Is it Time To Pivot ‘The Plunge’?

Jesse Pujji:I remember going into a casino one time and losing $110 on $5 blackjack and literally being nauseous. Over many, many years, I'll lose that on a hand, you know, and… 

Alex Lieberman:That happened to me in the Bahamas during my bachelor party. And I had that nausea experience, where I started out on a $25 hand and I was told this foolproof way to win in blackjack. Obviously not foolproof. 

Jesse Pujji:Well, you should've run the other way as soon as you heard that. 

Alex Lieberman:It's, anytime you lose a hand, you double your bet, and you just, every time you lose anything, you keep doubling your bet.

Jesse Pujji:You could do that if you have a bigger bankroll than the casino. 

Alex Lieberman:I got to a $3,000 hand and I decided that I did not feel comfortable losing any more money. So yeah, that works as long as you're willing to stay liquid. 

Jesse Pujji:That was terrible advice. You should have texted me. 

Alex Lieberman:What's up, everyone? I'm Alex Lieberman. 

Jesse Pujji:Yo, This is Jesse Pujji. 

Alex Lieberman:And this isThe Crazy Ones. Mic's on, lights on, kind of seeing stars outta the corner of my eye right now. Another week in the life of builders. What's going on with you? 

Jesse Pujji:Well, I decided for the first time inCrazy Oneshistory to not wear a turban to the episode. 

Alex Lieberman:That is true. That is breaking news. 

Jesse Pujji:Really, the reason was I see how Shaan Puri looks and he's like the random Indian guy onMy First Millionand you're the media guy. And I was like, man, I need to dress down more. 'Cause he just looks so dressed down. I love you, Shaan. 

Alex Lieberman:So that's it. 

Jesse Pujji:I was like, the turban…I'm looking too fancy on these episodes. No, actually, it's the end of the week and I was like, I need to keep it casual. I've had a long week. 

Alex Lieberman:I'm all for the casual look, though. It's funny, in the early days of the Brew, the second it got to like 60-degree weather, I would wear shorts in the office. And I remember one day Austin gave me so much shit about it. I can't remember what he said exactly, but basically he was like, you know, you're setting a horrible example by wearing shorts to the office. And I was like, in my head, maybe I got a little defensive. I was like, but I don't give a shit if other people wear shorts to the office. What’s your view on employee garb? 

Jesse Pujji:Yeah, I think, well, let me start by saying like, the reason I actually do take the time to properly put a turban on and make my beard look tidy, it's like a 45-minute process, and especially on something public…one of the tenets of Sikhism, the religion, is actually to maintain the identity, almost like a uniform you don't take off, so that you are representing your people and you know, God and holiness and all that stuff. And so I do actually take it pretty seriously, especially in this kind of a venue. This is a show and it's gonna be on YouTube and stuff. So it is interesting 'cause I'm like, yeah, it's still tough to be here…this is not, you know, it's notnotrepresenting, but it's not fully representing. 

Alex Lieberman:Yeah, I was gonna say like, do you feel bad doing this? 

Jesse Pujji:A little bit. 

Alex Lieberman:Yeah, it makes sense because it's an important part of your identity. 

Jesse Pujji:Well, and I also feel, I know I'm representing a whole group of people. And so, you know, to show up with the bandana on, it's a bit of a thing, but this week it's fine. 

Alex Lieberman:I was gonna say, permission has been granted from everyone. 

Jesse Pujji:But no, I think in the workplace, you know, look, I'm one of the big fans of these common-sense things. I think it's interesting…with the more interesting category of how you dress in the office is one of the many things that aren't discussed about entrepreneurship, which is just, you gotta come up with a policy for how people show up to your office. We had issues with it for sure, where people were wearing like cutoff midriffs and things, and we just had to like, we had to give some guidance, right. And it's actually kind of a dicey topic, especially in San Francisco or other places that are uber liberal. And you say “Guys, like, you know, we gotta, we have to have some reasonable type of attire.” So shorts, I don't know, shorts don't bother me, but I think there's certain, I dunno, call it common sense… 

Alex Lieberman:Yeah. It's like, where do you draw the line? Totally. 

Jesse Pujji:Yeah. Common sense. And I had a thread idea yesterday. I meant to write it down. I was playing tennis and I thought of this like, “Are you ready to be a CEO/founder?” That’d be the headline. And then it'd be like, that means, “Are you ready to blank? Are you ready to blank? Are you ready to blank?” And not like, raise money and generate a genius idea, but are you ready to have your first hire quit the day you need them the most? Are you ready to have to come up with policies for how people dress in your office? Are you ready to… 

Alex Lieberman:I like that. You have to write that thread. 

Jesse Pujji:Yeah. Because I could write a hundred things that most people who, when they're starting a company or building company, that's not where their brain goes, right? 

Alex Lieberman:A hundred percent. 

Jesse Pujji:Are you ready to come up with the policy for how dishes get cleaned in the office?

Alex Lieberman:It just reminded me it was probably 2018 or 2019. We're at like somewhere between 15 and 20 employees at this point, maybe a little bit more. And you know, the early days of the Brew were all like the first few people on the team, you know, we were very, very homogeneous, like 22-year-old, white male Jewish team. And then over time, the team got more diverse in every sense: gender, age, ethnicity, background. And I so vividly remember the first time that we hired a mom; we had never had a mom in the company. And then all of a sudden, you know, one day they asked us because they had just had a child recently and they had to pump milk. Austin and I were like, holy shit. This is the definition of when… 

Jesse Pujji:Blind spots. 

Alex Lieberman:Yeah. When you have such a different life situation from other people, you have such blind spots to things you would never think about. So we literally…I remember at the time our HR person literally had to put up a curtain on one of our conference rooms. Literally for them to be able to do that because it just had…and there ends up being, inevitably, so many examples of that as you go about a business. And so it's almost like sometimes you just hire, when you hire senior people, you're basically hiring people that are just uncovering those blind spots.

Jesse Pujji:Yeah. And well, I think the other thing that comes up is, we've never talked about it, actually. There's a lot of the DEI, you know, diversity, inclusion, equity, like thinking about it, there's a lot of people out there. Because some of my friends, like on a text chain, will be like, “Oh, pronouns are so stupid. Why are they forcing everyone to use pronouns?” or, you know, “Don't force people to hire different people.” And my response was like, you guys think that these businesses are stupid and they're doing this, like they're caving to pressure? I'm like, no, it's good business. The fact that you didn't have someone like that meant there was probably a whole group of readers you guys didn't understand or appreciate. 

Alex Lieberman:A hundred percent.

Jesse Pujji:You know, like having women, having people of color, having tall people, short people, fat people, skinny people, like every type of person helps you actually build a better business. Because the world is filled with all kinds of different sorts of people. 

Alex Lieberman:Unless Morning Brew’s readership was like Temple B’nai Abraham in Livingston, New Jersey, we probably needed a group that more fully represented all the readers of the newsletter. 

Jesse Pujji:Yeah. And I think for founders, I noticed we had a thing, I remember we were a few years in also, back in the day, and we looked around and like, the male to female ratio was horrendous. There were no female, you know, leaders in the company. The three founders were obviously all men. And you know, what I realized at that moment was like the ocean, you know, the waves of the current of whatever will take everyone in a certain direction by default. And so if you don't actually swim against them a little bit, especially on DEI stuff, you will end up with something that looks like the default. And we made a bunch of changes, you know, the organization made tons of changes to change that, and not because there were some employees asking for it and stuff, but it was just much more like, wait…the funny thing about Ampush in particular was most of the people who click and buy e-commerce direct to consumer things are women, right? And so it just, it almost made no sense. There was such a disconnect, and said differently, there was such a richness in making sure that the overall company's gender split was 50/50, that we had, you know, lots of leaders who were women. But it's an interesting one because it definitely comes up and I think there's a lot of controversy. Like the pronouns thing, my friends, there's people who just go like, “Oh, you're forcing it, it's so stupid.” And the companies I'm in and around, I'm on the board of this one old grocery store here in town and they take it all super seriously and it has nothing to do with caving to pressure. They just believe it's a good business choice. 

Alex Lieberman:A hundred percent. Yeah. Well, I want to hear, you know, you mentioned it's Friday, you're tired, you know, it's casualCrazy Onestoday. I wanna get some thoughts from you on what's going on in your world, but I wanna just share, there's like two updates on the two businesses in Alex's startup studio right now. And so I just wanna get your thoughts on them.

Jesse Pujji:Let's do it. 

Alex Lieberman:So the first one is, it looks like we are going to be pivoting The Plunge. I would say it's 80% of the path to pivot. Because basically, and this is where I think being able to get comfort in the gray area as a founder is so important, because you're never…it's not like a test in school where it's wrong or right. There's never gonna be someone who gives me a slip of paper that says “This game is gonna succeed” or “This game is going to fail.” There's so much feel. But the TL;DR is that as we've gotten more people to play this game…you know, we have this ambassador program that I've set up. We have ambassadors who have the game host weekly games in like five cities. There's been a common thread that we've heard, which is, the game is too hard, that people have too much difficulty, that the first 10 times you throw the plunger, people will get it once or maybe twice. And it becomes, people get unexcited about it. They feel dejected because they're like, “This game's too hard. F that.” You know, we heard this enough where basically I think we're in the place now where we want to go back to the drawing board, because I don't think the challenge of the game should be completion. I think the challenge should be competition and in improving your skill. And so I would say it's not an easy decision… 

Jesse Pujji:It's sort of like the opposite of pickleball, right? 

Alex Lieberman:Exactly.

Jesse Pujji:I think the reason pickleball got so popular is that anyone can pick up a racket and not only play it for the first time, but I've even noticed, you know, my wife and I have played. I'm obviously a very competitive tennis player. When her and I play tennis, I have to bring myself down multiple levels. And even then I could easily beat her, easily move her around the court. In pickleball it actually evens us out quite a bit, even though, you know, I'm good with a racket or whatever. And so it's…

Alex Lieberman:Do you think you're ever gonna get bored of pickleball because of that easy-ness? 

Jesse Pujji:I don't think I'll ever be a serious pickleball...I'm a serious tennis player and I love tennis and it's exercise, but I think I'm an awesome casual…like I will jump in if people are playing it, and obviously can hold my own. My wife and I played doubles against this other couple the other day and it was fun. Yeah. 

Alex Lieberman:That's awesome. Yeah. And so like for me, I don't know, it's just, it's a good example of, I don't know if this is the right or wrong decision; there's a chance that we could still push forward with it and people buy it and the difficulty is what some people love. But part of the reason…

Jesse Pujji:But what's the pivot? What are you guys gonna pivot to? 

Alex Lieberman:We're going to basically test out other suction-based games, but that the barrier or the floor for completion, being able to do the activity, like pickleball, is way lower so that people can play the game. And then competition and getting more skillful is the long-term challenge. I also think there's something that, not that I wanna change about myself, but I wanna be cognizant about is I, I've said this before, but I love having original thoughts and original ideas and original businesses, and I think it's actually a pretty like, I don't know, it's a pretty false narcissistic view of oneself, because Morning Brew wasn't original. This content agency I'm starting is not original. And so I just think we're trying to do too many things. I'm trying to teach people to enjoy throwing plungers while teaching people to play a suction-based game for the first time. What I'd rather do is like a remix, where I take the rules of, say, cornhole or bocce, something where the behavior is proven, and bring it to a new form factor. But you know you're gonna have people who are already interested in that behavior. 

Jesse Pujji:Can I challenge a little bit? Some of our listeners love it when we actually are like… 

Alex Lieberman:Yeah. No, no, I actually want your feedback on all of this. 

Jesse Pujji:Yeah. I think it's kinda like the coaching episode we did. My story is, you are really excited about this idea. You brought it, you're pushing it into the world. You forgot…because I felt like this with Poophoria and other weird things. You forgot how damn hard this is and how much resistance building something into the world takes. You've had VCs chewing you out and saying you're an idiot. “Go spend your time on something bigger.” You've had reactions and feedback and it feels a little bit too much, too fast.

A couple specific pushbacks I have is, one is like, this is a regular, this is the same…people know what axe-throwing is. You have done what you're saying already. I don't know. It feels like too large of a reaction to something you haven't even given a fair shot in the world. Now, I think the feedback is very valuable and I don't know, this came up for me when you said that or where I thought you were gonna go was, “I'm gonna innovate around the suction device. I'm just gonna make it easier.” Yes, okay. That's a very valuable insight in the iterative cycles. But I don't think it's “abandon the whole thing.” I think it's “make the plunger easier to…” Maybe it’s not a plunger; maybe it's a suction... 

Alex Lieberman:So it's funny, my partner for this business literally just sent me a text saying “I'm looking at it now.” He basically was like, the designer at the factory in China iterated on the design and added a bunch of suction cups to it, like little suction cups to the big one that makes it super sticky. Here, I'll show you the video. 

Jesse Pujji:Yeah, there you go. 

Alex Lieberman:Yeah. And so that is an option, is like we made it stickier. That solves a problem. I'll also say two other things in my story of myself that I know are contributing to this. One is my fear of losing money and my fear of putting…I didn't realize how uncomfortable it would be to me to put a lot of money into a business before seeing any return.

Jesse Pujji:It wasn't a sure thing, yeah. 

Alex Lieberman:Yeah. Like, like, like honestly I feel so much more comfortable with this content agency right now. Not only… 

Jesse Pujji:One time, when Red Ventures invested in Ampush, and Ric Elias is my mentor and a guy I love and I respect a ton, and our biggest client at that time was Uber. And you may remember 2015, 2014, they were losing a billion or $2 billion a year. And you know, we're meeting, going through the business, and Ric, he just takes a step back in his chair and he goes, “Man, if my company was losing a billion dollars a year, I could not sleep at night.” And at the time I took it as a criticism of the Valley and Uber for whatever reason. That's how it registered with me. And then as I've gotten back in starting things, I realized he wasn't criticizing; he was literally just saying, he was demonstrating some self-awareness, going, “Icouldn't sleep at night.Icouldn't do that.” And I've definitely had a similar experience burning cash with Kahani. And it sounds like you've had a similar experience, even, burning… 

Alex Lieberman:Yeah. I didn't realize how uncomfortable of a feeling it was. 

Jesse Pujji:It is, yeah.

Alex Lieberman:I’ve spent $36,000 on this game. My guess is to truly take it to market, if we run the…we're working with a Kickstarter agency, we run their paid ad plan that they wanna run with us, it's probably gonna be another $20k. That's $56,000. Haven't seen a dollar yet. Probably so far from taking profit outta the business. On the other hand, I have this content agency where I have a high degree of confidence that I can charge clients $6,000 to $10,000 per month and make a 50% margin on that. And that feels really nice. 

Jesse Pujji:Yeah. And lots of your unfair advantages are in that too…

Alex Lieberman:Exactly. 

Jesse Pujji:But I don't know, dude. Let me give you one suggestion also that helped me a lot when I was feeling similar. I think you're also doing it, the way you're funding the business is a little bit too piecemeal and haphazard and it's kind of a mindfuck for yourself. Because every time you have to write the check, you have to revisit those emotions. I would encourage you to…I know you have a lot of cash. Write a $100,000 or $200,000 check, make your peace that it may disappear, and then dude, go all in with that money and let your partner go all in with that money. And it is hard for guys who bootstrapped, but it's also, dude, it's a limiting issue for both of us. 

Alex Lieberman:Totally. 

Jesse Pujji:I very much believe that, because there's people who could sleep at night losing a billion dollars and I'm not saying don't be who you are, but it's a good opportunity to challenge your growth in a way that, dude, again, $200,000 you lost is not gonna kill you. Just literally take your bank balance and deduct $200k from it and say that's the number now, and I'm gonna go do my best that I have with this Plunge. Because I would hate to see you, either in large ways or small ways, throw the talent on this. Because I think, I still believe what I've said to you every time, which is, is this gonna be a hundred million dollar business? I don't know. But do I think it could be a $10 million business that made $1m to 2 million a year.

Alex Lieberman:A hundred percent, yeah. 

Jesse Pujji:The market's big enough, there's enough people out there, and I think the suction thing, I don't know, maybe it's a sticky sheet on top of it. Maybe it's not even a plunger. Maybe it's a faux axe that's safe but will stick to something. There's an insight here that I don't think you should shift so fast. 

Alex Lieberman:I agree with that. So I'm meeting with my partner on Monday to talk through all of this and I'll keep everyone updated. I do find, just to stay on that point for a second around the discomfort of spending a shit ton of money. I do think part of it is, again, this fear of losing money mindset I've maybe had my whole life. I think the other part is, it is very much the bootstrapper thing, and I think there's just this spectrum of what an entrepreneur's risk tolerance is, and it's always, entrepreneurs are bucketed in a certain way, but I really realized I hate losing money so much, and whereas we look at other founders, whether it's, you know, Brett from Figure who's putting so much of his capital into that business and I'm like, oh my god, this person's conviction and their ability to be risk on, I could never do that in my life. But I have such a…and maybe it's because you want a little something that you don't have. I have so much respect for that. Like Mark Lore who founded Wonder, and he's building this utopian Las Vegas; he took a bunch of his money from jet.com and diapers.com to fund these businesses. It's a different mind... 

Jesse Pujji:I think some of it all is also just where you start, and your tolerance. It's just like gambling, or I've never drank, but I guess what drinking is like. But for gambling, I remember going into a casino one time and losing $110 on $5 blackjack and literally being nauseous. Over many, many years, I'll lose that on a hand, you know, and… 

Alex Lieberman:That happened to me in the Bahamas during my bachelor party. And I had that nausea experience, where I started out on a $25 hand and I was told this foolproof way to win in blackjack. Obviously not foolproof. 

Jesse Pujji:Well, you should've run the other way as soon as you heard that. 

Alex Lieberman:It's, anytime you lose a hand, you double your bet, and you just, every time you lose anything, you keep doubling your bet.

Jesse Pujji:You could do that if you have a bigger bankroll than the casino. 

Alex Lieberman:I got to a $3,000 hand and I decided that I did not feel comfortable losing any more money. So yeah, that works as long as you're willing to stay liquid. 

Jesse Pujji:That was terrible advice. You should have texted me. But anyway, I think that there is a tolerance level and I always think of it almost for myself even as, I'm building it up. I hope to be Brett one day, where I could just write a $10 million check into something and believe in it or figure out how to grow it in that way. I've done versions, we've all done versions inside of an operating business. I'm sure you've launched initiatives inside of the Brew that cost half million or million and lost it.

Alex Lieberman:Totally. It's not really your money. Or it is, but it's in a derivative fashion. 

Jesse Pujji:Kind of. I don't know. If you hadn't invested in that…I mean, Adriane and I are working on a lot of stuff and she sometimes struggles even to ramp up hiring, because she's even more hardcore in that direction. And I'm like, no, we'll track it. We are gonna invest in it because we could've taken that money out as a distribution if we didn't take it. But we're gonna pay people and hope to grow our own…but you know, the other thing to remember is inside of a company, oftentimes the returns on capital are way higher than even an investor ever gets. Like there's initiatives…hiring five salespeople can have a 500% return in a year if you do it well. But I don't know, dude. I think you should write a single check from here on forward. I think you should capitalize the company and you should let it do its thing and know that, trust yourself and trust that after, if you run out with that money, just like, you're done funding it, you're done funding it. Otherwise this piecemeal thing is gonna drive you crazy. 

Alex Lieberman:I know. I can tell you that I already am. 

Jesse Pujji:And I think you're either gonna over- or undershoot. Some people do the opposite. They keep putting money in and then they turn around, they spent half a million dollars and they didn't realize it. 

Alex Lieberman:Yeah. That's my biggest fear. That's why I'm so in my head about it, because if I'm not mentally proactive and anxious about it, I'm gonna get to that point, and if I'm at that point, I'll be sick.

Jesse Pujji:Yeah. So I think be proactive in going, “Here's a $200k, $250k check. The operator's also responsible for it. That's what we have to operate off of. We're gonna win, lose, or draw based on our ability to do that well. It means we have to be nimble, fast, et cetera. And if we run out, obviously if we run out and the business is booming but we just need cash flow, that's different. But if we run out and we haven't gotten traction in the business, then it's time to put a bullet in it and move on.” 

Alex Lieberman:Totally. I will say the other thing, and you probably didn't experience this with Pooporia or Unbloat because I would think those are products that have pretty damn good margins. But a heavy outdoor game, like I've never had to deal with something that has true cogs to it. And so in my head, the fact that the margin you're working with from square one is not that different…

Jesse Pujji:And it's all…but the reframe is, it's a different business. Like I was running services businesses which also effectively have a hundred percent, you know, you obviously have the cost of your people, and media businesses also have great cost structures. It's also funny because I remember doing it and it's funny because you go on Twitter and everyone, the grass is always greener. 

Alex Lieberman:Of course. 

Jesse Pujji:Everyone's like, “I'm running a services business; I wish I was running a brand. I'm running a brand; I wish I was running a SaaS business.” And they all have their own unique challenges. 

Alex Lieberman:Yeah. You end up learning every business is hard. 

Jesse Pujji:Every business is hard in its own way, and multiples…like getting a million-dollar SaaS ARR is probably as hard as getting a million dollars in EBITDA, let's say in a services business. And guess what? Those streams are valued exactly the same. 

Alex Lieberman:Totally. 

Jesse Pujji:So the market is very efficient in terms of how it treats these businesses and these business types. 

Alex Lieberman:Well, okay. So I just want to quickly throw at you what's going on with the content agency. I want advice on a few things, and then let's talk about you. So this content agency, I did aCrazy Onesjournal-style episode on this. But the whole pitch is lots of founders, CEOs, execs like yourself who understand the value of building audience, they believe truly that they can drive business through their audience, but they don't have the time or skill to do it. So I'm hiring great ghostwriters to write on their behalf, and there'll be different packages. I'm charging somewhere between, depending on the package, $6,000 to $10,000 a month. And I look at the math of this and my first goal is get this to a million dollars of cash flow as soon as I can. And when I look at that, it doesn't seem that crazy. Say it's a 50% margin business, means I need to do $2 million topline. $2 million topline is $170,000 a month, and if I charge a client $8,000, I need 40 clients. So I need 40 clients paying $8,000 a month to get this to be a million-dollar cashflow a year business. 

And by the way, the big idea here is not the agency. The big idea is the people who I help build up their audiences, can I launch businesses off the back of their audiences? So if I help someone in a niche build up their audience, can then we launch a different business together off the back of that? So it's like cash flow and then lottery tickets. I think the hardest thing for me, and see, you have an advantage with this with GrowthAssistant, but my biggest concern is scaling supply. I have zero concern about demand, zero concern. My concern is, how am I going to be able to scale enough great ghostwriters to get this to be a significant, a great business. 

And I think there's three answers. It's find supply that other people haven't found that's actually really high-quality, unfound good supply. The second is, train the supply. So train these ghostwriters, create a ghostwriting school that I also get paid for, that become the ghostwriters. The third is, leverage AI or automation to scale a ghostwriter from servicing four clients to 15 clients. How would you…one, is that the challenge that you would think of when you're thinking about this business, and if you, knowing what you know, which is like right now I have three clients. I onboarded the first one today, I'm onboarding the second one on Monday. What would you be entirely focused on right now? 

Jesse Pujji:Yeah, I think those three things you said, the answer is yes. Do you do all of them? And who's the CEO of the business? 

Alex Lieberman:No CEO yet. That's another question I'm asking myself, is when do I go and find the operator? Yesterday?

Jesse Pujji:A month ago? Yeah. Well, I mean, unless you wanna operate and run the business, I think it's important. Dude, it's the hardest lesson I've learned from my journey so far. Because I also tried to shift gravity, and I just don't think there's a way you can microwave that. I think something has to give, right? You either, like for Ric, he kind of ran the business, a certain business line, himself with the team for five years before, then people started…he really created that culture, then people started breaking off and he can kind of run it with GMs. You know, Buffett buys the business. There's all these examples, but nobody can get away from, you need amazing leadership and you need to be a coach of leaders, in my opinion. So that's probably the number one thing I'd be focused on, is bringing in someone to be your partner and to run it with you. So that's number one. I think number two… 

Alex Lieberman:And by the way…sorry, just on that. I think if you were to ask me why haven't I done that yet, I think it's a very easy, obvious answer, which is because the idea of potentially paying someone a $150,000 a year salary before the agency is cash flowing enough money to pay for that is scary to me.

Jesse Pujji:Yeah. One of the Type 7 Enneagram, did I send you the thing that was like NEWS, the acronym NEWS? 

Alex Lieberman:No. 

Jesse Pujji:So the biggest fear Type 7s have, or the biggest anti-pattern or whatever that we try to avoid, is being nerdy, empty, stingy, and withdrawn. There's our four anti-patterns to be managed. And it's funny because I feel the stinginess that you're talking about too, and I'm a little bit more, like when I bought this exotic car right after the Ampush deal closed. And I remember the week before, I was like, and this has happened to me with big purchases.