again, we look for clients that we like. We love clients who are buying for themselves with a clear viewpoint, and that is Ulla to a T. So, we'll look at things as we're buying them and say, “This is the kind of thing that is for Ulla or her store or this kind of client.” One can never expect that means if you buy that piece, it sells in that way, but it does pull a spring at times on how we're acquiring certain parts of our collection. Thus far, it's proved pretty accurate. Sharon: I'm surprised. I'm the same as you; I've only seen the pictures of the store. There doesn't seem to be a lot of jewelry, at least from the pictures. Matthew: In the press pictures, it's hard to see. When they did the press pictures and when the store opened are largely different things. Obviously, one has to get the message out ahead of time before they open the doors. In one of the pictures, you can actually physically see the showcases, but I can send subsequent pictures that show you the jewelry displayed in them. There are two lovely floor cases, top-down vitrines that you'd be looking into. We're not looking to have 20 showcases. Given our requirements for how we purchase things and what they need to look like and the requirements we have for how we buy inventory, if we needed a whole new inventory for an entire store of jewelry, it would be extremely difficult. Right now, with the stock we have—not that everything sells immediately, but buying things is challenging because we do have a viewpoint and specific standards. Not to say there aren't a few things here and there that might be more bread and butter or commercial pieces. Even when we're sending things out to Ulla, we're looking for things where it doesn't matter. It's not like, “Oh, we're sending them out to another collection, so it can be different from what we put at Bergdorf.” Everything has pretty strict standards. In Ulla's space, they have two lovely, very interestingly built cases, I have to say. They're things I would never be clever enough to design in a million years, but it's displayed very, very beautifully. It's a very focused collection. We're not talking about 500, 600 pieces. Sharon: So, you do have vitrines and showcases. Matthew: Yes. Sharon: Nothing shows. It looks like you just have a few pieces. Matthew: That's just in the press photos. I understand with these things, there's always pressure to get the press photos out so the major press can be done, and the major message there should be Ulla. We are kind of an inclusion below the fold, but inasmuch as we are there, as they merchandise and get the pieces out there, this is the soft opening, as they say. Every store has to work out some of the kinks when it opens. In this case, it's easier for us given the nature of what we sell and it being valuable things that can't be just mixed in and around the inventory to cover Ulla after the fact. The formal opening is going to be closer into October, when we come out. By then, we'll have better photos of how everything is displayed in the store. People will come here and say, “There's always a new way to do design that somebody hasn't seen.” At the end of the day, it's still jewelry on props. Whatever they are, you still want people to see it and go after it. I think it's a tremendous success, given that they have a wonderful designer they worked with. Ulla herself has such a vision, and we were happy to be in the mix. Sharon: I think it's a really nice idea. It adds a lot to a store because you usually see—I don't mean to disparage it—but costume jewelry or whatever the store is selling. You don't see fine jewelry. How do you keep it secure? Matthew: It's all locked up at night, similar to what we do at Bergdorf. Things are in a locked case. If a client wants to see a piece, they work with a sales associate who will show it to them, and then everything is secured at the end of the day. Any proper jewelry store should be doing that. We're extremely careful and have all our little operations in place. We know their team is a crack team, too, and we will be doing everything to keep it very safe. Sharon: It looks like quite a large store from the pictures. Everything I'm talking about is from the pictures. Matthew: Yeah, but if you think of it this way, we operate in Bergdorf, which is a tremendously huge store and has so much going on. Once you know the order of operations and the sales associates understand the specific rules for showing jewelry, it's fairly straightforward and pretty easy. Nowadays it's different. Everything is very secure. Everyone has cameras in their spaces. We were doing retail for quite a long time before the advent of cameras and different sensors and all these ways of keeping things safe through technology. We feel very confident. Sharon: Do you think it's bigger than most of the stores in that area? That was my impression. Matthew: This is where I have to say I couldn't myself say. I am not an expert on that area of Beverly Boulevard or how the different retailers are size-wise. I know that when we started, it was quite a large store. We felt very comfortable because we're working with partners who we know well, who are leaders in their fields and have people working with them that are excellent. Given that Ulla is quite an accomplished designer and has a sizeable presence in New York already and obviously sells in other outlets and units, I would imagine that her store is commensurate with the level of success she's seen in our store, which is to say appropriate to what she does. Whether bigger or smaller than one of her colleagues, I don't know. Sharon: Do you or Carrie have any input in the design of the store? Matthew: No. Again, this is a lovely partnership and a meeting of minds, but our partnership is—like you said, where some retailers out there might fill their jewelry section with costume jewelry they've licensed out to someone else to design, or maybe they have a third party doing it. I think what Ulla saw in us is the idea that we have a similar viewpoint for how we present what we do. Part of the reason, even when you see on social media—if you look at Ulla on the internet, you see how she's wearing her own designs and her jewelry. It works so well together. Similarly, with the store, our input wasn't needed or even appropriate because it's Ulla's space to let her designs shine. But we know that whatever she does, her pieces are going to look good within the context of that collection. Despite what the store looks like, the main imprint is still, visually, that all of her wonderful clothing designs and our pieces have worked thus far. We obviously have the utmost confidence in both her and her designer to create an environment that would be wonderful for us to show our jewelry. Sharon: I don't know what Bergdorf carries, but do people come to you with one of her designs and say, “What can you recommend to go with this?” Matthew: I could certainly ask my sales staff. At Bergdorf it's not uncommon, whether it's Ulla or other designers, because we work across the store. We have our own specific private salon right on the seventh floor next to the restaurant. It's a little different than the main jewelry shown the ground floor. It's just our material, just our sales staff that works for us specifically, and we serve as an outlet for the rest of the store for what is essentially the antique and estate department at Bergdorf. What happens frequently is, whether it's an associate who is working in Ulla's section or somebody working in Chanel, they'll come and say, “I have a client who's looking at a gown and needs something to wear with it. This is a picture of the gown. What can you recommend?” Then the client would be able to try on the dress or whatever they're looking at with our pieces. If something works for them and they like it, then great; we can help them out that way. Certainly, that's part of it. One of the benefits for us to be in Bergdorf, aside from the fact that obviously it's Bergdorf and it gets a wonderful assortment of people who come to shop at the store, it puts us in the context of what people are wearing. While we have collectors who might specifically collect the pieces and wearing is secondary, by and large, our goal is for people to wear what they buy. We firmly believe things should not sit in the safe deposit box. They interact with the designer's clothing while the client is trying it on with our pieces. That's the best effect overall, I think, for a client looking at how the pieces are represented when they get them home and when they wear them. They look at them with the real eye. Sharon: Is there a decrease in the kind of people who are buying a Chanel piece, let's say, or a Chanel gown, a red carpet look? Matthew: Oh gosh, in terms of a red-carpet look, that's where my knowledge of Bergdorf sell-through would be behind. “I don't know” is the answer, but I can certainly say Chanel is experiencing a slowdown, at least judging by the number of people who shop at the Chanel departments at Bergdorf. Overall, I don't think I'm any genius or original thinker for thinking this. People have become less formal overall, but that hasn't really changed what we do. Yes, we have pieces that might be, to some clients, extremely occasion-specific and one or two pieces that would have to be worn for a red-carpet look, but what we're mostly buying is something that, given somebody's own personal comfort level, they can wear with anything. Whether it's a Deco diamond bracelet or it's a really simple pair of gold earrings, it's not for us to say, “Oh, you can only wear that at a fancy dress occasion,” or “Oh, that's just casual.” We like to think that's where one's own sense of creativity comes into play, because we buy things with the idea they'll be worn. We're not looking to pass on family heirlooms to sit in a box all year long. We really love our clients to experience their goods, wear them, have the confidence to wear them however they're going out. At the end of the day, it's one of those simple, little items that can really change how an outfit looks or how you feel. Sharon: I keep thinking about the jewelry in L.A. The collaboration you have, did that come about because you all were having dinner one night and you said, “Why don't we do this?” What happened? Matthew: In this case, Ulla, in opening her West Coast store—and I'm speaking secondhand because she and my sister initially had the conversations, but Carrie and I do everything together. So, it became a discussion we all had at one point. I think it was something as casual as, “I'm opening up a store on the West Coast. It would be great to have some Kentshire pieces there.” We feel so fortunate to have Ulla as a partner in this, specifically because she's such a good friend and has been so supportive of us when we took over the business. She has been herself one of the more inspiring collectors we have. Looking at the variety of pieces she's purchased that range from very modern to very old to things that are almost costume to things that are extremely fine—everything together, there's such a personal viewpoint about how these pieces come together. I took it as an incredible honor when she said she wanted to include us, because I don't think Ulla necessarily needs us to sell her fashion. She's so capable of creating a look that is beyond what we're able to think about. We're jewelers. We don't think about fashion that way necessarily, although we're certainly around it and we love it. In this case, I think it was a much more casual meeting of the minds where she said, “You know what? We all love each other. Let's work this out.” Then Carrie and Ulla talked about the details and figured out how it would work, and I played a supporting role in doing whatever I could do. Now we're seeing the fruits of that together as the collection is coming out West and people are starting to see it. Sharon: You mentioned some of the—I'll call them baby things you've tried out here, but do you think this is a beginning? Do you intend to do other things and make your brand more known out here? Matthew: Certainly, we would like our brand to be more known out there. In some ways, it's the biggest no-brainer for us, in that we have a lot of clients out on the West Coast, not just specifically the Northeast. We have a lot of clients who've purchased from us over the years. The challenge for us is always that I can't call up the factory and say, “Send me another 300 of those antique bracelets I sold.” We're a piece at a time. So, the challenge is always finding enough material that meets our qualifications so we can service all our clients. I think what we're hoping to see happen, all of us, is that this becomes successful, and we continue to grow our presence with Ulla and create a bigger collection for her there, which allows us to run similarly to how we run in New York. It's a comfortable setting for us, being in a fashion space and having clients coming in we know are already in the mindset of looking at jewelry and clothing together. I don't know if we necessarily have the appetite to open our own store out West, all things being equal, simply because it's more than a full-time job between Bergdorf and the website. So, for us having a partner like Ulla who can handle the day-to-day operations—and her team is so wonderful. To be able to do that is invaluable to us. We'll be doing trunk shows out there where we come and meet people at Ulla's store and introduce them to her brand and our brand, absolutely. That's something that will be starting in September on the 20th in the afternoon there. Then we'll continue as it goes and as we all find a good rhythm for how that works. Sharon: So, she did buy high-end. She bought what I call regular pieces that you wear every day and really high-end, over-the-top, red-carpet stuff. Matthew: We don't deal in things that we think are over the top simply because we're not looking to sell such specific pieces that way. It's not to say we never have, but it's by and large not a focus of our collection. I think what is incredible about Ulla's eye is she's looking specifically for what she likes. She's not looking at the of-the-moment piece or asking, “What do I see happening in the next year?” and it shows with her clothing. Ulla has this specific viewpoint. She'll see something in our collection and the first qualification isn't, “Oh, does it cost a lot or a little?” or “Is it by this designer?” It's, “Do I like it?” It's the simplest question, “Do I like it?” I think that nowadays, it's easy to get misled, even in the vintage jewelry world, with what's the hot thing now or who's the hot maker. At the end of day, for us, the most important consideration is, “Do you love it?” I know it sounds pedantic to say that, but I think it's easy sometimes to have the other parts of the piece drive it. Somebody will say, “Oh, who is it?” first or they'll say, “How much is it?” or “What's the size of the stone?” or what have you. This can all be important. I'm not saying they're not, but I think we're a good match for Ulla because we all approach the concept first of, “Do we love this? Does this excite us?” And then, “Why does it excite us?” Then, as you start to uncover the parts of what the piece is, if it's by somebody, if it's from a certain place, if it's from a certain time period, if it's got a rare stone, then those add to the excitement. But it has to be something inherently beautiful and unusual. Sharon: We will have photos posted on the website. Please head to the JewelryJourney.com to check them out.

For more info on what is discussed in this epsiode, head to MarketPowerMethod.com Allen: Boom, welcome to another edition of the Options Genius Podcast! Today, as promised, in the last episode, we have an interview, an interview with a fellow named Kevin. And Kevin is one of our beta testers in the Market Power Program, Kevin has done an amazing 266% ROI, since he's joined the program earlier in 2003. So that's not even a whole year worth the results. And that is after fees. So after he took out his commission's after he took out his fees, that's how much money he put in his pocket. Or basically, he left in the account. I don't know what he did with it. But yeah, that's what he kept. All right. That is amazing. I wanted to share this with you, I wanted to get this to you. Because these type of results are uncommon. I think that's an understatement. You know, when you have most people trying to make seven 8% A year from the stock market, even though you know, the market, banks, banks are paying what 4 or 5%. Right now, that's wonderful, that's great. Stock market should be paying more, but nobody out there is getting 266%. So shake cheese, but we are doing it with the market power program, I wanted to share this because I want you to be excited, I want you to be happy for Kevin, I want you to know this type of stuff is available, it's doable, if you have success with trading. So that's like the goal. I mean, the goal shouldn't be 266%. But the goal should be that you have enough money coming in to pay for all your expenses that you could do that from your trading. So you have basically your financial independence, right? And then after that you keep adding more and more money to the accounts or to your savings account or whatever, so that the financial worries that you have in your life melt away and you don't have any financial work. Because the thing is like, hey, oh, I got a speeding ticket. Okay? Well, if you can write a check, to make your problem go away, you don't have a problem. And that's what I really want. That's the type of life I want to have for you. Okay, so the type of problem where he's like, Okay, if I can just write a check and make this problem go away, I don't have a problem, I have a money issue. And the money issue, we want to make it go away through trading, market power is going to be one of those ways this program is coming. It's exciting. It's amazing. I can't speak enough about it. I mean, it's just unbelievable. I haven't I lost sleep. When we first came up with this seriously, I lost sleep for days and days and days. And I just can't believe it. And even now, it's still unbelievable. 54 trades in a row that I have made with this program. I think Kevin, the one that you're going to see in the interview, I think he had one trade that went bad, and he had to adjust it. And so it still worked out. And it's phenomenal. It's amazing. And he's not the only one, I'm not the only one, we have 35 other people that are trading this, in our beta testing program. They're all doing phenomenal. We have case studies, we have screenshots, we have interviews, we have, you know, the emails from them, thanking us and saying how amazing it is. So it's just a matter of time before we can open it up for others join. And unfortunately, you know, we can't let everybody in the whole world join. So whoever gets in to get in, that's wonderful. You only help certain limited amount of people, because we still need to protect it and keep it somewhat secret in the sense so that it doesn't get diluted and it doesn't stop working. So that's the situation here. I'm gonna go ahead and stop talking and let you watch or listen to the interview. And then when market power, makes his official debut and launches to the general list, I will let you know on the podcast. Or if you want to get to know earlier, then you can go to OptionGenius.com and email us or contact us and say hey, I want to be on the notification list. I want to know more about Market Power. I want to know when it comes out. I want to be one of the first How do I get to the top of the line, right? So let's do that. And let's go ahead and let's get into this interview. Matthew: Alright. So today we're joined by Kevin Donegen, and he's a member of our market power program. And I want to thank you today for sharing your experience. And you know how the course has been going for you and the program, and just really appreciate having you. Kevin: You're welcome. Glad to be here. Thanks, sir. Matthew: You're welcome. So, I always ask people, you know, the first question is, how did you find Option Genius? So a lot of people find it by podcast or other means. So how did you find out Option Genius? Kevin: It's been a few years now, because I joined other, you know, the training portion of Option Genius a couple years ago, I think it was late 21. So almost two years now, I guess, you know, it's a good question, how I found Option Genius. I guess. I was exploring Option Trading, you know, on my phones, or searches and option genius. And I looked at a few mean, option, genius came up and I gravitated towards it. I don't know, I think I was just searching for option learning, training and learning kind of stuff and found it and it's been good. So I think I found it just by searching. Matthew: Just by discovery. Kevin: Yeah, research Matthew: Great. So you've been a part of our original market program. Call you guys kind of like the Founding Fathers, you know, you, you went in there and tried everything? And is there anything when you decided to join the program? Were you like, hey, you know, I want to be a part of this program that stuck out to you. Kevin: Boy, when Allen, when you all had that first introductory conference call regarding the program, and shared the historical back testing data about what the program was based on? I mean, that that clinched it right there, that historical back tested data, of, you know, the premise, and the process of the program, and how it looked back tested was just the results are just remarkable. Matthew: Excellent. Did you have any personal expectations before you joined the program, you know, as far as like a percentage goal or just to kind of get consistent? Kevin: I had been trading options, covered calls and in spreads before a little bit, I dabbled in it. So I guess my initial expectation for the program was to pay back my, the cost of the program. First, that was my first goal. And I did it pretty quickly. And by starting out slow, you know, I, you know, I started out real slow just to get the feel for the program. And as I traded more, and you know, the indicator came up, and I made a trade in one and one again, and one again, my confidence, says, Yes, this is real. And then I just started slowly, my trade starts slowly ramped up, and I think I paid for it. And depending on how slow or fast you start, it can be a fast payback. If you start with larger trades, but I think I paid mine back in a few weeks, like 12 weeks or something. Matthew: Wow, that's great. That's like, yeah, it's really important, what you just said, you know, a lot of people, you know, you're excited, and you can see things working. And a lot of times, you know, the human psychology gets involved, and we go too fast, right? You know, so it's, it's really kind of really great that you kind of measure yourself and start slow. So it's really great. For sure. Is there any kind of particular part of the program that you really like? You know, is it some people can say, oh, it's adjustment, or it's, whatever. Is there anything you can pinpoint? Kevin: Yep, the two things come, pop up in my mind, that the online forum of the group and the chats and the sharing of information amongst the market power group, I really enjoy that to get other people's opinion and take on the program in the market and when to trade, not to trade. So I really like that it's an open forum. And it's, it's welcoming, and no one's afraid to say anything. So I really liked that. The second tool I like is the trading log, the market power trading log that you all put together. It's well organized. I've been using that to track all my trades. Matthew: Great. Yeah. I mean, again, you hit on a really great point. I mean, that we have a group of people, you know, some people are just new to options. And you have some people I said in another interview that are looks like they take it to quantum physics. So it's like, you get all this range of knowledge. And it's really kind of, we're all here for the right reason. So it's really kind of great. It's almost like a family, if you will. Kevin: Absolutely, yeah, absolutely. Matthew: How has the support been? I mean, you kind of mentioned a little bit from Option Genius, but more like the people around you. I mean, I think you just alluded to that, that you have a good support system that If you want. Kevin: Oh yeah, whether it be a group member or yourself or Trish or an even Allen, it's been great. The communication has been prompt and, and timely and always answered. So there's always someone to answer a question or what have you. So it's been really good. Matthew: That's great to hear. You know, we really want people to feel involved and not feel left out. I'm, you know, there's nothing worse than feeling like you're alone, you know? Yeah. Kevin: So I don't, I don't feel that way at all.  Matthew: Awesome. Has your trading changed at all? Since you joined the program? Like, as far as I mean, can you talked a little about confidence, or, you know, some people? You know, a big main reason is confidence, I say, but how was it for you? Kevin: So, last year before the program, I had some success, just doing it myself, but then I got burned, and wiped away all my profits. So what I get out of the program is the discipline of the program. And, you know, when you have an indicator day, that's the day to trade no other. So, I'm more disciplined since joining the program. And I'm only trading when there's an indicator day, by and large. So the short answer is, I've gained a lot of discipline after joining the program.  Matthew: That's great to hear. So we're all shoot for that to be consistent, you know, and there's nothing worse than trading and winning than winning, and then giving it all back. I think it's like the, you know, it's the worst thing that can happen, right? Kevin: Anybody that's probably been in options have had that experience at one time or another? Matthew: Sure. So it's almost required. Kevin: Boy, it's a tough learning, but that's okay. Matthew: All right. So, um, how have your results been so far? For you? Kevin: I'm looking at my trading log right now, because I figured you'd ask that. And I've kind of added some features to it myself. But if you're interested in those, we can talk about that. But I've made what about 47 trades? Not counting yesterday. So I work off the two platforms. So I'd make trades in both one as is a smaller account, one's a bigger account. So I may duplicate a given day on two different platforms. But anyway, you know, 47 trades, I think I lost only one. And that was because of me. It wasn't because of the program. And I only lost like 600 bucks. So no big deal. And then I adjusted and made it back. So but that was my fault. And I bought too early in the day, basically. And I put notes out there, which is good. My average number of contracts, I would say is 20. So but you know, I've been up as high as 40 and 10. And 30. Just depends how I'm feeling. You know, like, like, yesterday, I did only 20. I don't know, I I don't know why I just didn't want to do 40. You know, and so long and short. I've made over a minute, I also back out the cost of trades to get a net profit, right? So my net profit is 226%. Matthew: Yeah, that's great. You mean, you're trading at a good amount? You kind of just talked to how a little bit can made me kind of feel how I trade you know, there's some days that, you know, you don't you have like kind of a hunch, you know, you're like, I don't really feel, you know, can be personal. It could be like something like, I just don't feel like trading today. And that's perfectly fine. And what I do love, and I think you'll agree is that some days, you don't have to trade, you know, it's like, you don't have to take every signal. Right? You can, you can wait and there'll be another one coming down the pike, you know? Kevin: Absolutely. Yeah, for sure. And that's why that's where the discipline comes in. You know, because you just got to be patient because the signal will come. And when it comes, that's your time. Matthew: So yeah, yeah, you kind of take it as a case by case basis. You know, that's great, for sure. Alright, so kind of a fun question. So a lot of people, they have different goals for their profits. And it's nice to good problem to have, you know, you're in your profit, you're making money. Some people do fun things like take vacations, and some people just roll it into their account. So what are your plans? Kevin: So I guess, on articulate or unstated two goals for the program and the profits that I earned from market power. First is to build up my account so I can grow the dollars in My Account for doing this so that I could keep slowly ramping up as I get more and more comfortable. But then I also, the second one is to take some of the profits and have some fun. And like you alluded to, I think maybe before we started the call, but, you know, I went fishing in Colorado, and virtually almost paid for the whole trip, in a day, at least a good portion of VRBO expense. And then, earlier in the year, my wife and I went to Paris, and I was trading when I was over in Paris, and helps pay for that part of the trip. So, you know, Matthew: It's great. I mean, it almost makes your trip more enjoyable. You know, you're over there, you're like, hey, you know, this is cash flow in this right now, you know? Kevin: Exactly. So it's, it's a great feeling. So yeah, two things, take a little profits, have some fun with it, and then keep growing the account. Matthew: Excellent. Excellent. So what would you say to someone that you were there in the original group, and a lot of people have apprehensions about joining programs, you know, whether it's true, we're kind of at a point now, where we've had many, many winners, and if not any losers on the track record, actually no losses on the track record. So it's almost too good to be true. So people are naturally skeptical. What would you say to someone that, you know, there's going to be next group and a group after that, and people join in this program? So what would you say to someone that's kind of on the fence about joining this program? Kevin: Well, if they see any of these interviews from the current market power group, I gotta believe take it from the member, the current members and what they're saying, and their results, trust, the back tested data is real. And ever since we, we joined market power, the program to your point hasn't had a losing trade yet. So it works. I mean, the data speaks for itself, and they can if they're apprehensive, start slow, kind of like what I did and get comfortable with it. And you'll quickly, quickly get more confidence in the program. Matthew: Excellent. Well, wise words, I mean, you know, it's really important, you hit on some really important points that, you know, patients taking your time, and really kind of just trusting yourself. I mean, give it you know, giving something a try and, you know, the worst possible thing that can happen, you know, so that's great. So I really want to thank you for taking the time today. I really appreciate it and you know, sharing your experience, so really great having you on. Kevin: Yeah, my pleasure. Thank you, Matthew. All right. Thank you. Have a great day. You too.

Rounding Up Season 2 | Episode 2 – Empathy Interviews Guest: Dr. Kara Imm Mike Wallus: If there were a list of social skills we hope to foster in children, empathy is likely close to the top. Empathy matters. It helps us understand how others are feeling so we can respond appropriately, and it can help teachers understand the way their students are experiencing school. Today on a podcast, we talk with Dr. Kara Imm about a practice referred to as an empathy interview. We'll discuss the ways empathy interviews can help educators understand their students' lived experience with mathematics and make productive adaptations to instructional practice. Mike: Well, welcome to the podcast, Kara. We're excited to have you join us. Kara Imm: Thanks, Mike. Happy to be here. Mike: So, I have to confess that the language of an empathy interview was new to me when I started reading about this, and I'm wondering if you could just take a moment and unpack, what is an empathy interview, for folks who are new to the idea? Kara: Yeah, sure. I think I came to understand empathy interviews in my work with design thinking as a former teacher, classroom teacher, and now teacher-educator. I've always thought of myself as a designer. So, when I came to understand that there was this whole field around design thinking, I got very intrigued. And the central feature of design thinking is that designers, who are essentially thinking about creating new products, services, interactions, ways of being for someone else, have to start with empathy because we have to get out of our own minds and our own experiences and make sure we're not making assumptions about somebody else's lived experience. So, an empathy interview, as I know it now, is first and foremost a conversation. It's meant to be as natural a conversation as possible. When I do empathy interviews, I have a set of questions in mind, but I often abandon those questions and follow the child in front of me or the teacher, depending on who I'm interviewing. Kara: And the goal of an empathy interview is to elicit stories; really granular, important stories, the kind of stories that we tell ourselves that get reiterated and retold, and the kinds of stories that cumulatively make up our identities. So, I'm not trying to get a resumé, I'm not interested in the facts of the person, the biography of the person. I'm interested in the stories people tell about themselves. And in my context, the stories that kids tell themselves about their own learning and their own relationship to school, their classrooms, and to mathematics. I'm also trying to elicit emotions. So, designers are particularly listening for what they might call unmet needs, where as a designer we would then use the empathy interview to think about the unmet needs of this particular person and think about designing something uniquely and specifically for them—with the idea that if I designed something for them, it would probably have utility and purpose for other people who are experiencing that thing. So, what happened more recently is that I started to think, “Could empathy interviews change teachers' relationship to their students? Could it change leaders' relationships to the teachers?” And so far, we're learning that it's a different kind of conversation, and it's helping people move out of deficit thinking around children and really asking important questions about, what does it mean to be a kid in a math class? Mike: There's some language that you've used that really stands out for me. And I'm wondering if you could talk a little bit more about it. You said “the stories that we tell about ourselves”; or, maybe paraphrased, the stories that kids tell themselves. And then you had this other bit of language that I'd like to come back to: “the cumulative impact of those stories on our identity.” Can you unpack those terms of phrase you used and talk a little bit about them specifically, as you said, when it comes to children and how they think about their identity with relation to mathematics? Kara: Sure. I love that kind of phrase, “the story we tell ourselves.” That's been a pivotal phrase for me. I think stories kind of define and refine our existence. Stories capture this relationship between who we are and who we want to become. But when I'm thinking about stories in this way, I imagine as an interviewer that I'm trying to paint a portrait of a child, typically. And so, I'm trying to interact with this child in such a way that I can elicit these stories, painting a unique picture of this kid, not only as a learner but also as a human. What inevitably happens when you do these interviews is that I'm interested in their experience in math class. When I listen to kids, they have internalized, “I'm good at math, and here's why” or “I'm bad at math, and here's why. I just know it.” But when you dig a little bit deeper, the stories they tell are a little more nuanced, and they kind of live in the space of gray. And I'm interested in that space, not the space of testing and measurement that would land you in a particular identity as meant for math or not meant for math. Mike: I think what I was going to suggest is, why don't we listen to a few, because you shared a couple clips before we got ready for the interview, and I was fascinated by the approach that you had in chatting with these children and just how much information I could glean from even a minute or two of the interview slices that you shared. Why don't we start and get to know a few of these kiddos and see what we can learn together. Kara: Sounds great. Mike: We've got a clip that I'm going to invite you to set it up and give us as much context as you want to, and then we'll play the clip and then we can talk a little bit about it. I would love to start with our friend Leanna. Kara: Great. Leanna is a third-grader. She goes to an all-girls school. I've worked in Leanna's school over multiple years. I know her teacher well. I'm a part of that community. Leanna was kind of a new mathematician to me. Earlier in the day I had been in Leanna's classroom, and the interview starts with a moment that really struck me, which I won't say much more about. And I invited Leanna to join me after school so we could talk about this particular moment. And I really wanted to know how she made sense of what happened. So, I think we'll leave it at that and we'll listen to what happened. Mike: Alright, let's give it a listen. Leanna: Hi, I'm Leanna, and I'm 8 years old. Kara: Hi, Leanna. Today when I was in your class, something interesting happened where I think the kids said to me, and they said, “Do you know we have a math genius in our class?” Do you remember that moment? Leanna: Yeah. Kara: Tell me what happened in that moment. Leanna: Um, they said, “We have a math genius in our class.” And then they all started pointing at me. Kara: And what was that like for you? Leanna: It was … like, maybe, like, it was nice, but also it was kind of like, all the pressure was on me. Kara: Yeah, I was wondering about that. Why do you think the girls today—I mean, I'm a visitor, right?—why do you think they use the word “math genius”? And why did they choose you? What do you think they think of you? Leanna: A mathematician … Kara: Yeah. Leanna: … because I go to this thing every Wednesday. They ask me what I want to be when I grow up, and I always say a mathematician. So, they think that I am a math genius. Kara: Gotcha. Do you think all the girls in your class know that you want to be a mathematician when you grow up? But do they mean something else? They didn't say, “We have a mathematician in our class.” They said, “We have a math genius.” Leanna: Maybe. Kara: Are you a math genius? Do think, what does that even mean? Leanna: Like, I'm really good at math. Kara: Yeah. Do you think that's a true statement? Leanna: Yeah, a little bit. Kara: A little bit? Do you love math? Leanna: Yeah. Kara: Yeah. Have you always loved math? Leanna: Yeah. Kara: And so, it might be true that, like, is a math genius the same as a mathematician? Leanna: No. Kara: OK. Can you say how they're different? Leanna: Like, a mathematician is, like … Like, when you're a math genius, you don't always want to be a mathematician when you grow up. A math genius is when you just are really good at math, but, like, a mathematician is when you really, like, want to be when you grow up. Kara: Yeah. Mike: That was fascinating to listen to. So, my first inclination is to say, as you were making meaning of what Leanna was sharing, what were some of the things that were going on for you? Kara: Yeah, I was thinking about how math has this kind of unearned status, this measure of success in our culture that in this interview, Leanna is kind of pointing to. I was thinking about the mixed emotions she has being positioned as a math genius. It called into mind the model minority myth in which folks of Asian descent and Asian Americans are often positioned as stereotypically being good at math. And people say, “Well, this is such a lovely and respectful stereotype, who cares if it's not true?” But she later in the interview talks about the pressure of living up to this notion of math genius and what means. I think about her status in the classroom and how she has the agency to both take up this idea of math genius, and does she have the agency to also nuance it or reject it? And how that might play out in her classroom? So yeah, those are all the things that kind of come to mind as I listen to her. Mike: I think you're hitting on some of the themes that jumped out for me; this sense that kids who are participating in particular activities have been positioned, either by their participation or by their kids' perceptions of what participation means. And I thought the most interesting part was when she said, “Well, it's nice”—but there was a long pause there. And then she talked about this sense of pressure. What it's making me think about as a practitioner is that there are perhaps ways that as a teacher, if I'm aware of that, that might change something small, some things big about the way that I choose to engage with Leanna in the classroom; that I choose to help her navigate that space that she finds herself in. There's a lot for me there as a practitioner in that small clip that helps me really see her, understand her, and think about ways that I can support her. Kara: Yeah. And, like, from a design perspective, I huddled with her teacher later in the day, and we talked about this interview, and we thought about what would it mean to design or redesign a space where Leanna could feel really proud of who she was as a mathematician, but she didn't feel the kind of pressure that this math genius moniker is affording her. And so, ultimately, I want these interviews to be conducted by teachers so that, as you said, practitioners might show up differently for kids or think about what we might need to think more deeply about or design for kids like her. She's certainly not the only one. Mike: Yeah, absolutely. And I think part of what's hitting me in the face is that the term “empathy interview” really is taking on new meaning, even listening to this first one. Because feeling the feelings that she's sharing with us, feeling what it would be like to be in those shoes, I've had kiddos in my class who have been identified or whose folks have chosen to have them participate in programming. And I have to confess that I don't know that I thought as much about what that positioning meant to them or what it meant about how kids would perceive them. I was just struck by how, in so many subtle ways doing an interview like this, might really shift the way that I showed up for a child. Kara: Yeah, I think so. Mike: Well, let's listen to another one. Kara: OK. Maybe Matthew, should we meet Matthew? Mike: I think we should meet Matthew. Kara: Yeah. Mike: Do you want to set up Matthew and give us a sense of what we might need to know about the context? Kara: Absolutely. Matthew is a fifth-grader who describes, in my conversation with him, several years of what he calls “not good” years in math. And he doesn't enjoy mathematics. He doesn't think he's good at it. He has internalized, he's really blamed himself and taken most of the responsibility for those “bad“ years of learning. When I meet him, he's a fifth-grader, and he has written a mathography at the invitation of his classroom teacher. This is a practice that's part of this school. And in his mathography as a fifth-grader, he uses the word “evolving,” and he tells the story of how he's evolving as a mathematician. That alone is pretty profound and beautiful that he has the kind of insight to describe this kind of journey with mathematics. And he really just describes a fourth-grade teacher who fundamentally changed his relationship to mathematics, his sense of himself, and how he thinks about learning. Mike: Let's give it a listen. Kara: Maybe we'll end, Matthew, with: If people were thinking about you as—and maybe there's other Matthews in their class, right—what kinds of things would've helped you back in kindergarten, first and second grade to just feel like math was for you? It took you until fourth grade, right … Matthew: Yeah. Kara: … until you really had any positive emotions about math? I'm wondering what could we have done for younger Matthew? Matthew: Probably, I think I should have paid a lot more attention. Kara: But what if it wasn't about you? What if it's the room and the materials and the teacher and the class? Matthew: I think it was mostly just me, except for some years it was really, really confusing. Kara: OK. Matthew: And when … you didn't really want in third grade or second grade, you didn't want to be the kid that's always, like, “Hey, can you help me with this?” or something. So that would be embarrassing for some people. Kara: OK. You just made air quotes right, when you did embarrassing? Matthew: Yeah. Kara: Was it embarrassing to ask for help? Matthew: It wasn't embarrassing to ask for help, and now I know that. But I would always not ask for help, and I think that's a big reason why I wasn't that good at math. Kara: Got it. So, you knew in some of these math lessons that it was not making sense? Matthew: It made no sense. Kara: It made no sense. Matthew: And then I was, like, so I was in my head, “I think I should ask, but I also don't want to embarrass myself.” Kara: Hmm. Matthew: But also, it's really not that embarrassing. Kara: OK, but you didn't know that at the time. At the time it was like, “Ooh, we don't ask for help.” Matthew: Yeah. Kara: OK. And did that include asking another kid for help? You didn't ask anybody for help? Matthew: Um, only one of my friends that I knew for a really long time … Kara: Hmm. Matthew: He helped me. So, I kind of got past the first stage, but then if he was absent on those days or something, then I'd kind of just be sitting at my desk with a blank sheet. Kara: Wow, so it sounds like you didn't even know how to get started some days. Matthew: Yeah, some days I was kind of just, like, “I'm not even going to try.” Kara: “I'm not” … OK. Matthew: But now I'm, like, “It's not that big of a deal if I get an answer wrong.” Kara: Yeah, that's true. Right? Matthew: “I have a blank sheet. That is a big deal. That's a problem.” Kara: So having a blank sheet, nothing written down, that is a bigger problem for you than, like, “Oh, whoops, I got the answer wrong. No big deal.” Matthew: I'd rather just get the answer wrong because handing in a blank sheet would be, that would probably be more embarrassing. Mike: Oh, my goodness. There is a lot in a little bit of space of time. Kara: Yeah. These interviews, Mike, are so rich, and I offer them to this space and to teachers with such care and with such a deep sense of responsibility 'cause I feel like these stories are so personal. So, I'm really mindful of, can I use this story in the space of Matthew for a greater purpose? Here, I feel like Matthew is speaking to all the kind of socio-mathematical norms in classrooms. And I didn't know Matthew until this year, but I would guess that a kid like Matthew, who is so quiet and so polite and so respectful, might've flown under the radar for many years. He wasn't asking for help, but he was also not making trouble. It makes me wonder, “How would we redesign a class so that he could know earlier on that asking for help—and that this notion that in this class, mathematics—is meant to make sense, and when it doesn't make sense, we owe it to ourselves and each other to help it make sense?” I think it's an invitation to all of us to think about, “What does it mean to ask for help?” And how he wants deep down mathematics to make sense. And I agree with him, that should be just a norm for all of us. Mike: I go back to the language that you used at the beginning, particularly listening to Matthew talk, “the stories that we tell ourselves.” The story that he had told himself about what it meant to ask for help or what that meant about him as a person or as a mathematician. Kara: Yeah. I mean, I am trained as a kind of qualitative researcher. So as part of my dissertation work, I did all kinds of gathering data through interviews and then analyzing them. And one of the ways that is important to me is thinking about kind of narrative analysis. So, when Matthew tells us the things that were in his head, he tells you the voice that his head is saying back to him. Kids will do that. Similarly, later in the interview I said, “What would you say to those kids, those kids who might find it?” And what I was interested in is getting him to articulate in his own voice what he might say to those children. So, when I think about stories, I think about when do we speak in a first person? When do we describe the voices that are in our heads? When do we quote our teachers and our mothers and our cousins? And how that's a powerful form of storytelling, those voices. Mike: Well, I want to listen to one more, and I'm particularly excited about this one. This is Nia. I want to listen to Nia and have you set her up. And then I think what I want to do after this is talk about impact and how these empathy interviews have the potential to shift practice for educators or even school for that matter. So, let's talk about Nia and then let's talk about that. Kara: You got it. Nia is in this really giant classroom of almost 40 kids, fifth-graders, and it's co-taught. It's purposely designed as this really collaborative space, and she uses the word “collaboration,” but she also describes how that's a really noisy environment. On occasion, there's a teacher who she describes pulling her into a quieter space so that she can concentrate. And so, I think that's an important backstory for her just in terms of her as a learner. I ask her a lot of questions about how she thinks about herself as a mathematician, and I think that's the clip we're going to listen to. Mike: Alright, let's listen in. Nia: No, I haven't heard it, but … Kara: OK. I wonder what people mean by that, “I'm not a math person.” Nia: I'm guessing, “I don't do math for fun.” Kara: “I don't do math for fun.” Do you do math for fun? Nia: Yes. Kara: You do? Like, what's your for-fun math? Nia: Me and my grandma, when we were in the car, we were writing in the car. We had this pink notebook, and we get pen or a pencil, and she writes down equations for me in the backseat, and I do them and she times me, and we see how many questions I could get right in, like, 50 seconds. Kara: Oh, my gosh. What's an example of a question your grandma would give you? Nia: Like, they were just practice questions, like, three times five, five times eight. Well, I don't really do fives because I already know them. Mike: So, we only played a real tiny snippet of Nia. But I think one of the things that's really sticking out is just how dense these interviews are with information about how kids think or the stories that they've told themselves. What strikes you about what we heard or what struck you as you were having this conversation with Nia at that particular point in time? Kara: For me, these interviews are about both storytelling and about identity building. And there's that dangerous thinking about two types of people, math people and non-math people. I encounter adults and children who have heard of that phrase. And so, I sometimes offer it in the interview to find out what sense do kids make of that? Kids have told me, “That doesn't make sense.” And other kids have said, “No, no, my mom says that. My mom says she's not a math person.” So, she, I'm playing into it to see what she says. And I love her interpretation that a math person is someone who does math for fun. And truthfully, Mike, I don't know a lot of kids who describe doing math for fun. And so, what I loved about that she, A: She a described a math person's probably a person who, gosh, enjoys it, gets some joy or pleasure from doing mathematics. Kara: But then the granularity of the story she offers, which is the specific pink notebook that she and her grandmother are passing back and forth in the backseat of the car, tell you about mathematics as a thing that she shares a way of relating to her grandmother. It's been ritualized, and really all they're doing if you listen to it is, her grandmother's kind of quizzing her on multiplication facts. But it's such a different relationship to multiplication facts because she's in relationship to her grandmother. They have this beautiful ongoing ritual. And quite honestly, she's using it as an example to tell us that's the fun part for her. So, she just reminds us that mathematics is this human endeavor, and for her, this one ritual is a way in which she relates and connects to her grandmother, which is pretty cool. Mike: So, I want to shift a little bit and talk about a couple of different things: the types of questions that you ask, some of the norms that you have in mind when you're going through the process, and then what struck me about listening to these is you're not trying to convince the kids who you're interviewing of anything about their current thinking or their feelings or trying to shift their perspective on their experience. And I'm just wondering if you can think about how you would describe the role you're playing when you're conducting the interview. 'Cause it seems that that's pretty important. Kara: Yeah. I think the role I'm playing is a deep listener. And I'm trying to create space. And I'm trying to make a very, very, very safe environment for kids to feel like it's OK to tell me a variety of stories about who they are. That's my role. I am not their classroom teacher in these interviews. And so, these interviews probably look and sound differently when the relationship between the interviewer and the interviewee is about teachers and students and/or has a different kind of power differential. I get to be this frequent visitor to their classroom, and so I just get to listen deeply. The tone that I want to convey, the tone that I want teachers to take up is just this fascination with who they are and a deep curiosity about their experience. And I'm positioned in these interviews as not knowing a lot about these children. Kara: And so, I'm actually beautifully positioned to do what I want teachers to do, which is imagine you didn't know so much. Imagine you didn't have the child's cumulative file. Imagine you didn't know what they were like last year. Imagine you didn't know all that, and you had to ask. And so, when I enter these interviews, I just imagine, “I don't know.” And when I'm not sure, I ask another smaller question. So I'll say, “Can you say more about that?” or “I'm not sure if you and I share the same meaning.” The kinds of questions I ask kids—and I think because I've been doing this work for a while, I have a couple questions that I start with and after that I trust myself to follow the lead of the children in front of me—I often say to kids, “Thank you for sitting down and having a conversation with me today. I'm interested in hearing kids' stories about math and their math journey, and somebody in your life told me you have a particularly interesting story.” And then I'll say to kids sometimes, “Where do you want to start in the story?” And I'll try to give kids agency to say, “Oh, well, we have to go back to kindergarten” or “I guess we should start now in high school” or kids will direct me where they think are the salient moments in their own mathematical journey. Mike: And when they're sharing that story, what are the types of questions that you might ask along the way to try to get to clarity or to understanding? Kara: Great question. I'm trying to elicit deep emotion. I'm trying to have kids explain why they're telling me particular stories, like, what was significant about that. Kids are interesting. Some kids in these interviews just talk a lot. And other kids, I've had to really pepper them with questions and that has felt a little kind of invasive, like, this isn't actually the kind of natural conversation that I was hoping for. Sometimes I'll ask, “What is it like for you or how do you think about a particular thing?” I ask about things like math community, I ask about math partners. I ask about, “How do you know you're good at math and do you trust those ways of knowing?” I kind of create spaces where we could have alternative narratives. Although you're absolutely right, that I'm not trying to lead children to a particular point of view. I'm kind of interested in how they make sense. Mike: One of the things that, you used a line earlier where you said something about humanizing mathematics, and I think what's striking me is that statement you made: “What if you didn't have their cumulative report card?” You didn't have the data that tells one story, but not necessarily their story. And that really is hitting me, and I'm even feeling a little bit autobiographical. I was a kid who was a lot like Matthew, who, at a certain point, I just stopped raising my hand because I thought it meant something about me, and I didn't want people to see that. And I'm just struck by the impact of one, having someone ask you about that story as the learner, but also how much an educator could take from that and bring to the relationship they had with that child while they were working on mathematics together. Kara: You said a lot there, and you actually connect to how I think about empathy interviews in my practice now. I got to work with Rochelle Gutiérrez this summer, and that's where I learned deeply about her framework, rehumanizing mathematics. When I do these empathy interviews, I'm living in this part of her framework that's about the body and emotions. Sometimes kids in the empathy interview, their body will communicate one thing and their language will communicate something else. And so, that's an interesting moment for me to notice how body and motions even are associated with the doing of mathematics. And the other place where empathy interviews live for me is in the work of “Street Data,” Jamila Dugan and Shane Safir's book, that really call into question this idea that what is measurable and what is quantifiable is really all that matters, and they invite us to flip the data dashboard. Kara: In mathematics, this is so important 'cause we have all these standardized tests that tell children about who they are mathematically and who they're about to become. And they're so limiting, and they don't tell the full story. So, when they talk about “Street Data,” they actually write about empathy interviews as a way in which to be humanizing. Data can be liberatory, data can be healing. I feel that when I'm doing these interviews, I have this very tangible example of what they mean because it is often the case that at the end of the interview—and I think you might've had this experience just listening to the interview—there's something really beautiful about having a person be that interested in your story and how that might be restorative and might make you feel like, “There's still possibility for me. This isn't the last story.” Mike: Absolutely. I think you named it for me, which is, the act of telling the story to a person, particularly someone who, like a teacher, might be able to support me being seen in that moment, actually might restore my capacity to feel like, “I could do this” or “My fate as a mathematician is not sealed.” Or I think what I'm taking away from this is, empathy interviews are powerful tools for educators in the sense that we can understand our students at a much deeper level, but it's not just that. It's the experience of being seen through an empathy interview that can also have a profound impact on a child. Kara: Yes, absolutely. I'm part of a collaboration out of University of California where we have thought about the intersection of disability and mathematics, and really thinking about how using the tools of design thinking, particularly the empathy interview can be really transformative. And what the teachers in our studies have told us is that just doing these empathy interviews—and we're not talking about interviewing all the kids that you teach. We're talking about interviewing a select group of kids with real intention about, “Who's a kid who has been marginalized?” And/or “Who's a kid who I don't really know that much about and/or I don't really have a relationship with?” Or “Who's a kid who I suspect doesn't feel seen by me or doesn't feel, like, a deep sense of belonging in our work together?” Teachers report that just doing a few of these interviews starts to change their relationship to those kids. Kara: Not a huge surprise. It helped them to name some of the assumptions they made about kids, and it helped them to be in a space of not knowing around kids. I think the other thing it does for teachers that we know is that they describe to do an empathy interview well requires a lot of restraint, restraint in a couple of ways. One, I'm not fixing, I'm not offering advice. I'm also not getting feedback on my teaching. And I also think it's hard for teachers not to insert themselves into the interview with our own narratives. I really try to make sure I'm listening deeply and I'm painting a portrait of this kid, and I'm empathetic in the sense I care deeply and I'm deeply listening, which I think is a sign of respect, but the kids don't need to know about my experience in the interview. That's not the purpose. Mike: We could keep going for quite a long time. I'm going to make a guess that this podcast is going to have a pretty strong on a lot of folks who are out in the field listening. Kara: Hmm. Mike: If someone was interested in learning more about empathy interviews and wanted to explore or understand more about them, do you have any particular recommendations for where someone might go to continue learning? Kara: Yes, and I wish I had more, but I will take that as an invitation that maybe I need to do a little bit more writing about this work. I think the “Street Data” is an interesting place where the co-authors do reference empathy interviews, and I do think that they have a few videos online that you could see. I think Jamila Dugan has an empathy interview that you could watch and study. People can write me and/or follow me. I'm working on an article right now. My colleagues in California and I have a blog called “Designing4Inclusion,” “4” being the number four, and we've started to document the work of empathy and how it shows up in teachers' practice there. Mike: Well, I want to thank you so much for joining us, Kara. It has really been a pleasure talking with you. Kara: Thank you, Mike. I was really happy to be invited. Mike: This podcast is brought to you by The Math Learning Center and the Maier Math Foundation, dedicated to inspiring and enabling individuals to discover and develop their mathematical confidence and ability. © 2023 The Math Learning Center | www.mathlearningcenter.org

Welcome episode 227 of the Cloud Pod podcast - where the forecast is always cloudy! This week your hosts are Justin, Jonathan, Matthew and Ryan - and they're REALLY excited to tell you all about the 161 one things announced at Google Next. Literally, all the things. We're also saying farewell to EC2 Classic, Amazon SES, and Azure's Explicit Proxy - which probably isn't what you think it is.  Titles we almost went with this week:

Welcome episode 226 of the Cloud Pod podcast - where the forecast is always cloudy! This week Justin, Matt and Ryan chat about all the news and announcements from Google Next, including - surprise surprise - the hot topic of AI, GKE Enterprise, Duet, Co-Pilot, Code Whisperer and more! There's even some non-Next news thrown into the episode. So whether you're interested in BART or Bard, we've got the news from SF just for you.  Titles we almost went with this week:

Matthew Prince, Co-founder & CEO at Cloudflare, joins Corey on Screaming in the Cloud to discuss how and why Cloudflare is working to solve some of the Internet's biggest problems. Matthew reveals some of his biggest issues with cloud providers, including the tendency to charge more for egress than ingress and the fact that the various clouds don't compete on a feature vs. feature basis. Corey and Matthew also discuss how Cloudflare is working to change those issues so the Internet is a better and more secure place. Matthew also discusses how transparency has been key to winning trust in the community and among Cloudflare's customers, and how he hopes the Internet and cloud providers will evolve over time.About MatthewMatthew Prince is co-founder and CEO of Cloudflare. Cloudflare's mission is to help build a better Internet. Today the company runs one of the world's largest networks, which spans more than 200 cities in over 100 countries. Matthew is a World Economic Forum Technology Pioneer, a member of the Council on Foreign Relations, winner of the 2011 Tech Fellow Award, and serves on the Board of Advisors for the Center for Information Technology and Privacy Law. Matthew holds an MBA from Harvard Business School where he was a George F. Baker Scholar and awarded the Dubilier Prize for Entrepreneurship. He is a member of the Illinois Bar, and earned his J.D. from the University of Chicago and B.A. in English Literature and Computer Science from Trinity College. He's also the co-creator of Project Honey Pot, the largest community of webmasters tracking online fraud and abuse.Links Referenced: Cloudflare: https://www.cloudflare.com/ Twitter: https://twitter.com/eastdakota TranscriptAnnouncer: Hello, and welcome to Screaming in the Cloud with your host, Chief Cloud Economist at The Duckbill Group, Corey Quinn. This weekly show features conversations with people doing interesting work in the world of cloud, thoughtful commentary on the state of the technical world, and ridiculous titles for which Corey refuses to apologize. This is Screaming in the Cloud.Corey: Welcome to Screaming in the Cloud. I'm Corey Quinn. One of the things we talk about here, an awful lot is cloud providers. There sure are a lot of them, and there's the usual suspects that you would tend to expect with to come up, and there are companies that work within their ecosystem. And then there are the enigmas.Today, I'm talking to returning guest Matthew Prince, Cloudflare CEO and co-founder, who… well first, welcome back, Matthew. I appreciate your taking the time to come and suffer the slings and arrows a second time.Matthew: Corey, thanks for having me.Corey: What I'm trying to do at the moment is figure out where Cloudflare lives in the context of the broad ecosystem because you folks have released an awful lot. You had this vaporware-style announcement of R2, which was an S3 competitor, that then turned out to be real. And oh, it's always interesting, when vapor congeals into something that actually exists. Cloudflare Workers have been around for a while and I find that they become more capable every time I turn around. You have Cloudflare Tunnel which, to my understanding, is effectively a VPN without the VPN overhead. And it feels that you are coming at building a cloud provider almost from the other side than the traditional cloud provider path. Is it accurate? Am I missing something obvious? How do you see yourselves?Matthew: Hey, you know, I think that, you know, you can often tell a lot about a company by what they measure and what they measure themselves by. And so, if you're at a traditional, you know, hyperscale public cloud, an AWS or a Microsoft Azure or a Google Cloud, the key KPI that they focus on is how much of a customer's data are they hoarding, effectively? They're all hoarding clouds, fundamentally. Whereas at Cloudflare, we focus on something of it's very different, which is, how effectively are we moving a customer's data from one place to another? And so, while the traditional hyperscale public clouds are all focused on keeping your data and making sure that they have as much of it, what we're really focused on is how do we make sure your data is wherever you need it to be and how do we connect all of the various things together?So, I think it's exactly right, where we start with a network and are kind of building more functions on top of that network, whereas other companies start really with a database—the traditional hyperscale public clouds—and the network is sort of an afterthought on top of it, just you know, a cost center on what they're delivering. And I think that describes a lot of the difference between us and everyone else. And so oftentimes, we work very much in conjunction with. A lot of our customers use hyperscale public clouds and Cloudflare, but increasingly, there are certain applications, there's certain data that just makes sense to live inside the network itself, and in those cases, customers are using things like R2, they're using our Workers platform in order to be able to build applications that will be available everywhere around the world and incredibly performant. And I think that is fundamentally the difference. We're all about moving data between places, making sure it's available everywhere, whereas the traditional hyperscale public clouds are all about hoarding that data in one place.Corey: I want to clarify that when you say hoard, I think of this, from my position as a cloud economist, as effectively in an economic story where hoarding the data, they get to charge you for hosting it, they get to charge you serious prices for egress. I've had people mishear that before in a variety of ways, usually distilled down to, “Oh, and their data mining all of their customers' data.” And I want to make sure that that's not the direction that you intend the term to be used. If it is, then great, we can talk about that, too. I just want to make sure that I don't get letters because God forbid we get letters for things that we say in the public.Matthew: No, I mean, I had an aunt who was a hoarder and she collected every piece of everything and stored it somewhere in her tiny little apartment in the panhandle of Florida. I don't think she looked at any of it and for the most part, I don't think that AWS or Google or Microsoft are really using your data in any way that's nefarious, but they're definitely not going to make it easy for you to get it out of those places; they're going to make it very, very expensive. And again, what they're measuring is how much of a customer's data are they holding onto whereas at Cloudflare we're measuring how much can we enable you to move your data around and connected wherever you need it. And again, I think that that kind of gets to the fundamental difference between how we think of the world and how I think the hyperscale public clouds thing of the world. And it also gets to where are the places where it makes sense to use Cloudflare, and where are the places that it makes sense to use an AWS or Google Cloud or Microsoft Azure.Corey: So, I have to ask, and this gets into the origin story trope a bit, but what radicalized you? For me, it was the realization one day that I could download two terabytes of data from S3 once, and it would cost significantly more than having Amazon.com ship me a two-terabyte hard drive from their store.Matthew: I think that—so Cloudflare started with the basic idea that the internet's not as good as it should be. If we all knew what the internet was going to be used for and what we're all going to depend on it for, we would have made very different decisions in how it was designed. And we would have made sure that security was built in from day one, we would have—you know, the internet is very reliable and available, but there are now airplanes that can't land if the internet goes offline, they are shopping transactions shut down if the internet goes offline. And so, I don't think we understood—we made it available to some extent, but not nearly to the level that we all now depend on it. And it wasn't as fast or as efficient as it possibly could be. It's still very dependent on the geography of where data is located.And so, Cloudflare started out by saying, “Can we fix that? Can we go back and effectively patch the internet and make it what it should have been when we set down the original protocols in the '60s, '70s, and '80s?” But can we go back and say, can we build a new, sort of, overlay on the internet that solves those problems: make it more secure, make it more reliable, make it faster and more efficient? And so, I think that that's where we started, and as a result of, again, starting from that place, it just made fundamental sense that our job was, how do you move data from one place to another and do it in all of those ways? And so, where I think that, again, the hyperscale public clouds measure themselves by how much of a customer's data are they hoarding; we measure ourselves by how easy are we making it to securely, reliably, and efficiently move any piece of data from one place to another.And so, I guess, that is radical compared to some of the business models of the traditional cloud providers, but it just seems like what the internet should be. And that's our North Star and that's what just continues to drive us and I think is a big reason why more and more customers continue to rely on Cloudflare.Corey: The thing that irks me potentially the most in the entire broad strokes of cloud is how the actions of the existing hyperscalers have reflected mostly what's going on in the larger world. Moore's law has been going on for something like 100 years now. And compute continues to get faster all the time. Storage continues to cost less year over year in a variety of ways. But they have, on some level, tricked an entire generation of businesses into believing that network bandwidth is this precious, very finite thing, and of course, it's going to be ridiculously expensive. You know, unless you're taking it inbound, in which case, oh, by all means back the truck around. It'll be great.So, I've talked to founders—or prospective founders—who had ideas but were firmly convinced that there was no economical way to build it. Because oh, if I were to start doing real-time video stuff, well, great, let's do the numbers on this. And hey, that'll be $50,000 a minute, if I read the pricing page correctly, it's like, well, you could get some discounts if you ask nicely, but it doesn't occur to them that they could wind up asking for a 98% discount on these things. Everything is measured in a per gigabyte dimension and that just becomes one of those things where people are starting to think about and meter something that—from my days in data centers where you care about the size of the pipe and not what's passing through it—to be the wrong way of thinking about things.Matthew: A little of this is that everybody is colored by their experience of dealing with their ISP at home. And in the United States, in a lot of the world, ISPs are built on the old cable infrastructure. And if you think about the cable infrastructure, when it was originally laid down, it was all one-directional. So, you know, if you were turning on cable in your house in a pre-internet world, data fl—Corey: Oh, you'd watch a show and your feedback was yelling at the TV, and that's okay. They would drop those packets.Matthew: And there was a tiny, tiny, tiny bit of data that would go back the other direction, but cable was one-directional. And so, it actually took an enormous amount of engineering to make cable bi-directional. And that's the reason why if you're using a traditional cable company as your ISP, typically you will have a large amount of download capacity, you'll have, you know, a 100 megabits of down capacity, but you might only have a 10th of that—so maybe ten megabits—of upload capacity. That is an artifact of the cable system. That is not just the natural way that the internet works.And the way that it is different, that wholesale bandwidth works, is that when you sign up for wholesale bandwidth—again, as you phrase it, you're not buying this many bytes that flows over the line; you're buying, effectively, a pipe. You know, the late Senator Ted Stevens said that the internet is just a series of tubes and got mocked mercilessly, but the internet is just a series of tubes. And when Cloudflare or AWS or Google or Microsoft buys one of those tubes, what they pay for is the diameter of the tube, the amount that can fit through it. And the nature of this is you don't just get one tube, you get two. One that is down and one that is up. And they're the same size.And so, if you've got a terabit of traffic coming down and zero going up, that costs exactly the same as a terabit going up and zero going down, which costs exactly the same as a terabit going down and a terabit going up. It is different than your home, you know, cable internet connection. And that's the thing that I think a lot of people don't understand. And so, as you pointed out, but the great tragedy of the cloud is that for nothing other than business reasons, these hyperscale public cloud companies don't charge you anything to accept data—even though that is actually the more expensive of the two operations for that because writes are more expensive than reads—but the inherent fact that they were able to suck the data in means that they have the capacity, at no additional cost, to be able to send that data back out. And so, I think that, you know, the good news is that you're starting to see some providers—so Cloudflare, we've never charged for egress because, again, we think that over time, bandwidth prices go to zero because it just makes sense; it makes sense for ISPs, it makes sense for connectiv—to be connected to us.And that's something that we can do, but even in the cases of the cloud providers where maybe they're all in one place and somebody has to pay to backhaul the traffic around the world, maybe there's some cost, but you're starting to see some pressure from some of the more forward-leaning providers. So Oracle, I think has done a good job of leaning in and showing how egress fees are just out of control. But it's crazy that in some cases, you have a 4,000x markup on AWS bandwidth fees. And that's assuming that they're paying the same rates as what we would get at Cloudflare, you know, even though we are a much smaller company than they are, and they should be able to get even better prices.Corey: Yes, if there's one thing Amazon is known for, it as being bad at negotiating. Yeah, sure it is. I'm sure that they're just a terrific joy to be a vendor to.Matthew: Yeah, and I think that fundamentally what the price of bandwidth is, is tied very closely to what the cost of a port on a router costs. And what we've seen over the course of the last ten years is that cost has just gone enormously down where the capacity of that port has gone way up and the just physical cost, the depreciated cost that port has gone down. And yet, when you look at Amazon, you just haven't seen a decrease in the cost of bandwidth that they're passing on to customers. And so, again, I think that this is one of the places where you're starting to see regulators pay attention, we've seen efforts in the EU to say whatever you charge to take data out is the same as what you should charge it to put data in. We're seeing the FTC start to look at this, and we're seeing customers that are saying that this is a purely anti-competitive action.And, you know, I think what would be the best and healthiest thing for the cloud by far is if we made it easy to move between various cloud providers. Because right now the choice is, do I use AWS or Google or Microsoft, whereas what I think any company out there really wants to be able to do is they want to be able to say, “I want to use this feature at AWS because they're really good at that and I want to use this other feature at Google because they're really good at that, and I want to us this other feature at Microsoft, and I want to mix and match between those various things.” And I think that if you actually got cloud providers to start competing on features as opposed to competing on their overall platform, we'd actually have a much richer and more robust cloud environment, where you'd see a significantly improved amount of what's going on, as opposed to what we have now, which is AWS being mediocre at everything.Corey: I think that there's also a story where for me, the egress is annoying, but so is the cross-region and so is the cross-AZ, which in many cases costs exactly the same. And that frustrates me from the perspective of, yes, if you have two data centers ten miles apart, there is some startup costs to you in running fiber between them, however you want to wind up with that working, but it's a sunk cost. But at the end of that, though, when you wind up continuing to charge on a per gigabyte basis to customers on that, you're making them decide on a very explicit trade-off of, do I care more about cost or do I care more about reliability? And it's always going to be an investment decision between those two things, but when you make the reasonable approach of well, okay, an availability zone rarely goes down, and then it does, you get castigated by everyone for, “Oh it even says in their best practice documents to go ahead and build it this way.” It's funny how a lot of the best practice documents wind up suggesting things that accrue primarily to a cloud provider's benefit. But that's the way of the world I suppose.I just know, there's a lot of customer frustration on it and in my client environments, it doesn't seem to be very acute until we tear apart a bill and look at where they're spending money, and on what, at which point, the dawning realization, you can watch it happen, where they suddenly realize exactly where their money is going—because it's relatively impenetrable without that—and then they get angry. And I feel like if people don't know what they're being charged for, on some level, you've messed up.Matthew: Yeah. So, there's cost to running a network, but there's no reason other than limiting competition why you would charge more to take data out than you would put data in. And that's a puzzle. The cross-region thing, you know, I think where we're seeing a lot of that is actually oftentimes, when you've got new technologies that come out and they need to take advantage of some scarce resource. And so, AI—and all the AI companies are a classic example of this—right now, if you're trying to build a model, an AI model, you are hunting the world for available GPUs at a reasonable price because there's an enormous scarcity of them.And so, you need to move from AWS East to AWS West, to AWS, you know, Singapore, to AWS in Luxembourg and bounce around to find wherever there's GPU availability. And then that is crossed against the fact that these training datasets are huge. You know, I mean, they're just massive, massive, massive amounts of data. And so, what that is doing is you're having these AI companies that are really seeing this get hit in the face, where they literally can't get the capacity they need because of the fact that whatever cloud provider in whatever region they've selected to store their data isn't able to have that capacity. And so, they're getting hit not only by sort of a double whammy of, “I need to move my data to wherever there's capacity. And if I don't do that, then I have to pay some premium, an ever-escalating price for the underlying GPUs.” And God forbid, you have to move from AWS to Google to chase that.And so, we're seeing a lot of companies that are saying, “This doesn't make any sense. We have this enormous training set. If we just put it with Cloudflare, this is data that makes sense to live in the network, fundamentally.” And not everything does. Like, we're not the right place to store your long-term transaction logs that you're only going to look at if you get sued. There are much better places, much more effective places do it.But in those cases where you've got to read data frequently, you've got to read it from different places around the world, and you will need to decrease what those costs of each one of those reads are, what we're seeing is just an enormous amount of demand for that. And I think these AI startups are really just a very clear example of what company after company after company needs, and why R2 has had—which is our zero egress cost S3 competitor—why that is just seeing such explosive growth from a broad set of customers.Corey: Because I enjoy pushing the bounds of how ridiculous I can be on the internet, I wound up grabbing a copy of the model, the Llama 2 model that Meta just released earlier this week as we're recording this. And it was great. It took a little while to download here. I have gigabit internet, so okay, it took some time. But then I wound up with something like 330 gigs of models. Great, awesome.Except for the fact that I do the math on that and just for me as one person to download that, had they been paying the listed price on the AWS website, they would have spent a bit over $30, just for me as one random user to download the model, once. If you can express that into the idea of this is a model that is absolutely perfect for whatever use case, but we want to have it run with some great GPUs available at another cloud provider. Let's move the model over there, ignoring the data it's operating on as well, it becomes completely untenable. It really strikes me as an anti-competitiveness issue.Matthew: Yeah. I think that's it. That's right. And that's just the model. To build that model, you would have literally millions of times more data that was feeding it. And so, the training sets for that model would be many, many, many, many, many, many orders of magnitude larger in terms of what's there. And so, I think the AI space is really illustrating where you have this scarce resource that you need to chase around the world, you have these enormous datasets, it's illustrating how these egress fees are actually holding back the ability for innovation to happen.And again, they are absolutely—there is no valid reason why you would charge more for egress than you do for ingress other than limiting competition. And I think the good news, again, is that's something that's gotten regulators' attention, that's something that's gotten customers' attention, and over time, I think we all benefit. And I think actually, AWS and Google and Microsoft actually become better if we start to have more competition on a feature-by-feature basis as opposed to on an overall platform. The choice shouldn't be, “I use AWS.” And any big company, like, nobody is all-in only on one cloud provider. Everyone is multi-cloud, whether they want to be or not because people end up buying another company or some skunkworks team goes off and uses some other function.So, you are across multiple different clouds, whether you want to be or not. But the ideal, and when I talk to customers, they want is, they want to say, “Well, you know that stuff that they're doing over at Microsoft with AI, that sounds really interesting. I want to use that, but I really like the maturity and robustness of some of the EC2 API, so I want to use that at AWS. And Google is still, you know, the best in the world at doing search and indexing and everything, so I want to use that as well, in order to build my application.” And the applications of the future will inherently stitch together different features from different cloud providers, different startups.And at Cloudflare, what we see is our, sort of, purpose for being is how do we make that stitching as easy as possible, as cost-effective as possible, and make it just make sense so that you have one consistent security layer? And again, we're not about hording the data; we're about connecting all of those things together. And again, you know, from the last time we talked to now, I'm actually much more optimistic that you're going to see, kind of, this revolution where egress prices go down, you get competition on feature-by-features, and that's just going to make every cloud provider better over the long-term.Corey: This episode is sponsored in part by Panoptica.  Panoptica simplifies container deployment, monitoring, and security, protecting the entire application stack from build to runtime. Scalable across clusters and multi-cloud environments, Panoptica secures containers, serverless APIs, and Kubernetes with a unified view, reducing operational complexity and promoting collaboration by integrating with commonly used developer, SRE, and SecOps tools. Panoptica ensures compliance with regulatory mandates and CIS benchmarks for best practice conformity. Privacy teams can monitor API traffic and identify sensitive data, while identifying open-source components vulnerable to attacks that require patching. Proactively addressing security issues with Panoptica allows businesses to focus on mitigating critical risks and protecting their interests. Learn more about Panoptica today at panoptica.app.Corey: I don't know that I would trust you folks to the long-term storage of critical data or the store of record on that. You don't have the track record on that as a company the way that you do for being the network interchange that makes everything just work together. There are areas where I'm thrilled to explore and see how it works, but it takes time, at least from the sensible infrastructure perspective of trusting people with track records on these things. And you clearly have the network track record on these things to make this stick. It almost—it seems unfair to you folks, but I view you as Cloudflare is a CDN, that also dabbles in a few other things here in there, though, increasingly, it seems it's CDN and security company are becoming synonymous.Matthew: It's interesting. I remember—and this really is going back to the origin story, but when we were starting Cloudflare, you know, what we saw was that, you know, we watched as software—starting with companies like Salesforce—transition from something that you bought in the box to something that you bought as a service [into 00:23:25] the cloud. We watched as, sort of, storage and compute transition from something that you bought from Dell or HP to something that you rented as a service. And so the fundamental problem that Cloudflare started out with was if the software and the storage and compute are going to move, inherently the security and the networking is going to move as well because it has to be as a service as well, there's no way you can buy a you know, Cisco firewall and stick it in front of your cloud service. You have to be in the cloud as well.So, we actually started very much as a security company. And the objection that everybody had to us as we would sort of go out and describe what we were planning on doing was, “You know, that sounds great, but you're going to slow everything down.” And so, we became just obsessed with latency. And Michelle, my co-founder, and I were business students and we had an advisor, a guy named Tom [Eisenmann 00:24:26] in business school. And I remember going in and that was his objection as well and so we did all this work to figure it out.And obviously, you know, I'd say computer science, and anytime that you have a problem around latency or speed caching is an obvious part of the solution to that. And so, we went in and we said, “Here's how we're going to do it: [unintelligible 00:24:47] all this protocol optimization stuff, and here's how we're going to distribute it around the world and get close to where users are. And we're going to use caching in the places where we can do caching.” And Tom said, “Oh, you're building a CDN.” And I remember looking at him and then I'm looking at Michelle. And Michelle is Canadian, and so I was like, “I don't know that I'm building a Canadian, but I guess. I don't know.”And then, you know, we walked out in the hall and Michelle looked at me and she's like, “We have to go figure out what the CDN thing is.” And we had no idea what a CDN was. And even when we learned about it, we were like, that business doesn't make any sense. Like because again, the CDNs were the first ones to really charge for bandwidth. And so today, we have effectively built, you know, a giant CDN and are the fastest in the world and do all those things.But we've always given it away basically for free because fundamentally, what we're trying to do is all that other stuff. And so, we actually started with security. Security is—you know, my—I've been working in security now for over 25 years and that's where my background comes from, and if you go back and look at what the original plan was, it was how do we provide that security as a service? And yeah, you need to have caching because caching makes sense. What I think is the difference is that in order to do that, in order to be able to build that, we had to build a set of developer tools for our own team to allow them to build things as quickly as possible.And, you know, if you look at Cloudflare, I think one of the things we're known for is just the rapid, rapid, rapid pace of innovation. And so, over time, customers would ask us, “How do you innovate so fast? How do you build things fast?” And part of the answer to that, there are lots of ways that we've been able to do that, but part of the answer to that is we built a developer platform for our own team, which was just incredibly flexible, allowed you to scale to almost any level, took care of a lot of that traditional SRE functions just behind the scenes without you having to think about it, and it allowed our team to be really fast. And our customers are like, “Wow, I want that too.”And so, customer after customer after customer after customer was asking and saying, you know, “We have those same problems. You know, if we're a big e-commerce player, we need to be able to build something that can scale up incredibly quickly, and we don't have to think about spinning up VMs or containers or whatever, we don't have to think about that. You know, our customers are around the world. We don't want to have to pick a region for where we're going to deploy code.” And so, where we built Cloudflare Workers for ourself first, customers really pushed us to make it available to them as well.And that's the way that almost any good developer platform starts out. That's how AWS started. That's how, you know, the Microsoft developer platform, and so the Apple developer platform, the Salesforce developer platform, they all start out as internal tools, and then someone says, “Can you expose this to us as well?” And that's where, you know, I think that we have built this. And again, it's very opinionated, it is right for certain applications, it's never going to be the right place to run SAP HANA, but the company that builds the tool [crosstalk 00:27:58]—Corey: I'm not convinced there is a right place to run SAP HANA, but that's probably unfair of me.Matthew: Yeah, but there is a startup out there, I guarantee you, that's building whatever the replacement for SAP HANA is. And I think it's a better than even bet that Cloudflare Workers is part of their stack because it solves a lot of those fundamental challenges. And that's been great because it is now allowing customer after customer after customer, big and large startups and multinationals, to do things that you just can't do with traditional legacy hyperscale public cloud. And so, I think we're sort of the next generation of building that. And again, I don't think we set out to build a developer platform for third parties, but we needed to build it for ourselves and that's how we built such an effective tool that now so many companies are relying on.Corey: As a Cloudflare customer myself, I think that one of the things that makes you folks standalone—it's why I included security as well as CDN is one of the things I trust you folks with—has been—Matthew: I still think CDN is Canadian. You will never see us use that term. It's like, Gartner was like, “You have to submit something for the CDN-like ser—” and we ended up, like, being absolute top-right in it. But it's a space that is inherently going to zero because again, if bandwidth is free, I'm not sure what—this is what the internet—how the internet should work. So yeah, anyway.Corey: I agree wholeheartedly. But what I've always enjoyed, and this is probably going to make me sound meaner than I intend it to, it has been your outages. Because when computers inherently at some point break, which is what they do, you personally and you as a company have both taken a tone that I don't want to say gleeful, but it's sort of the next closest thing to it regarding the postmortem that winds up getting published, the explanation of what caused it, the transparency is unheard of at companies that are your scale, where usually they want to talk about these things as little as possible. Whereas you've turned these into things that are educational to those of us who don't have the same scale to worry about but can take things from that are helpful. And that transparency just counts for so much when we're talking about things as critical as security.Matthew: I would definitely not describe it as gleeful. It is incredibly painful. And we, you know, we know we let customers down anytime we have an issue. But we tend not to make the same mistake twice. And the only way that we really can reliably do that is by being just as transparent as possible about exactly what happened.And we hope that others can learn from the mistakes that we made. And so, we own the mistakes we made and we talk about them and we're transparent, both internally but also externally when there's a problem. And it's really amazing to just see how much, you know, we've improved over time. So, it's actually interesting that, you know, if you look across—and we measure, we test and measure all the big hyperscale public clouds, what their availability and reliability is and measure ourselves against it, and across the board, second half of 2021 and into the first half of 2022 was the worst for every cloud provider in terms of reliability. And the question is why?And the answer is, Covid. I mean, the answer to most things over the last three years is in one way, directly or indirectly, Covid. But what happened over that period of time was that in April of 2020, internet traffic and traffic to our service and everyone who's like us doubled over the course of a two-week period. And there are not many utilities that you can imagine that if their usage doubles, that you wouldn't have a problem. Imagine the sewer system all of a sudden has twice as much sewage, or the electrical grid as twice as much demand, or the freeways have twice as many cars. Like, things break down.And especially the European internet came incredibly close to just completely failing at that time. And we all saw where our bottlenecks were. And what's interesting is actually the availability wasn't so bad in 2020 because people were—they understood the absolute critical importance that while we're in the middle of a pandemic, we had to make sure the internet worked. And so, we—there were a lot of sleepless nights, there's a—and not just at with us, but with every provider that's out there. We were all doing Herculean tasks in order to make sure that things came online.By the time we got to the sort of the second half of 2021, what everybody did, Cloudflare included, was we looked at it, and we said, “Okay, here were where the bottlenecks were. Here were the problems. What can we do to rearchitect our systems to do that?” And one of the things that we saw was that we effectively treated large data centers as one big block, and if you had certain pieces of equipment that failed in a way, that you would take that entire data center down and then that could have cascading effects across traffic as it shifted around across our network. And so, we did the work to say, “Let's take that one big data center and divide it effectively into multiple independent units, where you make sure that they're all on different power suppliers, you make sure they're all in different [crosstalk 00:32:52]”—Corey: [crosstalk 00:32:51] harder than it sounds. When you have redundant things, very often, the thing that takes you down the most is the heartbeat that determines whether something next to it is up or not. It gets a false reading and suddenly, they're basically trying to clobber each other to death. So, this is a lot harder than it sounds like.Matthew: Yeah, and it was—but what's interesting is, like, we took it all that into account, but the act of fixing things, you break things. And that was not just true at Cloudflare. If you look across Google and Microsoft and Amazon, everybody, their worst availability was second half of 2021 or into 2022. But it both internally and externally, we talked about the mistakes we made, we talked about the challenges we had, we talked about—and today, we're significantly more resilient and more reliable because of that. And so, transparency is built into Cloudflare from the beginning.The earliest story of this, I remember, there was a 15-year-old kid living in Long Beach, California who bought my social security number off of a Russian website that had hacked a bank that I'd once used to get a mortgage. He then use that to redirect my cell phone voicemail to a voicemail box he controlled. He then used that to get into my personal email. He then used that to find a zero-day vulnerability in Google's corporate email where he could privilege-escalate from my personal email into Google's corporate email, which is the provider that we use for our email service. And then he used that as an administrator on our email at the time—this is back in the early days of Cloudflare—to get into another administration account that he then used to redirect one of Cloud Source customers to a website that he controlled.And thankfully, it wasn't, you know, the FBI or the Central Bank of Brazil, which were all Cloudflare customers. Instead, it was 4chan because he was a 15-year-old hacker kid. And we fix it pretty quickly and nobody knew who Cloudflare was at the time. And so potential—Corey: The potential damage that could have been caused at that point with that level of access to things, like, that is such a ridiculous way to use it.Matthew: And—yeah [laugh]—my temptation—because it was embarrassing. He took a bunch of stuff from my personal email and he put it up on a website, which just to add insult to injury, was actually using Cloudflare as well. And I wanted to sweep it under the rug. And our team was like, “That's not the right thing to do. We're fundamentally a security company and we need to talk about when we make mistakes on security.” And so, we wrote a huge postmortem on, “Here's all the stupid things that we did that caused this hack to happen.” And by the way, it wasn't just us. It was AT&T, it was Google. I mean, there are a lot of people that ended up being involved.Corey: It builds trust with that stuff. It's painful in the short term, but I believe with the benefit of hindsight, it was clearly the right call.Matthew: And it was—and I remember, you know, pushing ‘publish' on the blog post and thinking, “This is going to be the end of the company.” And quite the opposite happened, which was all of a sudden, we saw just an incredible amount of people who signed up the next day saying, “If you're going to be that transparent about something that was incredibly embarrassing when you didn't have to be, then that's the sort of thing that actually makes me trust that you're going to be transparent the future.” And I think learning that lesson early on, has been just an incredibly valuable lesson for us and made us the company that we are today.Corey: A question that I have for you about the idea of there being no reason to charge in one direction but not the other. There's something that I'm not sure that I understand on this. If I run a website, to use your numbers of a terabit out—because it's a web server—and effectively nothing in—because it's a webserver; other than the request, nothing really is going to come in—that ingress bandwidth becomes effectively unused and also free. So, if I have another use case where I'm paying for it anyway, if I'm primarily caring about an outward direction, sure, you can send things in for free. Now, there's a lot of nuance that goes into that. But I'm curious as to what the—is their fundamental misunderstanding in that analysis of the bandwidth market?Matthew: No. And I think that's exactly, exactly right. And it's actually interesting. At Cloudflare, our infrastructure team—which is the one that manages our connections to the outside world, manages the hardware we have—meets on a quarterly basis with our product team. It's called the Hot and Cold Meeting.And what they do is they go over our infrastructure, and they say, “Okay, where are we hot? Where do we have not enough capacity?” If you think of any given server, an easy way to think of a server is that it has, sort of, four resources that are available to it. This is, kind of, vast simplification, but one is the connectivity to the outside world, both transit in and out. The second is the—Corey: Otherwise it's just a complicated space heater.Matthew: Yeah [laugh]. The other is the CPU. The other is the longer-term storage. We use only SSDs, but sort of, you know, hard drives or SSD storage. And then the fourth is the short-term storage, or RAM that's in that server.And so, at any given moment, there are going to be places where we are running hot, where we have a sort of capacity level that we're targeting and we're over that capacity level, but we're also going to be running cold in some of those areas. And so, the infrastructure team and the product team get together and the product team has requests on, you know, “Here's some more places we would be great to have more infrastructure.” And we're really good at deploying that when we need to, but the infrastructure team then also says, “Here are the places where we're cold, where we have excess capacity.” And that turns into products at Cloudflare. So, for instance, you know, the reason that we got into the zero-trust space was very much because we had all this excess capacity.We have 100 times the capacity of something like Zscaler across our network, and we can add that—that is primar—where most of our older products are all about outward traffic, the zero-trust products are all about inward traffic. And the reason that we can do everything that Zscaler does, but for, you know, a much, much, much more affordable prices, we going to basically just layer that on the network that already exists. The reason we don't charge for the bandwidth behind DDoS attacks is DDoS attacks are always about inbound traffic and we have just a ton of excess capacity around that inbound traffic. And so, that unused capacity is a resource that we can then turn into products, and very much that conversation between our product team and our infrastructure team drives how we think about building new products. And we're always trying to say how can we get as much utilization out of every single piece of equipment that we run everywhere in the world.The way we build our network, we don't have custom machines or different networks for every products. We build all of our machines—they come in generations. So, we're on, I think, generation 14 of servers where we spec a server and it has, again, a certain amount of each of those four [bits 00:39:22] of capacity. But we can then deploy that server all around the world, and we're buying many, many, many of them at any given time so we can get the best cost on that. But our product team is very much in constant communication with our infrastructure team and saying, “What more can we do with the capacity that we have?” And then we pass that on to our customers by adding additional features that work across our network and then doing it in a way that's incredibly cost-effective.Corey: I really want to thank you for taking the time to, basically once again, suffer slings and arrows about networking, security, cloud, economics, and so much more. If people want to learn more, where's the best place for them to find you?Matthew: You know, used to be an easy question to answer because it was just, you know, go on Twitter and find me but now we have all these new mediums. So, I'm @eastdakota on Twitter. I'm eastdakota.com on Bluesky. I'm @real_eastdakota on Threads. And so, you know, one way or another, if you search for eastdakota, you'll come across me somewhere out there in the ether.Corey: And we will, of course, put links to that in the show notes. Thank you so much for your time. I appreciate it.Matthew: It's great to talk to you, Corey.Corey: Matthew Prince, CEO and co-founder of Cloudflare. I'm Cloud Economist Corey Quinn and this is Screaming in the Cloud. If you've enjoyed this podcast, please leave a five-star review on your podcast platform of choice, whereas if you've hated this podcast, please leave a five-star review on your podcast platform of choice along with an angry, insulting comment that I will of course not charge you inbound data rates on.Corey: If your AWS bill keeps rising and your blood pressure is doing the same, then you need The Duckbill Group. We help companies fix their AWS bill by making it smaller and less horrifying. The Duckbill Group works for you, not AWS. We tailor recommendations to your business and we get to the point. Visit duckbillgroup.com to get started.

In Episode 8 guest Steven File of Strategic Home Defense sheds light on the need to protect one's home with a plan, which he says is an act of greater freedom and security.   Steven brings 19 years combined experience in law enforcement and as an infantry squad leader with the National Guard to his business helping homeowners feel safer. “Rather than rely on some government agency to protect my family, that's my responsibility. And if I'm not prepared to do that in a justified way, and in an effective way, am I really taking care of my family?” he asks. With increased food shortages and other supply chain issues expected–and crime rates escalating and less police and resources available to respond–it's becoming even more important to protect one's home base and become more self-sufficient, he and co-hosts Jim Gale and Matthew Britt share. Topics covered in this interview:Getting prepared with a strategic plan to build home defense security: The mindset of having everything covered. Does everybody in the family know their role? Do you have food, water, and back up power?  Emergency planning by building relationships with like-minded people, who can help share resources and have different skill sets. Matthew:  “It's going to be a strength in numbers, survival-of-the-fittest moment…to work in collaboration if the system collapses (and all signs point to a collapse of some sort).” –Key components of a plan, from layers to review such as locations on a premise in which to build more security, to practice sessions for tactical preparation. Building privacy with trees and shrubs is important for “the less people see, the less people know.” –Ways to strengthen security both in the suburbs as well as for city dwellers are discussed. –Security tips for physical safety such as: Do not share photos on social media while on vacation so you don't alert anyone that you are away.  (Post vacation photos AFTER you return home if you want to share.)  Dogs are scarier than alarms to a potential intruder (and it's rare a house with a dog will get broken into, Steven claims). –The Great Awakening and seeing people becoming more empowered and self-sustaining. –Which “hard” does one choose?  On self-sufficiency: Matthew Britt: “It's hard to be rich and it's hard to be poor.  LIfe isn't easy.  It's simple, though. And if you do simple things repeatedly it will produce a predictable result….and being able to take care of yourself is when you get a new level of confidence ….getting into the strength position that I have everything I need right here.  If you can yourself set up where you have your food, you have your water, you have your family protected, you're standing on a strong foundation that can put you in a position to care for others.” –With home defense security, the goal is to empower people to successfully provide for and protect their homes, their families and their livelihood. Jim Gale:  “Defend your property before anything starts…that's the best way to defend it, where nobody wants to mess with you in the first place.”  About Steven File Co-founder of Strategic Home Defense Steven has worked in Law Enforcement for seven years and has 12 years of military experience. He has worked as a Tactical Operations Officer and an Intelligence Detective. He earned his Bachelor's Degree in Criminal Justice in 2017. He co-founded Strategic Home Defense with his wife, Kelsey, who also has seven years experience in law enforcement.  Additionally, Kelsey is a nationally certified canine handler through the North American Police Work Dog Association. Strategic Home Defense: https://www.strategichomedefense.com Food Forest Abundance: Website: https://foodforestabundance.com Facebook: https://www.facebook.com/FoodForestAbundance Instagram: https://www.instagram.com/foodforestabundance/ Twitter: https://twitter.com/FFAbundance LinkedIn: https://www.linkedin.com/company/food-forest-abundance/ The Jim Gale Show Podcast: https://linktr.ee/jimgaleshow Produced by: https://socialchameleon.us

Description:  ArtBeat Radio sits down with filmmakers from Art Center—Tran, Cristina, Brian, and Matthew—as they describe the process of creating their first animated film, Dingo's Adventure. The artists go over their trials, tribulations, as well as tips and tricks on how to create a film from scratch, as well as how to be a voice actor.  Dialogue of the interview: Hello everybody! Welcome to Artbeat Radio. We have a special episode for you today—for some of us students and staff from Art Center—we are coming together to show you what we did last semester from 2021 to 2022—working on a film for our animation class called Dingo's Adventure.So, I'd like to introduce some of the filmmakers, as well as our host for this podcast episode. Let's start with Cristina: “I'm Cristina”. I'd also like to introduce Matthew: “I'm Matthew Compano!” Thank you, Matthew. I'd also like to introduce Brian: “Hi, I'm Brian”. Patty: And lastly, I'd like to introduce Daniela, who is our assistant program manager at Art Center. She will be asking the questions for this podcast episode, and acting as the host. So, hey Daniela, thanks for being here. And then lastly, I am Patty, I am the instructor for the animation class, and I will be helping us out with answering some of these questions. And I hope you enjoy this podcast episode—without further ado, here is Daniela to start off our questions.Daniela: Hi everyone! Alright, I have some questions for you all, so question one: What is Dingo's Adventure about? Cristina: “Dingo's Adventure is about a dog [who meets] two humans, they're friends—Huck, and Josh, with the motorcycle, [and gets] injured, and the Dingo helps [them] to safety.Yeah, so we'll start from the top here—you're doing a great job, Cristina. Dingo's Adventure follows Dingo Starr…Cristina: The wild dog meets two humans [and gets] injured [so] Dingo goes for help to  safety. Ok everyone—now who was the voice of each character? Matthew: “I played Josh!” You played Josh, okay, Cristina, which character did you play?Cristina: “Played Huck.” You played Huck. Alright, Brian, what about you?Brian: “I played the singing doctors” Very cool. And what about you, Tran? Which character did you play in the film?Tran: “Dingo Starr.” Dingo Starr—nice! You were the main character. Tran: “Yeah”Alright, next question: How long did it take you all to make this film? Cristina: “From January to May” Ok, from January to May? Cristina: “Yeah”How did y'all come up with the character Dingo Starr? Yeah, so Matthew…Matthew: “Inspired by dogs and The Beatles' Ringo Starr, and Shining Times Station!”Thanks Matthew. And can you describe what Shining Times Station is?Matthew: “It's a PBS Thomas and Friends T.V. series.” I think that sounds incredible.I have another follow-up question for you, Matthew. Who decided to have Dingo Starr talk in the film?Matthew: “Everyone!” It's a collaboration, right? Matthew: “Yup.” How did y'all also come up with the doctor chracters? Cristina: “We want The Beatles dressed as the doctors.” Oh, so you were inspired by The Beatles? Cristina: “Yes, inspired by The Beatles music.” (For the rest of the transcription please email dlucidi@ableartswork.org)

                  Isaiah - the Vision - Part Three:                           “Covenant with Death”                                     Isaiah 28:14-22  They had a choice to choose life or choose the death, to trust God or trust mere humans: Isaiah 2:22 Jesus made it clear: John 14:6 Scoffer or Mocker' is a strong indictment, since scoffing, in the OT is the very last degree of ungodliness: Psalm 1:1-2They rule faithlessly in the city of faith: Isaiah 1:21-23There agreement with Egypt will not exempt them from the wave of God's wrath: Isaiah 8:6-8  In his life and work all that the Bible teaches about the trustworthiness of God comes to fulfillment:  1 Peter 2:4-6 Their defender has become a gatherer of troops against them: Isaiah 5:26 Like the fools house in Matthew It would be swept away:  Mt. 7:26-27The first account was at Mount Perazim, where God broke out against the Philistines:  2 Samuel 5:19-20The second was in the Valley of Gibeon he sent a hail storm to demolish the Amorites: Joshua 10:11 God never belongs to anyone, he will side with those who want to serve him:  1 John 2:3-6 The sin from which there is no return is not merely refusing to listen to God, but making fun of the very means by which he addresses us: Heb 10:26-31 Support the show

In this week's show, Phil talks to Matthew Gaddy, a productivity and high-performance coach for engineers, helping them to operate at their best so that they can produce work that makes a difference. He is on a mission to increase productivity in a way that reduces stress and fosters a quality working environment. Matthew talks about the importance of visualizing our ideal outcomes and sticking to the roadmap that will take us there. He also discusses the value of time management and how planning can help.   KEY TAKEAWAYS:   TOP CAREER TIP Begin with the end in mind! We often get so caught up in the task itself that we lose sight of why we began in the first place.   WORST CAREER MOMENT When first applying productivity techniques to his work, Matthew found that he unfortunately burned himself out. This led to a greater understanding of the importance of taking time out.   CAREER HIGHLIGHT After making a huge leap in his career, Matthew recognized the value in ensuring we have sufficient reserves in case of setbacks. It also allowed him to make his next step much closer to his goals, which was also his most productive action.   THE FUTURE OF CAREERS IN I.T The way the world of work has changed has allowed for a greater sense of prioritization. Systems and processes are all moving towards being more adaptable and allowing people to do their best.   THE REVEAL What first attracted you to a career in I.T.? – What's the best career advice you received? – Start with the end in mind! What's the worst career advice you received? – The way to get more things done is to work harder and for longer. What would you do if you started your career now? – Matthew would look to gain more clarity about the goal of the company and look for further ways to make positive change. What are your current career objectives? Producing content focusing upon increasing performance and mastering time. What's your number one non-technical skill? – Communication. How do you keep your own career energized? – Revisiting goals and realigning with what's important. What do you do away from technology? – Running and fitness, as well as reading and spending time with family.   FINAL CAREER TIP Choose how you're going to spend your time in advance and plan wisely. Work hard but take breaks. Remember your time is a finite resource.   BEST MOMENTS (1:30) – Matthew - “What I do is help engineers to master their time and to create their best work” (4:27) – Matthew - “Think about “What do I want? What do I want my lifestyle to look like?” And build backwards from that point” (7:45) – Matthew – “Time wants to be told what to do. It doesn't like to be found” (19:35) – Matthew – “It's not about the emails. It's not about the customers. It's about growing the business and making sure you're communicating”   ABOUT THE HOST – PHIL BURGESS Phil Burgess is an independent IT consultant who has spent the last 20 years helping organizations to design, develop, and implement software solutions.  Phil has always had an interest in helping others to develop and advance their careers.  And in 2017 Phil started the I.T. Career Energizer podcast to try to help as many people as possible to learn from the career advice and experiences of those that have been, and still are, on that same career journey.   CONTACT THE HOST – PHIL BURGESS Phil can be contacted through the following Social Media platforms: Twitter: https://twitter.com/_PhilBurgess LinkedIn: https://uk.linkedin.com/in/philburgess Instagram: https://instagram.com/_philburgess Website: https://itcareerenergizer.com/contact Phil is also reachable by email at phil@itcareerenergizer.com and via the podcast's website, https://itcareerenergizer.com Join the I.T. Career Energizer Community on Facebook - https://www.facebook.com/groups/ITCareerEnergizer   ABOUT THE GUEST – MATTHEW GADDY Matthew Gaddy is a productivity and high-performance coach for engineers, helping them to operate at their best so that they can produce work that makes a difference. He is on a mission to increase productivity in a way that reduces stress and fosters a quality working environment.   CONTACT THE GUEST – MATTHEW GADDY Matthew Gaddy can be contacted through the following Social Media platforms: LinkedIn: https://www.linkedin.com/in/matthewgaddy/ Website: https://www.matthewgaddy.com/ Instagram: https://www.instagram.com/matthew.gaddy/

Matthew Hunt built and sold two agencies over the past decade. Automation Wolf is his third iteration. In his second agency, after losing almost two years of momentum because he never “got around” to marketing his own business, he hired another marketing agency to promote his agency. Although he was not completely satisfied with the result, he says, “80 percent done is better than not done at all” and his agency finally gained momentum and grew. In this interview, Matthew explains his understanding of what a lot of agencies don't understand – that clients are “not looking for a do-it-yourself model or a done-with-you model” and “not looking to coach-and-consult it.” He claims, “They're looking for done-for-you model.”  Matthew believes that most agencies should probably not be trying to do for themselves what they do for their clients. He has found that webinars, epic inbound-outbound marketing efforts, and labyrinthine Rube-Goldberg-machine sales funnels don't work. He proposes that the most important website component for agencies with under a million dollars in annual revenue is a “ten-minute amplifier video,” where the owner-founder (usually an agency's best salesperson) articulates the transformation the agency can provide for its clients. Skip the blogs. Skip the podcasts. The abbreviated VSL (video sales letter, which Matthew says needs to be “done right”), social proofs of success (before-and-after reports, analytics screenshots, and brief descriptions of how the agency effected change), a scrolling list of customer testimonials, and the price are all a smaller agency needs to drive business. The goal is to get as few leads as possible but to get pre-qualified, pre-sold leads and to close them all.  As it grows, the “filter” for an agency is not how much money it will take to scale, but how much time you can put into it. Matthew holds that low effort, high-impact demand generation is the most effective way to generate business. He recommends connecting with clients and potential clients on LinkedIn and posting helpful, short-form (snackable) content to build relationships and entice potential customers to the agency's VSL. Matthew says, “People only buy from people they know, like, and trust, and no selling can be done until you actually establish trust.” He then goes on to say that the biggest mistake many people make with inbound and outbound is they're always trying to sell too early.” Matthew discusses the challenges an agency faces in building an agency team and a “referral engine” and the strategies he has employed to move his agency quickly through the phases of startup . . . stay up . . . and scale up. He can be found as Matthew Hunt on LinkedIn or on his agency's website at: automationwolf.com. ROB: Welcome to The Marketing Agency Leadership Podcast. I'm your host Rob Kischuk and I am joined today by Matthew Hunt who is the founder at Automation Wolf based in Toronto Ontario, welcome to the podcast, Matthew. MATTHEW: Thanks, Rob. Thanks for having me. ROB: It's excellent to have you here. Why don't you start off by giving us the rundown on Automation Wolf? What is your sweet spot? MATTHEW: Automation was created because it was one of my own problems. I wish I had had this service when I built my first two agencies. Most agencies, at the end of the day, suffer from what we call the cobbler's kid goes with no shoes syndrome – where they're so busy taking care of their team and their existing clients that they never get around to doing their own marketing. I remember my second agency, so this is my third agency. I've had two that I sold in the last ten years and built – this is the third one. But my second one, I remember losing almost two years of momentum because I kept thinking we were going to get around to doing our own marketing. Finally, after two years, I finally bit the bullet. I hired another agency to do marketing for our marketing agency. It wasn't done perfectly, but I'll tell you something – 80 percent of done is better than not done at all. So even though I didn't think it was perfect and it wasn't exactly what I wanted, it provided so much momentum. That's when we really started to grow, so sometimes you just got to do it. ROB: What was the lag time from pulling the trigger to impact? Because there's kind of some shortcuts . . . there's some cheats . . . there's some fast forwards you can do and then you really have to do the work and build the engine, right? MATTHEW: Yeah, totally. What's really interesting is another thing a lot of marketing agencies tend to make mistakes with is they think what they do for their clients is what they should do for themselves. Nothing could be further from the truth. I spent a lot of time doing a lot of inbound marketing and then even trying outbound marketing. In general, both were pretty epic failures for my agency. Same thing with webinars or doing other things like this . . . they really did not produce the results that I was after. I would say that's the case for most marketing agencies. They can't understand, or there's two things – one is it becomes sort of, for lack of better vocabulary, but of a mind eff because it works so well for your clients, but then it doesn't work for you. The second thing, right? You're like, “Why is this working for clients but my own damn agency, it doesn't work for.” The second thing is a lot of times the thing that they do for their client isn't the right thing for them because they're not – they shouldn't be using the same filter, The filter you should be using for your own agency is really a different question than the money question. That's usually what people are asking, like “What's the ROI and how much money can I throw at this thing to scale this thing up?” That's not the real problem for them. The real problem is time. How much time can you provide? What you want to look at is, “What is the thing that we can do as an agency that is a low effort but yet high impact? That's the first thing. So, to get things in the right order. Once you use that as a filter, what you're going to discover is, it's much like growing up as a kid – if you've ever raised kids. I've got 3 of them myself now. But they have to learn how to sit up first before they crawl. Then they learn how to crawl and then they learn how to walk, and then they learn how to run. Then, when they get to be – my kids' age now is teens, they start to do backflips off the back shed of the house and you go, “My god! Get off the shed! Why are you on the roof?” Right? But that's a good problem to have. That's one filter. The next thing is really understanding. You know how your ideal clients actually buy and where your best customers come from. Once you understand that, then you start making the right marketing decisions. A lot of agencies, what they don't understand is their clients don't actually want to know how to do something – they're coming to you because they're not looking for a do-it-yourself model or a done-with-you model. They're not looking to coach-and-consult it. They're looking for done-for-you model. They're also busy as well, too. In general, the first thing that most agencies need to do is get their ten-minute amplifier video on their website that explains what sort of transformation they provide for other people. The reason why you want to do this – some people call the VSL, but a VSL is way too long. If it's more than ten minutes, it's too long. That's the first asset you need because, what it does, it multiplies you. Usually, who's the best salesperson in your organization? Yeah, usually owner-founder. If you can create your signature system and you can clearly articulate the transformation that you provide for people – from the before and after state that they're going to receive – in ten minutes or less and you don't gate the video, people will watch it and they will fill out your contact form and you've already done the demo. So, then you're only getting people . . . and you should put the price in there too and that is the only thing you need. And if you're a marketing agency that's under a million dollars per year, if you do anything else besides that VSL and a whack of testimonials down below, you are totally wasting your time. Do not do anything else. Do not blog. Do not create a podcast. Do not. You do not get to collect go and collect your two hundred dollars. That is where you need to start. If you haven't done that, that's the only thing you need to do. Then you need to find a way to get people to that VSL. Getting them there is not as hard as you think. You don't need as many people as you think either, because the goal is not to get lots of leads and fill your calendar with loads of leads. The goal is to get as few leads as possible but close them all. And have them pre-qualified before they get there, right? And if you can have them pre-qualified, pre-sold, then the time that they get to you – you can suck at sales and you can charge more. Because you shouldn't seem like everybody else – which is like all your other competitors – which is probably a sea of sameness. If – just go ahead and do this – please type in digital marketing agency of any kind that you want. You go and do this right? Go to Google right now, I dare you to pause this and go and look. I want you with it, quickly go and look at all the digital marketing websites from city to city to city, from service offer to service offer – you all look exactly the freaking same. Then I dare you to go and look at your Google analytics or whatever analytics tool you want to look at and look at what is the average time on your website. It's probably a minute. What do you think all this other stuff is doing for you at the end of the day? I know you sell this as a service – to blog and create content and to run ads into having these epic crazy labyrinth funnels that one thing triggers to another thing, which triggers this email, and this triggers this upsell, in this downsell and ends up turning into this giant Rube Goldberg machine which is totally cool. Don't get me wrong – I am wowed by it. It is awesome and there was so much work into it, but it didn't do anything for you. It didn't create any transformation. It didn't help you, except for create a whole lot of noise, a whole lot of effort, and provided very little impact for you. So, these are some things I want you to consider. The other thing I want you to consider is usually when you're focused on inbound and/or outbound, it's very, very small thinking. It does not leverage what you have already created because most agencies, right, or businesses, begin organically and grow out of referrals. The business grows, which is awesome. But what happens is the business grows and you get some people on payroll and then you have mouths to feed and mortgages to cover and it starts going, “Oh, crap! This is a serious business!” And then you go, “Oh, a client left.” Or, all of the sudden you have a bad month or Covid hits and shish hits the fan and you're like, “I need a consistent way of getting business,” and so you think the solution is . . . more leads. You're like, “Hey, that worked for my clients and B2C. We sent the gym or the dentist or the lawyer the whatever more business and they're loving it. This is going to work for my agency too.” And wrong. It doesn't, you don't need leads, what you need is a consistent way of getting more referrals and staying top of mind with your existing clientele, with your existing partners with, your existing network at the end of the day, without coming across as being salesy or sleazy because nobody likes to be marketed to. Including you, right? Marketers are the most jaded people in the world, right? Nobody likes to be sold to – so it has to feel invisible. So, if it has to feel invisible, it has to be low effort but high impact. Well, what do you do? What I usually recommend is that you look at doing something called Demand Gen. Demand Gen is just a simple way of saying putting helpful content out there that makes people more awesome and gives you the ability to do one to many selling, ideally to your existing warm network. Now, if you're going to do that, a great place to begin is emailing them if you have a list with your database but more ideally, that feels like marketing, a better thing to do is make sure you're connected with them on a place like LinkedIn and then publish little short snackable content on LinkedIn where they go. They don't go to LinkedIn to consume long-form content or read articles or blogs they go to LinkedIn because they treat it like any other social media network and they're in the mindset to discover, maybe learn something very quickly, and/or most likely procrastinate before and after meetings, right, is what they're doing. If you do, that your warm network will see you being helpful and will keep you top of mind. Then they continue to send you referrals. Good things happen and more opportunities come up because, at the end of the day, people only buy from people they know, like, and trust. No selling can be done until you establish trust. So, the biggest mistake that people make with inbound and outbound is they're always trying to sell too early. It's they're eager beavers, right? ROB: So, we poke in tactically a little bit on LinkedIn. Obviously, strategy level makes sense. Tactically, you get all sorts of advice all over the map. You have your brand page. You have companies developing entire initiatives around getting their team to share their brand content. Sometimes there's just the founder as a salesperson in an authentic way. What kind of mix of activity do you see as effective? It seems to me it's a golden age in LinkedIn right now. I see nothing but opportunity there. But there's a lot of ways to waste time, too. MATTHEW: Totally. So, we have a system that we recommend agency owners follow. It's called the “ACES” method – to keep it simple. Basically, you're asking what kind of content do we create and what is most impactful, right? And how do we do this? Here's how you the ACES method – Authority, Connect, Engage, and Show. Authority is anything that you want to be known for, that you know really well, that you can share – where you can offer a tip and make people more awesome. Connect is anything that hits the heart, the gut, and/or the funny bone – comedy goes a long way. Engage is not necessarily always having to come up with the content – a lot of time you can ask your network, your community, your connections for advice to start conversations. Let them create the content for you to gamify a little bit. Why do you always have to be the one coming up with the content? The last one is Show. We don't tell, we Show. We don't want to come across as braggadocios, right? We don't want to be telling people and beating our chest about how amazing we are. What we want to do is give sneak peeks behind the scene. We want to show before-and-after transformations or screenshots of analytics and growth with a little tip of how you went about doing it. This positions you as an expert on what you're doing by showing. If you do that and then break it up into the different content formats – we've got video, text posts, images, and polls, and then pdf documents – those are basically the core types of content, because you don't know what people enjoy. Do a version of each. I only put a post out per day. That's how you stay top of mind. It's all about consistency, right? They can't trust you if they don't like you. They can't like you if they don't know you. So, step one is about being consistent. The biggest challenge is most people are inconsistent. We all know we've got to go to the gym on a regular basis and eat clean if we want to be fit, right? That this is not brain surgery. Well, it's the same thing with LinkedIn, you need the consistency. The problem is time. It's why most people fail. This is why we created one of our personal branding LinkedIn products. We created a product because this would solve this problem – where someone can spend an hour-and-a-half with us per month and we will create all of their social media, snackable content including for LinkedIn, and post it every single day. The way we do it is we record them via Zoom with the intention that snackable content is the lead domino which gets all the videos, and the videos that inspire all the text posts, the images, the polls, the pdf document carousels, etc., and then we post it for them. Basically, we created a product that allows people to look like they go to the gym every day and eat clean. Yet, they only have to go to the gym once a month for an hour and a half. ROB: It's like a filter for your social media. You just put the filter on, everybody looks good. You hinted at it and I'm curious. You said, you had your previous agencies. You sold them. You had one agency that came in and did things about 80 percent right, and then you started Automation Wolf. Number one, what led you to want to dive back into the fray and then start over again? Number two, what was that difference – the twenty percent between what was done for you and what you felt like needed to be done for others? MATTHEW: Great questions. I sold my shares in my second agency due to partner conflicts. Having partners is a very tricky ship to sail. When it works well, it's amazing. When it doesn't, it's like going through an ugly divorce. It's never fun. So, we went through our divorce and I was not finished with my mission yet on creating the business that I wanted to create. That's what sent me back to the fray now. We had an inbound marketing agency that we were a Goldspot, a Reseller of Hubspot, did PPC, did SEO. We were mostly focused on enterprise clients, mostly Fortune Five Hundred. Very successful agency, did very, very well. I was in a non-compete – to not able to do any sort of inbound marketing for two years – which is fine. When you sell your shares, that's the rightful thing that needs to come up – which led me to doing outbound. Yeah, it was like, “All right, fine. I can't do inbound. I'll do outbound.” So, I started the outbound agency. We basically sprayed and prayed. We basically spammed people on LinkedIn, used LinkedIn automation. We cold emailed you and did all kinds of stuff. Throughout that process, I quickly realized what worked and what didn't work. The reality was outbound sucks even more than inbound and works even less if you really want to piss the whole industry. Inbound is the same thing but when you do inbound and outbound, you're focused on the exact same market which is the 1 to 3 percent of the market that's in market right now. So, you can grow that way. Inbound, you don't feel it emotionally because you don't see all the nos. When you do outbound, you feel it immediately because everybody tells you how much they hate you in the process, right? What the challenge that I realized was – both are not the correct answer. The right answer is actually creating demand first so you can do outbound and inbound. You want to put them into an invisible marketing funnel where you're adding value first and creating demand. Once we switch around to being focused on that – wow! Magic happened. So, we focus a lot on personal branding on LinkedIn so you can connect with people and put them in a controlled environment where they can get to know, like, and trust you. You could do it through an interview series just like you're doing right now, you can do it through community, you can do it through all different ways. There's a lot of different tactics that do it. But, at the end of the day, all we're trying to do is take a group of people and put them in a controlled environment where it doesn't feel like we're marketing and selling to them. Then we can do one-to-many selling to them where they can get to know, like, and trust me and they can go across that trusto meter to like – ding-ding-ding-trust – that once they end up in our pipeline, they're presold. And this way we can suck at sales and we can charge more money. And that's basically the gist of it, at the end of the day, once you set up a system like that and use the right tactics in the right order, you're off to the races. The right order is always not based on money. It's based on your time. ROB: Yeah, it's certainly about kind of getting to that distinctive place. You mentioned you can do a ten-minute video but you've got to look different from the other thousand agency websites that people saw along the way. Peter Thiel put it differently in saying he likes to be a monopoly. You're talking about a way of being a monopoly in the eye of the buyer. When it comes time to buy, you just can't predict, that you can't time it. That ten-minute video, to me – maybe to some people that's a short video – that sounds like a lot. What is the structure of a good ten-minute video that introduces someone to an agency and starts to build that layer of trust? MATTHEW: That's a great question. There's absolutely a format to doing it. I'll tell you the format and the framework that I follow every single time that works like gangbusters. One is, your first thirty seconds should be a big giant epic promise. For example, when it comes to our LinkedIn services, ours is, “How to get new clients right now from LinkedIn, organically. I'm going to show you how to create all your LinkedIn content by only spending one-and-a-half hours with my team each month.” That's it. That's the offer, right? Something like that. The second part is, who it is for, and who it is not for? You can't be all things to everybody. It's really important that you niche down. That's the case. So, for us, we call it out, “Hey! We work with consultants, coaches, people who do B2B, B2B, SAS companies, and agencies. That's, “If you're in B2B and your audience is on LinkedIn, this is for you.” The next thing you need to do is tell them all the things that they want and that they've been lied to. It's really, really important that you shout out that they've been lied to because you have to absolve them of their problems. If you tell them it's their fault, they're not going to listen to you. But if you tell them, “It's someone else's fault that's lied to you,” then you're going to get their attention. Now that you have their attention, you start going through and describing their problems better than they can describe themselves. You need to hit the hot buttons, fears, frustrations, wants, and aspirations. Remember, if you can make it sound like you're reading their mind, you're saying the stuff they're thinking but they won't say out loud, you know you've hit the hot buttons. Once you've been able to describe their problems better than they can themselves, the next thing is to have counterintuitive thinking about what the problem is. It must be something that's new. So, if you'll notice me, I keep playing with this theme, ‘inbound sucks, outbound sucks, but demand gen is right' – here's the old way of doing things versus the new way right? We're playing constantly with FAQ's versus SAQ's, so, frequently-asked questions versus should-ask questions. You know when you discover a problem, the questions you ask to discover it are not going to solve it. You have to ask deeper questions to get there. This is why the five whys exists right? There's a whole system from this – “Why did that happen? Well. why did that? And why did this? Why did that? Why?” And then you get to the root cause of really what's causing the problem and if you can come up with this counterintuitive thinking that is different than everybody else's saying – Boom! That's called positioning and you are no longer in the sea of sameness. You are now unique. You are now monopoly like you said, right? Once you have the monopoly you need to have a very simple signature system that explains what it is that you do. I recommend that everybody have a three-pillar system. So, mine is short-form, long-form, community, which is tied to “know you, like you, trust you.” You have three pillars. Usually you have a three-step process for each pillar, so you have a three-by-three matrix. If you can clearly articulate the matrix, then you're good-to-go to get their attention. You clearly state what you're going to charge, so that it's not a surprise to anybody. Nobody should be coming into your marketing funnel who doesn't know what the approximate price is going to be. You don't want to talk to them. You want to spend a lot of time on repelling just as much as you were attracting. This way, by the time they get to you, they're pretty qualified. You didn't have to spend thirty minutes qualifying them when you could have used an automated ten-minute video to do so, right? Then, a sign of the only thing you need is some sort of social proof of success, of transformation – before-and-afters or a whack of testimonials on your site. If you go to my website today, it's a 1-page website with nothing else that you can do except watch a ten-minute video or read the endless scrolling testimonials that are there of our clients. The only thing you can do is reach out and connect to us, so you have no other options. There's nowhere to be confused about what to do. That business in twelve months has grown an agency from zero to over a million dollars of recurring revenue. ROB: That's solid. It sounds like you're at a price point where, if you're demonstrating results, it recurs at loops. You keep building. You scale the process. All of that clearly makes sense and you've kind of shorthanded. But if you really get down to it, in particular, what are some things you're doing differently this time, what you know? You built two companies before. What did you learn in those – obviously a partnership lesson, but outside of that – what have you learned that's different this time? MATTHEW: Less is more, right? Which we all know. Even this system here that we're doing on-demand gen – we just launch one service per year and perfect it. This last year, we perfected the LinkedIn content creation, demand gen system. It's awesome, man. It's perfect. It took a whole year. They do it really well. Next year, we're adding on a few more services. So, do one thing at a time. The one thing. I think there's a whole book on it – just the one thing, right? So, that's the big lesson – less is more. The next big lesson is, spend a lot of time on operations and hiring, on talent and training your talent, and supporting your team, right? You don't want to have false starts. Your team is everything, especially for an agency. Your highest expense is going to usually be people. People are difficult – more people, more problems. It's not like Biggie said. Biggie said, “Mo money, Mo problems.” It's not. It's more people, more problems, right? So, focus on really developing the team and understanding the team and understanding what that looks like and getting a lot of referrals. That next thing is, if you deliver what you say you're going to deliver and you even come close to coming to what you say you're going deliver, you will get referrals – and a ton of referrals. So, if you get the referral engine going, you get the team going, I would say that you've got a decent startup and a proof of model. The goal from a startup is to get to stay up and then from stay up is to scale up. I believe that you can do it in a three-year period. Usually, year one is startup. In my case, I even had year one as a false start, focusing on the wrong business – which is proof of model really, right? So, proof. So, it's one thing to sell it. It's one thing to keep it. It's a little bit of the balance of two. I was able to sell the cold emailing spamming thing because people want to buy that too, just like inbound. But ultimately it kind of worked. I wasn't really excited about it. It didn't focus on my unique ability. It didn't make me happy. I didn't go to bed going, “Oh, my god! That was a great day!”. It was like, “Oh, my god! I just spammed the world. I'm a fraud, right?” You know, you've got to love what you do, too. But once you get the right thing that people want to buy and then you can keep them, then you've got what's called proof of model and that's really your first year. The second year, and the way I'm looking at this is the first year is proof of model, the second year is getting up or the first years is about getting you out of operations – the day-to-day operations – so, that the second year, you can focus on marketing, selling, and talent acquisition. The third year is scale up that you can get you out of marketing, selling, and talent acquisition. Then once you're out of the third year you have the option at that point to keep it as a running asset because it doesn't take . . . you should only be attending the board meetings and a few other things or you have an asset that you can sell, right? Which is exactly why you bought the business or created the business. Whether you bought it or created it, that's it. If you can't do that in a three-year period, you're probably on the wrong track – you're probably spinning your wheels and not focusing on the right things. That's a very realistic and fair amount of time to build a great business. ROB: It's an interesting mirror that you talk about holding up with the spamming. There were some folks who were involved in starting Sales Loft, which is now a billion-dollar valuation company. Their first product was built around scraping and spamming LinkedIn, harvesting email addresses, that sort of thing. They had a million dollars in revenue around it and they threw the product away because it wasn't really authentic to them. They were selling a sugar high. It sounds like you've been in that world. I've seen the LinkedIn automation in the agency space. We've seen how many sugar high newsfeed optimizations, spamming, SEO, right? SEO used to be about tactics and ways to skirt the rules. We keep having to figure out how to be authentic if we want to build a real business. MATTHEW: It always comes back to the fundamentals. At the end of the day, most people think they have a sales problem or they think they have a lead-gen problem – but they don't. They actually have a community problem and a trust problem. If they made the measurement of the objective to build more community and to build more trust in that community, they would make very different decisions. Same thing, as well, to the mindset about forever business versus a short-term business – because one is focused on tactics and me-me-me-me versus you-you-you-you. Then the same thing even when it comes like creating content. You're very smart to have this podcast because you're focused on being a talent scout instead of being the talent. Being talent is actually really hard. If you look at the biggest and best and fastest-growing companies out there, they focus on two things – one, being a media company is really good talent scouts or two, they focus on the network effect. Okay, if you do that, you have epic growth really, really quick. The reason you have it is this. If you are a talent scout, then you become Tim Ferriss, Joe Rogan, Oprah. What are the experts of absolutely all? Okay. But what are they really good at? What are they really good at doing? Bringing in really interesting people, asking them really interesting questions to teach their audience what to look for and what to look out that builds trust. So then expert comes and goes, okay, and the law of transference passes all that expertise to those hosts. They're the ones who are the sticky ones that everybody is after going forward. They're building what's called a media company. Then those who take that media company flip it into these private communities -- something like real vision television – you name it. They then get the network effect, which is what Facebook is, and Youtube is, and Instagram is, that has exponential growth that it takes on its own life. Once you have the network effect and you have that ability of hosting where you built trust with the community basically – instead of calling it network, call it community – it's a deeper connection, you then have a license to print money – because you can go to that community you want and say, “What is the problem? What is it that you want to solve?”, go find the product or service and connect it with your community, and instantly print money. The end. If you ask yourself, instead, as a business and in B2B, “How do I create more community? How do I build more trust with this? How do I treat this as a forever business?”, you start making really different decisions about what you're going to invest your time and energy and money into at the end of the day. So, it's usually just that you're asking their problems. They're asking, “How do I get more leads and how do I get more sales?” It's a very surface-level question. It's a byproduct. A byproduct of community and trust is lots of leads and sales and rabid buyers who are ready to throw you money. ROB: But there's a lot of work ahead of that.  MATTHEW Yeah. ROB: Lots of good thoughts, lots of distilled knowledge from experience from building businesses, from scaling up. Congratulations on all of that. When people want to connect with you and with Automation Wolf, where should, they go to find you? MATTHEW: There's only two places you can find me – either on LinkedIn – you just search Matthew Hunt – or at automationwolf.com. You won't find me anywhere else. ROB: Yeah, and you can do like three things on the site – you can read the testimonials, you can watch the video, you can schedule some time. It's all pretty clean and simple, very good. Well thank you so much for that distillation of wisdom, Matthew. Good to connect with you. Thank you for sharing with the audience I wish you all the best.  MATTHEW: You too Rob. Thank you for having me. ROB: All right. Be well. Thanks.

About MatthewMatthew Prince is co-founder and CEO of Cloudflare. Cloudflare's mission is to help build a better Internet. Today the company runs one of the world's largest networks, which spans more than 200 cities in over 100 countries. Matthew is a World Economic Forum Technology Pioneer, a member of the Council on Foreign Relations, winner of the 2011 Tech Fellow Award, and serves on the Board of Advisors for the Center for Information Technology and Privacy Law. Matthew holds an MBA from Harvard Business School where he was a George F. Baker Scholar and awarded the Dubilier Prize for Entrepreneurship. He is a member of the Illinois Bar, and earned his J.D. from the University of Chicago and B.A. in English Literature and Computer Science from Trinity College. He's also the co-creator of Project Honey Pot, the largest community of webmasters tracking online fraud and abuse.Links: Cloudflare: https://www.cloudflare.com Blog post: https://blog.cloudflare.com/aws-egregious-egress/ Bandwidth Alliance: https://www.cloudflare.com/bandwidth-alliance/ Announcement of R2: https://blog.cloudflare.com/introducing-r2-object-storage/ Blog.cloudflare.com: https://blog.cloudflare.com Duckbillgroup.com: https://duckbillgroup.com TranscriptAnnouncer: Hello, and welcome to Screaming in the Cloud with your host, Chief Cloud Economist at The Duckbill Group, Corey Quinn. This weekly show features conversations with people doing interesting work in the world of cloud, thoughtful commentary on the state of the technical world, and ridiculous titles for which Corey refuses to apologize. This is Screaming in the Cloud.Corey: Writing ad copy to fit into a 30 second slot is hard, but if anyone can do it the folks at Quali can. Just like their Torque infrastructure automation platform can deliver complex application environments anytime, anywhere, in just seconds instead of hours, days or weeks. Visit Qtorque.io today and learn how you can spin up application environments in about the same amount of time it took you to listen to this ad.Corey: This episode is sponsored in part by Honeycomb. When production is running slow, it's hard to know where problems originate: is it your application code, users, or the underlying systems? I've got five bucks on DNS, personally. Why scroll through endless dashboards, while dealing with alert floods, going from tool to tool to tool that you employ, guessing at which puzzle pieces matter? Context switching and tool sprawl are slowly killing both your team and your business. You should care more about one of those than the other, which one is up to you. Drop the separate pillars and enter a world of getting one unified understanding of the one thing driving your business: production. With Honeycomb, you guess less and know more. Try it for free at Honeycomb.io/screaminginthecloud. Observability, it's more than just hipster monitoring.Corey: Welcome to Screaming in the Cloud, I'm Corey Quinn. Today, my guest is someone I feel a certain kinship with, if for no other reason than I spend the bulk of my time antagonizing AWS incredibly publicly. And my guest periodically descends into the gutter with me to do the same sort of things. The difference is that I'm a loudmouth with a Twitter account and Matthew Prince is the co-founder and CEO of Cloudflare, which is, of course, publicly traded. Matthew, thank you for deigning to speak with me today. I really appreciate it.Matthew: Corey, it's my pleasure, and appreciate you having me on.Corey: So, I'm mostly being facetious here, but not entirely, in that you have very publicly and repeatedly called out some of the same things I love calling out, which is AWS's frankly egregious egress pricing. In fact, that was a title of a blog post that you folks put out, and it was so well done I'm ashamed I didn't come up with it myself years ago. But it's something that is resonating with a large number of people in very specific circumstances as far as what their company does. Talk to me a little bit about that. Cloudflare is a CDN company and increasingly looking like something beyond that. Where do you stand on this? What got you on this path?Matthew: I was actually searching through really old emails to find something the other day, and I found a message from all the way back in 2009, so actually even before Michelle and I had come up with a name for Cloudflare. We were really just trying to understand the pricing on public clouds and breaking it all down. How much does the compute cost? How much does storage cost? How much does bandwidth cost?And we kept running the numbers over and over and over again, and the storage and compute costs actually seemed relatively reasonable and you could understand it, but the economics behind the bandwidth just made no sense. It was clear that as bandwidth usage grew and you got scale that your costs eventually effectively went to zero. And I think it was that insight that led to us starting Cloudflare. And the self-service plans at Cloudflare have always been unlimited bandwidth, and from the beginning, we didn't charge for bandwidth. People told us at the time we were crazy to not do that, but I think that that realization, that over time and at scale, bandwidth costs do go to zero is really core to who Cloudflare is.Cloudflare launched a little over 11 years ago now, and as we've watched the various public clouds and AWS in particular just really over that same 11 years not only not follow the natural price of bandwidth down, but really hold their costs steady. At some point, we've got a lot of mutual customers and it's a complaint that we hear from our mutual customers all the time, and we decided that we should do something about it. And so that started four years ago, when we launched the Bandwidth Alliance, and worked with almost all the major public clouds with the exception of Amazon, to say that if someone is sending traffic from a public cloud network to Cloudflare's network, we're not going to charge them for the bandwidth. It's going across a piece of fiber optic cable that yeah, there's some cost to put it in place and maybe there's some maintenance costs associated with it, but there's not—Corey: And the equipment at the end costs money, but it's not cloud cost; it just cost on a per second, every hour of your lifetime basis. It's a capital expense that is amortized across a number of years et cetera, et cetera.Matthew: And it's a fixed cost. It's not a variable cost. You put that fiber optic cable and you use a port on a router on each side. There's cost associated with that, but it's relatively de minimis. And so we said, “If it's not costing us anything and it's not costing a cloud provider anything, why are we charging customers for that?”And I think it's an argument that resonated with almost every other provider that was out there. And so Google discounts traffic when it's sent to us, Microsoft discounts traffic when it's sent to us, and we just announced that Oracle has joined this discounting their traffic, which was already some of the most cost-effective bandwidth from any cloud provider.Corey: Oh, yeah. Oracle's fantastic. As you were announced, I believe today, the fact that they're joining the Bandwidth Alliance is both fascinating and also, on some level, “Okay. It doesn't matter as much because their retail starting cost is 10% of Amazon's.” You have to start pushing an awful lot of traffic relative to what you would do AWS before it starts to show up. It's great to see.Matthew: And the fact that they're taking that down to effectively zero if you're using us is even better, right? And I think it again just illustrates how Amazon's really alone in this at being so egregious in how they do that. And it's, when we've done the math to calculate what their markups are, it's almost 80 times what reasonable assumptions on what their wholesale costs are. And so we really do believe in fighting for our customers and being customer-centric, and this seems like a place where—again, Amazon provides an incredible service and so many things, but the data transfer costs are just completely outrageous. And I'm glad that you're calling them out on it, and I'm glad we're calling them out on it and I think increasingly they look isolated and very anti-customer.Corey: What's interesting to me is that ingress to AWS at all the large public tier-one cloud providers is free. Which has led, I think, to the assumption—real or not—that bandwidth doesn't actually cost anything, whereas going outbound, all I can assume is that one day, some Amazon VP was watching a rerun of Meet the Parents and they got to the line where Ben Stiller says, “Oh, you can milk anything with nipples,” and said, “Holy crap. Our customers all have nipples; we can milk them with egress charges.” And here we are. As much as I think the cloud empowers some amazing stuff, the egress charges are very much an Achilles heel to a point where it starts to look like people won't even consider public cloud for certain workloads based upon that.People talk about how Netflix is a great representation of the ideal AWS customers. Yeah, but they don't stream a single byte to customers from AWS. They have their own CDN called Open Connect that they put all around the internet, specifically for that use case because it would bankrupt them otherwise.Matthew: If you're a small customer, bandwidth does cost something because you have to pay someone to do the work of interconnecting with all of the various networks that are out there. If you start to be, though, a large customer—like a Cloudflare, like an AWS, like an Azure—that is sending serious traffic to the internet, then it starts to actually be in the interest of ISPs to directly interconnect with you, and the costs of your bandwidth over time will approach zero. And that's the just economic reality of how bandwidth pricing works. I think that the confusion, to some extent, comes from all of us having bought our own home internet connection. And I think that the fact that you get more bandwidth up in most internet connections, and you get down, people think that there's some physics, which is associated with that.And there are; that turns out just to be the legacy of the cable system that was really designed to send pictures down to your—Corey: It wasn't really a listening post. Yeah.Matthew: Right. And so they have dedicated less capacity for up and again, in-home network connections, that makes a ton of sense, but that's not how internet connections work globally. In fact, you pay—you get a symmetric connection. And so if they can demonstrate that it's free to take the traffic in, we can't figure out any reason that's not simply about customer lock-in; why you would charge to take data out, but you wouldn't charge to put it in. Because actually cost more from writing data to a disk, it costs more than reading it from a disk.And so by all reasonable accounts, if they were actually charging based on what their costs were, they would charge for ingress but they want to charge for egress. But the approach that we've taken is to say, “For standard bandwidth, we just aren't going to charge for it.” And we do charge for if you use our premium routing services, which is something called Argo, but even then it's relatively cheap compared with what is just standard kind of internet connectivity that's out there. And as we see more of the clouds like Microsoft and Google and Oracle show that this is a place where they can be much more customer-centric and customer-friendly, over time I'm hopeful that will put pressure on Amazon and they will eliminate their egress fees.Corey: People also tend to assume that when I talk about this, that I'm somehow complaining about the level of discounting or whatnot, and they yell at me and say, “Oh, well, you should know by now, Corey, that no one at significant scale pays retail pricing.” “Thanks, professor. I appreciate that, but four years ago, or so I sat down with a startup founder who was sketching out the idea for a live video streaming service and said, ‘There's something wrong with my math because if I built this on AWS—which he knew very well, incidentally—it looks like it would cost me at our scale of where we're hoping to hit $65,000 a minute.'” And I checked and yep, sure enough, his math was not wrong, so he obviously did not build his proof of concept on top of AWS. And the last time I checked, they had raised several 100 million dollars in a bunch of different funding rounds.That is a company now that will not be on AWS because it was never an option. I want to talk as well about your announcement of R2, which is just spectacular. It is—please correct me if I get any of this wrong—it's an object store that lives in your existing distributed-points-of-presence-slash-data-centers-slash-colo-slash-a-bunch-of-computers-in-fancy-warehouse-rooms-with-the-lights-are-always-on-And-it's-always-cold-and-noisy. And people can store data there—Matthew: [crosstalk 00:10:23] aisles it's cold; in the other aisles, it's hot. But yes.Corey: Exactly. But it turns out when you lurk around to the hot aisle, that's not where all the buttons are and the things you're able to plug into, so it's freeze or sweat, and there's never a good answer. But it's an object store that costs a fair bit less than retail pricing for Amazon S3, or most other object stores out there. Which, okay, great. That's always good to see competition in the storage space, but specifically, you're not charging any data transfer costs whatsoever for doing this. First, where did this come from?Matthew: So, we needed it ourselves. I think all of the great products at Cloudflare start with an internal need. If you look at why do we build our zero-trust solutions? It's because we said we needed a security solution that was fast and reliable and secure to protect our employees as they were going out and using the internet.Why did we build Cloudflare Workers? Because we needed a very flexible compute platform where we could build systems ourselves. And that's not unique to us. I mean, why did Amazon build AWS? They built it because they needed those tools in order to continue to grow and expand as quickly as possible.And in fact, I think if you look at the products that Google makes that are really great, it ends up being the ones that Google's employees use themselves. Gmail started as Caribou once upon a time, which was their internal email system. And so we needed an object store and the sometimes belligerent CEO of Cloudflare insisted that our team couldn't use any of the public cloud object stores. And so we had to build it.That was the start of it and we've been using it internally for products over time. It powers, for example, Cloudflare Images, it powers a lot of our streaming video services, and it works great. And at some point, we said, “Can we take this and make it available to everyone?” The question that you've asked on Twitter, and I think a lot of people reasonably ask us, “What's the catch?”Corey: Well, in my defense, I think it's fair. There was an example that I gave of, “Okay, I'm going to go ahead and keep—because it's new, I don't trust new object stores. Great. I'm going to do the same experiment twice, keep one the pure AWS story and the other, I'm just going to add Cloudflare R2 to the mix so that I have to transfer out of AWS once.” For a one gigabyte file that gets shared out for a petabyte's worth of bandwidth, on AWS it costs roughly $52,000 to do that. If I go with the R2 solution, it cost me 13 cents, all of which except for a penny-and-a-half are AWS charges. And that just feels—when you're looking at that big of a gap, it's easy to look at that and think, “Okay, someone is trying to swindle me somewhere. And when you can't spot the sucker, it's probably me. What's the catch?”Matthew: I guess it's not really a catch; it's an explanation. We have been able to drive our bandwidth costs down low enough that in that particular use case, we have to store the file, and that, again, that—there's a hard disk in there and we replicate it to make sure that it's available so it's not just one hard disk, but it's multiple hard disks in various places, but that amortized over time, isn't that big a cost. And then bandwidth is effectively zero. And so if we can do that, then that's great.Maybe a different way of framing the question is like, “Why would we do that?” And I think what we see is that there is an opportunity for customers to be able to use the best of various cloud providers and hook the different parts together. So, people talk about multi-cloud all the time, and for a while, the way that I think people thought about that was you take the exact same workload and you run it in Azure and AWS. That turns out not to be—I mean, maybe some people do that, but it's super rare and it's incredibly hard.Corey: It has been a recurring theme of most things I say where, by default, that is one of the dumbest things I can imagine.Matthew: Yeah, that isn't good. But what people do want to do is they want to say, “Listen, there's some really great services that Amazon provides; we want to use those. And there's some really great services that Azure provides, and we want to use those. And Google's got some great machine learning, and so does IBM. And I want to sort of mix and match the various pieces together.”And the challenge in doing that is the egress fees. If everyone just had a detente and said there's going to be no egress fees for us to be able to hook these various [pits 00:14:48] together, then you would be able to take advantage of a lot of the different technologies and we would actually get stronger applications. And so the vision of what we're trying to build is how can we be the fabric that can stitch the various cloud providers together so that you can do that. And when we looked at that, and we said, “Okay, what's the path to getting there?” The big place where there's the just meatiest cost on egress fees is object stores.And so if you could have a centralized object store, and you can say then from that object go use whatever the best service is at Amazon, go use whatever the best service is at Google, go use whatever the best service is at Azure, that then allows, I think, actually people to take advantage of the cloud in a way which is what people really should mean when they talk about multi-cloud. Which is, there should be competition on the various features themselves, and you should be able to pick and choose the best of all of the different bits. And I think we as consumers then benefit from that. And so when we're looking at how we can strategically enable that future, building an object store was a real key part of that, and that's part of what we're doing. Now, how do we make money off of that? Well, there's a little bit off the storage, and again, even [laugh]—Corey: Well, that is the Amazonian answer there. It's like, “Your margin is my opportunity,” is a famous Bezos quote, and I figure you're sitting there saying, “Ah, it would cost $52,000 to do that in Amazon. Ah, we can make a penny-and-a-half.” That's very Amazonian, you could probably get hired over there with that philosophy.Matthew: Yeah. And this is a commodity service, just [laugh] storing data. If you look across the history of what Cloudflare has done, in 2014, we made encryption free because it's absurd to pay for math, right? I mean, it's just crazy right?Corey: Or to pay for security as a value-add. No, that should be baked into whatever you're doing, in an ideal world.Matthew: Domain registration. Like, it's writing something down in a ledger. It's a commodity; of course it should go to whatever the absolute cost is. On the other hand, there are things that we do that aren't commodities where we are able to better protect people because we see so much traffic, and we've built the machine learning models, and we've done those things, and so we charge for those things. So commodities, we think over time, go to effectively, whatever their cost is, and then the value is in the actual intelligent services that are on top of it.But an object store is a commodity and so we should be trying to drive that pricing down. And in the case of bandwidth, it's effectively free for us. And so if we can be that fabric that connects the different class together, I think that makes sense is a strategy for us and that's why R2 made a ton of sense for us to build and to launch.Corey: There seems to be a lack of ability for lots of folks, at least on the internet to imagine a use case other than theirs. I cheated by being a consultant, I get to borrow other people's use cases at a high degree of turnover. But the question I saw raised was, “Well, how many workloads really do that much egress from static objects that don't change? Doesn't sound like there'd be a whole lot of them.” And it's, “Oh, my sweet summer child. Sure, your app doesn't do a lot of that, but let me introduce it to my friends who are hosting videos on their website, for example, or large images that get accessed a whole bunch of times; things that are written once and then read forever by the internet.”Matthew: And we sit in a position where because of the role that Cloudflare plays where we sit in front of a number of these different cloud providers, we could actually look at the use cases and the data, and then build products in order to solve that. And that's why we started with Workers; that's why we then built the KV store that was on top of that; we built object-store next. And so you can see as we're sort of marching through these things, it is very much being informed by the data that we actually see from real customers. And one of the things that I really like about R2 is in exactly the example that you gave where you can keep everything in S3; you can set R2 in front of it and put it in slurp mode, and effectively it just—as those objects get pulled out, it starts storing them there. And so the migration path is super easy; you don't have to actually change anything about your application and will cut your bills substantially.And so I think that's the right thing to enable a multi-cloud world where, again, it's not you're running the exact same workload in different places, but you get to take advantage of the really great tack that all of these companies are building and use that. And then the companies will compete on building that tech well. So, it's not just about how do I get the data in and then kind of underinvest in all of the different services that I provide. It's how can we make sure that on a service-by-service basis, you actually are having real competition over time. And again, I think that's the right thing for customers, and absolutely R2 might not be the right thing for every use case that's out there, but I think that it wi—enabling more competition is going to make the cloud better for everyone.Corey: Oh, yeah. It's always fun hearing it from Amazonians. It's, “You have a service that talks to satellites in orbit. You really think that's a general-purpose thing that every company out there has to deal with?” No. Well, not yet, anyway.It also just feels to me like their transfer approach is antithetical to almost every other aspect of how they have built their cloud. Amazonians have told me repeatedly—I believe them—that their network is effectively magic. The fact that you can get near line rate between any two points without melting various [unintelligible 00:20:14], which shows that there was significant thought, work, effort, planning, technology, et cetera, put into the network. And I don't dispute that. But if I'm trying to build a workload and put it inside of AWS, I can control how it performs tied to budget; I can have a lot of RAM for things that are memory intensive, or I can have a little RAM; I can have great CPU performance or terrible CPU performance.The challenge with data transfer is it is uniformly great. “I want to get that data over there super quickly.” Yeah, awesome. I'm fine paying a premium for that. But I have this pile of data right here. I want to get it over there, ideally by Tuesday. There's no good way to do that, even with their Snowball—or Snow Family devices—when you fill them with data and send them into AWS, yeah, that's great. Then you just pay for the use of the device.Use them to send data out of AWS, they tack on an additional per-gigabyte fee for getting the data out. You're training as a lawyer, you went to the same law school that my wife did, the University of Chicago, which, oh, interesting stories down that path. But if we look at this, my argument is that the way to do an end-run around this is to sue Amazon for something, and then demand access to the data you have living in their environment during discovery. Make them give it to you for free, though, they'd probably find a way to charge it there, too. It's just a complete lack of vision and lack of awareness because it feels like they're milking a cash cow until it dies.Matthew: Yeah, they probably would charge for it and you'd also have to pay a lot of lawyers. So, I'm not sure that's the cost [crosstalk 00:21:44]—Corey: Its only works above certain volumes, I figure.Matthew: I do think that if your pricing strategy is designed to lock people in to prevent competition, then that does create other challenges. And there are certainly some University of Chicago law professors out there that have spent their careers arguing why antitrust laws don't make any sense, but I think that this is definitely one of those areas where you can see very clearly that customers are actually being harmed by the pricing strategy that's there. And the pricing strategy is not tied in any way to the underlying costs which are associated with that. And so I do think that, especially as you see other providers in the space—like Oracle—taking their bandwidth costs to effectively zero, that's the sort of thing that I think will have regulators start to scratch their heads. If tomorrow, AWS took egress costs to zero, and as a result, R2 was not as advantaged as it is today against them, you know, I think there are a lot of people who would say, “Oh, they showed Cloudflare.” I would do a happy dance because that's the best thing [thing they can do 00:22:52] for our customers.Corey: Our long-term goals, it sounds like, are relatively aligned. People think that I want to see AWS reign ascendant; people also say I want to see them burning and crashing into the sea, and neither one of those are true. What I want is, I want someone in a few years from now to be doing a startup and trying to figure out which cloud provider they should pick, and I want that to be a hard decision. Ideally, if you wind up reducing data transfer fees enough, it doesn't even have to be only one. There are stories that starts to turn into an actual realistic multi-cloud story that isn't, at its face, ridiculous. But right now, you have to pick a horse and ride it, for a variety of reasons. And I don't like that.Matthew: It's entirely egress-based. And again, I think that customers are better off if they are able to pick who is the best service at any time. And that is what encourages innovation. And over time, that's even what's good for the various cloud providers because it's what keeps them being valuable and keeps their customers thinking that they're building something which is magical and that they aren't trapped in the decision that they made, which is when we talk to a lot of the customers today, they feel that way. And it's I think part of why something like R2 and something like the Bandwidth Alliance has gotten so much attention because it really touches a nerve on what's frustrating customers today. And if tomorrow Amazon announced that they were eliminating egress fees and going head-to-head with R2, again, I think that's a wonderful outcome. And one that I think is unlikely, but I would celebrate it if it happened.Corey: This episode is sponsored by our friends at Oracle Cloud. Counting the pennies, but still dreaming of deploying apps instead of "Hello, World" demos? Allow me to introduce you to Oracle's Always Free tier. It provides over 20 free services and infrastructure, networking databases, observability, management, and security.And - let me be clear here - it's actually free. There's no surprise billing until you intentionally and proactively upgrade your account. This means you can provision a virtual machine instance or spin up an autonomous database that manages itself all while gaining the networking load, balancing and storage resources that somehow never quite make it into most free tiers needed to support the application that you want to build.With Always Free you can do things like run small scale applications, or do proof of concept testing without spending a dime. You know that I always like to put asterisks next to the word free. This is actually free. No asterisk. Start now. Visit https://snark.cloud/oci-free that's https://snark.cloud/oci-free.Corey: My favorite is people who don't do research on this stuff. They wind up saying, “Oh, yeah. Cloudflare is saying that bandwidth is a fixed cost. Of course not. They must be losing their shirt on this.”You are a publicly-traded company. Your gross margins are 76% or 77%, depending upon whether we're talking about GAAP or non-GAAP. Point being, you are clearly not selling this at a loss and hoping to make it up in volume. That's what a VC-backed company does. Is something that is real and as accurate.I want to, on some level, I guess, low-key apologize because I keep viewing Cloudflare through a lens that is increasingly inaccurate, which is as a CDN. But you've had Cloudflare Workers for a while, effectively Functions as a Service that run at the edge, which has this magic aura around it, that do various things, which is fascinating to me. You're launching R2; it feels like you are in some ways aiming at becoming a cloud provider, but instead of taking the traditional approach of building it from the region's outward, you're building it from the outward in. Is that a fair characterization?Matthew: I think that's right. I think fundamentally what Cloudflare is, is a network. And I remember early on in the pandemic, we did a series of fireside chats with people we thought we could learn from. And so was everyone from Andre Iguodala, the basketball player, to Mark Cuban, the entrepreneur, to we had a [unintelligible 00:25:56] governor and all kinds of things. And we these were just internal on off the record.And I got to do one with Eric Schmidt, the former CEO of Google. And I said, “You know, Eric, one of the things that we struggle with is describing what is Cloudflare.” And without hesitation, he said, “Oh, that's easy. You're the network I plug into and don't have to worry about anything else.” And I think that's better than I could say it, myself, and I think that's what it is that we fundamentally are: we're the network that fits together.Now, it turns out that in the process of being that network and enabling that network, we are going to build things like R2, which start to be an object store and starts to sort of step into some of the cloud provider space. And Workers is really just a way of programming that network in order to do that, but it turns out that there are a bunch of workloads that if you move them into the network itself, make sense—not going to be every workload, but a lot of workloads that makes sense there. And again, I think that you can actually be very bullish on all of the big public cloud providers and bullish on Cloudflare at the same time because what we want to do is enable the ability for people to mix and match, and change, and be the fabric that connects all of those things together. And so over time, if Amazon says, “We're going to drop egress fees,” it may be that R2 isn't a product that exists—I don't think they're going to do that, so I think it's something that is going to be successful for us and get a lot of new users to us—but fundamentally, I think that where the traditional public clouds think of themselves as the place you put data and you process data, I think we think of ourselves as the place you move data. And that's somewhat different.That then translates into it as we're building out the different pieces, where it does feel like we're building from the outside in. And it may be that over time, that put versus move distinction becomes narrower and narrower as we build more and more services like R2, and durable objects, and KV, and we're working on a database, and all those things. And it could be that we converge in a similar place.Corey: One thing I really appreciate about your vision because it is so atypical these days, is that you aren't trying to build the multifunction printer of companies. You are not trying to be all things to all people in every scenario. Which is impossible to do, but companies are still trying their level best to do it. You are staking out the bounds of where you were willing to start and where you're willing to stop, in a variety of different ways. I would be—how do I put it?—surprised if you at some point in the next five years come out with, “And this is our own database that we have built out that directly competes with the following open-source project that we basically have implemented their API and gone down that particular path.” It does not sound like it is in your core wheelhouse at that point. You don't need—to my understanding—to write your own database engine in order to do what you do.Matthew: Maybe. I mean, we actually are kind of working on a database because—Corey: Oh, no, here we go again.Matthew: [laugh]—and yeah—in a couple of different ways. So, the first way is, we want to make sure that if you're using Workers, you can connect to whatever database you want to use anywhere in the world. And that's something that's coming and we'll be there. At the same time, the challenge of distributed computing turns out not to be the computing, it turns out to be the data and figuring out how to—CAP theorem is real, right? Consistency, Availability, and Partition tolerance; you can pick any two out of the three, but you can't get all three.And so you there's always going to be some trade-off that's there. And so we don't see a lot of good examples. There's some really cool companies that are working on things in the space, but we don't see a lot of really good examples of who has built a database that can be run on a distributed workload system, like Cloudflare to it do well. And so our team internally needs that, and so we're trying to figure out how to build it for ourselves, and I would imagine that after we build it for ourselves—if it works the way we expect it will—that that will then be something that we open up.Our motivation and the way we think about products is we need to build the tools for our own team. Our team itself is customer zero, and then some of those things are very specific to us, but every once in a while, when there are functions that makes sense for others, then we'll build them as well. And that does maybe risk being the multifunction printer, but again, I think that because the customer for that starts with ourselves, that's how we think about it. And if there's someone else's making a great tool, we'll use that. But in this case, we don't see anyone that's built a multi-tenant, globally-distributed, ACID-compliant relational database.Corey: I can't let it pass on challenge. Sure they have, and you're running it yourself. DNS: the finest database in the world. You stuff whatever you want to text records, and now you have taken a finely crafted wrench and turned it into a barely acceptable hammer, which is what I love about doing that terrible approach. Yeah, relational is not going to quite work that way. But—Matthew: Yes. That's a fancy key-value store, right? So—and we've had that for a long time. As we're trying to build those things up, the good news is that, again, we've run data at scale for quite some time and proven that we can do it efficiently and reliably.Corey: There's a lot that can be said about building the things you need to deliver your product to customers. And maybe a database is a poor example here, but I don't see that your motivation in this space is to step into something completely outside your areas of expertise solely because there's money to be made over there. Well, yeah, fortune passes everywhere. The question is, which are you best positioned to wind up delivering an actual transformative solution to that space, and what parts of it are just rent-seeking where it's okay, we're going to go and wherever the money is, we're chasing that down.Matthew: Yeah, we're still a for-profit business, and we've been able to grow revenue well, but I think it is that what motivates us and what drives us comes back to our mission, which is how do you help build a better internet? And you can look at every single thing that we've done, and we try to be very long-term-oriented. So, for instance, when we in 2014 made encryption free, the number one reason at the time, when people upgraded for the free version of our service, the paid version of our service is they got encryption for that. And so it was super scary to say, “Hey, we're going to take the biggest feature and give it away for free,” but it was clearly the direction of history and we wanted to be on the right side of history. And we considered it a bug that the internet wasn't built in an encrypted way from the beginning.So, of course, that was going to head that direction. And so I think that we and then subsequently Let's Encrypt, and a bunch of others have said, it's absurd that you're charging for math. And again, I think that's a good example of how we think about products. And we want to continue to disrupt ourselves and take the things that once upon a time were reserved for our customers that spend $10 million-plus with us, and we want to keep pushing those things down because, over time, the real opportunity is if you do right by customers, there will be plenty of ways that you can earn some of their budget. And again, we think that is the long-term winning strategy.Corey: I would agree with this. You're not out there making sneakers and selling them because you see people spend a lot of money on that; you're delivering value for customers. I say this as one of your paying customers. I have zero problem paying you every month like clockwork, and it is the least cloud-like experience because I know exactly what the bill is going to be in advance, which is apparently not how things should be done in this industry, yadda, yadda, yadda. It is a refreshingly delightful experience every time.The few times I've had challenges with the service, it has almost always been a—I'll call it a documentation gap, where the way it was explained in the formal documentation was not how I conceptualize things, which, again, explaining what these complex things are to folks who are not steeped in certain areas of them is always going to be a challenge. But I cannot think back to a single customer service failure I've had with you folks. I can't look back at any point where you have failed me as a customer, which is a strange thing to say, given how incredibly efficient I am at stumbling over weird bugs.Matthew: Terrific to have you as a customer. We are hardly perfect and we make mistakes, but one of the things I think that we try to do and one of the core values of Cloudflare is transparency. If I think about, like, the original sins of tech, a lot of it is this bizarre secrecy which pervades the entire industry. When we make mistakes, we talk about them, and we explain them. When there's an error, we don't throw up a white page; we put up a page that has our logo on it because we want to own it.And that sometimes gets blowback because you're in front of it, but again, I think it's the right thing to do for customers. And it's and I think it's incredibly important. One of the things that's interesting is you mentioned that you know what your bill is going to be. If you go back and look at the history of hosting on the internet, in the early days of internet hosting, it looks a lot like AWS.Corey: Oh, 95th percentile transit billing; go for one five minutes segment over and boom, your bill explodes. Oh, I remember those days. Unkindly.Matthew: And it was super complicated. And then what happened is the hosting world switched from this incredibly complicated billing to much more simplified, predictable, unlimited bandwidth with maybe some asterisks, but largely that was in place. And then it's strange that Amazon came along and then has brought us back to the more complicated world that's out there. I would have predicted that that's a sine wave—Corey: It has to be. I mean—Matthew: —and it's going to go back and forth over time. But I would have predicted that we would be more in the direction of coming back toward simplify, everything included. And again, I think that's how we've priced our things from the beginning. I'm surprised that it has held on as long as it has, but I do think that there's going to be an opportunity for—and I don't think Amazon will be the leader here, but I think there will be an opportunity for one of the big clouds.And again, I think Oracle is probably doing this the best of any of them right now—to say, “How can we go away from that complexity? How can we make bills predictable? How can we not nickel and dime everything, but allow you to actually forecast and budget?” And it just seems like that's the natural arc of history, and we will head back toward that. And, again, I think we've done our part to push that along. And I'm excited that other cloud providers seem to be thinking about that now as well.Corey: Oh, yeah. What I do with fixing AWS bills is the same thing folks were doing in the 70s and 80s with long-distance bills for companies. We're definitely hitting that sine wave. I know that if I were at AWS in a leadership role, I would be actively embarrassed that the company that is delivering a better customer experience around financial things is Oracle of all companies, given their history of audits and surprising people and the rest. It is ridiculous to me.One last topic that I want to cover with you before we call it an episode is, back in college, you had a thesis that you have done an excellent job of effectively eliminating from the internet. And the theme of this, to my understanding, was that the internet is a fad. And I am so aligned with that because I'm someone who has said for years that emerging technologies are fads. I've said it about cloud, about virtualization, about containers. And I just skipped Kubernetes. And now I'm all-in on serverless, which means, of course it's going to fail because I'm always wrong on these things. But tell me about that.Matthew: When I was seven years old in 1980, my grandmother gave me an Apple ][+ computer for Christmas. And I took to it like a just absolute duck to water and did things that made me very popular in junior high school, like going to computer camp. And my mom used to sign up for continuing education classes at the local university in computer science, and basically sneak me in, and I'd do all the homework and all that. And I remember when I got to college, there was a small group of students that would come around and help other students set their computer up, and I had it all set up and was involved. And so, got pretty deeply involved in the computer science program at college.And then I remember there was a group of three other students—so they were four of us—and they wanted to start an online digital magazine. And at the time, this was pre-web, or right in the early days of the web; it was sort of nineteen… ninety-three. And we built it originally on old Apple technology called HyperCard. And we used to email out the old HyperCard stacks. And the HyperCard stacks kept getting bigger and bigger and bigger, and we'd send them out to the school so [laugh] that we—so we kept crashing the mail servers.But the college loved this, so they kept buying bigger and bigger mail servers. But they were—at some point, they said, “This won't scale. You got to switch technologies.” And they introduced us to two different groups. One was a printer company based out in San Francisco that had this technology called PDF. And I was a really big fan of PDF. I thought PDF was the future, it was definitely going to be how everything got published.And then the other was this group of dorky graduate students at the University of Illinois that had this thing called a browser, which was super flaky, and crashed all the time, and didn't work. And so of the four of us, I was the one who voted for PDF and the other three were like, “Actually, I think this HTML thing is going to be a hit.” And we built this. We won an award from Wired—which was only a print magazine at the time—that called us the first online-only weekly publication. And it was such a struggle to get anyone to write for it because browsers sucked and, you know, trying to get students on campus, but no one on campus cared.We would get these emails from the other side of the world, where I remember really clearly is this—in broken English—email from Japan saying, “I love the magazine. Please keep writing more for the magazine.” And I remember thinking at the time, “Why do I care if someone in Japan is reading this if the girl down the hall who I have a crush on isn't?” Which is obviously what motivates dorky college students like myself. And at that same time, you saw all of this internet explosion.I remember the moment when Netscape went public and just blew through all the expectations. And it was right around the time I was getting ready to graduate for college, and I was kind of just burned out on the entire thing. And I thought, “If I can't even get anyone to write for this dopey magazine and yet we're winning awards, like, this stuff has to all just be complete garbage.” And so wrote a thesis on—ehh, it was not a very good [laugh] thesis. It's—but one of the things I said was that largely the internet was a fad, and that if it wasn't, that it had some real risks because if you enabled everyone to connect with whatever their weird interests and hobbies were, that you would very quickly fall to the lowest common denominator. And predicted some things that haven't come true. I thought for sure that you would have both a liberal and conservative search engine. And it's a miracle to this day, I think that doesn't exist.Corey: Now, that you said it, of course, it's going to.Matthew: Well, I don't know I've… [sigh] we'll see. But it is pretty amazing that Google has been able to, again, thread that line and stay largely apolitical. I'm surprised there aren't more national search engines; the fact that it only Russia and China have national search engines and France and Germany don't is just strange to me. It seems like if you're controlling the source of truth and how people find it, that seems like something that governments would try and take over. There are some things that in retrospect, look pretty wise, but there were a lot more things that looked really, really stupid. And so I think at some level, I had to build Cloudflare to atone for that stupidity all those years ago.Corey: There's something to be said for looking back and saying, “Yeah, I had an opinion, and with the light of new information, I am changing my opinion.” For some reason, in some circles, it feels like that gets interpreted as a sign of weakness, but I couldn't disagree more, it's, “Well, I had an opinion based upon what I saw at the time. Turns out, I was wrong, and here we are.” I really wish more people were capable of doing that.Matthew: It's one of the things we test for in hiring. And I think the characteristic that describes people who can do that well is really empathy. The understanding that the experiences that you have lead you to have a unique set of insights, but they also create a unique set of blind spots. And it's rare that you find people that are able to do that. And whenever you do—whenever we do we hire them.Corey: To that end, as far as hiring and similar topics go, if people want to learn more about how you view things, and how you see the world, and what you're releasing—maybe even potentially work with you—where can they find you?Matthew: [laugh]. So, the joke, sometimes, internal at Cloudflare is that Cloudflare is a blogging company that runs this global network just to have something to write about. So, I think we're unlike most corporate blogs, which are—if our corporate blog were typical, we'd have articles on, like, “Here are the top six reasons you need a fast website,” which would just be, you know, shoot me. But instead, I think we write about the things that are going on online and our unique view into them. And we have a core value of transparency, so we talk about that. So, if you're interested in Cloudflare, I'd encourage you to—especially if you're of the sort of geekier variety—to check out blog.cloudflare.com, and I think that's a good place to learn about us. And I still write for that occasionally.Corey: You're one of the only non-AWS corporate blogs that I pay attention to, for that exact reason. It is not, “Oh, yay. More content marketing by folks who just feel the need to hit a quota as opposed to talking about something valuable and interesting.” So, it's appreciated.Matthew: The secret to it was we realized at some point that the purpose of the blog wasn't to attract customers, it was to attract potential employees. And it turns out, if you sort of change that focus, then you talk to people like their peers, and it turns out then that the content that you create is much more authentic. And that turns out to be a great way to attract customers as well.Corey: I want to thank you for taking so much time out of your day to speak with me. I really appreciate it.Matthew: Thanks for all you're doing. And we're very aligned, and keep fighting the good fight. And someday, again, we'll eliminate cloud egress fees, and we can share a beer when we do.Corey: I will absolutely be there for it. Matthew, Prince, CEO, and co-founder of Cloudflare. I'm Cloud Economist Corey Quinn, and this is Screaming in the Cloud. If you've enjoyed this podcast, please leave a five-star review on your podcast platform of choice, whereas if you've hated this podcast, please leave a five-star review on your podcast platform of choice along with a rambling comment explaining that while data packets into a cloud provider are cheap and crappy, the ones being sent to the internet are beautiful, bespoke, unicorn snowflakes, so of course they cost money.Corey: If your AWS bill keeps rising and your blood pressure is doing the same, then you need The Duckbill Group. We help companies fix their AWS bill by making it smaller and less horrifying. The Duckbill Group works for you, not AWS. We tailor recommendations to your business and we get to the point. Visit duckbillgroup.com to get started.Announcer: This has been a HumblePod production. Stay humble.

Matthew Kepnes runs the popular travel blog, Nomadic Matt, and also writes a successful newsletter. In fact, Matt's newsletter is one of the biggest I've had on the show. His book, How to Travel the World on $50, is a New York Times Best Seller.After a 2005 trip to Thailand, Matt decided to leave his job, finish his MBA, and travel the world. Since then, he's been to nearly 100 countries, and hasn't looked back. Besides being a New York Times best-selling author, Matt's writings have been featured in countless publications. He's a regular speaker at travel trade shows, and is the founder of FLYTE, a non-profit organization that sends students overseas to bring their classroom experience to life.I talk with Matt about his unique approach to running his business. While others are building online courses, Matt has shifted to doing more in-person meetups and events. We talk about his newsletter, and we also talk about growing your Instagram follower count, scaling a business as a solopreneur, and much more.In this episode, you'll learn: When & why you need to start outsourcing day-to-day tasks Matt's email opt-in strategies and tips to get more subscribers The most important metric about your email list How to quickly get more followers on Instagram Links & Resources Blue Ocean Strategy Matador Lonely Planet Blue Ocean Strategy book Pat Flynn Women In Travel Summit Traverse Cheryl Strayed ConvertKit TravelCon FinCon Podcast Movement World Domination Summit Hootsuite Tim Ferriss Seth Godin OptinMonster Seth Godin: This is Marketing Rick Steves Nathan Barry Show on Spotify Nathan Barry Show on Apple Podcasts Matthew Kepnes' Links Matt's website Follow Matt on Twitter Matt's Instagram The Nomadic Network Nomadic Matt Plus Episode Transcript[00:00:00] Matthew:When I started these courses back in 2013, there wasn't a lot of folks. Now you have so many people with courses, so many Instagrammers and TikTokers selling their stuff. It's sort of like, is this worth the time to really invest in it when my heart really isn't in it? How can I maintain 400K in revenue a year? Is that the best use of our resources? The answer is, not really.[00:00:33] Nathan:In this episode, I talk to my long time friend, Matt Kepnes, from Nomadic Matt.Matt's got a travel blog that's wildly popular, and he gets into that—shares all the numbers. He's probably one of the biggest newsletters that I've had on the show, so far.What I love about him, in particular, is how thoughtful he is about his business model.Most people are just adding more courses and figuring out how to grow revenue; honestly, what's now fairly traditional ways, and it's quite effective. Matt takes another approach. He gets into in-person events and meetups. We get to talk about why in a busy, crowded online world, he's actually going offline.I think that Blue Ocean Strategy he references, the popular book by the same title, I think it's interesting, and it's something worth considering when some of the online strategies don't work. We also get into a bunch of other things like growing his newsletter. Like I said, it's quite large.Then, also growing an Instagram following. Instagram is not something that I'm going to actively pursue, but it's interesting hearing his approach of what you do if you're at 5,000 followers on Instagram, and want to grow to 50,000 or more.So, anyway, enjoy the episode.If you could do me a favor and go subscribe on Spotify or iTunes, or wherever you listen if you aren't subscribed already, and then write a review.I check out all the reviews. Really appreciate it. It helps in the rankings, and I'm just looking to grow the show.So, anyway, thanks for tuning in today. Let's go talk to Matt.Matt, welcome to the show.[00:02:06] Matthew:Thanks for having me, Nathan. I've been trying to get on this podcast for ages.[00:02:10] Nathan:Well, don't say that, that'll make people think they can get on just by asking. Really, you came to my house and stayed in my cottage on the farm, and then you're like, “Yo, have me on the podcast!” And that's when I was like, “Absolutely.” But if anyone just asked, that would not be a thing.[00:02:26] Matthew:No, I just mean I finally—I'm excited that I'm worthy enough in my blogging career to be on.[00:02:33] Nathan:Oh, yes.[00:02:35] Matthew:I've made it.[00:02:36] Nathan:Yeah. It's only taken you, what, a decade and a half?[00:02:39] Matthew:13 and a half years. Slow and steady wins the race.[00:02:43] Nathan:That's right.I actually want to start talking about that side of it, because I've been in the blogging world for 11 years now. But even I feel like things changed so much in the first couple of years, even before I entered into the world. So, I'm curious, going back to the early days, what were the prompts for you to come into the blogging world and say, “Hey, I'm going to start publishing online”?[00:03:10] Matthew:Yeah. You know, it was a very haphazard, there was no grand plan. Like I had Zanger when people had Zeno's, which is, you know, a personal blog, way back, you know, 2003, whatever. And so what, I went on my trip around the world in 2006, I just kept updating this Zynga. You know, it was called, Matt goes the world and it was just like, here I am friends here I am.And then, you know, everyone was really excited in the beginning. And then after a while I got sick in my update because the know their back of their office job. So I kinda just forgot about it until I came home and January, 2008 and I need money. And so I started a temp job, and I had a lot of free time and I really just hated being back in the, the office with the walls and everything.And so I was like, I need to earn money to keep traveling. And so I started the website really as with the goal of it being an online resume, you know, it was very bare bones. I used to share a travel news, have an update, like tips and stories from my trip. And then there was a section where we're like, hire me and it had my features and, you know, the guest blogs I did, I used to write for Matador travel.So just as a way to sort of build up, a portfolio of like, Hey, Yeah, freelance writing because I'm wanting to read guidebooks, you know, I wanted to write for lonely planet. That was a dream, right. The guidebooks. And so just the blog was a way to hone my skills and just get in front of editors to be like, Hey look, I do right.You know, here's where I've been, you know, and, and sort of build that base. And eventually that became a thing where I didn't need to freelance. Right.[00:05:03] Nathan:Was it called nomadic Matt from the beginning.[00:05:06] Matthew:He was, yeah. I B two names, nomadic Matt. And that does the world. Right. Because I like the double entendre of it. Right. Even though, but just cause I have a weird sense of humor and all my friends were like, you can't do that one. You gotta do nomadic Matt. It was really good because it's much better brand name, you know, in the long run.But again, I wasn't thinking about that. Right. I wasn't thinking like, oh, I'm going to start this brand. You know, I gotta think of a clever name that people can remember. It was like,Oh a place where people can see my work.[00:05:39] Nathan:Right. Okay. So now 13 and a half years later, what's the, what's the, the blog and newsletter look like. and I want to dive into the business side of it because I think a lot of people build successful newsletters, audience-based businesses, but don't make the leap to like something bigger than themselves.And so I want to dive into all those aspects of it.[00:06:01] Matthew:13 years later, it's seven people. We just hired a new events coordinator to help. my director of events, Erica, coordinate all these virtual in person events that we're going to kick off again. I have a full-time tech guy, a full-time director of content. We changed his title, but like three research assistants, because.I picked a niche that like is always changing. Right. You know, you have a fitness website, how to do a pull up. It's just, that's it,[00:06:37] Nathan:You ranked for that keyword. You're good to go.[00:06:40] Matthew:Yeah. Like how to do a pull up, doesn't change what to do in Paris or the best hospitals in Paris, constantly changing, you know? so it takes three resources, distance.Plus my content guy, me that basically keep up the content and then I have a part-time, graphic designer and part-time social coordinator.[00:07:00] Nathan:Nice. And how many subscribers do you have in the list now?[00:07:03] Matthew:We just called it, so it's a two 50 because we just, cause I haven't shaved it off in like five years or so. So we basically everybody that hasn't opened the email in one year where we're like, you want to be on.And like 2% of them click that button. And then we just got rid of the other 90%. It was like 60,000 names.[00:07:30] Nathan:Yeah. So for everyone listening, two 50 in this case means 250,000.[00:07:35] Matthew:Yeah.[00:07:36] Nathan:Just to clarify, I 7% businesses off of 250 subscribers would be remarkable. That would be just as impressive, but that's not what we're talking about here. going into, so a lot of people, talk about or worry about, should I prune my list or that kind of thing?What were the things that went into that for you? That's a big decision to, to prune 60,000 people off a list.[00:08:00] Matthew:I think it was probably more, maybe I want to say six 60 to 80 I somewhere around there. we were pushing up against our account before I went to the next billing step.So that's always a good impetus to prune the list, but you know, I I've been thinking about it for a while because. You know, I I really want to see what my true open rate.Is You know, like, okay, I have all these people and we were sending it this, I have multiple lists, but the main weekly list was like, 310,000-315,000 but it's been so long since we called and we have so many emails there and I just really wanted to get a true sense of like, what's our active audience.And so between, between that and, pushing up against the next tier price tier. Yeah. it yeah. It's cool to say like, oh, we have 300,000 300, you know, rather than 250,000 Right. But who cares? Right. I mean, at the end of the day, it's just a vanity metric, right? Yeah. It sounds cool. I get a million emails. Right. But if you only have a 10% open rate, You really only have 100,000.[00:09:20] Nathan:Right. I think that the times that it matters is maybe when you're selling a book to a publisher and that might be the only time that you like that dead weight and your email us actually helps you.[00:09:33] Matthew:Yeah. Like if you're, or you have a course, you know, are you trying to promote your numbers, but people would probably lie about that stuff too. yeah, so like, it really doesn't matter because all that matters is like, what's your true audience? Like who Who are the people that are really opening your stuff?[00:09:50] Nathan:Yeah. So let's dive into the, well, I guess really quick, I should say I am a hundred percent in the camp of, like delete subscribers, like do that once a year, that kind of thing. Clean up the list, go for the highest number of engaged subscribers, rather than the highest number of subscribers. It's just[00:10:06] Matthew:Right.[00:10:07] Nathan:To track.[00:10:08] Matthew:And, and I think you would know better than me, but isn't this a good. Like signal to Gmail. And you know, when you, you don't have a lot of dead emails, just go into a blank account. It's never getting opened or marked as spam or whatever.[00:10:24] Nathan:Yeah, for sure. Cause a lot of these times, there's a couple of things that happen. One is emails get converted to spam traps. And so it's like say someone's signed up for your email list six years ago And, they haven't logged into that email account for a long time.Google and others will take it and convert it to a spam trap and say, Hey, this email hasn't been logged into in six years.And so anyone sending to it, it's probably not doing legit things now you're over here. Like, no that person signed up for my list, but they're basically like you should have cleaned them off your list years ago. And then if that person were to ever come back and log into that Gmail account, do you remember like, oh, just kidding here, have the, have the email account back, but they're basically using that.And so you can follow all the. Best practices as far as how people join your list. But if you're not cleaning it, then you will still end up getting these like spam hits and, and other things. So you absolutely clean your list. Let's talk the business side, on revenue, I don't know what you want to share on the, on revenue numbers, but I'd love to hear any numbers you're willing to share.And then the breakdown of where that comes from, whether it's membership, courses, conferences, that sort of thing.[00:11:35] Matthew:Yeah.So there's like the pre COVID world and the post COVID world. Right. You know, like,[00:11:40] Nathan:Yes.[00:11:41] Matthew:Cause I work in travel, so like, you know, pre COVID we did over a million and like I was probably gearing up to like in 2020, like one, five, I think I were going to get a little over one five. and again, you know, this is, I work in the budget travel side of things, right.So like it's going to sell a lot of $10 eBooks to get up to seven figures. salary books are 10 bucks. and so. Postcode during COVID week, I think in 2020 made like half a million. and this year we'll probably get up to three quarters,[00:12:23] Nathan:Okay.[00:12:24] Matthew:K.[00:12:25] Nathan:He was coming back,[00:12:26] Matthew:Yeah. Yeah. and I think next year we'll, we'll get back over seven and then basically like how to go from there.You know, so maybe 20, 23, I might get to that one, five that was going to get to in 2020. most of the revenue now comes from ads, and then affiliates. we did, we did do a lot on courses, but then I, one of the things that, you know, a big pandemic that stops your business, allows you to do is really look at the things you're doing because every.Zero. So it's like when we start back up, is this worth investing time in? And so the answer is no. So we dropped down from, I think, peak of doing like $400,000 a year and horses, and this year we'll do maybe 40. and that's mostly because we just leave it up as like, you can buy this, we update it every six months.If it needs, it's basically like a high that blog course get all my numbers and tactics and strategies in there. but we don't offer any support for it. Right. It's just, you're buying information. and so it's very passive in that sense, but it's not like a core business where we're really moving and we were doing this pre COVID is moving into events and membership programs.So like we have pneumatic map plus, which gets you like all our guides, monthly calls and sort of like a Patriot on kind of thing, but like free.[00:14:03] Nathan:That cost.[00:14:04] Matthew:Five to 75 bucks a month, depending on what you want. So it's 5 25, 75. Most people opt for the five, of course. And it's really geared to like, get the five.But you know, that brings now, I think like three or four K a month. and then we have the events, which is donation based, but there's just like another two K a month. And so this is like, since COVID right. So like, that's say call it 50 K a year of, of revenue that we've added in. They didn't exist before.And now I know you're, you can compare that against the loss of the courses, but we had been phasing those out for years. and so that's really where we want to grow is bringing in more, you know, monthly revenue for that. Right. You know, Once we started, it's easy and we're gonna start doing tours again and, you know, so more high value things that don't take as much time.[00:15:08] Nathan:Right. So on the core side, I think a lot of people listening, maybe they have an email list of five, 10, 15,000 subscribers, and they're like, Hey, the next thing is to launch a course. And they're hearing that's where a bunch of the revenue is. And so it's interesting you moving away from that. So let's dive in more.What, what made you look at the core side of your business and say, I don't want to like restart that in a post COVID world.[00:15:33] Matthew:Yeah, there's just, there's a lot of competition, right? So like, I think it was like a blue ocean, red ocean strategy, you know, to think of that book of, you know, Blue Ocean Strategy. Right? One of the reasons we went into events is because a lot of our traffic comes from Google. And so it's a constant battle of always trying to be one or, you know, in the first couple of spots.Right with every blogger in every company with SEO budget, but there's not a lot of people doing in-person events or building sort of a community in the travel space. So I looked at that of being like, okay, there are a lot of people doing courses and they love doing courses and they're great teachers, you know, they're, you know, you get folks who know like path when, you know, low, like everyone, all these teachable folks, you know, they, they love that stuff.That's not where my heart really was. And so thinking of like, this is a red ocean now, because you have, when I started this, these courses back in 2013, there wasn't a lot of folks. Right. But now you have so many people with courses, so many Instagrammers and tic talkers selling their stuff. It's sort of like, is this worth the time.To like really invest in it when my heart really isn't right. Like how can I maintain your 400 K in revenue a year?[00:17:02] Nathan:Right.[00:17:03] Matthew:What's it going to take, you know, is that the best use of our resources? And the answer is not really, you know, let other people do that. Who love it. I mean, you want to buy my information.It's it's solid stuff. Right. Everyone loves the advice, but to really create like a cohort, like your class, which is sort of like the new version of courses, you know, like, whether it's a month or three months, it's sort of like, you go with this like cohort, right. My heart really wasn't into it because we can invest more in doing events and conferences and really in-person stuff.Especially now that everyone's really excited to do stuff in person again, with a lot less competition. It's easy. It's easy to start a course, but there's a lot of capital investment in doing events that we have the resource to do that, you know, somebody with a 10,000 email list might not.[00:18:03] Nathan:I think I see a lot of people going into courses in, particularly as you alluded to cohort based courses where they're doing it, like, Hey, this is a whole class that you're doing, you know, you're doing the fall semester for the month of October or whatever it is, I'm doing it, doing it the first time and really enjoying it because it's a new challenge they're showing up for their audience.It's just, it's super fun on that, doing it for the second time and going, huh? Okay. That was way easier and way less. And then the third time they go, I don't think I want to do this anymore. Like if the money is good and I just don't enjoy showing up at a set time for a zoom call or whatever else. So it's interesting of watching people jump on a bandwagon and some people it works for really well, and that is their strength and they love it.And then other people that I'm going to like, look, the money's good. And this is this just, isn't what I want to spend my time on.[00:19:02] Matthew:Yeah. You know, I've been doing it for, you know, seven, eight years now and I just sort of lost the passion for, you know, I think it's, I like when people take the information, they succeed with it. But I think after a while you start to realize, you know, it's sort of a 90 10 rule, right? You, 90% of your students, aren't really going to do anything with it.And it's not your fault. It's just because they become unmotivated or, you know, so we tried to switch to the cohort based to be like, okay, this is the class weekly, weekly calls.You know, come on, come together and you still get this drop off rate. That's, you know, sort, it gets this hard and you're like, all right, I've been doing this for eight years, you know, like moving on.But I mean, if you have the love for like pat loves it, you know, like you've got a whole team about it, he's got all these cohorts stuff that speaks to him where I think I'd rather do stuff in person that[00:20:01] Nathan:Right.Well, let's talk about the in-person side. Cause you did something that most people think is really cool and almost no one realizes how hard it is. I think I know how hard it is because I've attempted the same thing and that starting at a conference where everyone's like, you have this big online following, like what you just need to, you know, you have hundreds of thousands of people you just need, I don't know, 500 or a thousand of them to show up in a suit, that's gotta be easy.Right. And so they go and sort of conference, it's wildly difficult. And so.[00:20:33] Matthew:Difficult.[00:20:34] Nathan:I'd love to hear what made you want to start the conference and then yeah, how's it. How's it gone so far?[00:20:40] Matthew:Made me want to start the conference was I really don't think there's a good conference in the chapel space. Yeah. And there are good conferences in the travel space that are very niche and narrow. you know, like there's a woman in travel summit.That's really great. There's one in Europe culture verse, which I liked, but that's like a couple of hundred people there. Wasn't like a, something to scale, right. With wits, which is women to travel is like 300 people. There was, this is no thousand person, 2000 parts. And like mega travel conference for media that has done like, you know, the conferences we go to where it's like high level, you know, people coming outside of your immediate niche to talk about business skills.You know, there's, you know, In the conferences, there are, there's always the same travel, like it's me and like these other big names, travel bloggers over and over and over again. I want to take what I've seen and, you know, from social media world to, trafficking conversion, to mastermind talks, you know, to take all these things that I had gone to, we were like, let's bring it together for travel.Let's create a high level, not a cheap, like hundred dollar events, like, you know, with major keynotes who get paid to speak, because you know, in a lot of travel conferences, you don't get paid to speak, right? So you're high. You're going to get, you know, Cheryl strayed that come to your event for free.That's not waking up to do that. You know, I, you know, and while I can get nice deals from my friends, you still got to pay people right. For their time. And, and so that allows us to have a larger pool of people to create the event that I want to do. Because we will also get into the point where why should somebody who's been blogging for five or six years, go to travel blogging conference app when nobody is at a more advanced stage of blogging than you are, you know, nobody understands SEO better than you do, right?So like after a while you get into this, just drop off of people being like, do I want to fly around the world and hang out with my friends? So I wanted to also create an event where that I could go to and learn something is that I knew that would attract some of the other OJI, travel bloggers.[00:23:06] Nathan:Yeah. So how the, how the first one go, like what was easier than you expected and what was much harder than you.[00:23:14] Matthew:The first one went really well. We had 650 people, and you know, the next one we had 800. But now we're closed because of Kobe, but we're going to do one in 20, 22. And hopefully we get 800 again, things that shocked me, people buy tickets and don't show up. Right. That's weird. Right. Cause I was like, okay, we have 700, you know, I expected maybe like a 5% attrition rate, you know?So like I sold my 750 tickets, but then like six 50, those 600 showed up because the other 50 of those speakers, right. I was like, wow, that's a lot of no-shows for not achieving conference, you know? And so we plan, you know, a 10% attrition rate now.[00:24:04] Nathan:And you just mean someone who doesn't even pick up their badge? Not even, they didn't come to share us rates keynote, but just like they didn't show up to anything at the conference.[00:24:13] Matthew:Yeah, they just did not show up to the conference at all, you know? And. So that was a shock me. I mean, I know I work in travel and, you know, people get last minute of press trips or they, you know, they buy their ticket and they can't come cause, or they got stuck in the Seychelles or whatever, but I did not expect such a high level of no-shows. Because the food here's another thing, food costs a lot of money. Right.You know, I, I fully understand why the airlines took one olive out of your salad. Right. Because it's one olive, but times a million people every day it's actually adds up. Right. So like you think, oh, well it drinks five bucks.That's cool. We'll do a happy hour. Okay. Now times that by a thousand drinks Write, you know, times two, because everyone's drinking two or three, at least two. Right. So then you're like, okay, that's a $15,000 bill that you ended up with. you know, when everyone is all set up. Tax and tip hotel.It's crazy. It's like, okay, these fees, you're like, oh, I got to spend this like, yeah. Okay. Here is your lunch bill 50 grand.But then there's this fee that fee, this fee, this fee like Jake had like 65. You're like, all right. I guess I got a budget for that too. So that was, that was really weird. Like high is the lunch cost, $40,000, you know, and actually hotels, overcharge, and they add a bunch of fees and yeah, you can get them pretty quick.[00:25:46] Nathan:So if you were, if I was starting to conference. They have 50,000 people on a email list or a hundred thousand. And I'm like, Matt, I heard you started a conference. I'm going to do it too. What advice do you have for me? Like what are the first things that you'd call out?[00:26:03] Matthew:It's going to cost like three times more than you think. pricing. Where I went wrong in the second year. Right. So like we've lost money the first two years doing it, but I expected to lose money. It wasn't because I was investing in this long-term thing. Right. But we're at where I lost more money on the second year is that I really factor in flights as well as I did, like I kind of low balled it.And so I always think he should. Oh. And I also invited, I kept inviting people without really seeing, like, where was I? on my like speaker fees. Right. So like really creating a budget and then sticking to it. And even if that means not getting some of your dream folks, to a later year, but working up the food and beverage costs first, because you know, you go to the hotel and they're going to say your F and B, you know, is $90,000.And if they never going to hit that, no, you're going to go way. You're going to blow cause you got to get them to say, what are all the fees? You know, like, okay. You know, if I have a 300 person conference and I want to do two lunches, what does that look like?Plus all the taxes and fees,[00:27:23] Nathan:Okay, well, you, the launch price and you'll, you'll pencil that into your spreadsheet and they'll fail to mention that there's mandatory gratuity on top of that and taxes and whatever[00:27:33] Matthew:Yeah,And whatever, you know, plate fee there is. Right. So you gotta factor all that in and then look at what you got left.[00:27:40] Nathan:It's like when you're buying a car and you have to talk in terms of the out the door price in[00:27:45] Matthew:Yeah.[00:27:46] Nathan:The sticker price,[00:27:47] Matthew:Yeah. I made that mistake when I bought my car last year, I was like, oh 17. And I was like, wait, how did 17 go from 17,000 to 22? And like, well,[00:27:56] Nathan:Right.[00:27:57] Matthew:Thing that I was like, ah, okay,[00:28:00] Nathan:Yeah. Do you think w what are some of the opportunities that have come out from running the conference and has it had the effects of your community that you've hoped? It would,[00:28:10] Matthew:You know, this is a very, blogger faced event, you know, more than just travel consumers. but it's definitely allowed me to, you know, meet folks like Cheryl Austrade, you know, great way to meet your heroes. Is there pay them to come speak at a conference? so, you know, I, I know Cheryl, like, that's cool.The becoming more ingrained in sort of the, the PR side and with the demos and the brands, because, you know, on the website, I destination marketing organization.[00:28:44] Nathan:Okay.[00:28:45] Matthew:So they're like, you know, visit, you know, Boise visit Idaho, we call them a DMO. And so like since I don't really do press trips on the website, I don't know a lot of them really well.And so this has been a way to be, become more ingrained on that sort of industry side of events and not live in my own. and that's helpful because now I know all these folks, when we want to have meetups that might be sponsored when I do a consumer event, which is next up. So get these folks to come for that.So it's just really been good, just professionally to meet a lot of people that I would normally just not meet simply because I go to events and they were like, Hey, come to our destination, we'll give you a free trip. And like, you have a policy. And so I don't get invited to as many things as you would think.[00:29:37] Nathan:Yeah. Why, why do you have that policy? What do you like? What's behind it. And why is that different from other travel bloggers?[00:29:45] Matthew:Hi, it mostly stems from my hatred of reciprocity. You know, like if you, if I go on a free trip and it sucks, like I then create, it's awkward. If I have to go like hot, like, Hey, you suck. And I have to write this online. Then it creates a lot of bad blood that gets talked about, you know, it's a very small industry.People move around a lot, so you get less opportunities or I can just go, Hey, I'm not going to write that. And then they feel bad. Cause like, you know, like you're a nice person just doing their job, you know, like it's not your fault. I had a bad time. you know, I did this once with a friend and she gave me a couple of places to stay, at a hotel in San Jose, Costa Rica and chill out and sort of tell was really far out of town.And th the amount it took me to take a taxi back and forth. Like, I could've just got a place right. In the center of San Jose, you know? And so I was like, I really, I just don't think it's a good fit for my Anya. And she was very unhappy about it. I was like, I mean, I could write in, but I have to say that.Right. Yeah. And so I just never wanted to put myself in those situations again. I also think that taking a lot of free travel, like I do budget travel. So you given me a resort like that. Doesn't how does that help my audience? So if I start living this awesome life and getting free stuff, that's great for me, but it's not good for my audience.And so I don't mind taking free tours. Like, let's say I'm going to go to Scotland. Right? I did. This actually was real life example. I wanted to access cause I wanted to write about scotch. So I was like, Hey, I don't want to do like the public tour. you know, that 20 bucks, you know, it's like 10 minutes and you get the, I like, I want to talk to people because I want quotes for articles.I'm going to do like history stuff. So I contacted the Scottish tourism board and they got, got me visited. I that's where I went to. I just love P scotch. and so they got me like private tours. So I can like take notes in such. and they gave me a free accommodation that I was like, I want to be really clear about this.I'm not mentioning this place. And they're like, just, just take it. And so, and I didn't mention it and I didn't mention that, you know, I got access to these, you know, distillers to ask some questions, but it was more about building this article as a journalist than,Hey, I want like free tours, you know, like, I mean, I saved 20 bucks. Right. But the point was, I wanted to learn about the process to write about this story beam. And then they offered me free flights and stuff. It was like, now I just, I just want the tourist, please. Thanks.[00:32:44] Nathan:Yeah, it's interesting of the, what a lot of people would view as the perks to get into travel blogging. Right. I want to get into it because then I'd have these free chips or I can have these offs or whatever else, I guess the right apps you get, no matter what, but, You know that that's the other side of like, everything comes with a cost.And I think it's important to realize what you're doing because you want to versus what you're doing, because now you feel obligated because someone gave you something for free.[00:33:12] Matthew:Yeah. The most thing is I tend to accept our city tourism part, which gets you like free access to museums and stuff. I was like, okay, that's cool.But beyond that, I just, you know, I don't want to get into, like, you want to give me a museum pass. I'm going to see these museums anyway. Sure. I'll save some money and I'll, I'll make a wheel note, but I'm going to no obligation to write about which museum, because I write about the ones I like anyway.So,[00:33:39] Nathan:Right.[00:33:40] Matthew:You know, that's not to me like free travel. That's not what people think of Like the perks of. the job are.[00:33:46] Nathan:I, that was funny. When I learned about the, like the welcome packet that cities will, will give, like the first time I saw it in action was. I went to Chris, Guillebeau's like end of the world party in Norway. and I was hanging out with Benny Lewis there who runs, you know, fluent in three months, a mutual friend of both of ours.You've known him longer than I have, but like, we're both at our check into the hotel and he's got like this whole thing of all these museum passes he's got, and he's just like, yeah, I just emailed the tourism board and said, I was going to say, and they're like, oh, blogger. And they gave him like, you know, access to everything and you only ended up using half of it because we weren't there for that long, but,[00:34:28] Matthew:Yeah. That's great. You should always get these discount cards, like the comparison museum pass or the New York mic go card that will save you a lot of money if you're doing lots of heavy sites in.[00:34:39] Nathan:Yeah. Yeah, for sure. okay. So how does actually let's dive into the COVID side, right? Cause COVID took a hit huge hit on the entire traveling. we saw that just in the like running ConvertKit where, you know, having bloggers in so many different areas, we had a lot of growth because lots of people were stuck at home and start like, I'm going to start a new blog.I'm going to have time to, to work on this or whatever. And it was a lot of cancellations, mostly from the travel industry. If people like, look now that what this 50,000 person list, that was a huge asset is now just a giant liability. because no one's planning trips. How did you navigate that time? And what, like, what's the journey been?You know, the last 18 months, two years,[00:35:28] Matthew:Well first I would say that's really shortsighted of someone canceling their 50,000 person list like[00:35:34] Nathan:I think they were like exporting sitting on it and they're going to come back. But, but I agree. It was very shortsighted.[00:35:39] Matthew:Yeah. Like just like throw it away. 50,000 emails, right. I mean, it was tough in the beginning. You know, we went from like January and February were like best months ever, you know? And like, I mean, even, and then all of a sudden like, like March 13th is like that Friday, you know, it's like everything crashes, like again, like we were on our way to have a banner year, like, like, like hand over fist money, you know?And, and then to being like, how am I going to pay the bills? You know? and so, cause you know, we, haven't sort of the, the overhang from Java con, right. You know, like we didn't make money on the first two years. And year three was the, the breakeven year and travel con was in, Right in the world ended in March.Right. And so I had laid out all, like, you're so close to the event, that's you? That's when you start paying your bills. Right. And the world hits and all the sponsors who, you know, have their money, you know, in the accounting department are like, oh, we're not paying this now. And so you're like, well, I've just paid $80,000 in deposits and all that money that was going to offset.It has gone. and then you have people canceling. A lot of people were really mean about it. They're like, oh, I'm, I'm back now. And we're going to do charge backs, that, you know, you have that overhang and just, you know, fall in revenue it's it was really tough. thank God for government loans, to be quite honest, like I, I went to native through if it wasn't for, all that, because a lot of my.My money was tied up in non-liquid assets. So it wasn't like I could just like sell some socks though, you know, pay the bills. but things have come back a lot. I mean, there's a lot of paint up the man, for travel, I view it like this way, right? You got kids, right. You know, they get in trouble, you take away their toy and then you give them back.Right. Where do they want to do now? They just want to play with that toy even more because it's like, no, it's mine. No one else can have it. And like where you want to do this other toy. No. And so now that the toy of travel is being given back to people like people are like, never again, am I going to miss out on this opportunity to travel on my dream trips?Let's make it happen. So we had a really good summer. I spoke to mediocre fall and winter just as the kids are back in school, people are traveling less, you know, but as more in the world, that? will be good. but again, as I said, at the beginning of this, it's going to take awhile for us to get, to get back to where we were, but there's definitely demand there,[00:38:36] Nathan:When's the next conference when the travel con happening again.[00:38:39] Matthew:April 29th,[00:38:41] Nathan:Okay.[00:38:41] Matthew:22,[00:38:42] Nathan:So what's the how of ticket sales benefit for that? Is there like that pent-up demand showing up and people booking conference tickets or are they kind of like, wait and see, you know, you're not going to cancel this one too kind of thing.[00:38:55] Matthew:Yeah, I mean, we're definitely not canceling it. I mean, the world would have to really end for it. We just launched, this week. So, early October, we just announced our first round of speakers. and we sold like 10 or 15 tickets. I don't expect a lot of people, to buy until the new year I saw this.And the old event, right? Because in the old event we were had in May, 2019. Right. And we announced in the fall, but it wasn't until like, you know, a few months prior that people started buy their ticket. Right. Because they don't know where they're going to be. You know, where are they flying from? What were the COVID rules going to be like, the demand is there.But I, I know people are probably just waiting and seats for their own schedule too, you know? So, but you were against so 800 tickets and honestly, from what I've heard from other events, you know, people are selling out, you know, because there was such demand, like it's not a problem of selling the tickets, so I'm not sure.[00:40:01] Nathan:Yeah, one thing, this is just a question that I'm curious for myself. since I also run a conference, what do you think about conferences that rotate cities or like Mo you know, move from city to city, which we've been to a lot of them that do it. You know, the fin con podcast movement areTwo longer running ones that you and I have both been to. obviously that's what you're doing. The travel column. well, domination summit, which we've both been to a lot, you know, it was like very much it's Portland. It's always Portland. We'll never be anywhere anywhere else. What do you think, why did you chose? Why did you choose the approach that you did in what you think the pros and cons are?[00:40:39] Matthew:Yeah, for, for me it was, you know, we're in travel. I wanted to travel. Right. And plus, you know, I mean, you get up, we get a host, right? So like Memphis is our sponsor. Right. It's in Memphis. Yeah, it was supposed to be in new Orleans. New Orleans was our host sponsor. Right. So moving it from city to city allows us to get, you know, a new host sponsor every year is going to pony up a bunch of money.Right. I don't know how Podcast move into it, but I think if I wasn't in travel and it was more something like traffic and conversion, or maybe we'll domination summit, I would probably do it in the same place over and over again because you get better consistency. you know, one of the things I hate about events is that they move dates and move locations.Right. And, and so it's a little hard to in travel cause you know, COVID really screwed us. Right. But we're moving to being, you know, in the same timeframe, right. We're always going to be in early May. That's where I want to fall into like early may travel car, change the city, but you got the same two-week window, because it's hard to plan, right?So like if you're changing dates in cities, you're, you're just off of a year. So I wanted some consistency, make it easier for people to know, like in their calendar, Java con early Mac, Java con, early Mac, you[00:42:17] Nathan:Yep.[00:42:18] Matthew:It doesn't really work out cause of COVID, but post COVID we're we're moving to that, that, early may[00:42:24] Nathan:Yeah. Okay. So let's talk more about sort of scaling different between different levels of the business. So there's a lot of people who say, all right, 10, 20, 50,000 subscribers, somewhere in there. And it's very much the solopreneur of like, this is, I'm a writer. I just do this myself. Or maybe they, you know, contract out graphic design or a little bit more than that.What were some of the hardest things for you and why and what worked and what didn't when you made the switch from it being nomadic, Matt being just Matt to Matt plus a team.[00:43:00] Matthew:Yeah, it It's definitely hard to give up that control, right. Because you always think no one can do your business better than you can. And I mean, even to this day, I still have issues doing, you know, giving up control. Right.[00:43:14] Nathan:What's something that you don't want to, that you're like still holding onto that, you know, you need to let go of[00:43:19] Matthew:Probably just little things like checking in on people and, you know, Content probably like Content. I'm very specific about my voice, the voice we have. So. But I should let my content, people make the content that I know is fine. but I definitely, probably overly check on my teams to be like, what'd you do today?You know, you know, that kind of stuff. but I did take a vacation recently and I went offline for a week and they didn't run the thing down. So I was like, oh right. That was my like, okay, I can, I can let go. And it's going to be okay. But, so getting comfortable with that much earlier on, I would probably save you a lot of stress and anxiety.I definitely think you should move to at least having somebody, you know, a part-time VA, if you're making over six figures, hire somebody because you know, how are you are not going to go from a 100k to 500k really by yourself? Unless, you know, you just have some crazy funnel that you do, but even the people I know who are solopreneurs, they still have two or three people helping them a little bit part, even if it's just part-time because the more money you make, the more time you have to spend keeping that income up.And so your goal as the creator in the owner should be, how can I grow? How can I make more money? It should not be setting up your WordPress blog. You know, It should not be answering joke emails It should not be, you know, scheduling your social media on Hootsuite, that kind of low level stuff can be done by, you know, a part-time VA And maybe that part-time VA becomes a full-time VA as you scale up more. But you know, if you, you have to free up your time and you're never going to free up your time, if you're spending a lot of that time, scheduling. So you mean that the people I know who have half a million dollar businesses, selling courses, you know, and they're really just a solopreneur.They have somebody do that grunt work, right. Plus if you're making that much money, is that the best use of your time now? Really? Right. So getting somebody to do sort of the admin front work, as soon as you can, even if it's on a part-time basis will allow you to focus on growth marketing, and monetization, which is where you should be like Podcast.This week. I have like four or five podcasts I'm doing, right. You know, that is a good chunk of my week. If I have to spend that time scheduling on social media, you know, or setting up blog posts, like I can do that. And this is where the growth in the audience comes in.[00:46:12] Nathan:Okay. So since we're talking about growth, what are the things that you can tie to the effort that you put in that drives growth? Are there direct things or is it a very indirect unattributable[00:46:27] Matthew:Yeah, I think there's some direct things like, you know, before, you know, asking 10 years ago, I would say guest posting on websites. Right. You write a guest post on like Confederacy's site and boom, tons of traffic. Right. that doesn't exist anymore. I mean, yeah. You can get a lot of traffic, but it's not like the huge windfall it used to be, but it's still good for brand awareness.SEO. Great for links. Right. I would say things today that I can tie directly to stuff Podcast and, Instagram. So doing, like, doing a joint Instagram live with another creator. Right. You know, like me and, you know, it's I know pat. because someone with a big following there, we do, we do a talk, you know, 30 minutes, you know, I can see in my analytics, like a huge spike in my following right after that.And so that's a great way to sort of grow your audience is to do Instagram collabs in just like 30 minutes tops and[00:47:32] Nathan:Podcasts[00:47:33] Matthew:I get a lot of people will be like, I saw you on this podcast. I was like, wow, cool.[00:47:37] Nathan:I always struggle with that of like, of all the activities that you can do. Cause you get to a point where there's just so many opportunities open to you and it's like, which are the best use of time. What should you say yes to, what should you say no to, and I don't know. Do you have a filter along those or do you just, is it just kind of gut-feel[00:47:53] Matthew:I will say yes to any text-based interview, normally it is the same questions over and over again. So I sort of have a lot of canned responses that I can just kind of paste. and tweak But those are links, so I'm like, sure. Yeah. Send your questions over. Cut paste, tweak, you know, you know,[00:48:12] Nathan:Customize[00:48:13] Matthew:Customize a little bit, but you know, how many times do I need to rewrite from scratch?How'd you get into blogging, you know, what's your favorite country, Podcasts I definitely have a bigger filter on like you, I don't do new podcasts.[00:48:27] Nathan:Okay.[00:48:27] Matthew:I know that's like bad. because you know, this new podcast could become the next big thing, but come back to me when you have some following.[00:48:36] Nathan:I like Seth, Godin's rule I'm not on south Dakotan's level by any means, but he says like, come back to me. When you have 100 episodes, I will happily be your 100th interview on your podcast or something[00:48:47] Matthew:Yeah.[00:48:48] Nathan:And he's just like, look, Put in your time and then we'll talk.[00:48:51] Matthew:Yeah, so I like, I don't look for just following, but like again, you know, knowing that people give up on blogs, people give up Podcast too. So. You know, you have to have been doing it for like six months a year, like week a weekly, you know? So I know like this something you care about. and I like to listen because you know, you get a lot of new people and they're not really great.You know, they asked us like a lot of canned questions and you're like, listen, you're taking, you know, an hour, hour and a half of my time. You gotta make it interesting for me.Well, yeah, Podcast. And then for Instagram stories you gotta have, or Instagram lives, either a brand new audience, or if you're in travel, at least 75,000.Cause I have like a one 30, so I want to keep it in the same in a level.[00:49:43] Nathan:Yeah.I know nothing about Instagram and promotions on Instagram and all of that is there. If someone were to, like, in my case, if I came to you and say, Hey, I want to grow my Instagram following. I've got 3000 people or 5,000 people or something like that. And I want to be have 50,000 a year from now.Where would you point me?[00:50:05] Matthew:I would say, do you join Instagram lives with people like once a week, you know, and just, or maybe once a week for you and then go to somebody else on their side once a week. So, and just kind of work your way up, like find people in your, your sort of follower count level, you know? So in this case, I'd probably do, you know, you know, 1000 to 5,000, I would look for in your niche and like get online for 30 minutes and talk about whatever it is you want to talk about and and then go to someone else's channel and do that, and then keep doing that because you'll just see giant spikes and then you can move up the the ladder.Then you have 10,000 followers and someone with 25,000 followers might give you the time of day. And then you talk about that, you know, and you just sort of build awareness because you're always there. You're always around.[00:51:03] Nathan:It's a really good point about the figuring out what those rough bands are and reaching out within those. Because I think a lot of people are like, I'm going to go pitch whoever on doing Instagram live together. And it's like, you have 5,000 and they have 150,000. And like the content might be a perfect fit, but they're most likely going to say no, because you're not[00:51:24] Matthew:Yeah.[00:51:24] Nathan:Driving that much value for, or that many subscribers for their audience.[00:51:29] Matthew:Yeah. You know, and so you, maybe I would, you know, someone was like a finance blogger, and they had like 40,000, 30, 40,000. I'd probably.We do it because people who like to say money, like say money on travel. So it'd be like, there's probably a good fit. And you know, 30,000 people, they might not know me or they have like, like you said, 3000, come back to me, you know, when there's another zero,[00:51:57] Nathan:Right. Well, and then the other thing that's going to be true is if I'm bringing you to, to my audience to share and teach something, if you're using this strategy, like go do another 20 of these or 50 of these, and your pitch will be better. And the way that you teach finance to travel bloggers or whatever else it is, is going to get so much better.[00:52:17] Matthew:Yeah,[00:52:18] Nathan:It's like, I kind of don't want to be your Guinea pig. You know, I don't want my audience to be your Guinea[00:52:23] Matthew:Yeah,[00:52:24] Nathan:Pig for your content. And so just get more experienced and come back.[00:52:28] Matthew:Yeah. And you know, you also gotta think about, you know, people are so time-starved right. You know, when I started blogging, I could. There was no Instagram. There was no Snapchat. There was no Tech-Talk, you know, Twitter was barely a thing. So I didn't have to split my focus on so many different platforms and channels.Right. I can just, alright, I can be on this one blog, but now when people are like, whoa, sorry, I have to like manage all these different social channels and all of these comments in the blog and everything. They not don't have like an hour to give, you know, to just anybody way do you could have before,[00:53:12] Nathan:Yeah. Yeah. That's so true. Okay. So on the email side, specifically, if someone came to you with say 1,000 newsletter subscribers today, and they're like, I want to grow, I mean, you're looking to grow to 5,000. This might be so far removed from where you're at that you're like, I don't even know if that was, you know, a decade ago that I was in that position, but what are you seeing that's working?Where would you point them?[00:53:33] Matthew:What works for us right now? one having email forms everywhere on your site, sidebar, footer, we have one below the content below the content forms, and popups, popups, the work they're really great. we find for really long posts, having a form in the middle of the post converts better than, at the end of the post, because know a A lot of people don't read to the end, but when they get to in the middle you're still there.You know, if you look at heat maps are really long websites, right? You just see that drop-off right. So if all your forms are at the bottom of the page, they're just not getting the visibility, that you need. so middle of the page,[00:54:19] Nathan:Do you play with a lot of different incentives of like, you know, Opt-in for this fee guide, you know, or are you customizing it to something for a particular country or there, the content that they're reading[00:54:30] Matthew:Yeah, so we use OptinMonster for that. and so we have, like, if If you go to our pages that are tagged Europe, you get a whole different set of options. than if you go to Australia, like, and like the incentives are like, you know, best hostels in Europe, you know, best hostels in Australia, right? Like little checklist guides.And I tweak what the copy for that, you know, just to see what wording, will lift up a better conversion rate. But yeah, we definitely, because, you know, we cover so many geographic areas. The needs of someone going to Europe are a little different than somebody going to New Zealand. So we, we definitely customize that kind of messaging. And I think that helps a lot, you know, and definitely customizing messaging as much as possible. Um know, but in terms of just, you know, we can talk about, you know, the market, like how do you word things, but middle pop-ups and mil of blog posts definitely converts the best. And so like that's where we see a lot of growth, as well as, just on Instagram telling people to sign up for my newsletter or Twitter or Facebook, but don't let the algorithm, you know, keep you from your travel tips, sign up now and people do.[00:55:58] Nathan:Okay. And is that like swipe up on stories that you're doing[00:56:02] Matthew:Yeah.[00:56:03] Nathan:You know, on an Instagram live or all the above?[00:56:06] Matthew:All the above.[00:56:07] Nathan:Yeah.[00:56:07] Matthew:You just constantly reminding people to sign up for the list, you know, and. One of the failings of so many important for influencers today is, you know,They always regret everyone as everyone does. They always regret not starting to list, you know? And so, you know, you just got to hammer into people, sign up for the list, sign up for the list, sign up for the list.Yeah. And a lot of the copy is, do you see all my updates? No. Would you like to sign up for this newsletter?[00:56:39] Nathan:Yeah, because everyone knows. I mean, I come across people all the time. It's like, I used to follow them on Instagram. I haven't seen, oh no, I do still follow them on Instagram. Instagram just decided that I apparently didn't engage with their content enough or something.[00:56:53] Matthew:Yeah,[00:56:54] Nathan:So now I no longer see their posts,[00:56:56] Matthew:Yeah. You like, I go, I always go to my like 50 least interacted profiles. Right. And, you know, there are some people that aren't there. I interact with this guy all the time. How is this the least attractive? But that that's Instagram and saying, here are the people we don't show you in your feet.[00:57:13] Nathan:W where do you see that? Is that[00:57:16] Matthew:If you go to your, who you're following, it's it should be up on the top.[00:57:20] Nathan:Hmm. All right. I'll have to look at that.[00:57:22] Matthew:Yeah. I'll send you a screenshot. and so like, that's the algorithm be like, here are the people who you interact with the least, but it's like, no, I, I love their stuff. why why do it take them from me? So,[00:57:36] Nathan:Zuckerberg is like, do you really love their stuff? I just not feeling it.[00:57:40] Matthew:Yeah, yeah, yeah. And so, yeah, it's just, you know, the algorithms are terrible and what I hate and I learned this last year, and this was sort of a unsurprising, but surprising thing is that stories, which used to be like the latest first.[00:57:59] Nathan:Yeah.[00:57:59] Matthew:That is, they have an algorithm for that now, too. And I was like, I, I shouldn't be surprised, but I am surprised.And I'm annoyed by that because like, I liked it when it was just the newest first, but Nope, now that is based on, you know, sort of like Tik TOK thing of like, oh, this story is getting really a lot of interactions. We'll bring it up the front of people's queue or, you know, so it's not just like your first, because you had one, one second ago, you know, like it could, it's based on an algorithm[00:58:35] Nathan:Yeah.And that's how it's all going to go. Facebook did that a lot, you know, with Facebook fan pages back in the day where it used to be fantastic for engagement. And then they were like, yeah, it's fantastic. If you pay us[00:58:46] Matthew:Yeah. And even then it's like, I would pay to boost posts. I was like, great. You saw, I lectured five people. What? I just gave you a hundred bucks and that was. And there was some guy you remember him commenting last year. He was like, whatever happened to this page? I was like, I'm still here. He's like, no, no, no, no.And this isn't a common thread in Facebook. He's like your pages to get a lot more engagement. What happened? I was like, oh, Facebook algorithm. I was like, people just don't see it. Let me tell you where all my analytics side it's like this page. So I have 2000 people. You're like great. 1%, woo[00:59:23] Nathan:Do you do paid advertising? I'd like to get email subscribers.[00:59:28] Matthew:We used to, but, the CPMs went up so much that it wasn't worth the effort. You know, like paying a dollar 52 bucks for an email subscriber, is just a lot of money for, for, for things. We don't mind ties directly. Like we're not taking people through finals buy a course, right? Like just to get rot email, I'm not paying two bucks for.Yeah. And, and so I just, we stopped paying, like during the pandemic, like, June, June of last year, we were like, oh, we're going to take a break. And then we paid somebody to help us for it to make kind of reset it up. But I just had to spend down so much. I was like, you know what, I'm going to turn off for a bit.And yeah, that's been like,[01:00:17] Nathan:Didn't really miss it.[01:00:18] Matthew:Yeah, I looked at the numbers recently cause I was thinking, should we do it? And it's not that big of a difference of just doing it organically on like Instagram stories or just on the page. Right. And I also don't really like giving money to the Zuckerberg empire of VO. I just not a fan of that business.And so like, I know my ad spend is low, but I can't say just. On a rod number. Like it wasn't that big of a deal. Like, you know, like, cause the CPMs were so high, we were having to pay a lot of money. So like we put in like two grand a month and we weren't getting thousands. We getting hundreds of people, you know, I want four for two grand.I want thousands of people.[01:01:06] Nathan:Yeah. For my local newsletter, we're doing paid advertising on Facebook and Instagram and averaging about $2 per subscriber. And that I think now that's considered pretty good. You'd like a lot of, with a broader audience, you'd be at $3 or more per subscriber and it gets expensive pretty fast.[01:01:23] Matthew:Yeah. I mean, but I think at some point you'll just see such diminishing returns that, you know, I mean, how many people are in Boise, can you hit, you know, over and over again?Right.[01:01:35] Nathan:Yep.[01:01:36] Matthew:I, I was just reading Seth Godin's book. This is Marketing. And he said, you know, they talked about ads.You turned off ads when the Content says turn ‘em off. And my Content, I was like, you know, they're not really paying for themselves.[01:01:50] Nathan:Yeah. Let's see. Yeah. You turn that off. Looking forward, maybe like two or three years is that I think your business has fascinating of the approach that you have of taking an online audience, building a real team around it, and then building it into the in-person community. what do you think the business is going to look like in two, three years?Where, where is revenue coming from? What's your vision for the events and meetups and what are the things that like over that time period, they get really excited.[01:02:19] Matthew:Yeah. Two, three years. So we're talking, you know, 20 by 20, 23, most of our revenue coming from stuff in person, you know, having chapters around the world, people pay to go to them. So, you know, it it's like 10 bucks and you can bring your friends for free, right. So it's like five bucks versus. Just for the cost of like hosting events.Right. doing lots of that, doing tours, we're bringing back. and they won't be just with me cause they're community events. Right. So we'll have guides, right. So it's not just, you're coming to travel with me, sort of what Rick, Steve does. Right. You go on and Rick Steves tour, it's his itinerary, but he's not on the tour.Right. He shows up to a couple of them throughout the season when it's not like you don't expect him to be your guide at the time. So moving to that, having a consumer event for like, like a, like a world domination summit, you know, a weekend somewhere just for travel consumers, having an app for both having an app for that company. then online just being a lot of and affiliates and you know, even me. Just even taking away just having this like passive income course, just because, you know, one less thing to worry about. Right.And then travel con, so being around, but actually making money this time.[01:03:47] Nathan:Do you think travel con is going to turn into, I mean, obviously it's a significant amount of revenue, but the expenses are so high. Do you think it will turn into a profitable business[01:03:56] Matthew:Oh yeah. Yeah. Like, I mean, a lot of the unprofitability is just comes from the fact that I had no idea where that was doing.[01:04:02] Nathan:Yeah, I know that firsthand from my own conference, so yeah.[01:04:07] Matthew:It was, I didn't realize how quickly expenses gets that. Right. You know, being like, oh, okay. Like my food and beverage budget is 120,000 writing that in there. And then getting $145,000 bill because, oh yeah, it's 120,000 food, but then there's tax fees, which we, you know, all this stuff and like, Okay, well, that's $25,000 off the profit.Right. and so with a better handle of expenses, like we were definitely like this year, we were gonna like reg even, you know, at the very minimum, we'll pre COVID and this year we'll also break break event. Um it's and just keeping a handle on, you know, like, well, how will I don't invite a hundred speakers, you know?And, and be like, oh, I had planned to only budget, you know, 50,000 speaker fees, but now I'm at 80. Okay. Like, handling the cost better. We're good. Now I have a professional events team that kind of slaps me around and it's like, can't spend that money.[01:05:06] Nathan:I know how it is, where I'm like, Hey, what if, and then just like, now[01:05:10] Matthew:Yeah,[01:05:10] Nathan:Love it, but no,[01:05:12] Matthew:Yeah,[01:05:12] Nathan:Don't like, you don't have the budget for it.[01:05:15] Matthew:Yeah. But no, I mean, you know, we used to have a party. And we're getting rid of the second night party because people don't want to go. Like we didn't have a lot of people show up cause like they're out and about on town. So it's like, wow, I just spent, you know, $40,000 for like a third of the conference to come, you know, why not take that money and use it to something that's more valuable for everybody that has more like impact for dollar spent and still not like go over budget.You know, same thing with lunches. We got, we were getting rid of, we're doing one lunch now.You know, cause people don't really care that much, you know, about in[01:06:01] Nathan:Yeah, it's super interesting.Well, I love the vision of where the conference is going, and particularly just the way that the whole community interplays. I think it's been fun watching you figure out what you want your business model to be, because obviously, with a large audience, your business model can be any one of a hundred different variations.I like that you keep iterating on it, and figuring out the community.[01:06:26] Matthew:Yeah, we're definitely going

If it seems like a new DTC brand is launching every day, that’s because it’s true. In every industry, across every vertical, on every channel, the next “big thing” is competing for your attention, your clicks and your cash. As a consumer, sifting through all that noise and filtering out which companies are worth your time can be a daunting task. And as a brand, it begs the question: how do you set yourself apart from the ever-growing pack?One option is to find a trusted source to vouch for you. Matthew Hayes can be that source, and his new marketplace, The Fascination, is where he wants to lift up some of the most worthy DTC brands coming to market.The Fascination is a product recommendation and reviews publication focused on emerging and purpose-driven direct-to-consumer brands, large and small. Users of the platform have the ability to filter through vetted brands, digest the company’s story, and even transact all in one place.On this episode of Up Next in Commerce, Matthew dives into lessons he learned while building Leesa Sleep, why curation is so important in the rapidly expanding direct to consumer space, and gives his take on why the convergence of media and commerce will be the one thing that impacts ecommerce the most. Plus, I even pull out a few stories from his trip to Richard Branson’s Necker Island.Main Takeaways:Curation Station: The saturation of the market with a new DTC brand every day is creating issues for consumers and brands alike. With so much clutter, it’s hard to stand out. Through measurable metrics, in-depth reviews, and by holding brands up to certain benchmarks, The Fascination created a space that customers can trust, and brands want to be listed. Layers of Use: For a brand to stand out, The Fascination has found that being mission-driven, promoting social good, and leaning into and highlighting the unique aspects of your business will be the most effective strategy. Lessons Learned: While not everyone can pick the brains of the biggest entrepreneurs in the world, when you get the chance, it’s wise to listen. Matthew was able to visit Necker Island and spend time with Daymond John, Marie Forleo, Tim Ferris, Seth Godin, and Richard Branson. Tune in to hear what advice they gave that has been helping him to this day.For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.---Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Respond quickly to changing customer needs with flexible Ecommerce connected to marketing, sales, and service. Deliver intelligent commerce experiences your customers can trust, across every channel. Together, we’re ready for what’s next in commerce. Learn more at salesforce.com/commerce---Transcript:Stephanie:Hey everyone. And welcome back to Up Next in Commerce. This is your host, Stephanie Postles, co-founder at mission.org. Today, I'm chatting with Matthew Hayes, the co-founder at The Fascination and previously on the founding team at Leesa Sleep. Matt, welcome to the show.Matthew:Thanks for having me.Stephanie:Yeah, I'm very glad to have you on. So I was hoping we could start with maybe Leesa Sleep. Because when I saw that I'm like, "Whoa, you were like an OG in the D-to-C space," and I thought they'd be a good jumping off point.Matthew:Yeah. So I was part of the founding team at Leesa. Yeah, we launched it back in 2014 before everything exploded. Right? So we were very early. We were one of the first BedInABox brands to get out there, Tuft & Needle came maybe, I don't know, six months to a year before us. Casper was literally right before us. And then we were out right around Thanksgiving of 2014 and that whole industry just exploded under our feet. We had the wind at our back for most of our tenure, especially our growth years. But things are a lot different now and t's a different ball game in terms of launch and growing a D-to-C brand in 2021.Stephanie:Good. Tell me a bit about the differences. I mean, obviously the world is very different and there's a lot of new trends coming out about what to expect over the next couple of years, but are there any lessons that you took away from Leesa that are still relevant or is the world just like in such a different place now?Matthew:No, I think it's still really relevant. I think a lot of the stuff that we were learning as we grew is incredibly relevant to the way that we launched The Fascination, the way that brand founders are thinking about things now. When we first launched in 2015, cost of acquisition were beautiful. Like all day we could scale the auctions across Facebook and Google, were very, maybe a fifth of what they are now just in terms of competitiveness. Just, I mean the mattress industry specifically there was 180 entrants after we launched, so a huge amount of volume coming into that space and just generally in D-to-C. So the cost of acquiring just pure play digital customers was going up and people were seeing the writing on the wall and starting to diversify into brick and mortar.Matthew:And so I think that was one of the things that we realized, is we've got to have a diverse channel mix. And so we struck the partnership with West Elm, we leaned more into Amazon. We looked more at international and we actually set up our own brick and mortar stores. So I think the combination of that brand awareness and exposure helped our brand tremendously. Whereas a lot of brands stuck it out, stayed pure plays and they learneD-to-Costly less and overspending on acquisition.Stephanie:Yeah, that's definitely the biggest thing that I see from the past couple of years or past decade is like before you could just focus on paid acquisition, like throw a bunch of money at it and one's really, they're going to come to you either way. And then now it seems like a lot of the, I guess the brands that are ahead are more media companies now, and there's a big spectrum between paying for people versus organic or versus starting a community and then launching a product to them. So it does feel like a definitely a different world than just like pay, and grow, and scale up as you go.Matthew:Yeah. I mean, we're seeing that a lot actually. And I think our notion of how to build a profitable business with The Fascination is quite a bit different. No, we're not a pure play own D-to-C brand selling our own products, we're essentially a marketplace, but what we've done is we've seen the success that media companies have had in building an audience that's super loyal whether that's The Hustle, or Morning Brew or The Scam, all of this audience aggregation and demand with these customer demos, there's so much that you can do with it. And so, we saw a bit of an opportunity and the fragmentation that was happening across D-to-C brand for popping up literally every day. And you start to become a little leery of, is this a good brand? Is this is a good product? Does this align with my values and tastes? And we saw this need for curation across all spectrums of D-to-C really. And we saw an opportunity to really create a media platform and a commercial platform around that.Stephanie:So let's dive into The Fascination a bit. So it's a marketplace. You guys are curating D-to-C brands. I saw you have filters focused on the product technical quality, also the soul of the company. Tell me a little bit more about The Fascination. How do you allow brands into the marketplace? Yeah. And any other details around the platform?Matthew:Yeah, so I mean, people are basically referring to it as a marketplace meets magazine, which I think is an accurate description. It's basically at its core, it's a product recommendation and reviews publication specifically focused on emerging and purpose-driven direct to consumer brands. So in much the same way that Wirecutter or the strategists reviews top products and writes those objective third-party reviews and recommendations, as a media publisher we're really doing that, but we're focusing in on a subset of these D-to-C brands that are new and emerging and have purpose driven values.Matthew:And the idea is to create a single platform where people can come and discover new brands, they can read reviews and research those brands and products, and they can shop deals all in one place. So it's a linear play from discovery all the way through to purchase.Stephanie:Yep. So who are some of your favorite brands on the platform right now?Matthew:There's so many good ones.Stephanie:[inaudible].Matthew:Yeah, I know I'm going to get in trouble for this. We've got badges across the site, which are really cool. The badges call out things like women and minority led businesses, or organic, or made in the USA. And so like Girlfriend Collective is one of our women and minority led brands. Haus is another-Stephanie:Even Haus on, yeah.Matthew:... Yeah, they deal the [inaudible] and great products, great brand story.Stephanie:Delicious.Matthew:Delicious. Yeah. I was just chatting with the founders of Huron, which is a men's skincare line. Awesome story. And then we've got the big names that you'd expect. Like we've got Allbirds on the platform. We've got Warby joining soon if they're not up already any day now. We've got UNTUCKit so, those it's a nice mix of the old school D-to-C incumbents with a lot of really cool emerging brands that honestly I'm intimately involved in direct consumer and a lot of these brands I hadn't heard of for the first time.Matthew:So if you think about like, as it broadens out the halo from the bulls-eye of our tightest demos, there's going to be so many people that are discovering these brands for the first time. And that's really what we want. We want some of these big names to attract people into the site, and then we want a lot of our awesome emerging brands and products to be discovered while you're there.Stephanie:Yeah. That's great. So how are you convincing these larger brands to join the platform? Because I'm thinking your space, I think also is very competitive. I mean, the world right now is headed to a place where everyone wants curated collections. I mean, they don't want to spend a bunch of time everywhere. They want it all in one place. We had the CEO of Fast on talking about, you need the one-click checkout and be able to allow people just to check out instantly and not have to bulk it into a cart. It seems like your space is very competitive too. How are you convincing the Warby Parkers? And the older brands who probably are approached by quite a few marketplace platforms to, "Oh, join us." Why are these brands going with you?Matthew:Well, I think we've really a ton on the story and the user experience and just the overall look and feel of our digital product and what we stand for. I think it's also in our favor that we have been D-to-C operators ourselves and we can really empathize to what these founders need. And we've been fortunate to be in the community for several years now. So we had a few close partners that our spring pad, if you will. Not to mention Nick Sharma as an advisor, who's great at pulling in brands.Stephanie:He was on our show too, man, I was just-Matthew:Yeah, I know.Stephanie:... fortunate.Matthew:And so yeah, between that, and we had some really amazing brands reach out the first day that just totally shocked us. We have a type form application that comes through and we had a couple of 100 brands, including some of the biggest names in the space on day one, which it was super exciting. And just a lot of founders getting really excited by seeing their brands mentioned in our round ups, or seeing products being shared. So I think that the validation that we're starting to provide, and really empathizing with what brand founders need is something that they're really clamoring for. And I think word it gets out fast.Stephanie:Yeah. That's great. So is there any trends you're seeing right now around what customers are most excited about? I mean, I'm guessing you have all this data now and you can see, okay, a bunch of people are coming on during quarantine and buying Haus. We need another type of Appertiff or something to offer that's similar because we see so much engagement there, any trends?Matthew:I think that one of the things that we've seen that's really interesting is our roundup pieces on brands that are making an impact and just the social impact stories are really, really resonating with consumers. And the brands are sharing the stories, which is just amplifying the message that much more. So the general consumer sentiment that we're getting from a qualitative perspective is that a platform like this is very much needed and like, thank you for building it. So I don't think it's even halfway to where we want it to be, or it could be in terms of the overall product development evolution, but we're going to get there quickly.Stephanie:Yep. So how, when you're... You just said that certain stories that you're telling around the brands and the social good aspect of it are really resonating. Is that your main play when it comes to acquiring new customers on your platform is by writing good pieces of content, having the brand share it to get in front of their audiences as well, or how do you think about acquiring new customers?Matthew:Yeah, I mean, customer acquisitions, it's always a challenge for a marketplace like this. And that's why from day one, we didn't approach it as a pure play commercial marketplace where you're just aggregating and selling products. From a consumer perspective, that's really not serving the overall need that we're trying to address, which is discovery, research, and shop and convert. And so the research aspect of that is really where we're going to focus a lot of time and attention and work. And what I mean by that is writing really in depth, thorough product reviews that are authentic, that are meaningful, that consumers value and ultimately Google values that content really highly as well. And so, what I'm getting at is the SEO and organic traction and such. It's going to be a big part of how we grow organically, keep our acquisition costs low.Matthew:There's a lot of performance marketing things that we can and will be doing. Brands have had tremendous interest in doing paid marketing partnerships, whether that's white listing on Facebook, or sponsoring newsletters, or any sponsorships. I think there's a tremendous amount of demand for that. And we really are just dipping our toes into the very first test there. And then I think PR and having, as I said, our brands amplify, our content is also, it's just going to be a latent, organic way to continue to build low cost audience. I mean, I think if you think about the way that Leesa scaled and a lot of those 2015 brand scaled, we know that we can't run the same playbook and build a sustainable business.Matthew:And so as we were launching in early days, it's like being a media company is really hard, right. Coming up with really engaging content every single day, pumping it out, like the Morning Brews and Web Smith's of the world, I take my hat off to those guys because it's not easy, but I think you can already start to see the rewards that we're going to reap from that.Stephanie:Yeah. So what channels are you... Well, maybe actually first, let me talk about the content piece, because that's top of mind for me is, a lot of people say you just need to create good content and that's the key to finding great people. How do you go about brainstorming something that will resonate? Are you actually going through maybe search trends and starting there to see what's going on in the industry, and then writing articles around that? Or is it purely, just like, I want to talk about Haus's story and we're going to talk about what they're doing behind the scenes? Like, how do you brainstorm content?Matthew:It's a mix of all of that actually. So we've got a number of things that we're covering at any one time. A lot of it is when we have new brands onboarded, we've got to write the brand story and we've got to review their products. That's phase one. And that's like an ongoing process as we get up and running. But yeah, we're also looking at industry trends, category wide trends, search trends around specific products or competitive products to see how we can write really compelling content that meets that need.Matthew:And then we're thinking about the cultural relevance, things that are happening topically in everyday life. And we've got a couple of different personas that we look at. And so what are our personas caring about, what's their headspace, and then what are the things that are happening in their specific lives at this very moment in mid January? So as we think through those things, you start to surface really relevant content ideas, and that's where our social content, a lot of our editorial content comes from. And that's generally how we do it.Stephanie:Cool. And what are some of the channels that you're most excited about right now, or you think that there's untapped potential? Are you sticking with the Facebook where of course stick the Facebook? How is sticking with-Matthew:Afterthought.Stephanie:I like that. Hey, they used to be though. Right?Matthew:Yeah. Drop that.Stephanie:Yeah. I mean, when? It's still pretty relevant, but yeah. Are you sticking with Facebook? A lot of other brands still say that's the best place to reach customers. Are you trying out a bunch of new channels and experimenting? How are you thinking about that?Matthew:So Facebook isn't a priority for us right now other than to the extent that we use it for paid social advertising. I would say it's there. Of course it's there. But when we're thinking about building audience, Twitter has been a nice surprise for me, I'm really bummed that I didn't get myself on Twitter several years ago, but Sharon, our audience development team's doing an awesome job of engaging that really passionate community.Matthew:I think LinkedIn has sneaky, organic reach and potential. And we found that a lot of our brand founders are sharing our content there and we're getting a lot of engagement.Stephanie:They're more organic then, right, because LinkedIn is super expensive when it comes to advertising.Matthew:Yeah. All organic. And then stuff like TikTok is interesting as we look at really organic product reviews doing things with founders, I think that's something that we're going to be looking at as well as Clubhouse.Stephanie:Yeah. Clubhouse. I think that's where it's at. I'm on there. I listen to people. I think you can connect with a lot of great people on there. I'm still not sure about the unstructured format sometimes where things can go on for hours and hours, but yeah, it seems like there's a lot of potential there to at least connect with new people. I don't know about selling.Matthew:A lot of untapped potential.Stephanie:Yeah. So I saw that you were also an investor in GRIN. Right. And that's the influencer platform, which is... That's the right brand. Right?Matthew:Yup. [inaudible].Stephanie:Okay. So our guest yesterday that we had on was, that's her favorite new tool that she's looking into and I had not heard of it before. And I'm interested to hear a little bit about how are you thinking about influencers? What attracted you to GRIN, where's that market headed over the next couple of years?Matthew:Yeah. I mean, we've been doing influencer marketing since 2012, honestly. And I think there's going to be a lot more regulation around it for one. So you've got to be buttoned up as you execute itMatthew:So I think that's just part of the industry growing up. A lot of these minors are now celebrities in their own right with huge followings and PR teams. And so the days of just engaging with an influencer that way are over. It's really about adopting a micro/nano strategy where you're activating pockets of a couple thousand followers up to 50 to 100,000 followers and doing it more strategically at scale. And that's where I see a lot of brands and agencies having success doing this stuff. So GRIN is just a really awesome tool for managing that entire workflow. Keeping you really on top of things, you can search for look alikes of an influencer. So if you have someone or something that you want to find influencers around, it's great for that.Stephanie:That's awesome. And how did you think about attribution and analytics around utilizing influencers and seeing if you're really getting the most bang for your buck?Matthew:Yeah. I mean, well, especially with iOS 14 and everything that's going on there, it's always been an imperfect science, we never assume that we would have even close to perfect attribution on influencer activations. So we always treated it very top of funnel and you do what you can in terms of attribution. So you give them trackable UTM parameters, you give them a bespoke promo codes with their name. You give them a landing page experience, everything that you can do to cookie the user on your website and get them into what feels like an authentic customized experience for that loyal following. That's going to increase conversion, I think as much as anything.Matthew:And the vast majority of influencer activity is probably happening on mobile anyway. So wherever you're sending them, it's got to be very mobile optimized because if they switch over, your attribution's lost at that point.Stephanie:Yeah. And I think that authentic piece you're saying, I mean, it has to fit your brand. The person has to not just be saying something just to say it. And I think taking that longer-term approach more of like a partnership and someone who is going to be a part of your brand, even if they start out smaller and grow with you, will be way better than just trying to target a big name, because I normally don't really put any weight in products that large celebrities are showcasing, just because I'm like, I just know how much money you're getting paid and I highly doubt you're using that teeth whitener.Matthew:Yeah, I mean to that point and a lot of grants are basically incentivizing on the CPA or per sale basis with, like you're saying a subset of really loyal influencers and affiliates that they can send that influencer their fall collection of bags and apparel or whatever, and they can get 10 or 15 posts out of it if the influencer continues to see performance. And so I think that's the new way of doing things nowadays.Stephanie:Okay. So yeah, viewing it from a content generation perspective of, they're not just posting once trying to get their product off, but they're also creating an article or blog posts that you can repurpose and pull quotes from or whatever it may be.Matthew:Yeah. And more frequency drives more conversion. So the more you get that brand in front of your audience, the more likely it is they'll finally take action.Stephanie:Yep. So I want to talk a bit about mentorship, which I always love asking questions around this. I saw that you went to Necker Island a few days ago... a few years ago [crosstalk], really? Few years ago. And of course Richard Branson's Island. So I want to hear, what did you learn there? What advice did you hear? I saw, I think Damon John was there, Tim Ferriss, Seth Godin, Marie Forleo, a bunch of great people to learn from. And I want to hear about the stories behind going there. What did you learn, all that?Matthew:Yeah, I mean, it was a life changing experience for sure. Damon is still pretty close to us in the business. He got involved with Leesa after we met, especially with their 110 program, and I really just learn from him the hustle, the grind. He told his story about how he came up with FUBU and really built that business from zero. And so, talking about fundraising with him is a different thing.Matthew:Tim was on the Island too. I was fanboying out when I met Tim actually, because I was obsessed with four hour workweek, four our body and here I'm chatting with him in person. We actually started talking about going up against Casper. At the time, we were pushing pretty heavily into podcasts and Casper was buying up literally every podcast that we could find, that we wanted to go after. And funnily enough, he would really push a micro strategy to us. He said, "You need to go after these very small podcasts that aren't affiliated yet, that have nascent, but growing followings." And we did, we found 10 of those, especially in comedy and gaming, and we stayed with them for years and they ended up crushing for us.Stephanie:Oh, that's great. And did you secure long-term partnerships with this company?Matthew:Yeah, I think we're still working with a few of them honestly.Stephanie:Oh, that's great.Matthew:We just completely sapped the audience, an everyone's got a Leesa now. Yeah. And then we talked with Seth. David and I chatted with Seth Godin, who's a marketing genius. He's like the professor of modern day marketing. And at the time, we had done around 30 million in our first year of sales, which was just crazy. And he was talking about making this leap called crossing the chasm. Basically when you're attacking the early adopter market and you're doing quite well, there's a point at which you have to "cross the chasm" and reach the broader demographic of people. And so I don't remember the tactics that he talked about, but he always impressed that idea of our okay, now we've got to broaden our sphere of influence. We still use that phrase today.Matthew:And then Marie Forleo was there and we had a lot of really good, we like chatted one-on-one several times, because I was incredibly anxious. I've always dealt with anxiety issues in my career, in my past. And so we had some frank chats about vulnerability and putting yourself out there. And once you do that, it just eases the tension, eases the anxiety. And I still use that to this day.Stephanie:Yeah. I was going to say, does it help now? Because I mean, I definitely feel that too. I remember when we first sold this podcast, then they're like, "Oh, Stephanie can new host it?" And just being like, oh, I usually always would have our other team members host the shows and yeah, I liked working behind the scenes and it definitely was hard being like, okay, you just have to do it. You have to get yourself out there. Did it help afterwards thinking through about her advice?Matthew:Yeah, it totally did. And I always think of this idea of demonstrated performance, where it's like, you're nervous about something, you're anxious, you step on stage or you sit in the seat, you put yourself out there and you have a really good performance. And then that just gives you one more step, one more piece of confidence and you keep going and building. And now stuff that I do every day without even looking at my calendar is stuff that I would have just freaked out about all day five years ago. So I think it's just about experience.Stephanie:Yeah. Now I agree. I remember even just thinking about doing video meetings, like when I first was starting out in the corporate world and being like, "Oh, my gosh, my first meeting." I was just so scared and sweaty and nervous and then now taking like 10 a day and being like, not even thinking twice. So yeah, I think just doing the work and pushing past and knowing you'll probably fail a couple of times and who cares?Matthew:Exactly.Stephanie:That's great. And did you meet Richard Branson when you were there?Matthew:Yeah. We met briefly. He gave us a talk which was awesome. He talked a lot about Virgin's impact program, and what he's doing there. And so that was really important to us at the time, because we were setting up our Leesa 110 program and that was cool to hear from him.Stephanie:That's great. So where do you see the next couple of years headed for The Fascination? What are you guys building for? What are you doing in stealth mode right now? What are you planning for the world to look like in a couple of years?Matthew:Yeah, I mean, right now we're really heavily focused on getting the digital product where it needs be to really deliver on a full transactional marketplace that's cutting edge for consumers. So in the next couple of years, we want to have a destination that is super engaging. We want to have brand founders engaging with consumers real time in the platform. We want to have people shopping and reading and researching brands and products all seamlessly, and to be able to buy those products in one click, right? Right on The Fascination.com. And so a lot of things have to happen in the background to obviously make that work.Matthew:And then we're always thinking about, how can we acquire the best customers, bring them in most cost-effectively? And it's always on my mind of like, delivering really solid, meaningful content to the audience, not just fluff stuff, but stuff that's really, really valuable. And so that's what I think we're trying to win.Stephanie:Well. Yeah. It also seems like there's such an opportunity to... I mean, when you have all these brands and they have access to a lot of insights on their customers or who's coming to their website to then build lookalike audiences off of those brands, and then all of a sudden you have access to customers and you're coming from a different angle where maybe if Leesa would have already gotten in front of a customer two times and they're like, "Nah," they then see The Fascination comes in and they're like, "Hey, check out this mattress. It's like a third touch point. That's very separated." But it seems like there's a lot of opportunity there to get insights at a much more accelerated rate than you would get just by yourself.Matthew:Yes. That is the goal. Yeah, there's a whole data infrastructure that we really need to put in place to get the most out of it. And honestly, coming from Leesa for so long, I'm still trying to wrap my head around what that all looks like in terms of affiliate click attribution and how we create audiences and how we do product recommendations. So we're only a month old, but we'll get there. And I can tell you that there is such tremendous demand for what you're talking about. Just leveraging lookalike audiences, leveraging audiences across categories that aren't competitive with one another. At the end of the day, everyone that comes to The Fascination as an interested consumer if we do it right, it's always going to have similar demographic profiles, right. Whether they're a man or a woman. So as you aggregate that at scale, there's a ton of value for brands to be able to tap into that.Stephanie:Yeah. It seems like eventually they'll have to be tools for the merchants as well, to be able to interact with all the platforms they're on. Or like, I mean a lot of sales are moving towards the edge. There's a lot of people say and how do you keep track of that? Like, how do these merchants they're selling on The Fascination, they're selling on Fancy, they're selling on not that Fancy is the same, but there are quite a few places popping up where these brands might be like, "Yeah, I want to sell on that platform or over here," but I don't know if enough tools exist right now to keep track of what you're doing and consolidating it all in one place.Matthew:Yeah. I mean, it's got to be a challenge for these fairly young brands. There's product feed software that'll handle some of that, but at the end of the day there's manual stuff that's always needed once you're drop shipping and wholesaling and you have retail partners. So yeah, we're going to be thinking about it from the other side, just the same, how do you manage 100, 200, 300 merchants and keep them happy?Stephanie:Yeah. Crazy. All right. Well, let's shift over to the lightning round. Lightning round is brought to you by Salesforce commerce cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, Matt?Matthew:Yes.Stephanie:One minute to answer. All right. Yeah. Prepare, drink your drink, whatever that may be. All right. First thing, what one thing will have the biggest impact on ecommerce in the next year?Matthew:I think the convergence of content and commerce is, is going to have one of the biggest impacts. You've got media companies that are converging in the commerce, they all want to be transactional. They all want a bigger slice of the pie. They all want more lifetime value extraction from their readership. And then I think on the commerce side you see brands and retailers who are obviously seeing the cost rising of customer acquisition in the traditional sense and creating really rich content. It's the only way to do that. So we're diving in right at the intersection with what we're doing at The Fascination and that's where we saw it going. And that's why I think we're bullish on where we're headed.Stephanie:Yeah. Well, it'll also be interesting to do a recap episode on what's happened since some of these brands got into mixing media with commerce. I mean, I'm thinking about NBC, I think did a whole shoppable TV thing. And I remember seeing them launch that maybe in February or April last year, but I don't know what actually happened. So it'd be fun to do a recap of like, here's who launched in 2020 when it came to mixing media and commerce and here is status update.Matthew:Hopefully we will be one of the givers.Stephanie:Yeah. Hopefully. What's one thing from 2020 that you hope sticks around in 2021?Matthew:I think that we've all had to embrace things like this, just getting on video conferences, not having to present ourselves through this façade, in the office I would have never thought about wearing my hat backwards and rolling around in athleisure. And now that's just the norm for everybody. And kids are on work calls and it's just, the whole thing feels a lot more familial. And even if we do go back to offices, I really have loved that work now feels a little bit closer to home because you're in your home, but also because just the interactions, you see more than you would if everyone was in an office environment.Stephanie:Yeah, I agree. And I think it definitely brings a more human perspective too. Like you're saying, working together, knowing someone's kids, seeing them in the background, and then you also have more, I guess, empathy when a mom or dad's like, "Hey, I got to go do this with my kids." It's like, "Oh yeah, I saw your kid connection." Of course you can, whereas I'd say prior to this. Yeah. Not as much of a leniency, I guess for that. Yeah. That's a good one.Stephanie:What is the funniest story or best story you can think of when it comes to either building up Leesa or building up The Fascination where you're like, "Oh, this is a good time or a good story that really sticks in my brain from those years."Matthew:We've done so many like gimmicky things at Leesa. We were growth hacking like crazy and we were throwing stuff against the wall and not all of it stuck. We did a ton of stuff with Barstool Sports. We maybe did a few influencer integrations that wouldn't go over so well today with certain influencers.Stephanie:And with Barstool, I feel like they're so edgy that they can get you in trouble all these days anyways.Matthew:They're very edgy and we purposely like with all of those podcasters and creators, we're like, go be very authentic. And so you can't tell Barstool like, tame it down and not be authentic. But they were a huge converter for Leesa for several years.Stephanie:That's fun.Matthew:So we did a lot of fun stuff. We sponsored Larry at the gambling goldfish, which was a gold fish swimming around in a tank on Barstool sets, they pulled a mattress behind a truck with a Santa Claus riding on it. But we've also done a lot more admirable things, like we did a sleep out for the homeless. We've done a lot of cool things at Leesa just in the experientials side of things that made it fun.Stephanie:Yeah. I mean I have a love for the gambling goldfish. I want to go check that out. That actually sounds pretty funny.Matthew:Yeah. One more thing that we did is I think it was the 2017 NFL Draft, it's shown on ESPN and all the players are interviewed in their homes. And so we sent the players that we knew would be interviewed on TV, on ESPN Leesa mattresses. And we had them put their Leesa mattress boxes behind them and their families. And we got millions of impressions that night because we had Leesa mattresses all over the air on ESPN Draft.Stephanie:Oh, that's fun. See, I love creative stuff like that, where I mean, as long as it actually converts too, I always have the question about TV, does it actually convert or what happened after everyone saw the mattress behind them? Did you guys see a big uptick in sales, or?Matthew:I don't remember if we did or not. I think we saw a bit of an uptick, but I mean, it was such a low cost stunt to do that. It wasn't a swing for the fences, but we also did a ton of TV in heyday at Leesa. And you can really see the brand awareness effects the TV has even though it's insanely hard to track.Stephanie:Yeah. I agree. What is next on your reading list?Matthew:I'm probably going to do Shoe Dog by Phil Knight.Stephanie:Such a good one. I love that book. Yeah. So inspirational. I highly recommend. If you were to have a podcast, what would it be about and who would your first guest be?Matthew:Well, that's an interesting question because we may very well have one soon.Stephanie:Oh, nice.Matthew:Yeah, I don't know in what format it will be. It may be a podcast. It may just be like Instagram TV stories, but we really want to interview, just do flash interviews with our brand founders, asking about their origin story, asking about what makes their products different, fun facts. And I think a groundswell of really interesting stories like that would be fun.Stephanie:Cool. That sounds good. And then the last one, what's the nicest thing anyone's ever done for you?Matthew:Oh, that's tough. I mean, I there's been so many instances of generosity. I think honestly, giving me a chance to make the career switch that I did, and this is a bit of a shout out to David my co-founder, but he really took a chance on me. He's been super supportive of me for years, and it's really gotten me to where I am today in terms of my career and the place that we're at collectively. So him and the people around me that pushed me to make that leap out of the traditional corporate world of consulting. I was really hesitant to do that coming right out of my MBA and looking at a nice salary, and he was one of those people that pushed me over the top to do that. And I'm thankful for it.Stephanie:That's really cool. Great story. All right, Matt. Well, thanks so much for coming on the show. Where can people find out more about you and The Fascination?Matthew:So about me, you can find me on Twitter at MattDHayes, all one word, and then The Fascination.com. Go check it out.Stephanie:Awesome. Thanks for joining us, Matt.Matthew:All right. Thank you.

My guest today is Matthew Kemp, principal of SCP&CO, a mid-market private equity firm. Prior to his role at SCP Matthew was CMO of BlueGrace Logistics, and the founder of three very successful companies. This is Part 2 of the interview where we dive into marketing 3rd party logistics in general, and BlueGrace in particular.This week's sponsor:BugHerdThe easiest way to collect and manage website feedbackTurn email chains and spreadsheets of vague feedback into actionable tasks. Pin feedback to elements on a website and capture the technical information to help replicate bugs and solve issues. Track feedback tasks to completion.Try BugHerd for free today.Transcript:Edward: This is part two of my interview with Matthew Kemp. Today, we're going to dive into his experience as CMO of BlueGrace. Matthew, can you start by explaining what BlueGrace does?Matthew: Sure. BlueGrace Logistics is known as a 3PL. 3PL is an acronym for Third Partly Logistics. Think of them effectively as a broker consummating transaction on two sides. They are sitting in between clients, like Procter & Gamble, S.C. Johnson, Coca Cola, who needs to ship their wares around the country from either bringing it overseas into the country and then the distribution centers or from distribution centers to retail. Customers who need to ship things and then the actual carriers—trucks. There are tens of thousands of carriers throughout the country, and we are basically sitting in between those and helping customers interact with the carriers.Edward: Maybe I'm not aware of this, but trucking is one of the biggest industries in our country that many people don't even think about. Last I saw was an $800 billion industry with over a million truck drivers in the US alone. These third party carriers, there are actually effectively three different types. Is that right, three different types of carriers?Matthew: Carriers can fall into our two main components: LTL and then full truck load. LTL is less than truck load. The big carriers are ones that you're going to know, the familiar names, they're UPS, they're FedEx, there's Saia. You've seen these trucks on every highway whenever you've ever taken any kind of road trip.Full truck load is actually very much a mom and pop industry. There are tens and thousands of full truckload carriers. The average owner may own two, three, four trucks. In fact, there's tens of thousands of single truck operators out there. The difference between the two, full truck load is I go to a place, you have purchased my entire truck. I'm going to go to one location, I'm going to pick it up whether or not you fill up the entire truck is not relative. It's you own me, you own my truck, I'm going to go from point A to point B, and my time is not going to be distracted.Less than truckload is got to be much more sophisticated, much more difficult pricing strategy. This is where these major companies like FedEx, UPS, Saia are going and making multiple stops. They're finding five or six different customers, going and making multiple stops, grabbing things from those locations, taking them from Tampa to Atlanta and then going around (say) the Atlanta Metropolitan Area, stopping another six times to deliver their goods. Funny enough, BlueGrace started as a specialist in LTL. It's known in the industry as being an expert at LTL shipping. Truck load is something fairly new to the company. Funny enough, it has a lot to do with the fact that you and I know each other. When Warburg Pincus came on board and became an investor in BlueGrace, one of the things that they decided to do to help grow the company was to bring on some expertise in sales on the truck load side of the business. We have then diversified the company a bit and have two sources of revenue coming from two different distribution channels.Edward: Talk about those distribution channels. As a marketer, how do you market LTL versus full truck? Is it the same or they're different marketing channels?Matthew: They're very different. Full truck load is something that is in many ways “easier” because the logistics are very simple. It's point A to point B. That being said, the pricing is a little bit more complicated because it's based on the market. When a hurricane hits or there's some natural disaster, there's a snow storm, the pricing for truck loads can change daily if not hourly. LTL, while the actual logistics are really complicated because you're going through all these different stops, the driver has a very complex route, the pricing is actually something more like you would find on Orbitz or Expedia. I can go to the software that BlueGrace has developed called the BlueShip and place an LTL order without having to worry about the pricing change. I just tell you where my point A is, point B I can put the zip codes in. I tell you the weight, I can tell you how many pallets. And then I will get a price [...] online and I book that shipment and know that that price is actually going to be valid for the next 24 hours. That's not available on the full truck load side.To get back to the original question, there is some difference in marketing. The truck load world is something where we try to go after very, very large entities. I mentioned some of the customers like S.C. Johnson, Procter & Gamble, and Coke. That's a market where, because they can fill up the entire truck, that must mean they are shipping large quantities. They can afford to make large purchases. The average truck load could cost a customer $3000.LTL is smaller. You're going after small- and medium-sized businesses because the amount of items being put on any given truck is much smaller and it's not uncommon for the price of an LTL shipment to be just a few hundred dollars because you're only taking some portion of the truck.You're marketing really to two different constituencies. Truck load is you're going after the Fortune 1000 or even the top 5000, 10,000 companies in the country. On the LTL side, we were going after much smaller companies, and you try to strike a balance between the two.Edward: Why do both? What's the synergy between doing both LTL and full truck for different customers entirely?Matthew: Selfishly, you want to diversify your revenues. Truck load can be wildly profitable. You would like to be in that business. The gross margins are much higher. That being said, it is so much more variable. When the good times are great, if you're making tons of money when there's capacity restraints, then it can go really badly for you. BlueGrace has really benefited from having the two revenue streams.On the marketing side, you could actually do business with more companies if you can service both their needs. There are some companies in the midmarket. They've got needs on both the LTL and the full truckload side. Being able to do only one or the other limits how many companies you can talk to. Having both has really benefited BlueGrace and have been able to expand the universe of companies that they can market to.Edward: When you acquire a mid market company as a customer, you can then turn around it and sell two products to them. Whereas if you only had one of those products, you could only presumably sell one product to them, so your monetization per customer is significantly lower if you don't have both products.Matthew: Correct. You and I have spoken in the past about this enterprise type of customer where in the 3PL world, some customers are transactional. They're not committed, they don't have a relationship where they sign a contract, but they are just regular customers where you have a good relationship. We actually attempt to try to sell two- and three-year agreements to have companies outsource all of their logistics to BlueGrace. In that market, you have to have diversified types of distribution channels because then you're dealing with complex types of distribution or logistics transportation apartments. If you don't have all of the various distribution modes covered, you're going to lose a business. We don't have all of them in-house. For the ones like intermodal, which basically includes rail and Air Express, we would then supplement our capabilities internally with third party partners so that we could come as a package to a customer and say we do offer all the distribution channels that you could possibly be looking for.Edward: Are most of BlueGrace's competitors doing all three as well? Or is BlueGrace more unique in that they do all three?Matthew: They're very unique. I would tell you that most people do truckload. A lot of transportation companies only want to do truck load and when you get into the business, that's the one that is juicy because the margins are so much higher. A lot of the press that you're seeing in the industry with Uber freight and all the competitors, what they call digital freight matching, those are all centered around the truck load market. There aren't people who are trying to break in and disrupt the LTL market. It's much more difficult to do and there's very few companies that have the sophistication that BlueGrace has. We have limited competitors on that side, but we have hundreds of competitors on the full truck load side.Edward: But meanwhile, your LTL competitors are companies like FedEx and UPS. There are few competitors, but giant competitors that are going after you.Matthew: Those probably aren't competitors as much as partners. Those are the people we are bringing loads to. We are helping people get on to those trucks for FedEx and UPS. That BlueShip technology I was telling you about, we get pricing from FedEx, UPS, and Saia in all dominion and upload those prices into our database. Those are the prices being displayed to the customer when they're booking an LTL shipment.Edward: Got it. You're almost like an Expedia for LTL shipments.Matthew: Correct. That's a very good analogy. If you saw the website BlueShip, it will look and feel like almost every booking website that you've seen. You have the hotels.com, Expedia, Orbitz, or even on Amazon, we take a set of inputs, you hit submit, you get results. Just like you're booking a car. It's nice because, like when you're booking a car, the names are familiar. I have Hertz, I have Atoz. You got that comfort when you're booking LTL with BlueGrace. I've heard of the companies that are being given the options. I've seen all their trucks. We're very similar to that on the LTL side.Edward: BlueGrace's growth was primarily driven by sales. In terms of marketing spend. It's a very small percentage of your overall revenue. What role did marketing play? How did you grow the business with marketing?Matthew: Indeed, what you described is something that the CEO himself would admit a few years back, which is it was very much a sales organization, almost all of the outreach to prospective customers was via the phone, via email from a sales organization trying to hammer the phonebook in the old days. What we wanted to try to do was transition to a situation where companies were calling us. That's so much an easier sale when the phone is ringing and you're not having to make phone calls. We took a very small marketing budget and we started deploying it against [...] leadership in content ideas. We did not have a webinar series before I got there. We created a webinar series. We had no such things as white papers with very few case studies. We started building this inventory of assets collecting information about what we do and presenting it to customers in a really user-friendly way through video on LinkedIn and other places, and started drawing people's attention. We went out to the media, we hired an outside agency to help us with the press, and wrote articles that were published in industry publications. Folks are always looking for those kinds of opportunities. By and large, when you start Googling certain topics, all of a sudden through the years, BlueGrace became more of a relevant result and we started getting some really, really interesting inbound calls. From CEOs and COOs of very, very well-known companies that are commonplace and you would be proud to have as a customer. That wasn't happening before I got to BlueGrace.Edward: When you do that top of the funnel–type marketing, how do you know what's effective and what isn't? Some of the CEOs reach out later and individual sales are worth lots and lots and lots of money, but how do you know which of your early funnel marketing stuff was worth doing and which parts weren't?Matthew: That's a great question. Tying in the date that's coming in, the leads to the CRM, and doing reporting downstream is really important to us. We could measure each channel, whether it was coming from Google, LinkedIn, a webinar, or a tradeshow, and continue to watch those activities. We would upload into our CRM the source of every lead, and then as it spit down to the bottom of the funnel, we could see if we were being effective or not.That was the first project that I took on when I got to BlueGrace. As the CMO, I was the executive sponsor for the company building a proprietary CRM. We got rid of Salesforce. It could do a lot of things, but it wasn't really suited for what we were trying to accomplish. We built this really saleable little CRM called Bonsai, and it was able to capture (we felt) more of what the logistics sales development cycle looks like. Especially on those enterprise sales where there's a very, very long sales cycle. Nine months was commonplace, sometimes 18 months from initial contract to sale. We felt like having our own proprietary CRM was the way that we should help manage the touch points for the customer and track each of these sources all the way to the sale.Edward: You did some sports sponsorships as well. You sponsored the Tampa Bay Lightning. How did that go?Matthew: We did. When I was there, that was over 50% of the marketing budget, was a partnership with the Lightning. It wasn't really effective and it took me a little bit of time to convince the folks at BlueGrace. I'm not well liked for making that decision because when you come into the building, you're surrounded by Lightning apparel and signed jerseys from all the famous players throughout the hallways of the company. We were the official shipping solutions provider of the Lightning. We are no longer that.The problem with that is that most of the promotions were going on inside that building. When you go to see a Lightning game, sure, there are 15,000 or 18,000 people all screaming and happy that Lightning are doing well and they're seeing our name. The problem is, our company is national. We are helping people from Miami, Florida to Portland, Maine to Seattle, Washington and San Diego and every [...] in between. Primarily, shippers, there's a correlation with manufacturing. You're shipping something that you've made or you're a wholesaler. That industry just is not really something that has a presence in Tampa, Florida. There's just not a lot of that distribution going on here. While our name was getting out, it was getting out to people who could not become our customers. It just wasn't effective.We took that money and put it into getting in front of decision makers that could use our services and that was more of a happy ending for the company, but for the employees who liked having that relationship, not so much.Edward: Do you think that it's helped you attract employees?Matthew: It certainly did. But I don't know about retaining them. That part I don't know, but we did make use of the Lightning logo and the colors when we would go out in the community and do recruiting events. We would do some events that were actually at the Lightning games, drumming up, looking for young people or even at any kind of a heart walk, any kind of 5K. Anything that we participated in, it was nice to have the tie into the Lightning. I will say, from the recruiting perspective, yes, it was a benefit, but in terms of growing and translating into sales for our company, I would say it's very ineffective.Edward: Which marketing channels did work very well? I know you did a lot of paid social digital video.Matthew: Yes. I would say LinkedIn was the place that we were wildly successful over and above all the other places. Here is the hard part about logistics. There is no list. There is no place that I can go and a database will tell me, here is a list of companies who were spending a million dollars a year on shipping. There isn't such a thing as that list.A lot of what we have to do is qualifying companies. It's more of just trying to get people on the phone and learn a little bit more about their business. You could even be spending a million dollars on shipping, but if you're doing the “wrong” kind of shipping, if you're doing all Air Express, we can't help you. If everything that you put is on a freighter, ocean liner, we can't help you. If you do a lot of warehousing, that's another kind of distribution model that we don't participate in.We needed inbound leads that translated into conversations, where we could quickly qualify and then move through the channel or say, sorry, we really can't help you. Getting in front of folks on LinkedIn was helpful because we started figuring out not just the decision makers that might be someone who has a title in the transportation department, but there were influencers. The CFO, while they don't traditionally have the logistics arm or the company reporting to them, they are heavy influencers in decisions where you're spending a million dollars, $3 million a year on any kind of service.We market heavily to CFOs on LinkedIn talking about have you audited your supply chain? Top five reasons why a CFO should be doing XYZ to their supply chain. That became very effective. We started getting their attention. Lots of those leads would then be filtered down for their organization and then someone at the company gets an email from their CFO, says call this company. They're probably going to have to call that company. Again, they're not technically the decision maker, but have a heavy influence.Funny enough, we don't compete on “sales.” We're not offering you the lowest price per se, but with our software and our service, the entire package of going with BlueGrace is probably a better package than some of our competitors, and that was something that a CFO actually responded to quite well.Edward: How did you support outbound sales? Given that the business was growing primarily with sales, was it marketing supportive and helping accelerate sales?Matthew: Yeah. We had a couple different arms. Again, the company was broken up into the side that supported the transactional side of the business—the Coca Colas and whatnot of the world—and then this enterprise side of the business. The transactional side was a little more difficult for us because the nature of those companies being small and medium business, the retention wasn't great. People would use us once but then they may not need to ship again for a month, or three months, or even a year. The LTL side of the business is so SMB that you couldn't build relationships. However, we were really effective at supporting the sales organization on the enterprise side. That's where you have only 9 or 10 senior sales representatives who have got 20 years of experience. They are customers who are making million-dollar decisions about a budget over two or three years, they respond heavily to content that we were providing, the webinars that we were doing, the white papers that we are writing. That side of the business dovetail really nicely. The trade shows that we were going to pay to become speakers at events.Really showing authority because the decision there is a much bigger one. If I make a mistake buying a $250,000 LTL shipment, I'm not going to get fired. If I pick the wrong 3PL for Florida Tile, they spend $6 million a year on shipping, somebody there could possibly lose their job. The marketing side was really geared more towards those decisions, which is becoming experts in the field and creating really strong brand awareness with the mid market.Edward: Risk avoidance. No one gets fired from hiring IBM. No one gets fired for hiring BlueGrace.Matthew: Right. What we aspire to is to have that be the case, yes.Edward: Matt, this has been fantastic. Thank you for being on the show today. Before we go, tell me about your quake book and how it changed the way you think about the world.Matthew: The book that I mentioned to you was Nudge. I went to University of Chicago. Nudge was written by two renowned people in their field, but both very interesting University of Chicago personalities. The interesting thing about the book is you have Richard Thaler who actually comes from the economic side of the business and works in the business school. He's known as the Father of Behavioral Economics and has recently won a Nobel prize. The upside of the book, something that most people probably do not know. His name is Cass Sunstein. Cass Sunstein was a professor at the law school. I had a really interesting experience at the University of Chicago. When I was attending business school, my wife was in law school at the University of Chicago. I regularly walked across the midway in very frozen temperatures to go and socialize and eat lunch with her.I got to see and know Cass Sunstein a little bit. He was a Rockstar in his own right at the law school. The two of them combined and wrote the book. I raced out to buy this. I waited for a paperback. The two of them together, obviously, you have two of the smartest guys in the country in their respective fields. The part of economics and decision-making around our behavior is really fascinating. It gets to the root of everything that happens in microeconomics. Everything can be boiled down to human behavior and how simple ways that we can rephrase someone making decisions get them a changed behavior. Thaler's most famous one is that he talks about on and on getting people to contribute to 401(k)s in their companies. Having people opted into that decision without them even asking for it isn't a harmful thing. He makes the case that if you just simply have people choose to opt out of 401(k)s, they're not going to do that, like, oh yeah, I want to save. But if you don't do that, very few people will actually opt in and it ends up being the most well-educated, the highest thing people who will participate in a 401(k).That's just one example, but it's the most concrete one that he has in terms of getting the US and the average person to be better at saving around the country. There's anecdote after anecdote in there. Each chapter is obviously its own case study. I find it to be an absolutely fascinating book. Obviously, you can hear when I talk about it because I've actually met, not hung out—that's probably too strong of a word—but gotten to know through association both the authors because I was at the University of Chicago when both of those guys were there, too.Edward: Thank you, Matt. This has been fantastic. I really appreciate your time today.Matthew: It was great to talk to you. Thanks for inviting me, bud. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit marketingbs.substack.com

Corona-Virus, Covid-19 ~ Is It An End-Times-Sign? As you know, Corona-Virus jumped the human, animal fence. This was first made well known when the American News Media was examining this as only a Chinese issue. However!, we watched as this virus spread around the world. It was still growing, and still is, in terms of the number infected. So… why does this remind me of Jesus’ prophecy in The Book of Matthew? It reads, in part, “[4] Jesus answered them, ‘Watch out that no one misleads you.’ [5] For many will come in my name, saying, ‘I am the Christ,’ and they will mislead many. [6] You will hear of wars and rumors of wars. Make sure that you are not alarmed, for this must happen, but the end,… is still,… to come”. Please visit our Outreach Web site! ~ https://unchurched.site123.me Our Anchor audience can find more episodes at this link: https://is.gd/IKlYXs to our primary host while we switch. Introduction ~ About Us, Who We Are: https://is.gd/DNqtwP | On Anchor: https://is.gd/rgBN6h How-To Be Saved: https://is.gd/sJSZgR | On Anchor: https://is.gd/uYcVdh Short Links Provided by: https://is.gd “End Times” and “Benediction” A “Barking Squirrel Production” Copyright: 2018 ~ All Rights Reserved Series: Corona Virus, Covid-19 - Is it an End-Times Sign Session: 2020-0402 Episode: 15 Copyright: 2020 TAGS: Corona-Virus Covid-19 Jesus Prophecy The End Human Animal Chinese World America United States This podcast is powered by Pinecast.

In this episode, Tom and Michael chat with Matthew Whitaker from GK Houses about what it takes to have effective property management and how investors can set themselves up for successful relationships with their PMs.   --- Transcript   Michael: Hey, everyone. Welcome to another episode of The Remote Real Estate Investor. I'm Michael Albaum. And today I'm joined by Tom Schneider and Matthew Whitaker with GK Houses, Matt and GK Houses is one of our preferred property management partners at Roofstock. And so we're going to be talking to Matt today about what it's like to be a property manager. What are some things that we as investors can do to make their lives easier? And give us a little bit of insight into what a day in the life of a PM looks like. So let's get into it.   Theme Song   Michael: Matt Whitaker. Thank you so much for joining us today. Really, really appreciate you taking the time to be with us. How are you doing?   Matthew: Yeah, I'm doing great. I'm excited to be here and excited to do this with you.   Michael: Awesome. And you're down in the Southeast, right?   Matthew: I am. Yeah. I'm in Birmingham, Alabama. That's where our corporate office is and we're in eight different markets. So we're in three markets in Colorado and then we are also in Birmingham, Nashville, Atlanta, Chattanooga, and Little Rock.   Michael: Awesome. Awesome. And for those of our guests who might not know you, can you give us a little bit of background about yourself on GK houses, help everyone get to know you a bit?   Matthew: Yeah. I'd love to some, the CEO of GK houses. I started it about 13 years ago during the last recession. And during that kind of, 07, 08, 09 time when the market crashed, I owned about 30 rental houses at the time and had a hard time selling those once the market crashed. Most of those were in the low to moderate income world and the ability to sell that went away. And I started a property management company, converted all those 30 over into rentals and was able to get some of my investor buddies to also let me manage them. So I got up to about 70 houses pretty quickly, and that was kind of how I lasted through that recession through 08, 09, 2010 was by managing homes in about, we also were selling homes. So we were doing some turnkey stuff at the time, kind of original before it was very popular. And, but in 2013 we really started off focusing on the management business. And we decided at that point we managed about 250 homes right here in Birmingham. And at that point we decided that we wanted to get to 25,000 houses under management. And so we've been growing that ever since 2013. And today we manage somewhere around 26, 2,700 homes in those eight markets that I talked about earlier.   Michael: Great. And did you have any personal management experience in the real estate arena or did you go straight from owner to manager?   Matthew: I always swore I would never be a property manager or a real estate agent…   Michael: You're in good company.   Matthew: And a lot of companies did that same thing. Yeah. And so never, never say that to yourself, but now I'm a real estate agent and a property manager. And so I managed my own homes. So I had been doing it ever since I first got started, even my first house I ever bought, I still own, and I have rented it ever since. And that was a disaster story. So it's amazing that I'm in the property management business. So yes, I did have a little bit of management experience. I had been in the buying and selling business for about seven or eight years. So I was very familiar with what a manager did. I had some other third party managers that manage some homes for me for some time and found all the things that I didn't like about a property manager. And so I decided to just do it ourselves, with GK Houses.   Michael: That's great. I love that. You've got that personal experience that you did it for yourself and then went into business, helping other people do it because it just shows that you understand the business kind of from the ground up, which I think is so huge. And you're able to treat the rentals as if they were your own.   Matthew: Yeah. There's nothing that replaces knowing what it's like to have a $500 bill come through, or a $2,000 air conditioning, a replacement come through where you're expecting that cashflow to pay the mortgage. And now all of a sudden you've got to figure out some other way to pay that mortgage. So it definitely gives us empathy for our owners. And that's something that we've tried to communicate and teach to the team members that work for us is, you know, and I'll often say to them, what if on Friday you found out that I was going to pay you $500 less with your paycheck. And they, you know, that would be disappointing to them if it was a surprise. And that is the same surprise that we were calling up from time to time. And unfortunately having to deliver bad news to owners because inevitably things are going to break when an owner buys a rental house they're in business and you're going to have expenses for that business. And so we've learned a lot over the years about having reserves and making sure that you can afford to pay for the lumpy expenses that are in this business, but it still requires a bunch of empathy from our team members when they're communicating with owners and having deliver, you know, have tough conversations.   Michael: That's great.   Tom: You touched on reserves. I'd love your thoughts, Matt, on, you know, what do you think an appropriate like reserve level is?   Matthew: Yeah. If I was in new person getting into the business and I bought a foot, let's call it a fully renovated home. I would probably stay about. And obviously depending on the age or the vintage of the house, I would stay about $3,000 out. So I would keep at least $3,000 available at all times. And then as I got to a bigger portfolio, obviously the per house number would come down because you could dilute that across the portfolio. But getting started, I would say somewhere around two to $3,000, just available to make sure that it doesn't affect your lifestyle. And if you do have one of those expenses that comes through   Michael: And in that same vein, most lenders are going to require a cash reserve amount for PITI. Would you consider that a couple thousand dollars to be that same pool of the reserve bucket? Are you saying above and beyond this? The reserve?   Matthew: Yeah. I'm just talking about expenses and then capitalizable type items. I mean, I may even start as you started to build a portfolio and this is one of the reasons I always tell people don't buy one rental house. I mean, certainly try it on dip your toe in the water, but it's way easier to own 10 rental homes than it is to own one because you all these expenses start to get diluted amongst your cashflow of your portfolio. And then it doesn't become as big of a deal when you have a $500 bill come through. If you have a rental house, a $500 bill comes through, you're literally writing a check out of your back pocket. Sometimes if you have 10 rental houses and a $500 bill comes through, it's just another number on your statement. And you're just calculating your return based on that. So I think of that in excess of that, I'm just thinking of, in terms of repairs and maintenance,   Michael: Tom like you always say peanut butter spreading that across.   Tom: Peanut butter spread the risk. I love that quote yeah, 10 properties, a lot easier than one property.   Matthew: It is, and absolutely if you're not having to manage all of them, any, even if you are, obviously you're spreading that risk across multiple residents with different jobs and different industries. And if somebody invests through you, they can even do it across different markets. So 10 seems to be the magic number in my opinion.   Michael: Great   Tom: perfect segue talking about, you know, as long as you're not managing it, and let's talk in a little bit about the roles and responsibility of a third party property manager that you would hire, what are the different things that services that they would provide in the process?   Matthew: I really think the services of a property manager fall into two buckets. There is the accounting bucket and the communication bucket. And obviously under that communication comes execution, but let's talk about accounting first. Part of our operations is accounting for our homeowners. We want to make sure that the money comes in on time, that the resident's abiding by what the lease term says in terms of money paid. And so we're going to kind of hold the resident to making sure financially that house is getting taken care of. And then we're going to account for all the dollars that come in and of course paying any expenses that we need to pay out of that money that comes in. And then the other side is just operations and communication around those operations. We're obviously going to make sure that the house is taken care of. One of the interesting things, especially around small multifamily and single family.   There's a lot of logistics involved in that. I always say it's a communication challenge and a logistics problem. So it's about, you know, having a one house, one owner or one vendor, you're always communicating with somebody. So you need to be really good at communicating. And our property managers become more like air traffic controllers. They're making sure the vendor knows where to go. What time to be there has the resident's information. The resident knows that the vendor's coming. The owner knows that there's a problem at the house if it exceeds a certain amount of money. And so you're having to keep all of these people in the loop and make sure that the planes aren't running into each other while you're that. And so, again, it just boils really down to accounting and making sure that I's are dotted and T's are crossed and then operations and communications.   Michael: Matt, you said something that I want to circle back to that the owner knows if there's a problem, if it's above a certain dollar amount. So from folks who have never purchased a property, what do you mean by that? And why is that important to highlight?   Matthew: Yes. So you hire a private manager to basically take care of the problems and you don't want to know that something small has happened at your house. That's not really going to affect your lifestyle. It's just kind of brain damage for somebody to call you over a hundred dollar issue. So we have, what's called a $500 kind of threshold. And if one of our maintenance guys goes out there and he sees that this thing's going to exceed over $500, we're going to contact the owner before we do anything and provide them an estimate. But if it's below that $500, we're generally just going to take care of that issue. And then the owner's going to see that happen. You know, see that payment on their statement. You hire a property manager and you will be circled in on all the big issues, but we want to handle all the small issues. That's why we feel like you hire us is for a turnkey solution, not to have to sweat the small stuff.   Michael: Awesome. Thanks for clarifying and Matt, in your opinion, you know what separates the good from the great property managers?   Matthew: Yeah. We go back to accounting and communication again, getting the numbers right. Is so incredibly important and you'd be surprised at how many property managers get that wrong. The other, again, communicating, it's so hard in our business to communicate and trying to make sure as an owner. And of course I was in this position. So I know exactly how they feel. If you don't know what's going on, it's not like you expect the best is happening. And so you want to make sure that you're clearly in the loop and you have the confidence and the trust of your property manager, that if something bad is happening, that you're going to be well aware of it. And also communicated with what we call uncomfortable transparency, which means I'm not going to withhold information from you to make it easier to tell you or more palatable or, you know, easier on me really, because I don't want you to get mad at me.   So we want to make sure that we're giving our owners the truth. And we call that also entering into the danger and telling them, being willing to tell them exactly what's going on with their house so that they, if it is a big issue, they can make the best decision for themselves. And also try to remain as objective as possible when we're communicating, because money can be very emotional for people. And if we can kind of steer them towards the best solution, then we want to make sure that we're doing that based on our experience as a property manager, you know, we do have the benefit of, and especially in the South right now, it's getting really hot and air conditioners are breaking well. We have the benefit of knowing that air conditioners break and things we've done in the past and mistakes that we've made in the past. So, you know, when it becomes a, should I spend 600 or $700 to fix this air conditioner and it may last another couple of years or a $2,000 replacement or a $2,500 replacement. Well, we can give them kind of some objective advice based on what we've seen in the past. And then the owner can make their own decision based on that information.   Tom: That's a great example of being proactive in informing the most decision and using some of the information that you guys have as an investor. We want to get the top dollar. We want to manage the least amount of vacancy as possible. What were some things that you would advise that the owner, the investor can help achieve those?   Matthew: Yeah, the biggest expense and investor's going to have is turnover. You know, you can have a picky tenant that calls in a lot of maintenance work orders, or it feels like they're calling in a lot of maintenance work orders, but truly turnover in my opinion is the biggest expense you have. I think of it and you played football, Tom. It is like going in to score a touchdown. And instead of you throw an interception on as you're about to score, and then they run it back for a touchdown, it's like a 14 point swing that somebody moves out because, and the reason I say that is not only do you have loss of rent, so you're not having money come in, but you're also having to pay money out on deferred expenses when that happens. And so it's very important that you keep residents in homes and the way you do that is you do it through good communication with the residents.   You do that through handling maintenance work orders. One of the things we found was our residents started staying longer when we internalize maintenance because our maintenance team is not out there just fixing a problem. Our maintenance team is tasked with making the resident happy because they're a GK team member. And so if you think about kind of the change in that, if a maintenance team member thinks his job is to just fix something, well, that's a problem if ultimately in the owner's best interest is that resident staying alone time. But if the maintenance team member is out there with the idea, I want to make this resonant as happy as possible, then it makes the resident happy. It's in the owner's best interest because the resident stays a whole lot longer.   Michael: That's great.   Tom: Oftentimes decisions, especially those big decisions that you'll make with an investor it's the repair or replace, or do we want to focus on vacancy or rent growth? And I don't know, I guess one of you just elaborate a little bit on those two important decision points that can make or break deals.   Matthew: Let's talk a little bit about rent growth, because I think what I've always thought of it, the way I mentally look at it is staying a little bit behind the curve. Like I don't want to be on the bleeding edge and I don't think investors want to be on the bleeding edge of pushing grants. And I know there's some institutions out there that will actually do that for us, I think. And I like to stay a little bit behind the curve because I think it's so important that that a doesn't move out. I don't want that resident to feel like they can get a better deal somewhere else. And so what I like to do is stay a little bit behind, but definitely be in tune with rent growth and be focused on it. In our leases, we have some rent growth built in, but that also gives us the ability to go to the resident and say, Hey, you know, the owners being very generous, wants you to stay another year and has decided only to raise it 1% instead of the three to 5%, which may be in our lease or even better, they've decided not to raise rent. And because, you know, they think you're an awesome resident and normally they would raise it 5%, but they're not going to raise it at all. So it gives us the ability to even if you only raise it 1%, it gives us the ability to basically say, Hey, the owner's doing you a favor because you signed up for three or 5%.   Michael: That's great. I think, yeah, like you mentioned Tom investors where they want top dollar and you know, as much as we can push the envelope, we'd like to, but that's really great advice. Cause I think something that I chat a lot about with Academy members is when it comes to pushing rent is do the calculation, do the math for if this tenant leaves and you've got three weeks of vacancy, what does that cost versus what do you stand to make with the 10, 15, 20 bucks a month? You're going to increase the rent. The math kind of works itself out pretty clearly.   Matthew: Yeah. I would think if I'm an investor and I am on a number of rental homes, I think in terms of seven to 10 years, how can I maximize the most amount of money over that seven to 10 years? Not now. And this gets into having reserves too, because if an owner is making short term decisions is going to affect his or her longterm seven to 10 year plan then, and that's a problem. If you have reserves, you can make clear objective decisions based on how much, what the best longterm getting the most money in over that seven to 10 years. And so I think as your clients and investors operate, they need to be thinking longterm because this is a, this is not a get rich quick game. It is a consistently make good decisions over the long period so that they can over the course of owning that rental home, whether it's seven to 15 years, then they end up in a much better place.   Michael: Tom, Matt set you up so nicely for your T-ball swing. What do you like to say? Be what?   Tom: Oh, longterm greedy, be longterm greedu.   Matthew: Yeah, that's great.   Michael: Matt, I want to ask you a question about property management fees specifically around vacancy. And I get the question a lot in the Academy that says, Hey, you know what? It seems like property managers, aren't incentivized to actually keep tenants in place because of the new tenant placement fee being 50% or 75% or a hundred percent of one month's rent versus a lease renewal is typically less. So what would you say to someone that had that question?   Matthew: Yeah, I think it's a great question. You definitely don't want to incentivize your property manager to do something that's not in your best interest. And so when you're thinking about property management fees, what I would tell somebody is make sure that the fees are in line as well as you can with your incentives or with the incentives of the property manager, because you just don't want anybody to have to make this kind of moral decision that affects their income. And so what I would say is the way we look at it is we do need to make money when we're leasing, because we do a lot of work. The way we look at GK Houses is we want it to be an annuity business for our owners and for us. And the way to do that is to keep residents in homes. And that allows us to do certainly we're doing a lot of work while the residents in the house, but as soon as that resident moves out, I mean, it's like a full time job trying to get that home back on the market as quickly as possible. And so we often talk about, and we've structured our fees so that we don't want people moving out. We want to build this big annuity snowball. And so to me, you need to make sure that your property managers fees align with your interests and your interest of being an annuity. So I would say incentivize the manager to renew the lease over a leasing fee. Now the leasing fee may be higher, but what kind of work did they have to do to earn that? I would much rather earn a couple hundred dollars, 200 $5,300 renewal fee that is, that, you know, requires two to three hours worth of work versus the, you know, maybe 20 plus hours of work. I would pour it into a turn.   Michael: And can you give somebody who's listening a real high level overview of what work does go into a turn because I think that's such a great point is there is so much work that goes on into placing a new tenant, but that goes on behind the scenes. Most folks don't have any idea.   Tom: The Duck's legs under the water. That's another episode where we riffed on that for a minute. So, sorry. Yeah, go ahead.   Matthew: Well, we think about this about 60 to 90 days out. So we're trying to renew the resident almost, you know, six to eight months into their lease. We're trying to do it as quickly as possible. And so when they submit their notice and they start to move, you know, we start communication. So we communicate with the unit or, Hey, your resident is submitted. Notice just wants you to know. And then we give them an idea of what we're going to do when they move out. When the resident finally does turn in keys and moves out, we're going to do, depending on the market, we're in, we're going to do a walkthrough. And generally that happens not the same day, but within 24 or 48 business hours of that resident moving out. And we do a full writeup with pictures and it is amazing how many pictures we take, but we really feel like this is part of taking pictures, is communication with the owner.   They can see the pictures and kind of feel what the house looks like. And then one of the things that owners forget is we also have a requirement with the resident to account for their security deposit. So we have all these logistics going on and all this communication with the resident and communication with the owner, we send out a statement or an estimate, the owner that basically dumps all the expenses into three categories. One is these are the expenses we want to charge the resident for anything above normal wear and tear. So, you know, if the carpet has been lived on you can't really charge a resident for that because you expect the carpet to be lived on. But if there's a hole in the wall for some sort of misuse, or you can tell that the home has been misused there, we're going to charge that resonant for that.   And then there's a column that we say are required repairs. And so required repairs are, there's a hole in the wall and we need to fix this before the next resident moves in. You just can't leave a hole. Nobody's going to rent a house with a big hole in the wall, or then the next column is recommended. So maybe there's a room that is kind of in between. It's kind of in a gray area. May if you paint this room, it's going to run faster or you're going to rent it for more money. But if you don't paint it, then it's not going to keep us from renting. So we divide our estimate into those three columns and we'll send it to the homeowner and the homeowner will either approve the required or add on the recommended on top of that, and then approve whether the resident's security deposit. They're happy with how we account for that.   Then we have to basically do the accounting of the resident security deposit and then mail that to the resident. Now, oftentimes sometimes the resident disagrees with how we accounted for that. And the resident obviously did a move in when they, when they, and we did a move in before. So there's some time there's some kind of go back and forth between them and us on it. Was this a definitely misuse or was this like this when you moved in? And so sometimes when we inherit leases, we deal with some issues with that, but we do a really good job of a moving walk through. So we have pictures of the house before it moves in and we can easily compare those to the move out, walk through. Then once we we're done with the resident and everybody's happy there simultaneously, we're going back and forth with the owner on the work that needs to be done to get the house on the market.   And to me, owners love speed. And so that's one of the things we try to do is there is an anxiety that happens with an owner as soon as that resident moves out, that money stopped coming in and the expenses start, but it also makes an owner feel better if it gets done very quickly. So we're trying to renovate that house, turn that house as quickly as possible, and then put it back out on the market as fast as possible. And so, you know, depending on how long it takes to do the work, you know, our goal is to get that house back on the market, just literally as quickly as possible. And the only downtime being the time it takes to get the work done. We also start pre-marketing. So we try to start building some excitement. Some of our markets, we actually pre-market even when the residents about to move out, I just kinda made it hard recently with the pandemic, but you know, kind of a normal world will pre-market and we've been leasing a lot of homes.   We're starting to use some video tours. We're using a Matterport camera and we've been pre-leasing homes without people actually even walking through them. We've done a really good job with these Matterport cameras. And then again, getting it out on the market and getting as many people through it. One of the things that we found though, is if you take somebody through and the work's not done, sometimes there is a misunderstanding of what work needs to be done or what work is going to get done. And there's some disappointment from time to time. So we like to get the work done first, build the excitement, and then generally your first people through are your best opportunities to rent that house. Cause there's a, they feel that sense of urgency. And then we signed the lease and hopefully they move in as quickly as possible so that we get the rent coming back in and stop the expenses from flowing out.   Tom: I had like two questions I was going to, but you kept hitting him. I was, you know, I was gonna ask, Oh, you know, what changes have you guys made with the pandemic? And that's cool. So you guys are doing video tours and   Matthew: Yeah, we're using a Matterport camera now, which is basically you set it up in the middle of the room and it allows somebody to virtually walk through the house and it is really cool and it shows it's got a fish eye on it, fisheye camera on. It allows people to really see what it's like to live in that room. And the other thing is it's really a touchless and we're not using leasing agents as much as we did any more. Now, some areas are starting to let some leasing agents back. Colorado's allowing us to use leasing agents again, but it's still a opened the door. Let somebody go through and kind of obviously socially distancing the whole time. But we also use Rently a lot boxes on our homes, which allows a resident to check themselves in with a credit card and their ID. And they can go through the home by themselves without us having to be there.   There's some, obviously some accountability and the fact that we have a credit card and we have their ID and we know who they are, we have their cell phone number, but then we're proactively following up. So one of the things that we found in the past, we went a little too automated where we wanted somebody just never to talk to us to the point where they just leased our house without ever talking to us. But now we've found that proactively reaching out and talking to somebody on the phone, right after a showing, is that great way to get somebody comfortable enough to submit an app. And we're receiving right now, somewhere around three in some markets and somewhere around five times as many applications, part of that is pandemic driven. I think there's a move right now from multifamily to single family, just cause people don't want to be on top of everybody, but in part of it is the summer, but we're more occupied right now than we've ever been before.   Tom: That's really interesting.   Michael: Yeah. Very interesting. Matt a question. I get a lot in the Academy, especially of folks who are looking at Roofstock inspections is I've got all this repair work that needs to get done. Is this something that I have to do that I have to coordinate? Or is that going to fall on the shoulders of the PM? Are they able to assist in helping coordinate that work repair work to be done?   Matthew: I can't speak for all PMs, but I love it when we do the work in full transparency. So we do make money when we do the work as the general contractor of that work. But when I can control the process for the owner and I can control the communication and I can control what gets done and I have vendors that know how I work and I can get them in and get them out. I always think of it again, it says value and speed. I can get it done so quickly and there's not a lot of coordination and communication. If you're in a market, you could certainly try to do that because you may have the time, the drive over there. And it makes sure that the contractor is getting the work done. The biggest challenge we have is contractors and relationships with contractors. So for somebody to remotely hire a contractor and get the work done for not only cheaper, but on time and all their work done appropriately to me is just too big of a risk to take.   And what ends up happening is they end up putting the burden on the property manager to go make sure that we're gets done. So then it ends up costing them more because we're going to charge them for some of that oversight. So we just say, look, just let us handle it. And we're happy to give people an estimate to get that work done. And then we'll contract it out to the people that are vetted vendors that are insured. And if somebody falls off the proverbial roof, then they're not going to Sue you. And so we just think it's in the owner's best interest to let the PM handle that.   Michael: Great. And what would you say the most difficult part of being a property manager is what do you wake up everyday and go, Oh man,   Matthew: Not to use another football reference, but I am going to, there is no Superbowl in our world. There's no, we won the super bowl and now we can take two or three weeks off when the 31st hits and we collect a hundred percent of our rent. The first comes the next day and then all our rent's due again. And owners need to know this too. It is a thankless business. The whole point of the job is to deal with problems. And so when you're communicating with your property manager, you need to know that they are doing nothing but dealing with the exceptions, all the problems that have happened that day. And so I have a lot of empathy and sympathy for my team because it is hard. You have to keep them excited and it's hard not to get burned out. And so when an owner gets mad or a resident gets mad at them, obviously that takes an emotional toll.   And generally our PMs are not the ones that made the mistake or when something happens and listen, we're people, we're human. We try to execute as well as we can, but we are going to make mistakes. But when an owner kind of takes that out on a PM, because that's the person they see as kind of the face of the company, you know, that takes an emotional toll on people. So the whole, and when you're communicating with a resonant about not paying rent, you're talking to them about their home and the money, you know, money it's, everything emotionally is tied into this one thing that we're doing. So we have a lot of hard conversations. And so that's, what's so hard about being a PM. And I would say, that's, what's so hard about self managing too, you have the ability to be objective in an emotional situation?   Going back to the first rental house that I bought, I had a six month kind of agreement with an insurance company on a house that had burned down or somebody's house had burned down and they moved in for six months. The insurance company paid me additional money over above what I was asking. Well, the house person was living in the house. Couldn't afford the house normally. And when their house wasn't ready, they'd never moved out of my house. And so here I am self managing I'm 23 years old, and I need that money. I am very emotional about needing that money. And so I was probably the worst person to be dealing with that situation because I was overly emotional making bad decisions. Here I am. This is my first rental house I got paid for six months. Everything was great. I thought I was a real estate guru. And all of a sudden, now my resident's not paying, I'm paying a mortgage and it's not like I just have tons of money left over every month. And so I was just in an emotional place. And what I would say is, if you can't be objective, you can't treat that relationship like a business or even worse. Maybe you do have a lot of money or the ability to float things. And you allow things to go on too long because a resident may tell you a story. You know, it becomes very hard to be objective in those situations because either you're emotional about your own finances or you become emotional about the resident situation. And it really is like running a business. Well, listen, we do have a lot of sympathy and empathy for our tenants. We're very resident friendly, cause we know we want them to stay a long time. We want good residents to stay a long time, but you also have to be very objective when you're dealing with them. And, and so if somebody can't separate themselves from the situation, it becomes a lot of conflict. You know, personally, you're not going to do the right thing consistently to self manage.   Michael: I think that's such great insight into property manager, being a thankless business. You know, I personally am going to make this admission on the podcast. I don't think I've ever called my property manager wants to thank them for a full rent collection month, but I know I've called them and asked why the rent was late. So less than to everybody listening go, thank your property managers for the good stuff. Don't just highlight the bad stuff.   Matthew: And we do have some owners that are kind enough to thank us. And we do have some really great owners, but you're right. I mean, the expectation of the owner is full rent collection and no expenses. So as long as that happens,   Michael: Right, right.   Matthew: The bar is at a hundred percent.   Tom: Everybody's good.   Matthew: So anything below that is us not meeting expectations, even though, you know, it's not our house. If the toilet breaks, I've never used that toilet. Right. It wasn't you. Right. But I do understand too, that it's kind of funny, like an owner may move out of the house and then a new resident moves in and immediately owners because they are emotional about, especially a house that they lived in and owner will become very well that toll, it never broke when I was there. And I'm like, well, I don't know what to tell you.   Michael: I don't know what to tell you! Tom, You got any more questions?   Tom: Yeah. I guess, you know, kind of continuing on this theme of, you know, helping this thankless job, how would you say investors could help put their property manager in a better position to be successful?   Matthew: One of the things I would say is around communication is a lot of people want, expect like an email to go out and then an immediate email to come back and we do have RPMs or full time communicating. So we do have the ability to do that, but there are times when they need to be a little flexible about how fast we get back to people, because we do have other fires that are raging from time to time that a PM may be very focused on getting another owner's property fixed. So just having a, you know, not an unrealistic expectation around how fast we're able to get back with people. And look, we that's. One of the things that we measure is we do measure how fast we get back with people.   So we are getting back with people fairly quickly. The other thing is, again, having reserves really helps us out because it gets us into a situation where we're doing the right thing. We're playing the odds. We're placing good bets with these homes and allowing us to help you manage for the long term. So those are two things an owner can do. And then also when they do communicate with us, I know you're going to get frustrated when something happens bad and look, we're frustrated too, but know, it's every bit as hard to make that phone conversation and make that phone call and just know that the PM has been dreading calling you and telling you that there's this $500 expense or whatever it is. And so just having some empathy for that person that is making that phone call is helpful and being problem solvers together. Let's Hey, we're on the same team. We didn't cause this problem, but we're going to both fix it as teammates   Tom: Love it.   Michael: It's such a good point about around the communication timing. I was chatting with a student in the Academy. I won't say from where I was just say it rhymes with smooshmork. And they said, you know, I can't deal with this property manager. I said, what happened? He goes, well, I emailed them 20 minutes ago and have her back. I said, well, that, that might be how you're used to communicating, understand that it's different around the country. And so what I was recommending folks is just ask, when you're chatting with property managers, vetting property managers, ask them what their communication style is and ask them what a reasonable response time is, because the expectation should be set on the front end.   Matthew: Other thing I would add around communication. If you start to get up to, let's say five to 10 rental properties, what you need to is set up a regular monthly call with your property manager. We have found these calls to be so helpful. Again, getting back into being objective. You really solve problems together for the longterm. There's no emotion around it. There's no surprises when you have five to 10 rental properties and it's worth the manager spending an hour with you and kind of making sure that you're on the same page on a regular basis. It would be hard to have those calls for anybody below five houses let's say. But if you're starting to get up into five and continuing to grow, it makes sense for you to have a regular monthly call. And if you get to a point where you have 20 to 25 houses, it may be a weekly call that you would want to have. But I can't tell you how these regular calls have really helped us with our communication with owners, because you're not just hearing about the bad problems. You're also hearing, Hey, we collected this. We collected that. And you're starting to kind of get a better picture of what your portfolio is doing.   Michael: I've got to go set up weekly call. That's a really great idea.   Tom: I know. I love that as a takeaway from today's session... Yeah, I love that. That is a great idea. I really like that.   Michael: Tom, you got anything else?   Tom: That's good for me. Yeah. That's super insightful.   Michael: Love it. Awesome. Well, Matt, we've got some quick fire questions. We'd like to end our episodes with, if you don't mind, it's kind of a yes, no one answer to the other.   Matthew: All right, I'll do it. Alright.   Michael: So high rent growth or low vacancy?   Matthew: Low vacancy.   Michael: Angry resident or angry investor?   Matthew: Ooh, Whats C?. Yeah, definitely angry resident. Although none of those are fun.   Michael: Cashflow or appreciation?   Matthew: I am a cashflow guy.   Michael: Concentration or diversification?   Matthew: I am a concentration guy and I think this is an important thing too, is probably a good nugget for the people that are going to be listening to this, become an expert in an area. First, in my opinion, before you try to diversify too much, I have found that when you become an expert in one area like a Birmingham or even a neighborhood in Birmingham, then you are way more successful at buying than trying to diversify and not being an expert in one area. Sorry. That was more than one word, but..   Michael: No, that's super great insight. Super great insight. Local or remote investing?   Matthew: I think you can do both with technology today. I mean, I would hate to say one over the other because I think if you have access to all the technology that I have living in Birmingham, so it makes no sense for you living in California or in New York or wherever you're living, not to invest in Birmingham because I have the access to the exact same information as you do.   Michael: Great. Single family or multifamily.   Matthew: I'm a single family guy. I think, I think the best opportunities and the biggest opportunities to exploit what is still incredibly inefficient market is in the single family world. I think your points about like the pandemic people wanting a little bit more breathing room, like single family, really great way to go. I'm telling you, Tom we're at over 98% occupied. I've never been on. I've been doing this now almost 13 years. Never been that high and never gotten the amount of applications that were getting approved residents. Great residents are moving into our homes. It is really a good time to be in the single family world. Great turnkey or massive project. Definitely turnkey. Okay. Text message or email. I'm a text message guy. My emails, I forgot like 50,000 unread emails. That's a true story. I can, I can show you.   Michael: That's great. Last one. Olive oil or butter?   Matthew: I'm an olive oil guy.   Tom: Love it. Awesome.   Michael: Awesome. Well, Matt, thank you so much for taking the time to view with us today. If folks want to reach out to you at GK houses, you know, what's the best way someone can get in touch with you or someone on your staff?   Matthew: Yeah. I would say email me, but obviously…   Tom: The jig is up!   Michael: 50,001, right?   Matthew: Listen. The best email to email is support@gkhouses.com and we are monitoring that through a help desk type system. And then that'll get assigned to the right person in our office that can handle that. You can also look us up online and call any one of our offices. So we're a Roofstock preferred vendor in Atlanta and in Birmingham. And am I allowed to say the other two coming down?   Tom: Of course, growing markets all the time.   Matthew: So Little Rock, y'all are in Little Rock now and we're also a property manager there. And then we had a conversation with one of your team members this week about y'all are opening up in Denver, which is super exciting. So glad we're going to be a preferred vendor there too. So just y'all are growing and allowing us to grow right alongside of you. So we appreciate you so much.   Tom: Onward and upward.   Matthew: Yeah.   Tom: Thank you so much for coming on Matt.   Matthew: Yeah. Thank you for having me.   Michael: You got it, take care.   Michael: Okay. Everyone. That was our episode. Thank you so much to Matt Whitaker for coming on today. Really, really appreciate it. If y'all liked the episode, feel free to give us a rating or review wherever it is you listen to your podcast and we look forward to seeing you on the next one.  

[Matthew] It's That Easy: Ask and It's Granted! (But only the "good things") (Jeremiah 29:12-13; Matthew 7:7-11) - Rev. Preston Graham

In this episode we do a deep dive with Matthew Whitaker from GK Houses on what makes Birmingham Alabama a unique investment market.    --- Transcript   Tom: Greetings and welcome to the remote real estate investor. And today we have a special episode where we'll be doing a market spotlight today. We're going to be focusing on Birmingham and we have a special guest today and Matthew Whitaker, and I'll be joined with my cohost Michael album. All right, let's do it.   Tom: Matthew, thank you for joining us today.   Matthew: Well, thanks for having me. I'm super excited about being on this new spotlight and excited about being able to present Birmingham to you.   Tom: So Matt, why don't you tell us a little bit about your, your background and GK housing as well?   Matthew: Yes. So I got into investing when I was 23 years old and bought my first house using a home equity line of credit off of a little house that my wife and I, or a girlfriend, fiancé at the time owned and started buying and selling houses and got really excited about it and quit my job, day job. I was doing it on nights and weekends and started flipping houses for a living thought. I was a big shot real estate investor at 23 and did that for about four or five years and pretty successfully we flipped about a hundred houses. I had some partners, I always joke that they had a lot of money and no time. And I had a lot of time and no money and we got married. So we formed a partnership. I was the operating partner that was out there buying and selling homes. We did about a hundred deals in four years. So for a 25 year old kid, that's out there wheeling and dealing. It was the good old days.   And I thought I had the tiger by the tail. And then as y'all know how the story ends in 2008, 2009 becomes the real estate market crash. And as Warren buffet says, when the tide goes out, you realize who was swimming, found any shorts on? And I looked down and I was one of the ones that didn't have any shorts on. So had I owned about 30 rental houses at the time or 30 homes that we were 15 of, which we were trying to flip 15 of, which were already rentals and we just moved everything into a rental portfolio. And so we started managing, we started out managing as a way to sell more homes though. We were kind of on the front end of turnkey world. And it was very new. The idea of selling homes or packages of homes to investors was very new at the time. And so we did that for three or four years and helped put together a big fund of local investors that bought up a bunch of Birmingham houses. But back in, let's see, 2013, we decided that we enjoyed managing more than the kind of deal of buying and selling.   We were more of a, we call ourselves grinders the more of the plotters. And so we enjoyed management. So we, I still invest on the side about, about 30 or 40 houses a year, still personally, with a partner. And, but my, my day job is I'm the CEO of a company called GK houses. And we started here in Birmingham and started, I always tell the story started with those 15 or 30 houses, depending on how you looked at it. And then started just growing that business. In 2013, we managed about 250 homes. And today we've moved out of Birmingham into eight different markets and manage about 26, 2,700 homes. But Birmingham is still my home. It's where our corporate offices it's where all of our back office accounting and all of our corporate team is. And so, um, Birmingham is the market. I know really well and, and still spend a lot of my time investing in   Tom: Yeah, Matthew and GK houses are great friends of rootstocks and a great partner that we love to advocate for. And we actually are double dipping our podcast. We are having a podcast dedicated specifically to property management that is going to be coming out very soon with Matthew as well. But today, where is the market focus? So great partner.   Matthew: I love anytime I get to get on and sing Birmingham's praises, it has come from having a bad reputation for some certain things that happened in the past, but I'll tell you where Birmingham is a great place. And one of the things that people consistently say when they come here is number one, how green it is. So when you watch a movie about the state of Alabama, it's all red clay. And there are areas of Alabama that are certainly like that. But where I live is very green and very hilly. And they're amazed at how progressive, not just politically I'm, I don't want to get into that, but in terms of how it's moving forward. And we're really known for our food scene, our arts and culture scene. So very excited to get on and get to talk about the city that I live and have no desire to move. I get to travel a lot, obviously with my role as the CEO here at the company, but I have no desire to move because Birmingham is such a great place to live.   Tom: Excellent. So the way that this episode is going to flow is we're going to start with some high level quantitative overview of the market. And then we're going to needle into math to talk about some of the specific qualitative of employer's points of interest and, and all that good stuff. So why don't we go ahead and start in our quantitative breakdown, and we're going to make this consistent for all the markets that we talk about first, the MSA. So the greater area of Birmingham, it has a population of 1.313 million, and this was based off of the last census data and map. What are the major cities that consists of the greater Birmingham area?   Matthew: Great question. So Birmingham proper the city Birmingham is about 350,000 people, I think. And then it is made up of a group of municipalities. So one of the things that an investor would need to understand about Birmingham is it's not a County based government, but it's a very city-based government. So it's very fractured in terms of each little, like I live in Homewood, which is just South of Birmingham. And we have our own city government that manages our own school system, manages our own trash. Whereas somebody like a Nashville or a Kansas city would have a County based government. So that 350,000 people is Metro Birmingham. And then we have a bunch of municipalities in the kind of suburbs, so to speak what we call South of town and over the mountain area, which is all South of town. And then that also includes the Tuscaloosa area, which is where the university of Alabama is, which is about 45 minutes from Birmingham Southwest.   And obviously that area has grown a lot with, uh, with the university of Alabama, as most university towns are starting to grow. So that's where they make up that 1.3 million. There's probably 1.1 ish, a one to 1.1 in what I would consider really proper Birmingham. We don't manage specifically down in Tuscaloosa than Bessemer, which is about halfway between Birmingham and Tuscaloosa is the, is one of the other big towns or cities. And then Hoover, which is due South of Birmingham is another. So generally when you talk about the MSA, you talk about the Hoover Birmingham Metro area. And so Hoover and Birmingham are really the two largest communities in that MSA.   Tom: Got it. I'm looking forward to needle again, a little bit on those specific, uh, as it relates to thinking about those areas as investors. So that area has seen pretty significant population growth. According to the information we have with census plus 2.8% over the last couple of years, it has a median household income of $57,500 as a medium household income. This is coming from the John Burns data, and there's a pretty significant amount of units. So when I say units, single family homes, there is 520,000 homes in this MSA where 26% of them are renters. And this is again, John Burns along with some census data. So continuing looking at some of these metrics that we have on Birmingham. So a major uptick in new permits to build single family residence. The last value in 2019 is 3,280, and that is up 17.2% year over year. A couple of other metrics to throw around the entry home value within Birmingham is about $134,800.   And this is coming from core logic. And the median rent, this is 1030 $2. Again, this is core logic where this is coming with a really steady rent growth. We'll actually have all the metrics, all the markets that I've seen as one of the highest that 6.5% increase in rent. The last couple of metrics I'll hit on before we get in to the quality of stuff that we'll talk with Matthew about is the rent tiers. So we see a rent tier, and this is again at John Burns metrics on the lower end of an $827, the mid $1032. That's that same median level and at the high tier $1,408. So those are the bands at which are identified in the Birmingham market. All right. So let's get back in talking about those specific main cities and other cities within the Birmingham market. So are the majority of the rental market, is it just an at Birmingham proper, or tell us a little bit about that. The distribution of rentals.   Matthew: Let's talk about Birmingham, because I think I need to kind of set the scene. So if you're listening at home and you wanted to bring up a map of Birmingham, what you will see is that Birmingham appears to flow from the North Eastern side of town down through the Southwestern side of town. And so one of the reasons for that is there is the start of the Appalachian mountains, just South of town and runs from the Southeast to the North are excuse me, from the Southwest to the Northeast, and then runs all the way up through South Carolina and in North Carolina. And, and so it starts here. And, and so if you think about when Birmingham was built, it was built in the early 19 hundreds, 1920s, and it was built because this was kind of the Pittsburgh of the South. It was a steel based industry.   So you had a lot of wealth here, and then you had a lot of workers to support that steel industry. There's a lot of mining happen up underneath the mountain. And so when you think about the housing stock, the housing stock started kind of from the Northeast and flows down through the Southwest. And that is the older housing stock that was built on flat land. So if you look at the map and you look at places like Bessemer, which I talked about going up, I 20 through midfield and Fairfield, and then the Western side of town is called West End. And then you get to the Eastern side of town, which is, and starting to head North towards the airport, Woodlawn, Terrant Roebuck. You're talking about, East Lake, you're talking about areas that were built a lot of times in the, uh, some of those areas started in the twenties and then were built through about the forties or fifties.   So when you think about investing in Birmingham, you need to kinda know what the age of the home is. And that's kind of the first thing I think is important is when houses are built and 19 hundreds, they were built with the idea, there was no air conditioning. And if you've never been to the South in the summer, it is really hot here. And we're, we're recording this during the summer. So I'm coming right out of the heat and it's a hundred and something degrees, heat index with almost a hundred percent humidity. And, and so that is really hot. So you can imagine the ceiling, sometimes in those homes were 12 feet tall so that the heat would rise. And so when you're investing, you want to make sure that either those ceilings have been lowered, because now you're going to be required to have air conditioning in them.   And if you buy this older housing stock, you just need to know that it's older housing stock. So your repairs and maintenance are going to be a little bit higher. And what you'll probably want to dig into some of those, but let me, I'll give kind of the 20,000 foot view. And then we can dig into some areas. As move Northeast. And as you move North, and as you move further West, you get into more homes that were built in the fifties and sixties. So there was another kind of housing boom, around that time, those are more of your brick ranchers, more of your wood, three bedroom, one and a half, one to one and a half, two bathroom homes. And these, I call these your tanks. I mean, they're built for modern amenities because we started to use an air conditioning back then, but they're very efficient.   They have closets, but they're not huge closets. They're just a very efficiently built house. So you might find a 1200 to 1400, 1500 square foot home in these areas. And they are great rental houses because again, their tanks, they just hold up really well. They're again, they're very modern people enjoy them. The one bedrooms obviously rent a little bit less than the two bedrooms. Anytime you get multiple, excuse me, not the one bathrooms, uh, rent less than the two bathrooms. Anytime you get multiple bathrooms. Very important. Now, one of the interesting things too, is what I would consider the more A-class housing stock is South of town. So imagine in the sixties and seventies.   Tom: Is that Hoover?   Matthew: Yes, you're talking about Hoover. You're talking about Vestavia, Homewood, mountain Brook, and these areas, these homes are hard to buy and make the rental numbers work, but these are all built up on the mountain. So when we say over the mountain, you had more, as technology came in along and building, you are building these homes on the side of mountains. And so the housing stock is much younger as you get more vertical in Birmingham. And now if you're listening to this in Denver, you might fly into here and wonder where the mountains are. There's all rolling Hills, but we call them mountains. And then as you get further North, just like any city, it grew out, right? You're going to get into areas like Fultondale and Gardendale North. You're going to get into areas like Trussville to the East. You're going to get into areas like Hoover and kind of the Indian Oak mountain Indian Springs area, where my wife grew up, where Oak mountain state park is. And then as you go West, you're going to get into Hueytown and pleasant Grove.   Now these are your B plus neighborhoods that are kind of out a little bit further great areas to buy for high appreciation, but there's suburbs there. People are going to be driving into the city to work. And so, you know, just like any town, you can pretty much dictate what the pricing is of the house based on when it was built and what the housing stock was built for.   Tom: I think one of my favorite adjectives for a rental property is a tank property. That just goes on. You didn't mention what cities you said it was in the West or the Southwest. Is that like pleasant Grove and Fairfield or…   Matthew: Yeah, Hueytown pleasant Grove. Our Fairfield's more of that first area that I was talking about that was built more of a C class neighborhood. But when you get into Hueytown and pleasant Grove, you're talking about B plus B plus properties with high possibility for appreciation, a lot of home ownership in those areas. So really if you talk to some of the local investors, those are some of the areas that they like to hit the hardest.   Michael: Got it. Matthew, I've got a question for you. What I want to know is why are people living in Birmingham and are moving there? You know, there's gotta be job, pull job growth. Can you talk to us a little bit about who some of the major employers are and why folks are headed that way?   Matthew: The biggest employer in Birmingham is university of Alabama at Birmingham, the hospital and the university. So when you combine that it is a teaching hospital, it's one of the, in the Southeast, it's probably one of the biggest teaching hospitals. So it has a huge draw. You can imagine from Mississippi, from all parts of Alabama. And so we have a bunch of doctors and students that are learning at UAB. And then of course the school university of Alabama at Birmingham, the next thing that's a huge employer is Alabama power, AlaGasCo, kind of the utility companies that service the state. And then another thing that's exciting is we have two, no, excuse me, three different car automobile manufacturers within about an hour and a half of Alabama. So to the Southwest, as you go towards Tuscaloosa, which we talked about earlier, there is an area down there called McCalla.   It is where I 459, which has kind of the bypass meets back up with I 20. And if you keep on going down, [inaudible] right there. That is where the Mercedes-Benz produces the M class Mercedes. So the SUV Mercedes, and so McCall is a great area to buy rental homes. You're talking about a lot of new builds going on. That is where a lot of, and they continue to add square footage onto that facility to build more M class Mercedes. And that obviously feeds jobs. People traveling from Tuscaloosa and people traveling from Birmingham. If you go East on I 20, you have the Honda Odyssey van is produced in Leeds. So great area. Trustful sees a lot of their executives that come in from Japan. One of my old partners used to rent to all Honda executives, and they would come in from Japan and live here for two or three years, and then go back to Japan.   So, and obviously the having building the Honda Odyssey van, there's a ton of you don't think of just Honda, but you also need to think of all the suppliers that have to support a big operation, like building that Honda Odyssey van, building that M-Class. And then if you go due South, you breach Montgomery and just South of Montgomery, and that's, this is only about 60 or 70 miles South. You find the Hyundai plant, and I'm not sure exactly what build there. I would imagine most of the Hyundai workers work in Montgomery, but you still have some of the suppliers that are supplying all three of those in and around the Birmingham area, just so they can be very centrally located. So we have a, so that's pretty exciting. I mean, Mercedes has been there probably 20 years, maybe a little bit longer, maybe 25 years building that M class Honda came about about eight, 17 or 18 years ago.   And then the Hyundai plant is newer, probably 10 to 12 years. There's just a lot of exciting things going on. Amazon is building a facility now in Bessemer. So there's a big kind of gold rush in the Bessemer area just because they know there's going to be, have to be a lot of people that are going to support that Amazon distribution facility. Birmingham has been doing a great job of investing in the city has built new hotels in and around the downtown area. And we're also building a brand new football stadium too, for the UAB blazers. And it's going to hold things like concerts. And so there's just a lot of money right now being invested in and around the Birmingham area. So really a lot of exciting things going on.   Tom: That's awesome. You know, we already touched a little bit on education, major colleges, but UAB, as well as university of Alabama,   Matthew: Yeah, University of Alabama is down in Tuscaloosa, which is about 45 minutes to an hour Southwest of Birmingham. You have, let's see, you have Sanford university in Birmingham. You have Birmingham, Southern college is also obviously located in Birmingham. Yeah, you Auburn is about an hour and a half to two hours, South East of Birmingham and a place called Auburn, Alabama, which is pretty obvious Auburn in Auburn, but it is almost a when you get to Georgia. And so there's a lot of kind of university life. You see a lot of university students in and around. And of course the medical school at UAB brings a lot of people in. We have rented a lot, especially when we have homes in and around the South. What we call the South side of Birmingham, which is basically South of the entrepreneurial district. We have a lot of med students, dental students that rent with us.   Tom: And is that in the general Southern part? You said Southern part of Birmingham.   Matthew: Yeah, It is. If you kind of zoom in on Birmingham and you look what I would call in between Homewood, if you look where Volkan is, which is a statue that was dedicated to the iron ore industry in and around their five points South, all of that is where a lot of the young people live that are going to those universities.   Tom: Very cool. How about let's touch on transportation? So in looking at it, it looks like it is almost like an X from 65, 22, 20, 59. So it looks like a major central hub of a freeways in the South that all go through Birmingham.   Matthew: It absolutely is a Nashville about two hours to the North. Atlanta's about two hours to the East Jackson. Mississippi is about two or two and a half hours to the West. And then Montgomery is about an hour to the South. So it's very centrally located. Half the people here are Atlanta Falcons fans. The other half are Tennessee Titans fans. And so it is a very centrally located city and very easy to get to. And then in transportation, within the community, most people drive everywhere here. It is not a, unless you just live downtown and work downtown, which is, it's not an overly big downtown area you're going to drive to work. So kind of the main corridor where a lot of the, where it gets clogged during the week would be that 280 as you go South and East is a very heavily traveled road. I 20, I 65 coming from the South and from the South West. And that kind of tells you where the people are, right. It tells you where the people are and what they're doing. And then I 65 South into Birmingham in the mornings is very busy. So Birmingham is kind of spread out just because it, as you moved across the mountain, it does flatten out a bit and it allowed for the city to kind of expand,   Tom: I'm smiling as I'm hearing this, I'm so excited about this series of market spotlight. I'm learning so much about Birmingham and I'm like, so excited dip my toe into the investing market, continuing down. Well, there's also an airport right in Birmingham.   Matthew : Yeah. We've got what we call an international airport. I'm not sure where that international flight flies. I think it flies at The Bahamas, which is good. I mean, everybody's got to go to The Bahamas, right. But what I tell people is we have major flights in from Denver, obviously, and from Atlanta into Detroit, into New York. So it really is a two flight place. We fly obviously Dallas and Houston direct, but unless you're going to one of those kind of major cities, you're really going to, it's going to be a two flight place, which is fine though. I mean, Birmingham so easy to get around. I always tell people, you know, Atlanta is one flight away from everywhere, but you took two hours to get to the airport. Birmingham takes me literally 10 minutes to get to the airport and then another five minutes to get to my gate. And then I can fly to Atlanta and in 45 minutes. So it really saves me. I get placed as faster than people do in Atlanta.   Michael: And Matthew, speaking of getting places, do you all have traffic and understand you're speaking to a couple of California, so we gotta be careful here.   Matthew: Look, I've been in Atlanta on the bypass, the two 85 bypass. And it is really bad. There's only a couple areas in Birmingham that are probably that bad or, or could even like sniff being that bad. That two 80 corridor is really tough in the morning. It may take you an hour to come 15 miles, 20 miles in, but a lot of people do it. Like it's amazing to me. We keep making it wider and wider and wider. And as you know, it also makes it worse before it gets better. And then by the time they finish it, it feels like it needs to be wider. And that's where I would say a lot of the housing growth is going right now is South and East down to 80. So you can see Chelsea down there in the bottom right hand corner of the map. If you're looking at it, Chelsea is a really growing thriving area.   Again, anywhere around McCalla is really growing. That's where they're building a lot of homes. I've got some great friends that are one of the largest builders in Birmingham, and they consistently build in those areas and build in Trussville, which is just East of town. So they're still building in the suburbs. There's not a lot of infill building going on right now. And they continue to sell homes. Even during this market, when we're recording, this is kind of coronavirus world, and they're still selling homes. They're still building them. They still have people that are interested in buying them. So we really feel like in Birmingham, we've got a little bit of a shortage in the housing.   Tom: Yeah. I mean, it's one of the highest SFR applications for building new houses way up there. And looking at the beginning of some of those metrics, let's touch on investor friendly related matters. So is there any concepts of rent control or, you know, legal concerns around unlawful detainers or three-day notices I'd love just kind of, you're taking, you're probably an expert at this as a property manager, as a CEO of a property management.   Matthew: Yeah. Unfortunately, sometimes, unfortunately, fortunately. Yeah. So Birmingham is a very conservative, well, Alabama let's say, cause because most landlord tenant laws are state specific. Alabama is a very conservative politically state. Birmingham is a very progressive city though. And so, but still most of the laws are driven, are state driven, landlord tenant laws. So evicting a tenant is easy technically to get done, but it does take a while to get done. And in Birmingham that's probably the biggest drawbacks to Birmingham is sometimes it takes as many as 60, sometimes as many as 90 days to get someone set out from the time you fall an unlawful detainer to the time you actually set them out. So that is a really long time, even in a place like California. I think that's a long time. The good thing about Birmingham though is again, it is a very landlord friendly laws. The landlord tenant law is very, is it really written landlord friendly. We have very low property taxes, relatively speaking. So as a percentage, it's way less than a lot of the other communities around the country. And look, there is no rent control. I don't ever expect that we might be one of the last places in Birmingham to have that. So it's again, pretty much landlord friendly, but you want to make sure you get a good resident in your home so that you don't have to evict them.   Tom: Makes sense. My other kind of question on, I guess this is sort of landlord friendly. I know some areas have a lot of HOA ways and some of these hos, you know, they have sneaky little rules and the bylaws about being an owner occupant. And is that common in Birmingham?   Matthew: It's not, we managed in places like Nashville and Atlanta where that's very common. So very familiar with that. Birmingham is not that way right now. It could come that way. As the housing stock that's being been built in the last 10 to 20 years, maybe it becomes more rental stock, but right now it is definitely not that way, especially in the areas where investors are buying.   Michael: So it sounds like Matt, from the descriptions that you've been giving, this is a very seller friendly market. It's really a sellers market at this stage of the game. Is that fair to say,   Matthew: Is it is an investor market. It is absolutely. You can definitely sell a house right now, but there's, I mean, it's just a really healthy, it's like very aggressive sellers and very aggressive buyers right now. But yes, if you're selling a home, you could even do a good job. You could make out really well selling homes right now, too.   Michael: Okay. Great.   Tom: Any other thoughts on points of interests? I saw there's the Birmingham barons, AAA baseball team.   Matthew: They are AA, but yes, they are in downtown. They used to be down in Hoover and we moved them. They built a new facility that won a lot of awards in the downtown area. So that is down there much like many of the other communities, some of the things that draw people or we've, we've got a number of local breweries that are kind of fun places to hang out that a lot of people are enjoying doing. We have the food scene's really good here. So last year we had a Frank sta won the James Beard award for the best chef in the country or the best restaurant, excuse me. So we've got an, and then he's got, I always call it the coaching tree, but he's got all these other chefs that he's trained now that have gone out and started their own restaurants.   Tom: Diaspora. What's the name of his restaurant?   Matthew: His restaurant is called Highlands Highlands bar and grill. Nice. And so it's kind of an upscale, kind of a New York style bar and grill.   Michael: Awesome. Man Tom, we gotta make it out there.   Tom: I know   Matthew: That's the one of my favorite places to go.   Tom: Awesome. Michael, do you have any other questions?   Michael: Yeah. Just curious, Matt. So for all of our listeners who were previously unfamiliar with the Birmingham market, hopefully now they're a bit more acquainted with it. What would be your final thoughts if some of those needs, what, what would you want someone's final takeaway to be from, you know, about the Birmingham market?   Matthew: It'd be a long ending, but I think it's kind of important is our average rent somewhere in the $900 range. So you're talking about when you look at Birmingham, I would think more about investing in forties, fifties, and so homes in the forties, fifties, and sixties. If you're looking at investing in C class properties, maybe 60 seventies or eighties, or even some of the two thousands, we have some homes that are in the two thousands. If you're looking for B class kind of high appreciation, lower cashflow, where you're going to find those C class properties are in areas like East Lake was a, which is three, five, 206, zip code Western, the free five, two one one, Inslee three, five, two Oh eight. Midfield is three, five, Oh man. I own a house in Midfield. And I can't think of it. I'll think of in a second, but you're talking about Roebuck, which is three, five, two one five, Center point 35215.   You're going to talking about Grayson Valley area. Now you're starting to get into more B class neighborhoods that would be Trussville, Calera, a Chelsea, Hueytown, Pleasant Grove. So, and you're talking about rents now that are more in the $900 to $1,200 range. That's what we would consider B class, which kind of lines up with the statistics you were giving earlier in terms of just kind of a price brackets. We manage about six or 700 homes right now. And it is a great time to be in the rental business because we're at about 98% occupancy. We're actually north of 98% occupancy, which we've never been before. What we are seeing as a shift from people wanting to live in multifamily, to live in single family homes. So that's pretty exciting for us, obviously because the pandemic and I just don't see that going away anytime soon.   Like people just don't forget about the pandemic after it's over. They're not going to forget about it immediately. So I do think there's a shift to single family rental and in the South, this things may change, but the pandemic doesn't feel as bad as I, my friends tell me, you're experiencing in California where people are experiencing in New York, we are renting homes like crazy here. I know that our cases are up in terms of virus, but it doesn't feel that different than normal life down here right now. So all that may change, but I will tell you things are really good right now. And it's not like people are gonna stop paying rent. Obviously if they lose their job, that may be a problem. But everybody seems to have adjusted to kind of coronavirus world down here pretty well. So that's what I would say is most of our investments are in the C class and B class neighborhoods.   And look, another area I would want to highlight is Northwest, which is Forestdale and Adamsville another great area. One of my favorite areas to invest. If I could buy everything up there, I, I definitely would. And so, but I also want to be a reference for any of your potential clients. So, you know, if they have any questions, we obviously have people, I always say you, you date your real estate agent, but you marry your property manager. And so I want you to know that before we get married with any one of your clients, we want to make sure that they're buying the right thing too. So we don't, we have a vested interest in it's a longterm relationship. We can't just put somebody in any home, regardless of what that home is. So I know that was a long ending, but I thought it was important just to kind of give some numbers and some feedback on what's going on at the grassroots level.   Michael: That was great.   Tom: I love it. That's one of my favorite pieces of advice to give is, you know, leverage your property manager early and often, even in the acquisition process. I mean, it's a teamwork and you know, the earlier you can kind of start to build that trust, uh, so much value to it.   Matthew: Well, our, all our incentives are right. I don't want you buying a bad house because I've got to manage it. Like you don't have to manage it. I know you've got to pay for it, but I'm the one that has to manage it. So I don't want you buying something that's going to cause me a lot of headaches in the future. Just like any business owner. Obviously we want to work really hard and earn our money, but we don't want to do extra work just because we put you in a bad property.   Tom: Awesome. This is fantastic. Thank you so much for your time. This was super interesting. The Pittsburgh of the South. I love it.   Matthew: We used to be called the magic city because we grew so fast. And so now it's starting to grow again and I'm super excited to be a part of Birmingham.   Michael: Matt, before we let you go, if folks have any questions about the Birmingham market, where can they reach out to you? And a little birdie told me also that you've got a podcast of your own.   Matthew: Yeah, no, I appreciate you mentioning it. We actually started a podcast that helps people just like you're, you're trying to help people with Birmingham's specific information. It's called the Birmingham rental investor and they can get that on Spotify or Apple or wherever somebody listens to their podcast. If they want to reach out to us specifically, we again would love to help somebody. We want to make sure that you're getting into the right house. And the best way to do that is to reach out to our support support@gkhouses.com. And what we have is essentially a support ticketing system that we'll get into our sales department and they can help you understand questions about our management services, but most importantly, make sure that you're getting into the right house so you can send them addresses. We'll give you rental reports of what we think that'll rent for. We just want to be a supplier of good information so that you can make the best decision possible. So thank you.   Tom: All right. Thank you, Matthew.   Michael: Thanks so much, Matt.   Matthew: Thank you.   Tom: Thanks again to Matthew, that was super informative. Learning about the Birmingham market. If you have any other questions, other markets for us to deep dive into, please reach out to us. You can hit me up at tom@roofstock.com and as always, this episode is brought to you by Roofstock Academy. It is your one stop shop to getting to the next level, from on-demand online educational lectures, coaching, the SFR playbook, all of that good stuff. So just check us out at roofstockacademy.com and happy investing.    

Today brings a special YAWA with an extra special guest! For more than 16 years, Los Angeles-native Matthew Rubino has been heavily involved in the city's DJ community with long-standing residencies at some of the city's most successful venues including Cliftons, the Standard Downtown LA and Hotel Erwin in Venice where he has served as Music Director since 2011. He has also been programming the music at the Ace Hotel Los Angeles since 2016.
 He has performed for the likes of Robert Plant (Led Zeppelin), Debbie Harry (Blondie), Snoop Dogg, Ice Cube, Anne Hathaway, Kim Kardashian, Leonardo DiCaprio, and a whole lot more (to name a few)... Matthew's experience runs deep. Matthew became a part of the Flashdance in 2014 and has since traveled the world over with the crew. In 2018 founder Michael Antonia asked Matthew to join him as co-owner of The Flashdance! Big Takeaways The Flashdance is hosting parties at your house. Through zoom, two DJs, a hype-man and more, a live online party is thrown. Check the affiliate page! Q&A Lauren Amanda: What are fun and not corny ways to release tables to the buffet? Matthew's style is the enthusiastic minimalist. He tells people to have the wedding coordinator go up to the tables and release them one by one. It then doesn't distract from the fun of the music and doesn't add too much banter. What are their top 3 get everyone on the dance floor songs? Parties can vary. But in general, something in a familiar is always good. 1. Arethra Franklin - RESPECT 2. Prince - Let's Go Crazy 3. Stevie Wonder - Sir Duke Stephen Lawrence: *When planning to work with both a band and a DJ for the reception, what advice do you have? * Share the band's set list with the DJ ahead of time, if possible. Especially if the band is doing the first part of the dancing. It's nice to be able to plan a little bit. If possible, have the band break down while the DJ is starting. Keep the party going. Catherine Asikis: I'm greek. My fiancé is French Canadian. Our DJ, a great friend of ours, specializes in soca and Caribbean music. He's very talented but I'm worried about how he will work with my cultural music because he hasn't done a Greek wedding before. I am giving him a list of songs, but would it be appropriate to ask him to pre mix the Greek song portions of the evening so I can listen before the wedding day? Matthew says people come to them because they kind of already know their vibe. But since you are friends, it is a little different. For Matthew, he tells his clients to send him a list of songs (10-15, no more than 20) and he will play some but probably not all of them. Providing a window into what you are into is helpful, but you still have to let the DJs have creative control. When you are working with friends who are being generous, we encourage you to ask for less. Asking to hear something ahead of time is potentially more effort and work than you are paying for. Myriah Cohen Moses: How do we go about explaining to the DJ who probably takes pride in getting people on the dance floor, that we aren't big dancers? Yes to the first traditional dances, maybe a few fast songs but my fiancé will definitely have reached his limit by then, as will his side of the family. I really don't like an empty dance floor so I'm working with my venue to make it pretty small. People like to dance at a wedding! They just do. Unless it's just a small group of people that you know never dance even at a party. If there is over 50 people, you'll probably have a good amount of people that want to dance. At the end of the wedding, the groom or bride or someone will come up to the DJ and share how excited that people that they never see on the dance floor were out there going wild. Matthew's tips for inciting a packed floor: a small dance floor, make sure the lights have dimmers, wedding crashers that you can hire to basically hype people up. Brenda Lira: To me, the music and dancing are the best part of weddings. So naturally now that I'm engaged, its the part I'm most excited about and most worried about. My fiancé is very white, like Scottish/Irish white. I am very Mexican, like a 1st generation Mexican-American. We both have key family members that will party to any type of music and we're really counting on them to help us to get the party started. Aside from looking for a bilingual DJ with similar experience, what should I be asking or looking for? *Also I have 1 venue but 3 different spaces for ceremony, reception/dinner, and dancing. *Is it too much to ask a DJ to play music at all 3? It's all well within walking distance. And should I expect an up-charge for this? Definitely expect an up-charge. Every company will have their own set of pricing. But in each area, they have to set up equipment and sound, so expect to pay more. Three different areas is definitely feasible! The ability to play a little bit of something for everyone there is key. The DJ should be preparing beforehand. Matthew builds playlists, but also knows how to read the crowd and pivot when it's needed. Hire a DJ you vibe with! It makes a difference.
 Amanda Watt: I have a ton of specific songs that I want to dance to at our reception, but I am worried if I request all of them to be added to our must-play playlist it will stifle our DJ. He's amazing, and I totally trust him to keep our reception fun and our guests up and dancing at our reception...which is our number one priority, we want everyone to have a good time and have fun. How many songs do you recommend putting on a must-play playlist? And how many is too many? I don't want to be a music Bridezilla!! (Reception will have about 5ish hours of dancing) Thank you!! Give them 10-15 songs, 20 at most. That gives the DJ a taste of what you're into and gives plenty of room for creative freedom. Remember you're hiring him because you like him and trust him! Links We Referenced theflashdance.com (https://www.theflashdance.com) sharkpig.com (http://sharkpig.com) instagram.com/theflashdancedjs (https://www.instagram.com/theflashdancedjs/) alpinerings.com (https://alpinerings.com) (Promo Code: BIGWEDDING for 15% off sitewide!) Quotes “There's something to the idea of when you put effort into how you look, you do your hair, you put some clothes on, you know, you feel good.” - Matthew “It's not for everybody, but I do love that there is this option. That we can pivot and react.” - Michelle “Everyone is afraid of a corny DJ.” - Christy “People don't get weird when the lights are on super bright!” - Matthew “There are going to be different crescendos throughout the evening and day. The music at pre- ceremony is going to be different than the music at cocktail hour. It's fun to play with things.” - Matthew “I want people, from the moment they hear me start playing music, to look at each other and be like, ‘dude we are in good hands tonight.'” - Matthew Get In Touch EMAIL: thebigweddingplanningpodcast@gmail.com FACEBOOK: https://www.facebook.com/TBWPpodcast/ (https://www.facebook.com/TBWPpodcast/) INSTAGRAM: @thebigweddingplanningpodcast (https://www.instagram.com/thebigweddingplanningpodcast/) BE SURE TO USE THE HASHTAG: #planthatwedding TWITTER: @TBWPpodcast PHONE: (415) 723-1625 Leave us a message and you might hear your voice on the show! PATREON: www.patreon.com/thebigweddingplanningpodcast (https://www.patreon.com/thebigweddingplanningpodcast)

As you know, Corona-Virus jumped the human, animal fence. This was first made well known when the American News Media was examining this as only a Chinese issue. However!, we watched as this virus spread around the world. It was still growing, and still is, in terms of the number infected. So… why does this remind me of Jesus’ prophecy in The Book of Matthew? It reads, in part, “[4] Jesus answered them, ‘Watch out that no one misleads you.’  [5] For many will come in my name, saying, ‘I am the Christ,’ and they will mislead many.  [6] You will hear of wars and rumors of wars. Make sure that you are not alarmed, for this must happen, but the end,… is still,… to come”. Please visit our Outreach Web site! ~ https://unchurched.site123.me Our Anchor audience can find more episodes at this link: https://is.gd/IKlYXs to our primary host while we switch. Introduction ~ About Us, Who We Are: https://is.gd/DNqtwP | On Anchor: https://is.gd/rgBN6h How-To Be Saved: https://is.gd/sJSZgR | On Anchor: https://is.gd/uYcVdh Short Links Provided by: https://is.gd “End Times” and “Benediction” A “Barking Squirrel Production” Copyright: 2018 ~ All Rights Reserved Series: Corona Virus, Covid-19 - Is it an End-Times Sign Session: 2020-0402 Episode: 15 Copyright: 2020 TAGS: Corona-Virus Covid-19 Jesus Prophecy The End Human Animal Chinese World America United States

更多英语知识，请关注微信公众号: VOA英语每日一听Matthew: Hey Kat, you were just telling me about all the pros and cons of different renewable energies and you just got me thinking we're going to run out of oil in the next couple of decades. There are reports that say we're going to run out of oil in the next twenty years, but I'm guessing that in fifty years or a hundred years we really will run out and we'll need some sort of other energy sources. What do you think's going to happen?Kat: I think it's going to be a combination of all the renewable energy sources we have right now, but there's a lot of development going on especially into solar energy. Solar panels are becoming more and more efficient. There are now solar panels that are flexible and you can actually bend them around objects and the newest ones are actually made by biodegradable materials and they start to be see-through so you can actually apply solar energy harvesting tools to windows and I think that might be the future of renewable energy.Matthew: What about as far as cost performance goes and sustainability?Kat: Well when it comes to sustainability, I think these new forms of solar panels that are made of biodegradable material, I think they are definitely going to be the future.Matthew: It seems like it's a lot of resources. We use a lot of energy every day. Every person uses a lot of energy every day. Do you think that there's going to be a time where all houses are run by renewable energy? Do we have space, the capacity on this planet to actually fit every household with solar panels or wind energies?Kat: Well as far as the resources go as how much solar energy actually hits our planet, we can provide energy for the world a thousand times over. That is not a problem but I think financially it's going to be very difficult. At the situation we are at right now, I think it won't be possible.Matthew: I'm sure that scientists are going to figure out something but I just think solar panels, wind turbines, everything, they actually use plastics and metals and in order to produce those you need oil. Now if you have zero oil, how are you going to produce these renewable energy resource products?Kat: I have been trying to explain that earlier with biodegradable materials. There are actually solar panels being built from renewable materials themselves.Matthew: You're in the industry, you've been working there for a while and I am just wanting to ask you do you think that it's going to be successful? Will there be renewable energy throughout the globe or are people going to be too stubborn?Kat: Well as the situation stands right now, renewable energy will not be able to take care of our energy needs and I truly hope that there will be scientific discoveries in the next fifty years because as it is right now we will not be able to go on as we are just supported by renewable energy.

更多英语知识，请关注微信公众号: VOA英语每日一听Matthew: Hey Kat, you were just telling me about all the pros and cons of different renewable energies and you just got me thinking we're going to run out of oil in the next couple of decades. There are reports that say we're going to run out of oil in the next twenty years, but I'm guessing that in fifty years or a hundred years we really will run out and we'll need some sort of other energy sources. What do you think's going to happen?Kat: I think it's going to be a combination of all the renewable energy sources we have right now, but there's a lot of development going on especially into solar energy. Solar panels are becoming more and more efficient. There are now solar panels that are flexible and you can actually bend them around objects and the newest ones are actually made by biodegradable materials and they start to be see-through so you can actually apply solar energy harvesting tools to windows and I think that might be the future of renewable energy.Matthew: What about as far as cost performance goes and sustainability?Kat: Well when it comes to sustainability, I think these new forms of solar panels that are made of biodegradable material, I think they are definitely going to be the future.Matthew: It seems like it's a lot of resources. We use a lot of energy every day. Every person uses a lot of energy every day. Do you think that there's going to be a time where all houses are run by renewable energy? Do we have space, the capacity on this planet to actually fit every household with solar panels or wind energies?Kat: Well as far as the resources go as how much solar energy actually hits our planet, we can provide energy for the world a thousand times over. That is not a problem but I think financially it's going to be very difficult. At the situation we are at right now, I think it won't be possible.Matthew: I'm sure that scientists are going to figure out something but I just think solar panels, wind turbines, everything, they actually use plastics and metals and in order to produce those you need oil. Now if you have zero oil, how are you going to produce these renewable energy resource products?Kat: I have been trying to explain that earlier with biodegradable materials. There are actually solar panels being built from renewable materials themselves.Matthew: You're in the industry, you've been working there for a while and I am just wanting to ask you do you think that it's going to be successful? Will there be renewable energy throughout the globe or are people going to be too stubborn?Kat: Well as the situation stands right now, renewable energy will not be able to take care of our energy needs and I truly hope that there will be scientific discoveries in the next fifty years because as it is right now we will not be able to go on as we are just supported by renewable energy.

Episode 5 - Podcasters Choice - Anything goes on this edition of What the Lyric. Becky and Matthew choose their favorite bad lyrics from any decade and and genre. One is from 2016 and the other is from 1978. Who will be victorious? Podcasters Choice   [Start 00:00:00]   [Music playing 00:00:06]   Becky: Welcome. To What he Lyric? the podcast that confirms, yeah, that actually made it to radio.   Hello and welcome to What the Lyric? Today and What the Lyric? podcasters choice, we pick apart whatever song we want, it's a free for all. And I have picked something recent.   Matthew: Oh.   Becky: I think it still fits into the me-too movement theme I got going on.   Matthew: I do have to ask first though. Most hated bands…   Becky: These guys.   Matthew: Across the board…   Becky: Yes.   Matthew: Do not tell me yet. But any others like…   Becky: These guys.   Matthew: Was it an easy choice for you to make?   Becky: Yes. It was so… The first song that James Arthur, horrific train wreck of a wedding song that people are using. That one and I think this one are the reason that this podcast exists.   Matthew: Wow.   Becky: Yeah.   Matthew: There was no other song. That popped into your head?   Becky: Nope. This one. I was like and this is it. There are a couple others. That I thought of because they were funny, but I was like, no, I hate this one immensely. Like. So much, so much   Matthew: Fascinating. See! Mine was less generated by hatred and more confusion. Because I do have… This is again a favourite song of mine.   Becky: Kind of how bizarre confusion?   Matthew: Yes.   Becky: Okay.   Matthew: It is precisely how bizarre. I think everyone has heard the song and everyone has been like the fuck. I am excited to get into that.   Becky: Then I am going to let you go first, because…   Matthew: Really?   Becky: Yeah.   Matthew: End on the hatred note but start with confusion.   Becky: I have got a heavy dissertation going on over here.   Matthew: I mean, it is going to take, you no time to get…   Becky: Okay.   Matthew: What this song is. I am trying to think. Let me find. Oh, the songwriter is Jimmy Webb. And you know what…   Becky: Jimmy Webb?   Matthew: You’re going to have to think of more of the 70s. This is coming out of the 70s. I am breaking my millennial streak and also my 2008 streak.   Becky: Does it have to do with pina colada?   Matthew: It does not, although that is a fantastic song and I will not hear a word about those lyrics. I am going to skip the part where the song title is. Well, let's just start at the beginning. Spring was never waiting for us, dear. It ran one-step ahead as we followed in the dance. Blank is melting in the dark. There is your first clue.   Becky: Is this MacArthur Park?   Matthew: Yes, and I…   Becky: And I can't tell you how much I love this song for craziness of it.   Matthew: Right, but precisely right. If you look at the lyrics and this is a fantastic song by Donna Summer.   Becky: Oh, no. It is not, have you read the history of this?   Matthew: I have read a part of it. I don't know all of it. I love the Donna Summer version.   Becky: Oh, that is the classic. That one. Yes. Then Anthony Clark, a comedian, did a version. Well, he did a part about this song and his bit, which always made me giggle.  We used to play this at work, I looked it up, and there was somebody that did a cover of it. That we then spent a good half an hour trying to find so that we could play it. Now I get to look it up. But yes, MacArthur Park, genius.   Matthew: So I already knew off the bat, like, this is going to be low on the yikes scale. because…   Becky: Oh, it is so good.   Matthew: It is a phenomenal song if you have not heard it. But again, the entire thing is about MacArthur Park.   Becky: Cake out in the rain.   Matthew: And supposedly, it is supposed to be about the park because it says MacArthur's park is melting in the dark.   Becky: Yep.   Matthew: All the sweet green icing flowing down, presumably foliage.   Becky: Yep.   Matthew: And then it just goes off the fucking rails and it is like someone left the cake out in the rain. I don't think that I can take it. Cause it took so long to bake it.   Becky: Oh, my God.   Matthew: And I will never have that…   Becky: Here is when I hear the disco [Making noise 00:4:48] noise, yeah.   Matthew: There is so much going on in the song and this person is lamenting it took so long to bake it and I will never have that recipe again. And the series of oh no. Like you cannot describe the depth of emotion captured by that no.   Becky: So good. It is so good. And it's a seven minute long song. Also my favourite, it was Waylon Jennings. Matthew: I did not know Waylon Jennings.   Becky: Including a 1969 Grammy winning version by Waylon Jennings. And you can hear how pissed off he was singing that. Like he's fuckin lyrics don't mean shit. He was probably drunk or stone or whatever.   Matthew: [Inaudible 00:5:30]   Becky: Yeah. Oh, amazing. Waylon Jennings, Grammy won a Grammy.   Matthew: Did not know that. Also, I apologize, it was not in the 70s but it was in the 60s.   Becky: Yeah, 69. Yeah. I had to look it up.   Matthew: General area.   Becky: 68 was when it was first recorded. But you were close. It is a known area for the Donna Summer one.   Matthew: Right.   Becky: My mom had that album by the way.   Matthew: I mean it is phenomenal. And the thing is, there aren't many lyrics here. And I would argue that none of them are terrible. It is just so fucking weird. Like I recall the yellow cotton dress. Okay, that makes sense presumably someone wearing it, foaming like a wave. That makes absolutely no sense. And the ground beneath your knees, even less sense. Like how do you track and create lyrics that make absolute zero sense when you take three sentences together.   Becky: Let's be honest. Late 60s, the whole summer of love coming up soon.   Matthew: Wholesome non-drug usage   Becky: Probably a lot of drugs happening. Why is there a cake reference? What the whole cake reference? Matthew: Like looks at a park and says, you know, I really want to go to the cake.   Becky: It looks like a cake.   Matthew: Everything that I walk around this park screams cake.   Becky: I have never had a park look like a cake. Yeah,   Matthew: I would want to go the park more if it did.   Becky: That's again, that's an acid trip. And I may or may not have seen things that looked unlike that.   Matthew: It’s just like so weird because someone… Interesting fact, though, if you look at the lyrics, the first time you hear about the cake. It says someone left the cake out in the rain. She says it again; someone left the cake out in the rain. A little bit later on the song, the final stanza…   Becky: Does it becomes her cake?   Matthew: It does. It said someone left my cake out in the rain. And I don't think that I can take it because it took so long to bake it. And I'll never have that recipe again.   Becky: I will tell you what. After the whole cake off that we had at work, I understand that layer…     Matthew: There was a cake off?   Becky: We had the cake off. The Halloween theme, Friday the 13th, cake off.   Matthew: Well, we should clarify that this cake off was not for October Friday the 13th. It was a September Friday.   Becky: Yeah it was September, Friday 13th, a Halloween. It was more horror Friday 13th inspired cake off that we did it work. And yeah, I get that. I get that. The It cake I did was rough. I will never do that one again. And I hope I never remember that recipe because it did take so long to bake it.   Matthew: And you will never do that recipe again.   Becky: And I will never do that recipe again. Yeah. So yeah, I get it. I understand where she's coming from on that. I mean, I get it. I am with her.   Matthew: I know. All of them get it. I mean I personally don't understand the analogy of a park to a cake.   Becky: So good.   Matthew: The emotion in it, regardless of how…   Becky: She is good.   Matthew: batshit crazy the lyric are.   Becky: Yeah.   Matthew: I honestly give this zero yikes. Because it is, weird but I just wanted to bring it because it is a favourite song.   Becky: It is so good.   Matthew: And it make so a little sense.   Becky: Yeah. It makes no sense whatsoever. It is so good. So good. All right. So mine.   Matthew: Who do you hate? Oh, it might be recent. I might get it.   Becky: It is from 2016.   Matthew: Ariana Grande?   Becky: Oh, no, it’s a group and then another singer. These guys are known also for being producers, but they do all these collabs, as the kids say. And this was the first time that I heard them. At first I was like, well, this is kind of bland. Then I start listening to lyrics and I wanted to punch them in the face.   Matthew: I am intrigued.   Becky: Okay let me read some of the lyrics. Here is how it starts. Hey, I was doing just fine before I met you. I drink too much and that is an issue, but I am okay. No. hey! tell your friends it was nice to meet them, but I hope I never see them again. I know it breaks your heart. Moved to the city in a broke down car. In 4 years, no calls. Now you are looking pretty in a hotel bar. And I can't stop. No, I can't stop.   Matthew: I remember vaguely the song and I would not remember it if I had not heard you. Months ago talking about how much you hate this band.   Becky: Eviscerate this band. Yeah.   Matthew: I forget what the song is called, but is it The Chainsmokers?   Becky: Oh, it is.   Both Speakers: And Halsey.   Matthew: That is it.   Becky: I necessarily have issue with Halsey. I have a lot of issues with the fucking Chainsmokers. First off, let us just start with. I drink too much and that is an issue, but I am okay. No, clearly you are not. This is what AA is.   Matthew: I have issue but I am okay.   Becky: I'm okay. No, it is intervention time. Then like he sees you looking pretty good in a hotel bar? This is the dude that broke up with you because you got fat. Then comes back and is like, whoa! Somebody lost some weight. And wants to get back in on it. No, and then it goes in to baby pull me closer in the backseat of your rover that I know you can't afford. Come on. You don't know that. You have been away from her for four years. She could be doing well because  she did not have that frickin rock of an ex hanging around her.   Matthew: Dragging her down.   Becky: Yeah. Pull the sheets right off the corner of the mattress you stole from the roommate back in Boulder. There are several issues here. First off, bed bugs.   Matthew: Absolutely riddled with them. There is no way she is not.   Becky: God knows what else is on that mattress. Or has been on that mattress. There is not enough steam cleaning. or defogging or what you do with a mattress to kill anything that is on it. You should have just left that out in the backyard or on the side of the street somehow. No, gross. So gross. I can’t even.  How is that a lyric in a song way?   Matthew: Wait, pause because technically wait. Not only bed bugs would be a concern, but she…   Both Speakers: Stole it.   Becky: From her roommate.   Matthew: Yeah, at what point…   Becky: We don’t know.   Matthew: Did she just decide to up and leave while the like roommate was at work. Oh, shit this is a nice like Caspar mattress. Caspar if you would like to sponsor this podcast.   Becky: Yeah.   Matthew: Please contact us.   Becky: I picture like the tablecloth trick. Roommate sleeping whip the mattress out from underneath there. Drops 0n the box spring and runs.   Matthew: Done, love it.   Becky: That is what I am picturing. Gross, cooties. You don't know what that roommate's done on that mattress. What if that roommate blacked out, drunk, peed on the bed or…   Matthew: Worse?   Becky: Worse or, you know, maybe…   Matthew: There are so many imagination.   Becky: There is so, many fluids that could be on that bed.   Matthew: And likely are.   Becky: Again, not enough steam cleaning or de-fogging or whatever you could do.                                       Matthew: When they say get a new mattress every eight years, they mean get a new mattress from the factory, not a new mattress to you. So don't steal your roommates mattress.   Becky: Yeah and no amount of mattress bag or pads could get me further away. I am like the princess and the pea. I would be like, I still now that there is pee there.   Matthew: Wow! Again, well done.   Becky: Yeah. Then he just like we ain’t ever getting older. You are, you are, you are, you turd, you are, you are. I can't stand these guys. Then now all of a sudden he is like, you look as good as the day I met you. I forgot just why I left you. Cause you are a turd. I think we have established you are an alcoholic turd. Because you have a drinking problem, but you are okay with it. The first reason to leave the guy, I don't know why you even went back. I mean, granted, maybe your whole revenge plot was the mattress did have some sort of cooties and you put him down there first was like, I will be right back.   Matthew: Good lie. Becky: While all the bugs jump on him.   Matthew: Abandon ship.   Becky: Yeah, I mean, I can't. I would not. Then he says, stay and play that Blink-182 song, right there   Matthew: Yeah, which is it...That one?   Becky: I’m out.  Blink-182. Are we that old?   Matthew: Wait, which one is it?   Becky: Blink-182. There is so many. Oh, it's the one that they beat to death in Tucson. Did they beat the Blink-182 to death?   Matthew: Blink-182 death.   Becky: Then it just goes the course. I know I broke your heart. I know it breaks your heart. Moved to a city in a broke down car and four years later didn't call. I don't know why? Why?   Matthew: This go back into your craw.   Becky: I was like, what the…This is bull shit. You don't know I can't afford a Rover. I am paying for your sad ass. And not four years later I've been able to save up for a Rover and then bite the tattoo on your shoulder. No, you ain’t touching me.   Matthew: Gross don't?   Becky: Get your get your shit away. Get your…   Matthew: Bed bug infested.   Becky: You need to get back to the hole. Just get on track. Now I am looking pretty in a hotel bar.   Matthew: Wait, he is saying that?   Becky: That is her singing it now.   Matthew: Oh, yikes.   Becky: Yeah.   Matthew: No.   Becky: I mean. I am sure you are Halsey. You are a good looking gal. But…And I and I can't stop. No, I can't stop. Yeah. It is called self-control.   Matthew: Yeah. No, I have…   Becky: I can’t stand this, I can’t… everything.   Matthew: What I love about this. Going back to the we ain't ever getting older because I'm like, wait. You already admitting you have a drinking problem. So like, that is for sure. Aging your liver.   Becky: You are going to get aged quick.   Matthew: But your band is The Chainsmokers. Yeah, like all are 100 percent getting old just because you are going to die young. Does that mean you are not getting older?   Becky: Yeah. Then they have a collab with Coldplay that I just hear everywhere. Is that I want something just like this. Doo doo doo doo doo doo doo doo doo. I can't.   Mathew: Oh, I never heard it.   Becky: Oh, you have.   Matthew: Have I?   Becky: You have. Yeah, it is fucking everywhere. That one, they have another one, and I was like, oh, this sounds like…oh it is The Chainsmokers. This feeling maybe. I don't know. I can't. They just need to stop. They need to really take stock of what, the hell they are doing. I am sure they are great producers. I don't give a shit. Just don't sing anymore. Don't write any more lyrics. Just produce the music. Be happy with making that money. You are good looking guys. You get whatever you want.   Matthew: You will be fine.   Becky: You will be giving the ladies. It is not a big deal. Just stop singing and putting out this piece of crap.   Matthew: Now the question I have. Is, how many yikes you assigning it? One is the worst. Are you going for one?   Becky: There are a big fat one for me, across the board. You could go, hey, The Chainsmokers. Nope. one. I don't like it. I don't like it. They could do something with Pavarotti. And I'm still like, no. They could bring Elvis back from the dead. And I will still say, no. Beatles back from the dead. Nope, nothing. There is nothing. Yeah.   Matthew: What, if they cured cancer?   Becky: Maybe   Matthew: That is hard maybe.   Becky: Maybe if they cured cancer and never recorded again…   Matthew: Deal.   Becky: I would pump it up to two. But they won't stop producing crap.   Matthew: No.   Becky: It is in their blood now. They have had like two or three hits. So now they're like, yeah,   Matthew: We are band.   Becky: We fucking rock. Everything we touch turns to gold bitches. Yeah. No.   Matthew: Yikes.   Becky: I hate them. I hate them. Oh, my God, they make my skin crawl. I hate so much.   Matthew: It is important to have that. I was like, okay, this is good, you know. James Arthur,   Becky: James Arthur and The Chainsmokers.   Matthew: Wait for that collab. When that does inevitably happen. We will have to talk about it here.   Becky: Oh, it is going to happen. You know it is going to happen.   Matthew: If it has not already.   Becky: The sweet, sweet dulcet tones of James Arthur followed by the. I don't even know what the producing style of the…   Matthew: The Chainsmokers   Becky: The Chainsmokers.   Matthew: We know that there singing style will be slurred because both of them have drinking problem.   Becky: Yes. It is all about alcohol, and I am pretty sure it'll take forever because I have to keep stopping for a smoke break, run out side. Then come back in and be like, all right, let's do it.   Matthew: Ah, the wheeze.   Becky: Yeah.   Matthew: Just wait for the smokers hack.   Becky: Before, okay. Let me just clears out. [Making coughing hacking sound 00:19:20] All right I am ready, and then…   Both speakers:  That is the dulcet of James Arthur.   Becky: Yeah. Oh, yeah.   Matthew: Wow! Cause there, you know. Puff, huffing and puffing.   Becky: I am trying to think. They don't even really singing that song. It is like doing just fine before. Like mumbling of, yeah.   Matthew: [Inaudible 00:19:40-45]   Becky: Yeah. It is like a teenager who's doesn't want to talk to his parents. That is what it is like. That is how they sound to me.   Matthew: They just get close to the microphone [Inaudible 00:19:57].   Becky: I am pretty sure that's how they do it.   Matthew: You know the mumblers.   Becky: Yeah. Oh my God. Oh…   Matthew: Mumble core.   Becky: I dislike…the mattress you stole from…What is wrong with you people? Have we not heard of hygiene? I mean.   Matthew: They, no.   Becky: Bleach? anything. Please, dear God.   Matthew: You have the money. Please buy a new mattress.   Becky: Yeah. You could buy 50 or 40, however.   Matthew: I think we should make several pleas here. The first is please send us pizza or cake whenever you so desire. Check out the Website.   Becky: Oh, yes.   Matthew: whatthelyrics.com.   Becky: Nice one. I am glad you pulled that one because I didn’t. I was not even thinking about it.   Matthew: And specifically, we are going to make a plead directly to The Chainsmokers to use their money, put their money to good use and buy a new mattress. You deserve it, Casper mattresses.   Becky: Just buy a new mattress every year because if this song is any indication of what you are going through and doing. Maybe even every six months.   Matthew: Wait; was the name of the song? Remind me.   Becky: Closer.   Matthew: That is a closer. Well, that will be.   Becky: I don't want to get closer. I don't want to get closer to that mattress. I don't want to get closer to them. I don't want to get closer to anything in this song. I don't understand. Why are we just glossing over your alcoholism? That is like a one-liner. Like yeah! I know I drink too much. It is all right.   Matthew: No, it is not a problem.   Becky: I am a throw up on that mattress you stole from your roommate. Then I am going to pass out, blackout and pee on it like…   Matthew: You are going to love it.   Becky: Oh and why do you want to take that back?   Matthew: No, instead of closer. That was will be our closer.   Becky: Oh, I like it.   Matthew: Well, what will we be talking about next time?   Becky: Next time. Its party anthems.   Matthew: What kind of party anthems?   Becky: Yeah, it’s kinda open… children's birthday party. So party anthems I took to mean a song that everyone sings along to has their own kind of version of it when they sing. Or is like the go to karaoke one or like the end of the night drunky song that everybody sings drunk to. That is what I kind of took as the party anthem.   Matthew: I have mine. I don't know if it's from 2008, but it's probably close.   Becky: Minds of course, from the 80s. This I believe, is the first one that does not fit into the me too movement theme. I finally found one.   Matthew: We’re doing good work.   Becky: Maybe I can work it there. I got to look at the lyrics again, but I'm pretty sure it's not really, me too. It is more stalker-y.   Matthew: Okay, in the family of but not directly under the category.   Becky: Yeah, there is no overt booty references.   Matthew: Mambo number 5?   Becky: There is no donkey… ass   Matthew: With a monkey   Becky: Yeah, no big old butt kind of thing.   Matthew: Not yet.   Becky: Not yet. Although I don't know. It would be hilarious to have this. Yes next time. Party anthems. I cannot wait for mine.   Matthew: Well, I am excited and we will talk ‘atcha then?   Becky: Yes. Talk to you soon.   [Music playing]   [End 00:24:00]

In this episode Becky and Matthew delve deep into the late 80s and the early 2000s hip hop.  Will it be a hip hop battle to end all battles?   What the Lyric? Rap/Hip-Hop   [Start 00:00:00]   Music: [00:00:07]   Becky: Welcome to What the Lyric?, the podcast that confirms. Yeah, that actually made it to radio.   Welcome to What the Lyric? Today we are talking about hip-hop, the rap. I don't know what else I'd call it.   Matthew: The rap.   Becky: The rap.   Matthew: I mean you are talking to the two white people in the room talking about hip-hop. That is what this episode is.   Becky: I know. Oh, this is going to go down horribly. Although I do love my 80s, rap and I love the old Run DMC stuff before Aerosmith. Who else is in there? I am trying to think. A tribe called Quest. Although I cannot remember if they were 80s or not. It all runs together now for me. Then, of course, Public Enemy. I don't think that was 80s. Maybe they were 80s. Oh, my God. Yeah. Oh, there is a lot in there. 3rd Bass. That is right; I pull out 3rd Base, which you will never know. But the one guy in 3rd Base, a white guy is now like a baseball historian at Cooperstown, if I remember correctly.   Matthew: That is a turn career.   Becky: Yeah, Pete Nice. Was it Pete Nice? Oh I don't think it was Pete Nice. I cannot remember who it was now.   Matthew: Was it was not Pete Townsend? Becky: No, now I am going to have to look it up. Who were the members of 3rd Base? Yeah, so that is where I am coming from.   Matthew: Interesting. Mine, you know. Like, that is all I really need to say. We actually had a very interesting discussion at the end of the last episode talking about where does R&B begin versus hip-hop specifically.   Becky: Yes.   Matthew: I approach hip-hop from the more R&B side. So I am thinking Beyoncé, Lemonade.   Becky: All right, okay.   Matthew: To an extent, Drake, although he is not my favourite.   Becky: Oh God!   Matthew: And then smaller artists, particularly from the HBO show Insecure, has some very good hip-hop…   Becky: See I don’t know that.   Matthew: References. TT the artists. What is the name of the song? Is featured in it. She is great. Now I will have to introduce you to it. Then, of course, where would we be? But two people, two white people talking about hip hop. Also, listen to the entirety of Hamilton and needed to get said. There it is. It has been said we can now glaze past it.   Becky: I only know the Alexander Hamilton [Making sound 00:2:56]. I don't know anything else.   Matthew: That is all you need to know. That is what the musical is.   Becky: Yeah, I. Oh, man. I think I was right with Pete Nice. What did I say? Oh, my God.   Matthew: You did say Pete Nice.   Becky: Yeah. There is MC Serch and Pete Nice, but I feel like. Yeah. Pete Nice. Baseball historian, I had it right the first time.   Matthew: Well, with a band name like 3rd Base, you kind of have to.   Becky: They had a song called The Cactus.   Matthew: Why?   Becky: I can't even remember. I just remember The Cactus. I am sure I still have that CD somewhere. But yeah, The Cactus.   Matthew: I love.   Becky: I cannot even remember. It is all gone. It is so bad; they did have a big hit. What was their big hit?   Matthew: Was, it baseball related?   Becky: No, surprisingly. You would think with a name like 3rd Base. Pop goes the weasel.   Matthew: Oh.   Becky: From 1991. I remember that. That sounds like a hit. I did not have that one. I had the Cactus album and that was eighty-nine derelicts of dialect, which had the pop, goes the weasel. Yep, that was ninety-one. That was when I graduated high school.   Matthew: I won't say where I was at the time.   Becky: And a hoodie [Laughing], moving on. All right. I am going to let you go first this time.   Matthew: All right. So like I said, my primary job on this podcast is to serve as millennial ambassador.   Becky: And I am the only.   Matthew: There is a generation, obviously listen to this podcast. Who is waiting for your songs, too?   Becky: I am sure.   Matthew: But I want to bring them up to speed in case they hopefully missed it.   Becky: I would also like to point out I am representing old school with my older school tortoiseshell old schools.   Matthew: Wow! Well done. Actually…   Becky: I did not even think about that. I just put them on this morning.   Matthew: I should as a side note, give Becky more credit for being much more fashionable than me. I mean, because I have just got like these shitty Nike…   Becky: No   Matthew: Running shoes and blue jeans.   Becky: It is Old Navy jeans and Adidas. It is not really fashionable, it is just comfortable.   Matthew: As we should.   Becky: As my vsco [Inaudible 00:5:26] said.   Matthew: Oh, I forgot the vsco queen of this podcast.   Becky: Yeah, the old lady vsco queen.   Matthew: So really, this song I remember driving to high school, I think senior year of high school.   Becky: Okay.   Matthew: This song is being played a lot.   Becky: 2008?   Matthew: 2008   Becky: Okay.   Matthew: Right. I was graduating high school that year.   Becky: Lord, have mercy, okay.   Matthew: And more specifically, I am trying to think. Where do I go with this? I am not really sure, but let me just say…   Becky: 2008 [Inaudible 00:6:09]   Matthew: There you go. Very fluent in Spanish.   Becky: Is he like Pitbull?   Matthew: Oh, nailed it, yes. And it was his first song. Because I was going to say, like oh! He is like…   Becky: The one with Robin Thicke?   Matthew: I did not know there was one, but that really disturbs me.   Becky: Where he sing I don't like it. I love it, love it, love it. Oh, is that Pitbull? That is Pitbull.   Matthew: Probably.   Becky: yeah, oh boy.   Matthew: This is his first one. He speaks a lot of Spanish and again, since I am incredibly white. Even though I grew up in Texas, I know no Spanish. Because I took French in high school for whatever…   Becky: Yeah, I took German.   Matthew: For whatever godforsaken reason. But my favourite my favourite thing about Pitbull is the fact that he can't decide on a nickname. He is either Mr. 305 or he is Mr. Worldwide, which therefore implies that the entirety of the 305 area code is actually the world to either him, which could either be very sweet, or the fact that he doesn't travel a lot.   Becky: 305, Miami, I am assuming?   Matthew: Yes.   Becky: Yeah, okay.   Mathew: So that is where he is from. I am assuming he is Cuban. No offense to Mr. Pitbull, if he eventually listens to this podcast…   Becky: I think he is.   Matthew: Which I highly doubt.   Becky: I am sure he is a big fan.   Matthew: Obviously.   Becky: Can't wait to get fan mail about that one.   Matthew: So really, the song that he chose was I know you want me. Becky: Mm hmm.   Matthew: Which makes several assumptions that I think Pitbull has not quite figured out. I am not sure there, is a huge audience who is craving his music, but nonetheless, he still posits that people do want him. Again, most of it is in Spanish. So I will skip those parts because quite simply, I just did not take the time to Google translate any of it. The bad lyrics for it. I give it minus one point for repetitiveness…   Becky: Yeah.   Matthew: Because some of it is simply. I know you want me, want me. Then it is like…   Becky: oh, God, I don't remember.   Matthew: You know I want you, want you. Then it just repeats multiple times. I will not go into that. There is a lot of just, word association.   Becky: Yeah, okay.   Matthew: I know that Good hip-hop. You can do word association. And it makes sense and it flows. Pitbull just being like, oh, shit. Got it right. Like you can you can hear him like a train barrels towards the end.   Becky: Those are make the favourite raps. Post Malone, I hate that guy so much for this. At one point, he says something. He is trying to rhyme something. Instead of saying Luck Roy, he is says Lecroy, so he can rhyme it. First off, I hate that damn drink anyways. Second, you cannot even pronounce it right. Why? Just so you can fit in your little rap. Mr. Syracuse? I don't think so.   Matthew: Oh, he is from Syracuse.   Becky: Yeah.   Matthew: Congrats. Another New York native like Becky.   Becky: Yeah. I did not get all the face tats, though.   Matthew: Not yet, you are young.   Becky: Working on it. I am working on it.   Matthew: Pitbull goes on to say, you know, stick to the clock on my way to the top, which I am like, okay. He is being timed. One assumes.   Becky: Yeah.   Matthew: I do not think that is necessarily a bad lyric. Then there is just a weird word association, so like Pit got it locked from Bruce to the lock her. The bruise, b-r-e-w-u-s according to the lyrics, I find that amusing. RIP so rest in peace…   Becky: Yeah.     Matthew: Huh, Big and PAC. P-A-C, I don't know if that's like the…   Becky: Biggie and Pac? Biggie and 2Pac   Matthew: That is what I am assuming, right?   Becky: Yeah, okay.   Matthew: So it is like ok, he is doing due diligence as one does in hip-hop by making references.   Becky: Yeah.   Matthew: So far he has not necessarily run afoul of anything, he said premise.   Becky: He is also hitting both coasts like he's trying and play Sweden…   Matthew: Right?   Becky: Yeah.   Matthew: Even though he very clearly raps the east coast by being like Mr 305 checking in for the Remix.   Becky: Yet it is also Miami like it's not New York vs LA…   Matthew: You can calm down.     Becky: Hip-hop, yeah.   Matthew: He extends his condolences to both of them, and then disses himself.   Becky: Many years kind of late too, by the way.   Matthew: This is where I started to get concerned. As far as bad lyrics and also his self-esteem, because he immediately feels like R.I.P too Bigg and Pac. That he is not, but damn, he is hot. So what that implies to me is, Pitbull is actually saying that, oh, actually I'm not nearly as talented as Bigg and Pac, which I was like…   Becky: Truth,   Matthew: Which is just truth.   Becky: Truth.   Matthew: I do appreciate it. Then he has to saddle himself like, you know, I can never be them, but I am attractive. And that's still a stretch.   Becky: Yeah, I would say to 2Pac is probably better looking than him in my opinion.   Matthew: I would agree.  I am inclined to agree. Pitbull, He has a face like a pit bull.   Becky: He does, there is a reason he have that name. Yeah.   Matthew: I don't know what it is, but I can assume it's his face.   Becky: Yeah.   Matthew: And so continuing. What is even weirder is that he is like the label flop. So he's already saying that like whatever label he's on is going to flop presumably because of his songs like that doesn't inspire confidence. So it's like again, a diss at the start. Then he says, but Pitt won't stop. Label flop, but Pitt won't stop.   Becky: Wait a minute. Maybe what he is saying is, you know, I like when you would be like, oh, my God, I am totally failing this test. Then you nail it like he's psyching himself out, like I am the shittiest rapper. Then boom! Platinum.   Matthew: Huge fame. I don’t know if this ever went platinum. I would be surprised, but also not surprised if that were to happen.   Becky: You never know.   Matthew: But he is always starting with the dislike that he is not. But damn, he's hot. Label flop. But Pitt won't stop. And I'm like, ok. Then very left turn. Got her in the car playing with his como. And that's where he answered Spanish. Oh, wait, why are you having sex in a car? I am not surprised.   Becky: Yeah.   Matthew: But he was like, I am going to be an amazing rapper. Oh no, getting my dick sucked in a car.   Becky: Well, all right. I mean, you know, to each his own is all I am saying. You granted it back in the day…   Matthew: So, we should let Pitbull have his own.   Becky: Whatever makes him happy? You do you. Live your best life.   Matthew: Right. And this is where the associations continue because right. In two lines, He has gone from being like, I am sorry that Biggie died…   Becky: Yeah.   Matthew: And Tupac died. The label is going to flop. I mean, but I am going to keep making music. I am receiving oral in our car. Then he says, watch him make a movie like Alfred Hitchcock. Ha! Enjoy me.   Becky: Has, he made a movie?   Matthew: No, not at all. None. I don't think he's directed his own music videos. If he has, I can tell you the music one for this one. Looks like it was directed by…   Becky: I might know somebody who has done a video with him.   Matthew: Did they direct it?   Becky: No. He is a cinematographer. Curious at least he picked a good director.   Matthew: Right.   Becky: Alfred Hitchcock.   Matthew: He was not choosing…   Becky: One of my favourites.   Matthew: I am trying to think of who would be a bad director.   Becky: Well, the guy did. Oh, God. What is that movie that? James Franco did a movie about him that won an award, but he did not.   Matthew: Tommy Wiseau.   Becky: Yeah.   Matthew: Watch him make a movie like Tommy Wiseau. Huh! Enjoy me.   Becky: See, that works a little better for this.   Matthew: It actually does.   Becky: If he could have just let us edit his words, he would be spot on. Yeah, either him. I am trying to think Ed Wood.   Matthew: What does he do? I don't think I know, Ed Wood.   Becky: Oh, you have to go back and watch an Ed Wood movie. I think one of my favourites, which is called Jail Bait. And there's this weird 1950s. There is this weird, depending on which version you get. There is this weird kind of like guitar piece in it that keeps showing up randomly throughout and you think it is there to like build tension, but you are like, [Inaudible 00:15:01] just threw that guitar riff in there for no real reason. It is like you have flamenco, kind of. I don't know how to describe it, but it's hilarious. Johnny Depp actually starred is him in a movie called Ed Wood. He was pretty epic at making like B movies where you're like, what! is going on here? Plan 9 from outer space, I think is him…   Matthew: Oh! Okay,   Becky: Yes. Jailbait is probably my favourite.   Matthew: I will have to check these out. Thank you for the movie recommendation. The last time I recommended Repo the Genetic Opera.   Becky: Yeah. Plan 9 from outer space…   Matthew: Jailbait first.   Becky: Jailbait though is my favourite and I used to own it on VHS. That is how old I am.   Matthew: Oh yeah. If it makes you feel any better. I was acquainted with VHS.   Becky: Yeah. I am the VHS. Oh God! That movie was so good. So bad, it was so good. I am sure it is him, Jailbait. It has to be. He has done so many, and I think he did with like Vampira. Yeah, that is Ed Wood. Oh, so many. Oh, yeah. Glen or Glenda? Also a classic. Mm hmm. Genius of a man.   Matthew: That is incredible.   Becky: I wish there were more like him out there that could do these kinds of movies.   Matthew: We can only aspire too. But I mean, also Pittbull could aspire to, be the Ed Wood but currently he wants to be Alfred Hitchcock.   Becky: That is not happening.   Matthew: But when I was really thinking about this, I was like, what? You know, in my limited experience with hip-hop, what lyric stand out to me is like the worst things I can think of.   Becky: Yeah.   Matthew: And this one stood out in my brain, has not left my brain for the past eleven years, and presumably will not be my brain until I die. It is this line.   Becky: Okay.   Matthew: Because remember, the rest is repetitive. Mommy got an ass like a donkey with a monkey look like King Kong. Welcome to the crib. Now, granted, also, I do need to…   Becky: Okay.   Matthew: Make a very specific point that when I say mommy, it sounds like I am talking about…   Becky: Mom. Matthew: Right.   Becky: And actual Mom   Matthew: Its spell M-A-M-I. It is Spanish. I am incredibly white. I cannot make this work. I need you to know...   Becky: Mommy and Pappy.   Matthew: Yes. Exactly. Like he is clearly talking about an attractive young woman.   Becky: A lady friend.   Matthew: Quite honestly, does not make me feel any better about it because he's dancing. She has an ass like a donkey, which I do. I will give him credit for the association…   Becky: That is good little…   Matthew: Word played.   Becky: Yeah.   Matthew: It is like saying like, oh, hurray. I can do this wordplay. But I forgot that this is implying that I would fuck a duck.   Becky: Yeah. Yeah, like a donkey got a sweet booty. Yeah…ewe.   Matthew: An ass like a donkey and he says monkey. Like a donkey with a monkey. Then why with a monkey? She specifically has an ass like a donkey that has a monkey. Look like King Kong. Now, does he mean the woman? Does he mean the monkey? Or does he mean the donkey?   Becky: It is all very offensive. However, you look at it, every part of that is offensive. Like there is not a moment where you go, well, that is very flattering. I appreciate that. No, nothing like. Where does the monkey come in? That is just to make the rhyme, clearly.   Matthew: Now, would you be flattered if a man would actually say you have an ass like a donkey.   Becky: That is like Sisqo she got dumps like a truck, truck, truck.   Mathew: Okay I did forget about that.   Becky: The Thong Song, and then there is Wreckx-n-Effect with the rump shaker. There is another one, actually. This is a perfect lead in mine.   Matthew: Done, I was like, honestly, that I just want to say for the audience at home, that lyric haunts me to this day and I truly wish that it haunts you as well.   Becky: Great. Okay and mine is from 1989.   Matthew: That was prior to around the time of conception but definitely not [Inaudible 00:19:48].   Becky: Okay. So mine is from 1989 and I remember this song so I'm going to read the first part of it. I was at the mall sipping on a milkshake, playing the wall, taking a break. Admiring the girls with the bamboo earrings, baby hair and bodies built to swing. That is when I seen her. Name was Tina. Grace and Poise, kind of like a ballerina. I say how you doing? My name's big L don't ask me how I'm living because yo, I'm live in swell. But then again, I am living kind of foul because my girl don't know that I'm out on the prowl. To make a long story short, I got the digits.  Calls, one that drives me crazy. Calls her on my car phone and paid her a visit. I was spanking her, thanking her, chewing her, and doing her. Land like a king and sat on sheets of Satin. Well, that is what time it is. You know what is happening? She had a big old booty, and I am doing my duty.   I mean, yo, I admit that girls cutie. But Tina was erratic, Earl is my witness with the kind of legs that put stockings out of business. I went home. I kissed my girl on the cheek, but in the back of my mind was this big butt freak. I fat my girl down. I could not hold it in, and that is when I said to her, with a devilish grin. Tina got a big old butt. Matthew: That was a perfect Segway. Becky: Yeah, then it goes on. I know I told you I would be true. But Tina got a big old butt, so I'm leaving you. So this is LL Cool J, big old butt.   Matthew: This is LL Cool J?   Becky: Oh, my God. He has another one called Backseat in my Jeep, which is another one of my favourites, one of the lyrics said. It is like backseat of my Jeep. We swing an ep. So you could not say episode, he had to shorten it down to ep to sound hard.   Matthew: Wow   Becky: But yes, the whole song has him bouncing around from girl to girl with big old butts. So then, he moves on to I believe it is Brenda. Who he met at high school. Mm hmm.   Matthew: That's, you know, usually where this occurs.   Becky: Then he goes to Red Lop, so he started at the mall. Then he goes to the high school.   Matthew: Have we confirmed that he too is in high school?   Becky: Oh, I don't think so at this time.   Matthew: Oh, yikes.   Becky: Yeah. Mm hmm. He went to the high school about three o'clock. So clearly, he is not in high school.   Matthew: Oh.   Becky: To try and catch cutie. Riding my jock.   Matthew: That is a popular line.   Becky: I have not heard that a long time. She had that kind of booty that I always remember. I would say to my man, stop the jeep. She is only 17, but yo, don't sleep. So again, I have a theme for this series, apparently.   Matthew: You sure you do. I like 2008. You like rape song.   Becky: Yeah. I don't know what it is. Then he put the big booty on a bearskin rug.   Matthew: Wow! Why the fuck does, he have a bearskin rug?   Becky: He got satin sheets and a bearskin rug. LL…   Matthew: He just fuck so much.   Becky: He is on point as far as like 70s porn house.   Matthew: Easily. He call Hugh Hefner and I was like, can I fuck as many girls in your house as possible?   Becky: Yeah. I like I scope the booty like a big game hunter. I said to the girl, you, you look tired. Let's go get some rest. Relax by the fire.   Matthew: Oh, okay. Naked.   Becky: Apparently.   Matthew: But that is a terrible way to lay naked, because let us all remember that fires only come in one direction.   Becky: Yes, so half of you is sweating to death. The other half is freezing and you are on a bearskin rug. So now, half of you is sweating with bear fur stuck to you. Everything about this is wrong.   Matthew: That is so erotic. Becky: Then if you move to like the satin she. She just like right off. like nothing about it is good. Yeah. Oh, he also grabbed a pack of bullets and pulled out the steel. So how about that?   Matthew: The steel?   Becky? How about that for slang for putting a condom on?   Matthew: Okay.   Becky: Yep. Then he gets back, and he goes to Tina. I am going with Brenda now because she got a big old butt. So he's leaving you.   Matthew: Wow!   Becky: Later on, he goes to Red Lobster. For shrimp and steak, as it says, it must be the next day because we are at lunchtime now, because this is around the time when the waitresses are on lunch break. You know, he is hanging his bro, then he meet Lisa, one thing leads to another. And he's got to tell Brenda.   Matthew: It is time for her to go.   Becky: Yeah.   Matthew: Wait! What is the name of the song? Remind me.   Becky: Big ole butt.   Matthew: Big ole butt. It is just butt?   Becky: This was on the radio.   Matthew: Constantly.   Becky: Yeah, I remember this. Yeah.   Matthew: This is…   Becky: Big ole butt.   Matthew: Fascinating.   Becky: Hmmm. LL Cool J 1989.   Matthew: Assinating that is what I am going to call it.   Becky: It is assinating. I mean, he just. You know, I out and about. Maybe pulled in the parking lot, and parked his car. Somebody shouted out. I don't care who you are, I pay no attention. I walk inside because Brian had a nine and he was chilling in the ride. I got to be honest, I don't know what the hell that means.   Matthew: That is so weird.   Becky: Shrimp and Steak was not the only thing cooking.   Matthew: What?   Becky: Yeah.   Matthew: Although this does make you feel better that like consistently hip-hop artist, do you go to Red Lobster after they are fucking because, you know, Beyoncé is like… like,   Becky: Yeah.   Matthew: Fuck him so good. I don’t remember.   Becky: Yeah.   Matthew: Basically the sex so good that she's like, I take his ass to Red Lobster and now turns out LL Cool J originated the like lets go to lobster.   Becky: I feel Beyoncé is lying on this one.   Matthew: She would never…   Becky: Jay Z…..Red Lobster.   Matthew: There are multiple things like really…   Becky: For reals, yeah. But this girl Lisa was like, you got a girl and it don't matter. You are looking tastier than a piping hot pizza. Then he of course, I don't know why this was something he thought the ladies are going to enjoy this line. When she walked out the door, I threw my tongue down her throat.   Matthew: Ewe.   Becky: No.   Matthew: Also, that is a terrible verb for it. Like I threw it down her throat.   Becky: I don't want you touching my tonsils. The doctor is the old one who should be touching my tonsils and my uvula, and I love that term uvula.   Matthew: Even there on him fucking ice when they touch your tonsils.   Becky: Yeah. Dentist if necessary. No. And of course, this is the 80s. Late 80s after he has done his business. He grabs his pants and put on his kangol.   Matthew: Wow. It is the 80s.   Becky: Yeah. Then who did I see? Oh, yow it was Brenda. Yow, she worked at Red Lobster but I did not remember.   Matthew: Wow!   Becky: Lisa got a big ole butt. Matthew: Wait, he bring Lisa to Red Lobster.   Becky: He picked up Lisa a Red Lobster, but forgot Brenda also worked at Red Lobster.   Mathew: LL Cool J, what the hell are you doing.   Becky: I mean you just getting yourself into a train wreck. Yeah-Big Ole Butt.   Matthew: Wow! That is…   Becky: I can still hear the whole thing in my head. Brenda got a big ole butt it is awesome. I will listen to it tomorrow at work.   Matthew: See what I appreciate. I feel like with very few exceptions, most of the songs that we choose are so lovable.   Becky: Oh, I am still going to listen to him.   Matthew: In spite of the bad lyrics.   Becky: Except for two. The first one we did. Which is that James Arthur piece of trash.   Matthew: Yes.   Becky: That one, never. Like I will listen to it because I am being forced to. Because somebody wants to see me go what the fuck is? Does anyone not listen to this.   Matthew: Is anyone hearing this?   Becky: Yeah. Then there is another song. That is right up there for me. That every time it comes on I am like no. There is no way, no how, nope.   Matthew: What is it?   Becky: Oh, you will find out because it is going to be, I think, on our next episode.   Matthew: Oh, this will be interesting.   Becky: Yeah, yes.   Matthew: Actually. You know what. I realized we mistakenly forgot to do for our last episode.  We need to give…   Becky: We keep doing this.   Matthew: We have to assign a yikes.   Becky: We did not assign a yikes. Then we also forgot that we do have a Web site.   Matthew: You, know what? People who are bingeing this up.   Becky: Yeah.   Matthew: You will been binge these episode…   Becky: And you will know. It is just whatthelyric.com. I mean, really make sense.   Matthew: Exactly.   Becky: The yikes factor on this one for me. Oh God. I love it.   Matthew: Yeah. That is the thing where it is like honestly.   Becky: Hmm.   Matthew: Well, it depends. Right. Because it is like infidelity.   Becky: Yeah.   Matthew: That is not pleasant. But lyrics purely on lyrics alone. I think that is where we have to go with.   Becky: It is a little like that holiday song. Baby its cold outside where people like, oh, my God, that is awful.   Matthew: Oh, yes.   Becky: We should never play it again, but we remove it out of the context of the time that it was done in. And granted, it's never okay to be pushy with a woman at the same time. Is 1940s much like shipoopi with 1950s. It is not like somebody is writing up, redoing shipoopi.   Matthew: To make it…   Becky: Yeah.   Matthew: Hip and also consensual.   Becky: Though maybe I will give it a go.   Matthew: I hope you do.   Becky: I am going to do the female version of it.   Matthew: He poufy?   Becky: What would that be? Oh, no.   Matthew: He is shitty.   Becky: Oh that, I am writing it down. He is shitty. Okay I am writing down he is shitty, and then this is my assignment. Okay, it is going to take a while, but I will come up with something.   Matthew: Love it. That should be the season finally.   Becky: [Inaudible 00:30:35] shitty. Matthew: Debuting.   Becky: Oh, if only I knew someone who could get like Peter Griffin to read it. It would be amazing. Yeah, so on the yike scale. For me, I just…sigh, [Inaudible 00:30:56] is a tough one for me because I have seen interviews and he's just Mr. Positive.   Matthew: I know.   Becky: So you cant really hate him, but God. His lyrics are awful.   Matthew: The lyrics are bad. I give it, trying to be unbiased, but I can't.   Becky: Yeah.   Matthew: Like I would say a solid 3, I'm almost out of 4. But the positivity and honestly the rest of it is like huh! Most of this is in Spanish. You just mistakenly said that you wanted to fuck a donkey with a monkey around or on the donkey.   Becky: Yeah, Maybe it is just the setting. He did not express what the setting was. Like they are out on a beach, some tropical beach where there is wild animals.   Matthew: That is true, and also, I feel like it's one of those things where it's like Pitbull is the Tobias Funke of hip hop.   Becky: Really? He is.   Matthew: Because he said shit where he is like, oh, I want it. It sounds like he wants to fuck this animal. But really, it's like I just blow myself.   Becky: Yeah.   Matthew: That is the equivalent.   Becky: Yeah.   Matthew: I just blew myself.   Becky: Yeah, I think you are right. I think he is. Yeah. Matthew: So I will give it a three.   Becky: See, I am going four. I feel like he's never really offended, like he's not. There is nothing super offensive about it. Like the donkey, butt thing is probably the worst. But that kind of rolls back on him, I mean.   Matthew: He did let these lyrics…..he both…   Becky: Yeah.   Matthew: Helped write and perform these lyrics.   Becky: Yeah. I am going with a four on that one.   Matthew: [Inaudible 00:32:30]   Becky: LL Cool J on the other hand. He is like right up there. I am going with like one is like the end all be all the yuck factor. Is that what we said before? I probably do it all around.   Matthew: No. I forget… honestly I do also forget what the scale is. For the purposes of this podcast and moving forward.   Becky: Yeah.   Matthew: One is the worst. Five is the least offensive.   Becky: I am saying Pitbull is low grade offensive.   Matthew: Yes, okay. I would agree.   Becky: Yeah. On the scale, he is low grade. LL Cool J In the 80s, full on offensive like that whole song is epically like wow! In every way. I feel like I need a crying game shower after listening that. Also same deal with backseat of my jeep. But I still listen to them.   Matthew: You got to love them.   Becky: Kind of Religiously. Yeah, so I would give them. Backseat of my jeep, which I really wish I had kind of done too. And big ole butt more like two for me. Matthew: Okay, see I was leaning much more toward four for with this.   Becky: Oh!   Matthew: I will say I am a product if nothing but of my generation.   Becky: Yeah.   Matthew: You have to remember, like, boom. Twenty-three. Robin Thicke Blurred Lines come out.   Becky: Yeah.   Matthew: Suddenly someone being like I am having sex with a lot of these women and in really inconvenient places. But I'm only referring to their butt, I'm referring to their butts as butts and not like she's got a fine ass on her like a donkey.   Becky: Yeah.   Matthew: So I am kind of like this is heart-warming. He is only calling it a butt. And, you know, it's like he is problematic in different ways, but not as bad as…   Becky: Oh.   Matthew: You know, raping people, raping and pillaging.   Becky: Yeah, he was definitely rapey. Yeah, I'm going…     Matthew: I like spread, though.   Becky: Apparently so did LL Cool J. Seems to be a common theme in the rap.   Matthew: They all like the spread.   Becky: Even some of the ladies. Yeah. God, I am trying to think who is the one. There was one Lil Kim who you can't even… doesn't even look like she used to. I was like that's not a Lil Kim. Oh, my God, it is. Yeah, she liked the spread, so to speak.   Matthew: Oh, I agree. But I feel like this is product. I feel like we hit some high notes in hip-hop. Becky: Yes. We went with the tried and true. The old school, like one of the godfathers of hip-hop, sort of. More popular hip-hop.   Matthew: And one of the parasite's.   Becky: Yes. Exactly I mean, God love your Pitbull.   Matthew: But is he even making music? I am sure he is.   Becky: Guarantee tomorrow we will be like, oh…   Matthew: The newest Pitbull song.     Becky: He just drop the deuce, so to speak.  That is kind of wrapping it up on the hip-hop. Oh, I pull a dad joke. Next time, we are just going rogue and we are picking whatever, the hell we want. And I will tell you, I have a doozy.   Matthew: I have no doubts. Oh, I should have thought of No Doubt.   Becky: No   Matthew: [Inaudible 00:36:06] hole But we will save that for next.   Becky: Oh, all right. So next time it is our free for all. And we will talk to you guys then.   [Music playing]   [End 00:36:35]

Join Becky and Matthew as they turn their attention to musicals - both the broadway kind and the movie musical kind.  One is from the golden age of Broadway.  The other is from a little know movie opera from 2008.  Both deserve to be skewered.   What the Lyrics? Musicals [Start 00:00:00]   Becky: Hey, guys, just a quick note. When we went to record this, I left my headphones at home so I couldn't hear the funky noises that were happening when I was banging on the table during this discussion because I was so excited and heated about this discussion of musical songs. I apologize for that. Hopefully doesn't interfere with you loving the episode and liking us a million times and telling your friends about how awesome we are. With that said, I hope you enjoy it, and next time I will remember my headphones.   Music playing [00:00:38-00:00:45]   Becky: Welcome to What the Lyric? The podcast that confirms, yeah, that actually made it to radio. Welcome to Episode 3 of What the Lyric? Today we are talking musicals. How are you doing Matt?   Matthew: I am doing pretty well considering how much research I had to do into bad musicals, of which there are many.   Becky: There are a lot and a lot have made money, which is the part that I don't quite get. I am not sure how they made money because they were so bad.   Matthew: Agreed, and I took a broad stance on the definition of musicals. So thinking more along the lines of not just Broadway musicals, but off Broadway and basically movie musicals.   Becky: It was the movie ones that I was kind of like, do I go Disney? Because Disney has some crap lyrics, or I could go to all the stuff, we did when I was in high school. What did we do? We did Grease, but we had to change the lyrics on some of the stuff because it was too racy.   Matthew: Such as?     Becky: In one of the songs about him meeting. It was some weird slang for condom, but we could use it. Matthew: Was it rubber?   Becky: It was not using. I don't think it was. I would have to look it up but I think it was rubber. I feel like it was something like balloon or something. But you knew what it was when he was thinking about it. So we had to kind of do like the radio edit and go [sound 00:2:30] or something in it so that you filled in the blank.   Matthew: Which teenager does not know about condoms?   Becky: Oh my god. It was in the 1990s.   Matthew: Oh, they really did not know about condom.     Becky: 1991, so we should have. I mean it was all coming up then so we should have left it in there but no.   Matthew: I mean our high school did Wizard of Oz. That is very wholesome to an extent considering the fans, I don’t know, destruction.   Becky: Yeah. The Wizard of Oz. What else do we do? Of course, there is always music Man Fiddler on the Roof.   Matthew: South Pacific.   Becky: You guys had some serious production.   Matthew: I did not say it was good.   Becky: High school musicals are very rarely good. I mean, let us be realistic on that one. I went back to my high school musical roots for mine.   Matthew: I think that is a perfect segue way into me asking   Becky: Okay.   Matthew: Where did you go?   Becky: All right.   Matthew: Take us back.   Becky: We are going back to and in the movie sung by Buddy Hackett, who I remember from when I was younger and he was an older man who I have this vague recollection of him being like a dirty old man kind of guy.   Matthew: I mean he was way. Wait, when was this made?   Becky: 60-65, let us say. I want to say 65. No, Sorry. Well, the musical was 57; 62 was the movie.   Matthew: That was a generation of dirty old men.   Becky: Yeah, yeah. Also covered by the Family Guy and several other outlets. I am just in a dive right into it. You ready?   Matthew: I don't believe so, but I'm willing to listen.   Becky: I think this first group, set it up nicely. Well, a woman who will kiss you on the very first date is usually a hussy and a woman who will kiss you on the second time out is anything but fussy. But a woman who will wait till the third time around. Head in the cloud, feet on the ground. She is your girl. You are glad you found. She is your shipoopi, shipoopi, shipoopi. The girl who is hard to get shipoopi, shipoopi. shipoopi, but you can winner yet. Mm hmm. That is shipoopi from the Music Man.   Matthew: Wow.   Becky: The whole thing is yet again a me-too movement in song form.   Matthew: Do we have any historical context for, is shipoopi slang for anything. Do we..   Becky: I don't think so. When I was doing the research for this. I just typed in worst song in a musical ever, and it brought up like some sort of forum for Broadway musicals. And everybody was writing these dissertations and one person just wrote shipoopi. And that's really all you need because shipoopi, I mean you can't say without giggling either, before, after, during and it shipoopi. What is that?   Matthew: And they don't explain it? That is why I love that. He does not need to explain it. He is just like.   Becky: No.   Matthew: So she is playing hard to get or presumably saying no. But it was like men who are super into...   Becky: My guess is she probably hates this guy. Thinks he is a total dill hole, but yet he just keeps breaking her down by saying shipoopi in front of her. Like a playground thing. He just keeps calling her shipoopi. And eventually she breaks out and goes, okay, I guess that's the guy.   Matthew: That is the guy from me. You know, I was not going to have sex with him the first day. Then he said shipoopi about 17 more times.   Becky: You know when I met your father.   Matthew: [Laughing] he had cutest name for me.   Becky: All he said was shipoopi. He did not say anything. He just said shipoopi over and over and over again. And we thought he had been dropped on his head, but apparently not. And that's when I fell in love.   Matthew: I knew he was the one.   Becky: By the third day of shipoopi. That is when I knew.   Matthew: Wait. What is the bumper sticker slogan that is like? Sorry, like not having to say sorry.   Becky: Oh, I cannot. Yeah, I know the one you are talking about.   Matthew: I think it is from a movie. Something means not having to say you are sorry.   Becky: Yeah, shipoopi mean.   Becky and Matthew: Not having to say that you are sorry.   Becky: I'm going to just start filling in shipoopi when I can't remember the words, which is a lot of times now that we've found out we have Alzheimer's and dementia in the family. So now, all of us are forgetting everything. So we are just going to be like, you know, that time shipoopi, you know? Right. shipoopi and see, who knows. But yeah, I mean and it continues on in the kind of abusive way with squeezer once when she isn't looking.   Matthew: Who!   Becky: Who does that?   Matthew: Apparently Buddy Hackett.   Becky: I like if you get a squeeze back that is fancy cooking. I don't know anyone, any woman who would get squeezed and be like oh, oh well hello. Then squeeze back and mean it.   Matthew: It brings up a very viable point. Of where on the spectrum of being touched does being slapped follow like is it technically a squeeze?   Becky: It could be. Or she might have just grabbed him by his junk and was like, never do that again, if you want to keep this and then he said once more for a pepper upper, she'll never get sore on her way to supper. So all this is happening, I presumably on the first date?   Matthew: No, because then she will be a hussy. So would it be…?   Becky: Well, no. If you kissed her on the first date, is she is usually a hussy.   Matthew: I see.   Becky: The second date it is your borderline because a woman who you kiss the second time out is anything but fussy. She is, you know, almost out to pasture. Then the third time around, that is the gal.   Matthew: Okay, got you.   Becky: If on the third day you squeeze her and she squeezes you back, home run.   Matthew: Fancy cooking.   Becky: Yeah, It is fancy cooking and a home run. Then once more up for a pepper upper. If you do it again and she is game, then you have just won the World Series, I guess.   Matthew: Marry this woman.   Becky: Yeah. Yeah. I cannot even.   Matthew: I feel like this song is a good example of like, is it bad lyrics? Because in the 50s and 60s, you had no way of just saying like, oh, we are banging on the bathroom floor.   Becky: Yeah. I mean.   Matthew: There is a lot of euphemisms for sex here. Fancy Cook and Pepper upper.   Becky: Well, pepper upper. I think drugs. I think we are looking for like an upper. Like maybe, a little ecstasy or I don't know, special k. Do kids still do that? Is that even a drugs?   Matthew: I think I am sure. I am a square, you are talking to the wrong person. I am impressed. I am assuming that most of these are euphemisms for sex.   Becky: I don't know. I should have asked my mother and father and be like, hey, when you guys were kids and talking about slang for sex. Did you ever go shipoopi or fancy cooking or pepper upper?   Matthew: Actually, there is still time. So like the follow up to this episode will be the [Inaudible 00:10:37]   Becky: I will call my parents after this.   Matthew: We will record it.   Becky: Quick question. It would not be any worse than, some of the questions my mom woken me up with her asking to, tell her what some slang means because somebody's at work, young kids that work mentioned and she didn't want to seem like she was not cool.   Matthew: Uncool.   Becky: Yeah. Tea bagging was one of them.   Matthew: Perfect. Never forget where you were. The moment your mom asks you.   Becky: No, I was not. I will not. I just gotten to work. And my mom called and she said, hey, look, I got a question for you, can you. What is tea bagging? I just walked in the door. Can I call you back after I call my therapist and get some coffee? And apparently it was during the whole like…   Matthew: Tea Party moment?   Becky: Tea Party stuff. And mom, they were joking. It said something about Tea Bagging and I had to explain tea bagging. It went downhill from there. Years of therapy for that one.   Matthew: That is fancy cooking.   Becky: And a pepper upper in the morning if you have to answer that question, yeah.   Matthew: To say the least.   Becky: [Laughing] you have no idea. I was like I'm sorry, what now? did you just ask me. I got to go. I need to call my therapist. And I’m actually my therapist right now, and the siren. Oh, Seattle full moon weekend. You are the best.   Matthew: I should have curse a lot more. Just so, we can edit it out.   Becky: I know, oh well. All right. So Matt, what did you go with?   Matthew: Since we will be releasing the other music episode, we did.   Becky: Yes.   Matthew: This is actually a redo by my request. Upon reflection, realized that I feel like I had not done my due diligence. Right. Because the purpose of this podcast is to find bad lyrics and call them out as they happen, even in songs that we love. Upon reflection, I realize that rent, the reason why I called out rent the way I did is because I fucking hate that musical.   Becky: The musicals is awful.   Matthew: The lyrics were not necessarily the problem. The content of the entire musical is what really bothered me.   Becky: Yeah. That is a whole other episode. Like we could take down the entire musical in one episode. Maybe that would be a probably a two-parter.   Matthew: Yes just for me.   Becky: There is an intermission in that play.   Matthew: Forty-five minutes of me bitching about this movie because of how much, I fucking hate rent.   Becky: Yeah.   Matthew: But I was like, you know the lyrics were not necessarily bad. I just hated the content. So then, I dug deep and ended up watching a movie musical from 2008.   Becky: 2008.   Matthew: The two biggest names would have been Paris Hilton, and Sarah Brightman.   Becky: what?   Matthew: Who famously.   Becky: Was married. To Andrew Lloyd Webber.   Matthew: The best play write of a generation.   Becky: I dislike that guy and all, he's written so much. I cannot. I just cannot. I cannot.   Matthew: Surprisingly, though, he did not write. It feels like this would have been something he wrote.   Becky: Paris Hilton and Sarah Brightman.   Matthew: I think they were the two biggest names. Also, the guy who played well, he was on Buffy. I think he was British.   Becky: Oh, yeah. Who then married…   Matthew: Giles.   Becky: Yeah. Who then married one of the other characters in that.   Matthew: Did not realize that.   Becky: Yeah.   Matthew: But he is in this movie as well. I ended up watching.   Becky: 2008.   Matthew: Eleven years ago.   Becky: God. Okay, 2008. I don't even know what happened in 2008.   Matthew: Financial crisis.   Becky: Okay.   Matthew: Well actually, that could play into this story.   Becky: Please tell me, they did a musical, The Wolf of Wall Street.   Matthew: I think that on is still in the works.   Becky: probably. What the hell?   Matthew: I don't really have any hints, but I will say that it is. Repo, the genetic opera, which if you have heard of or have not heard of, rather, is a movie musical from 2008. The overall plot of which is that everyone is getting cancer. Everyone is dying in this dystopian land. As they are dying, there is this one capitalistic company that says, oh, well, we have organs essentially for rent. We will give you these organs to keep you alive. But if you miss any payments, the repo man will come take the organ and you will die.   Becky: This feel like that Tom Cruise movie. What was that one? Similar? I don't know if it was similar. It is probably not, I just see Tom Cruise and then I go to my happy place because I cannot stand him either. Oh, well that is gone now. I have to look at.   Matthew: I feel like…   Becky: It is shipoopi. It is shipoopi.   Mathew: Tom Cruise in shipoopi.   Becky: I would see that. Actually, that would be something I would see.   Matthew: His voice undoubtedly is terrible.   Becky: That laugh, I needed that laugh.   Matthew: That is the overall plot of it. There are a lot of twists and turns in it. It is a real weird movie musical. I am not sure if I recommend it, but I do recommend watching it just so that you get context for how bad the song is. One of the main characters is a girl who is told that she has this terrible condition. She basically can't go outside.   Becky: Oh, my God. Like bubble boy?   Matthew: Exactly. Spoiler alert. Full spoiler alert. It is not real. Her dad was just like I told you that so you wouldn't leave an entry this like dystopian land, whatever. But the entire movie is incredibly angst. The main character, this little girl named Shiloh is 16. Then she celebrates her 17th birthday and she has a song about turning 17. That, is the song that I have picked. It is called 17 and I chose it. Not only because of how terrible the lyrics are, but also it is precisely a Goth version of 16 going on 17…   Becky: Thank you.                                                                                                           Matthew: From sound of music.   Becky: I was going to ask is it? Please tell me that it has something to do with, I am 16, going on 17. Minority Report was the movie I was thinking.   Matthew: Yeah, okay. I could see that.   Becky: Yeah, sorry.   Matthew: Sound of music. Right. It is super cute. She is falling in love with the Nazi.   Becky: Sad note, I have never seen it.   Matthew: Oh. Spoiler alert. She fall in love with the Nazi.   Becky: Yeah. I have never seen it, but I know it. I know all the lyrics, to that frickin musical as well.   Matthew: She is 16   Matthew and Becky: Going on 17.   Matthew: It gets repeated a lot. It is very cute. I think she is like very excited about that.   Becky: She dating a Nazi, wait.   Matthew: Yes.   Becky: Okay. Yep, there we go.   Matthew: She is dancing on a gazebo with him and she is very happy to turns 17. Shiloh in this movie, however, is very displeased to be 17. And what I will pause it here. Is that Repo the genetic opera for all of the bad lyrics, in fact, actually nails were being 17 is like. Let's take a look at the lyrics.   Becky: The title of the movie makes me think a repo man like an opera of the Repo Man, which would be kind of awesome. I don't know if you can still get Emilio Estevez.   Matthew: Probably not, but this is like a much dumber version of it. I still recommend watching it. Only if you are inebriated in some way, but don’t do drugs kids.   Becky: Yeah, that will be later on today.   Matthew: Yes. Alcohol or weed. That is as strong as my recommendation get.   Becky: That will be today.   Matthew: It is very angst. She cries out 17. Momma drama has to go dad. 17, nothing is going to bring her back. Oh, her mom is dead. Also spoiled alert. Her mom's dad. Hence mama dramas.   Becky: I thought maybe he had a couple of ladies on the side and he didn't know which one was the actual mother of this kid.   Matthew: Oh, no, he is not dating. But the daughter is distraught. Her mom's dead, so 17. Nothing is going to bring her back. 17, experiment with something living. 17, cause I am sweeter than 16.                              Becky: That sounds like dad is hooking up with his daughter.   Matthew: The movie leaves that open. I mean, not really, but there are some weird things happening there.   Becky: Please tell me that this, character's played by Paris Hilton.   Matthew: No, sadly.   Becky: Damn it.   Matthew: But Paris Hilton's character is very on brand…. I will does not spoil that.   Becky: Does she sing?   Matthew:  Not well.   Becky: That is right. She did have an album out.   Matthew: She did. We all know she did not get many after or any Grammys.   Becky: Did she really mean to? She is loaded,   Matthew: Right. That ends up being the chorus. So I will stop yelling 17 at you, but just know that throughout this she got 17. Other choice lyrics, I would say. Again, I feel like this captures my experience being a 17 year old. I have always longed for true affection is one lyric. I am like, okay. Like, that is not a bad lyric.   Becky: No.   Matthew: But the next line after it is. But you compare me to a corpse.   Becky: What?   Matthew: And then the third lyric is Stay with the dead. I'm joining the living cause I'm freer than 16.   Becky: Huh? Okay.   Matthew: Right. It is teenage angst.   Becky: Yeah.   Matthew: Specifically served up in teenage incomprehension.   Becky: Yep.   Matthew: Which I do appreciate. I don't know why 16 is the thing holding her back. Why she needs to be freer than 16. Also, I don't know why she got compared to a corpse.   Becky: Yeah, and I got to say, being 46 now. 16 looks awesome because nobody else is paying my goddamn bills.   Matthew: Doesn't it feel great?   Becky: And like my laundry was getting done? Like, yeah. Food was…   Matthew: Served.   Becky: Yeah.   Matthew: You did not have to cook. You did not have to clean.   Becky: No.   Matthew: Pay bills.   Becky: Nope.   Matthew: did not have to work.   Becky: I just had to be angst, and sit in my room and listen to music.   Matthew: Exactly.   Becky: Yeah.   Matthew: Music like 17 from repo the genetic opera.   Becky: Just like that.   Matthew: So it goes on because there are two more things that I really appreciate about this. Number one; there is a Joan Jett solo in this.   Becky: As in like the real Joan Jett?   Matthew: Yes. She makes an appearance in the movie.   Becky: Wow.   Matthew: Bless you Joan Jett. But you did not need that.   Becky: No, no, no, no, no, no.   Matthew: Joan Jett makes a very strange appearance. But the final lines, I just love because they're terrible. She goes something is changing. I can feel it building suspense. I am 17 now. Why can't you see it? 17 and you cannot stop me. 17 and you won't boss me. You cannot control me, father. Daddy's girl is a fucking monster and that is the end of the song. It is one of these that I am like, I know that they're bad lyrics, but deep down the very small angst part of me as a twenty nine year old is like, yeah, fuck em, fuck parents. Boom make money.   Becky: She is a monster. What? Please tell me. She turns into like some sort of weird. I don't know. I just picture like the Toxic Avenger. But a 16 oh 17 year old girl.   Matthew: Yeah. She is freer. She is sweeter and freer than 16.   Becky: Yeah.   Matthew: She did not turned into a monster. She ends up actually being. Actually, I think it is a very good metaphor for puberty because she is saying all these things in song form.   Becky: Yeah.   Matthew: First of all, you took the time to create a song to convey your angst. That is a very teenage trait.   Becky: Oh, God, yes. Yeah.   Matthew: She does all of this. Then at the end of the movie, it turns out she is a big softie who like as her spoiler alert, dad dies. She is like, I love you, dad. I am sorry I was kind of an asshole. And I forgive you for lying to me about a debilitating condition that led you to lock me up for 16 years.   Becky: Okay, I have never been in that situation before, but clearly, the last time we heard about this, the girl killed her mother, just saying.   Matthew: That is true.   Becky: Yeah. Serving in time.   Matthew: Now, she is locked up in a different way.   Becky: Yeah. You are no longer free. So probably should have just left the house. Yeah. Okay, that is bad. Now I kind of want to see this at the same time.   Matthew: I do recommend it, but not because it is good.   Becky: Where did you see this? How did you see this?   Matthew: If anyone is interested in watching Amazon Prime, it is available. Just watch it.   Becky: Okay. Well, now I know what I am doing this week.   Matthew: Imagine if you really, really overfunded my chemical romance music video,   Becky: Oh God.   Matthew: So that is your aesthetic. Repo the genetic opera is absolutely the movie for you.   Becky: Oh, that is…   Matthew: Paris Hilton. Her best performance, arguably.   Becky: That is just awful. I cannot even like I bought this backpack. Then I realized, oh, my God, I am 46-year-old version of a vsco girl, unintentionally. Now I am, oh I kind of want to return.   Matthew: Wait, a what girl?   Becky: Vsco girl. Apparently, all these Instagram girls, it is a weird of crunchy, granola hippy kind of thing with really expensive accessories. Vsco is like a filter. You can run the photos through. Of course, all these girls do that.  It is like the backpack, like scrunches. Why? Anyone, want to bring that.   Matthew: [Inaudible 00:26:11]   Becky: I cannot even begin crocs in like Birkenstocks. It’s like, can we go in now on both of those? Sorry. No, no, no. No. Can do skis. What was the other thing? Oh, like a puka shell.   Matthew: Oh yeah.   Becky: Necklace kind of thing. I did not buy the $80 backpack. I went for the Chinese knockoff, but it is like that. Eighty-dollar Swedish backpack, which, by the way, somebody told me they got for their daughter. And she's like, and I looked inside. It is made in Vietnam. I was like, way to go, Sweden. Then I thought, well, had I known about that 6 years ago, I would have bought one when I was there. But no, no, no. I was like, oh, I am now this…   Mathew: Vsco girl.   Becky: Forty six year old vsco girl. I will put my hair up in a scrunches. Then there was some other accessories that I was like, Oh, sweet Jesus. There is one clothing company. That only makes one size. And it's like a size Barbie doll. I don't know. It is like a small. Then their clothes are like. It is like some Italian clothing company, Quartz.   Matthew: Yikes.   Becky: Which is funny because all the Italian ladies in my family were not Barbie size. But whatever, probably not their target market, but yeah, so.   Matthew: Wow. I mean, I, for one, am just grateful that I'm neither a vsco girl nor am 17 anymore.   Becky: Oh, thank God. Yeah, I don't even remember what… Oh, I do remember it as doing and it was not good. Properly better, pass that.   Matthew: You could have put all of your angst into a song and you would have felt properly much better.   Becky: I would properly come up with shipoopi though, as opposed to that.   Matthew: I think we both are on par.   Becky: Yeah, we got it.   Matthew: We nailed what being 17 was like in two different decades.   Becky: Shipoopi. Oh, shipoopi. Yeah. All right. Well, I think that probably rounds out the old musicals. Thank God. So coming up next week, or next episode next week, episode, whatever. It all runs together right now.   Matthew: We will release it when we want.   Becky: When we feel like it. No pressure, please. So next time around, we are doing hip-hop.   Matthew: I am excited.   Becky: I had to kind of figure out what the definition really was, because for me, it was just straight up rap. But it's not cause I looked and Drake's in there and post Malone. I don't get that one at all. Beyoncé was in there, and like that's more like R&B stuff to me.   Matthew: Interesting.   Becky: R&B pop.   Matthew: I will be very curious to know what you choose.   Becky: Now, full disclosure, I do love me some Old-School Hip-Hop and by Old School, I mean like 80s. Cause I remember Fab 5 Freddy on MTV, which you have no idea who that is.   Matthew: I sure don’t.   Becky: Yeah, he was in Blondie video and she even mentioned him in it. Old school. I can't remember, I think he was a rapper and M.C. but I can't remember it. Oh my god. My brain is fried and all of my friends who know are yelling right now. But yeah, I remember Fab 5, Freddy and then Yo!, MTV Raps and then it became the two Ed lover and Dr. Dre, but not the Dr. Dre we all know and love today. Yeah, so.   Matthew: This will be good because we are going to be getting that [Inaudible 00:30:14] and then I will be serving my purpose as the millennial on the podcast by bringing us back to 2008.   Becky: Oh, minus.     Matthew: Wow. I just realized I am a 2008 freak.   Becky: Sticking with the year. I don’t even know when mine came out. I want to say it was late 80s, early 90s. So Yeah. All right. Well, that is something to look forward to, and I guess that is the end of this episode. And we will see you next time. When we ask What the Lyric?   [End 00:30:45]  

How does the endless scroll of Netflix impact our desire for sneakers? How does the manufactured scarcity of shoes influence a billion-dollar secondary market? What is a sneaker bot? The difference between iPhones and Sneakers: This week Paul Ford and Rich Ziade sit down with product designer Matthew Famularo to talk about sneaker appreciation, manufactured scarcity, and the second-hand marketplace built around sneakers. We get acquainted with sneaker bots and discuss the ways that teens unknowingly carry out digital strategy for their favourite brands. We also listen to Rich’s admiration of Paul Newman’s good looks. [podcast player] ►iTunes/►SoundCloud/►Overcast/►Stitcher/►MP3 /►RSS 5:25 — Matthew: “Part of this multi-billion-dollar industry of sneakers winds up being sold because the supply is so incredibly limited and the demand is so high.” 7:25 — Matthew: “People will camp out for sneakers… It’s like Apple products, it’s like when the iPhone comes out.” 9:40 — Paul: “There was kind of a larger trend of athletes going from cool hometown celebrities to global mega superstars where everything is affiliated with them, like when Steph Curry came out with his sneaker and everybody made fun of it — I don’t follow basketball or sneakers, but that was big news.” 10:00 — Rich: “It’s fully baked at that point. You’re not wearing a sneaker to go play basketball in the schoolyard. You can, but it became fashion.” 16:18 — Matthew: “It’s a multi-billion-dollar industry, sneakers. It’s a marketplace. Because of this multi-billion-dollar industry and supply that doesn’t meet with demand, there’s now a billion-dollar secondary market that StockX is participating in, that eBay is participating in, that people are using platforms to sell sneakers.” 16:30 — Paul: “There’s a low cost of entry, it’s connected to street culture, there’s an element of hustle to it, and there’s a key thing you’ve just described which is that you’ve got this marketplace over here, you’ve got this waiting room here, you can automate this — or you could, theoretically.” 16:55 — Matthew: “There are a lot of different kinds of sneaker bots that you can get and it depends on the shoes that you’re looking for… Some bots do all of them. Some bots only do websites that use Shopify. Some bots only work on jailbroken iPhones because they work on the Nike SNKRS app. You have to understand what you’re looking for, and dependant on that, there are a number of options available.” 17:35 — Paul: “Everything you can do with the web has ended up in sneaker bot development territory.” 19:25 — Matthew: “We are now exposed to digital objects more than types of physical objects.” 20:05 — Matthew: “What you have today is between the digital objects [of music, TV, and film] is the notion of scarcity has exploded. Netflix will just pour content over your head until you drown in it so the perceived value is gone. I think that this is almost in a way a reaction to it, because you actually have this thing you can cherish in a weird way because not everyone has it. You know for a fact that because of the marketplace that there are just not a lot of them.” 20:50 — Paul: “That aspect, that sort of raw capitalist consumption part of street culture got really into the brains of cool rich young kids who are like, ‘Oh yeah, $1500 for a cool pair of sneakers, that’s no big deal. I’m a DJ and my parents are funding the next 30 years of my college education.’” 22:00 — Paul: “It’s not such a big market that serious, giant players are really deeply invested in it so it stays kind of ground level. Even the fact that there’s this whole sneaker culture and the bots and so on becomes part of the mystique. The marketplace is now connected to the big public branding event… They’re seeing this growing marketplace as feeding into their overall big brand efforts. Matthew at some level is pulling off the digital strategy around perceived value in the adidas and Yeezy brand for them.” 22:50 — Matthew: “One of the key points is that demographically you’ve got teenagers who fully understand that everything’s disposable. Everything. My Instagram, my Snapchat.” 27:35 — Paul: “Watches are very specific. Watches are rich people catnip.” 28:25 — Rich: “I just it’s cool that there’s this appreciation for this thing that there aren’t just endless amounts of.” 28:35 — Matthew: “There’s a separation between how widespread it can be. On social media, you can see photos of the shoe everywhere. But you go to… Ohio, and you’re not going to see that.” 29:30 — Paul: “When we’re having our kids play Pokemon Go, we’re training them to be sneaker drop consumers.” 31:10 — Paul: “As a species we find scarcity. I think it’s really exciting and I think it’s because we like having access to everything and then we get really excited about rich people having access to things we don’t and we’re like, ‘well why don’t I have it?’” LINKS Matthew Famularo, product designer StockX Virgil Abloh x MoMA x Nike The Story Behind The Air Menthol 10s YEEZY 500 | adidas + KANYE WEST Supreme Paul Newman’s Rolex

The Gospel According to Matthew: "It is... but it Isn't" | Matthew 18:1-13 | Rev. Trent Walker by Community Reformed See acast.com/privacy for privacy and opt-out information.

Dave and Jared continue the conversation with Matthew Ames. Here are some of the key points from Dave’s interview with Matthew: It’s ok to experience negative emotions. Be open to others who see something for you that you don’t see for yourself. The single biggest predictor of whether you will get through adversity is the quality of relationships you have with those people who are close to you. It takes a village of people to make something possible. We greatly underestimate the ability of young people to be able to do things. We can have more patience to teach young people how to do things and to empower them. Four of Matthew’s biggest learnings: Things are how they are, this acceptance creates a foundation for peace. Understand your why, your purpose behind why you do what you do. The positive attitude you need to execute and to identify opportunities, especially when things aren’t going your way. The value of relationships. What does Do Life Better mean to Matthew: love yourself and love others. Challenge for the week: ask yourself the question, are you happy with the relationship you have with those who are close to you? And if you’re not, what are you going to do about it? Follow us at facebook.com/projecthatch and Instagram at @project_hatch. To contact us about retreats, leadership training and workshops, visit www.projecthatch.com.au or email us at hello@projecthatch.com.au. Remember to subscribe to, rate and review the podcast to help spread the do life better message. Now, go out and create a great day.

A lot of passages in Scripture make me uncomfortable. But this one scares the dickens out of me. In Matthew 12:36, Jesus declares "I tell you, on the day of judgment men will render account for every careless word they utter." Uhhh..."every careless word"? (Insert teeth chattering.) Now I don't know about you, but I've said some pretty ridiculous things in my life...things for which I would love to take the eternal Etch A Sketch, turn it upside down, and shake. (By the way, did I ever tell you I was in a 1970s Etch A Sketch commercial with my brothers and sisters? Story for another time...) And I'm betting there are plenty of people reading this that are just as terrified of that verse as I am. Well, fear not! In this special episode of the Art of Catholic, I'm actually the one being interviewed by none other than Marcus Grodi about this very difficult verse. Perhaps you've seen Marcus on his EWTN show The Journey Home. (I was on that show once, too...a long time after the Etch A Sketch commercial.) Marcus is a wonderful man and in this show we'll discuss things like: How words are more powerful than we realize The vital role of silence Why what's in your heart is the key to your speech How St. Paul provides help in gaining control over your thoughts The secret to maintaining "silence" even when speaking (this one rule is worth listening to the whole show...not that the rest isn't great, too:) So unless you don't have a tongue (or you're a professional mime), this very special episode is for you! Matthew It's got a whole chapter on silence and controlling your tongue! If you really want to understand the ins-and-outs of deep prayer: what it is, how to do it, the 3 Stages of the Spiritual Life, vocal, meditative, & contemplative prayer in the Catholic tradition - this is the book for you! "Matthew Leonard, in an engaging style, shows how ancient Catholic prayer traditions still meet the needs of today's Catholics.”—His Eminence Cardinal Donald Wuerl, Archbishop of Washington "We all need help to grow spiritually...Matt Leonard shows us the way." - Dr. Scott Hahn, author, speaker, and Professor of Scripture and Theology, Franciscan University of Steubenville Grab your FREE copy of my quick guide to deeper prayer 8 Ways To Jumpstart Your Prayer Life! It's an easy step-by-step guide to help you rocket to God!   --------------------------------------------------------------------------------------------------- Don't miss a show! Subscribe to The Art of Catholic by clicking this link and then clicking "View in iTunes" under the picture and then "Subscribe"!  Love the show and want more people to hear the Catholic faith? Leave a review by clicking here and then the "View in iTunes" button under my picture. This pushes the show up the rankings and puts it in front of more people. Android user? You can listen to The Art of Catholic on the Beyond Pod app from the Google Play Store.

Tom Levin stops by to talk his cinematic influences and practices as a filmmaker. Will he be similarly inspired by Pier Paolo Pasolini's The Gospel According to St. Matthew? It is the greatest story of all time after all. Straight up, spoilers for Louis CK's Horace and Pete.

In the New Testament we're not given just one Gospel witness to Jesus, but four. Each of the four Gospels introduce Jesus' public ministry in a different way and from a different location.Matthew: Reissuing the Torah as the Sermon on the Mount.Mark: Casting out a demon in the synagogue in Capernaum.Luke: Announcing the Lord's favor in the synagogue in Nazareth.John: Turning water to wine at the wedding in Cana of Galilee.In each case this establishes a particular emphasis of that Gospel.Matthew: It's time for a New Torah.Mark: It's time for the overthrow of Satan's kingdom.Luke: It's time for God's favor upon the world.John: It's time for the everlasting feast to begin.