Whatnot founder: This is the future of e-commerce
*$1M Attention Guide: 15+ ways to get eyeballs on what you’re building* https://clickhubspot.com/c764
Episode 863: Shaan Puri ( https://x.com/ShaanVP ) and Sam Parr ( https://x.com/theSamParr ) talk to Grant Lafontaine ( https://x.com/GrantLaFontaine ) the founder of Whatnot.
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Show Notes:
(0:00) Intro
(1:00) Grant turned down Shaan’s investment
(2:12) Shaan buys a crab on Whatnot
(3:58) First 1,000 users
(19:07) Black hat growth tactics
(28:52) 30 sales to $2.3M in year 1
(34:03) $2.3M to $163M in year 2
(34:56) $163M to $1B in year 3
(37:02) How to be a billion-dollar founder
(42:04) Going all the way deep on a single problem
(45:44) Don’t let people use fancy language
(49:48) Being disagreeable but likable
(50:43) The reason I left Facebook
(53:39) “If you think you’re moving fast, you’re probably not”
(54:13) Trends: NeeDohs, squishies, gold bars
(56:21) 9-figure sellers
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Links:
• Whatnot – https://www.whatnot.com/
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Check Out Sam’s Stuff:
• Hampton (joinhampton.com): My community for founders. Average member does $25m/year. Many of the guests are members. Get after it…apply: http://joinhampton.com/mfm
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Check Out Shaan’s Stuff:
• Shaan’s weekly email – https://www.shaanpuri.com
• Visit https://www.somewhere.com/mfm to hire worldwide talent like Shaan and get $500 off for being an MFM listener. Hire developers, assistants, marketing pros, sales teams and more for 80% less than US equivalents.
• Mercury – Shaan uses Mercury across all of his companies. you can too: http://mercury.com/
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My First Million is a HubSpot Original Podcast // Brought to you by HubSpot Media // Production by Arie Desormeaux // Editing by Ezra Bakker Trupiano /
You build a company that is worth $20 billion but just put that in perspective, that is more than if you add up the entire market cap of Wendy’s, Under Armour, Hertz Rental Car, Harley Davidson, American Airlines also. Isn’t that bananas when you hear that?
Yeah, I think it’s absolutely nuts.
What I find interesting about you is that you went from a guy who’s a kid who was working in a deli, almost failed out of high school, to now you’ve, you built a company that is worth $20 billion.
In all, in all honesty, I try not to focus on the number, because I just like if you focus on that sort of scenes obscene, and then you’re like, well, I’ve, you know, done a lot already. I’ll pat myself on the back, but I think we’re pretty early in what we’re doing.And so I just try not to think about it and just sort of look at like the problem ahead and put one step, 1 ft in front of the other. And yeah, we started this thing 6.5 years ago. There’s still a lot of work to do.
Yeah, I remember because, uh, you may not remember this, but we were on a phone call and I was like, hey, this is a great idea. I’d love to invest. And you’re like, I don’t know, we got like kind of, it’s already full. And I was like, oh, but I’m such a great guy. And then, uh, you were like, we’ll see. And I didn’t follow up. And, uh, that not following up cost me, cost me dearly.
I, I actually do remember.
it down in my diary that day.
Grant, what happened from your perspective? Yeah,
yeah, you tell the story.
Yeah, so, um, what happened? I mean, when, whenever you’re like one of the, like, we’ve, we’ve had rounds where we’ve been a hot company and we’ve had rounds where we’ve not been a hot company, sort of like seeing this, the full spectrum of things. And once the rounds close, all we really want to do is go back to work. So I remember talking, uh, to Sean and, um, you know, I’m like, oh, I should probably follow up with him and then I just got busy with work.And didn’t, and I think I, I like in my head I sort of felt bad, so I think I should have done something, but I don’t know.
Well, listen, I’ve been a fan. I was a fan before. I’m still a fan now. Now I’m just a bitter fan, uh, which is a unique place to be in. And we should explain what the company is, right? You’re the founder of whatnot. What’s amazing is you’ve built a large company in a space that I think most people would have found very small and unusual, unusual, it’s almost like a stack of unusual behaviors. We’ll just give a kind of quick summary, which is, if you open up whatnot today, the app,You will see people selling all kinds of things. It started off with collectibles and, you know, like these little Funko Funko dolls, and then opening up packs of cards and stuff like that. But now you could buy anything. I, Sam, I don’t know if you know this. You could buy crazy shit on whatnot. I bought a crab this morning. It was like a fisherman fishing.And he’s like, Oh, I got these crabs. And then he’s like, you can buy this crab right now. I bought a crab. He’s like, great, it’s going to be sent in the mail to you. Congratulations, Sean. And there’s a crab coming my way now. And that’s, uh, I don’t know what just happened, but I have a crab coming in the mail.
The seafood’s incredibly good, to be honest. Like I actually eat it. I eat it like very regularly. It’s my favorite. Uh, it
better be because I’m telling my wife.I bought internet crab and, uh, I don’t know if she wants that to be in the house, but I, I got internet crabs coming my way. You
saw where it came from. You don’t know what you’re getting if you go to the supermarket. That’s true. That thing came off the boat.
The personwho was doing it, their profile shows like how many they’ve sold, and it says 3300. Her, her username’s shout out to I love crabs. Um, so I love crabs, she sold 3300.Yeah, this crab pack I bought when it was $34 she’s made over $1,000,000 selling crabs on the internet. Like this isunbelievable.
Yeah, last week I had a full crab boil, um, brought to you by whatnot.
I can’ttell if Sam is dumbfounded or his internet connection has dropped. He’s made the same face for the last 30 seconds.
I want crab, but I, I don’t understand how on earth you could start something like this because a marketplace like this seems like probably the hardest business to start. I think marketplaces are probably the most durable and also the most challenging.And when Sean originally told me this idea, it might have been 4 years ago, you might have been 2 years in, I’m like, yeah, that sounds cool, but these are impossible. How did you get your first, let’s say,1000 sellers to even use the thing, cause I’d imagine that’s harder, sellers, not buyers.
Yeah, I mean, in the early days, it was all sort of hard. I think for us, the reason we did it is because.Me and Logan, who started it, we’d only ever spent our careers in consumer internet and working on two sided platforms and marketplaces. So, and the idea of starting a B2B business sounded way more painful than starting like a consumer marketplace to us just because of what we knew. When we, when we first got started, we didn’t even have the, the live component. And so we had to get like immensely creative, and so initially we had a value prop if we’d authenticate whatever was sold.
Can you do it like a movie scene, so.You and Logan, you’re sitting somewhere, you have an idea. Who says the idea? Where are you? What, what happened? And then how long from there to the first go live?
So there’s, there’s sort of like two founding stories depending on if you talk to Logan or you talk to me. They’re both, both technically true. So I’ll go back to the first one because Logan will be annoyed if I don’t tell it, which is Logan and I are in Japan, uh, over like the holidays, and we were both sort of fed up with our jobs, and we both, we’d both built companies before. So we, we, we prefer to sort of like focus on building things. And we’re drinking in a bar in Tokyo. We’re like, let’s start a business, and we bought like 50 domains.And we knew we’re gonna, we’re like, let’s talk marketplace business, and we bought all these like random domains. Did
you havean idea or just straight to the domain? You know,
it’s,you’re drinking in a bar, and so it’s like one of our initial ideas, which, you know, we, we did actually sort of do for a couple of weeks was we’ll build like a better full service Craigslist, which is a horrific business idea, by the way.Um, but that’s what we, we initially started with.
That’s like in the, uh, in like the starter pack of entrepreneurs. It’s like
Craigslist is so ugly. I could do better.
Yeah, the, the, you know, economics just don’t make any sense, right? And so you’re selling all these used goods that are basically worth nothing, but you need to be able to.You know, spend a bunch of money in order to make the user experience of Craigslist better, like be able to do. So, so sort of like, I’ll give you an example.
I’ve talked tohundreds of entrepreneurs on this podcast, and I’ve got a bunch of takeaways, but one of the big ones, one of them that shocks a lot of the people out there who are product nerds.Which frankly, I am myself, is that oftentimes in order to turn something that’s going kind of good into something that’s absolutely amazing, is to fix the marketing, not the product, and in particular, fix how many people know about the product. That’s like the big thing. It’s called attention. Say it with me, attention.And so this team at Starter Story, they put together a free guide, they call it the $1 million Attention guide. It’s this pretty amazing 39 page document that’s filled with 15 tactics to get eyeballs on what you are building. And so, there’s a, even a 30 minute recording from Pat, who’s the founder of Starter Store. He has interviewed hundreds and hundreds of entrepreneurs, so he’s able to put this together through a bunch of research and experience. And so if you’re interested in getting more attention, which frankly you should be, everyone should be.Then you should click the link below in the description or scan the QR code right here.
You know, we’re in Tokyo, we buy these domains. Some of the domains are like random domains we’re going to use to like SEO hack, like used Peloton and I, you know, you, you, you name it. Like we’ve had like 50 domains. We’re sort of growth hacking our way into the business even that at that stage. So anyways, then it comes to sort of like fall of, uh, 2019, and we, we’re sort of like, all right, we’re gonna make the plunge. Logan, Logan left his job, started to work on, on what became whatnot, andThe, the early division of labor was sort of like Logan’s gonna build it, and then I’m gonna like do everything else. And so like, all right, we’re on the full service Craigslist. And one of the bits of full service Craigslist was going to be like, we’re going to be able to do deliveries. And so I’m like, all right, let’s go figure out. I, I did like the envelope on, you know, on an app and be like, yeah, maybe they’re they’re there. And then I start calling all the delivery companies. So I go on LinkedIn.And I LinkedIn, all of these people who, um, run delivery businesses, like the guy who runs delivery at Bob’s Discount Furniture, the guy who runs delivery at like all these other companies, and like they take calls with me. I’m like, how much does a delivery cost at scale? And so like, how much is each leg and how efficient is it? And they were nice enough. They, they sort of told me.And with after doing two of those calls like this just doesn’t work, like the cost per delivery relative to the value added on the used item is just, there’s no margin there for the business. They’re like, oh shit, need to find something else to do. And at that point in time, it was Logan. We brought on, um, an engineer already, and then we had half a designer, so the team list is sort of like 3.5 people. Can,
canyou give a little perspective to your financial situation because we have a lot of entrepreneurs who listen, but we have a lot of people who want to start. So like you’re talking about hiring.Uh, people already, did you have funding or did you just have like $100,000 saved up? What was your financial situation to do that?
Yeah, probably, I don’t know, $1000 to $200,000 in the bank, um, not including my 401k.
Did you wire that over to the company and you’re like, All right, now we have $200,000. That’s what we could hire
with check by check, you know, I just sort of go like, I, the, the, the implicit agreement was I’d be willing to spend up to that amount of money doing the business, uh, before we raise money.And so like what we did early on, so our first engineer was actually based in Brazil. It was a guy that Logan used to work with and had known really well, who was, who’s like super talented, butYou know, he’s in Brazil and so it’s, it’s, it’s much more cost effective there. He’s kind of difficult to work with. So he’s, you know, he’s like really talented, but really challenging to work with. So you can get him on the cheap and then you give him some good equity. And then the designer, we just gave him equity. We’re like, do the branding, do all of our designs, we’ll give you equity in the business, which obviously has, has turned out well for, for both of those folks. And so, yeah, we’re, we’re sort of doing that.24 hours into like doing diligence on delivery costs, I’m like, oh shit, we have to change this business. And by the way, they’re building it. So we, we have, um, even to this day, we, we try and have an immense bias to action becauseYou just learn things by doing things. So even if you’re wrong, as long as you’re willing to admit you’re wrong and then change direction, it’s totally fine. So Logan and Gustavo were building the back end, like the order system and some of the front end, and, uh, go, everyone, hey, everyone, I don’t think this idea is gonna work. I’m gonna try and find something else. So like, it’s OK, we can, we got to build a payment system anyway. So as long as we’re doing a marketplace, we’ll keep building. She’s like, all right, yeah, we’ll still do that. And then I was just going around the internet looking for other marketplaces that I thought were really broken.And I kept coming back to, uh, eBay, which is, you know, back in the day I used to sell on Yahoo Auctions and eBay. It was like prepayment processing online. It was Pokemon cards.And um
this boy.
I don’t know if you can see it. Is that the is that the holographic Chancey? It’s a holographic
Chancey.
This is you. You guys did your diligence. I bought
this off you 20 years ago. Our paths crossed. I bought this for $10.
I, I remember that $10 money order. Um, definitely one of those like, uh, making money as the first time when you’re a kid and like something special about that. Yeah. So I kept on, you know, going through marketplaces and we’ll come back to eBay and then like everything that was trending on eBay was collectibles, and I could see all my friends were getting back into the collectibles. And then me and Logan start making trips to all of the comic book shops in LA.And they’re like packed, they’re full of Funko Pops. And so I go, everyone, I got this amazing idea. We’re gonna go and change and build a collectibles marketplace, and let’s focus on Funko Pops, and here’s all of the reasons.
Well, what, what were the reasons? Because the way that you’re describing this is very unsophisticated, and maybe it was that unsophisticated becauseLike, if a normal person, they’d be like, well, eBay seems like they’re doing collectibles pretty good, uh, like the marketplace is, I would imagine, all about liquidity, meaning the perfect amount of buyers and sellers, and there’s stuff there. And so, like, what was the metric or the signal where you said, this is actually attainable, or was it just, I want to build a business, this might work, let’s just see what happens.
It’s probably a little bit of both. Um, the initial sort of data or research we used to inform it was at that point in time, you could pull the sales by every single category on eBay. There’s a tool, I think it’s called Terrapeak, and, uh, we, we went across every single collectibles category and plotted the sales and collectibles through time and how it was growing.And in every one of these categories was like going gangbusters. So there’s clearly a, a broader trend happening in the market. And when you looked at it, then, there were more Funko’s being sold on eBay than comic books, which is one of the reasons we ended up choosing comics, or sorry, Funko’s over, you know, say comics or a bunch of the other categories. It was between Funko and Pokemon were the first two categories.
So there’s demand. People want to buy used Funkos.
Yeah, there’s, there’s huge demand.And then the, the, the sort of taste element of it was, we just felt like the product hadn’t changed in 20 years, materially, and it felt like it should.And when we thought there was something around social, we didn’t really know what it was, but we just sort of felt there was a, with aWith sort of this broader trend in collectibles, which, which was really driven by people our age who had money getting back into things that were nostalgic from childhood.And the fact that there just hadn’t been a lot of innovation in the space that probably should have had more innovation. And we could, we could sort of squint and imagine there’s a much better social experience around this, where you discover new things, where you chat with people that who are into the same things as you.And then we, yeah, we just took a, a leap of faith. When we started the company, one of the things we always said is we’re not a sort of vision driven company, we’re a user-driven company. So we were never beholden to like our idea needing to be like the idea. We were always going to try the thing, make sure, um, we’re building a greatUser experience and if users didn’t love it, we were always always willing to just change. Why do
you think that’s important? Because I think, you know, the media, movies, TV, magazines, they, they love the visionary founder, the one who saw it before anybody else, and it’s sexy as the founder, you also want to be the visionary founder. And the most iconic founders, you know, Steve Jobs was.You know, I would say that was like the attribute that was associated with him was a sort of like taste, you know, people don’t know what they want, but I will see what they want. I, I know what I’ll do. I’ll put 1000 songs in their pocket, that sort of thing. Why do you think it’s important to kind of highlight the otherway?
when we said we were sort of a customer driven versus vision driven company, it didn’t mean that we, we didn’t think there was, wasn’t any value in having an idea for how you want to build the future. You have to know which direction you’re heading in.It was more of this idea though that no matter what it starts and begins with the customer, if you have this amazing idea for something and customers do not want that, you’re dead to rights. And so if you’re thinking about, um, you know, stack ranking these things in terms of like what it, what matters, and what is of greater importance, of course it’s the customer, no matter how great your, your vision is, and I thinkIt’s, you know, one of, one of my lessons that’s been even more solidified from one running whatnot is stories are sort of BS. You know, a lot of stories in terms of like business are, are reallyA mechanism to convince people to follow you, versus something of like real substance, like the things that matter actually have much, much, much more depth to them. And so I think the, you know, the visionary founder just sounds good. What
whatwould be an example of a kind of popular myth, but the, the actual substance is something different? What would be an example?
I’ll give you some in the context of whatnot, where things that just like in the early days, sort of feel better, but actually if you, you dissect these things, um, they sort of work in a different way. So, one of the things like really early on with whatnot was investors were very nervous to invest in a funkel pop company. So there was a point in time when we launched our first live auctions product, and, you know, we’re growing like 100% month over month. And we talked to a lot of the, you know, the well-known investors.And they’re like, Funko’s, I don’t know about that, that’s a small market, you know, investors want to invest in these big giant markets and look at how big Apple is and Google is. But the reality is when you dissect history, all of those companies started in an incredibly small area. And almost every great company starts an incredibly niche or small area, and then takes that and and catapults it forward, because if you’re a 4-person company like we were in the early days,You can’t compete in a mass market. It’s, it’s almost impossible to drive, um, a ton of consumer value in a mass market. So instead, what you have to do is you have to compete in a small market, build a really great user experience for a smaller subset of people, and then expand it. Isn’t
that how eBay alsostarted? Like it wasn’t the first thing where you pay as a sensor, but then wasn’t it like, weren’t they also very niche at the beginning?
They were, they were incredibly niche. I think that the real story from what I’ve gathered from folks, so there’s two, there’s two founding stories there too. One that one is, is allegedly made up for PR, which was the Pez dispenser one. The real one was like the first item sold on eBay was a broken laser pointer sold to a broken laser pointer collector. And, and the PR just didn’t want eBay to be known for like broken junk, um, and, and so, you know, told the Pez dispenser story. But yeah, if you sort of like.There’s a lot of these things that like at first surface value, a thing sounds good, but actually there’s a lot of specificity to doing it right. So you don’t go after big markets, don’t hire big fancy executives, don’t necessarily hire people because they’ve worked at big fancy companies. There’s all these things that sort of at surface level sound good, which, which are actually largely incorrect.
Uh, the PayPal story is kind of like this, right? So you have Elon has his vision for X and he’s like, it’s gonna do.Everything a bank does on the internet, it’s gonna be, uh, you know, uh, lending, it’s gonna be mortgages, it’s gonna be checking accounts, savings accounts, and that’s what the vision was for that.And then here was PayPal, this little tool for eBay sellers, you know, it’s like this kind of the niche within the niche, and he kind of resisted it actually for a little while, and then they finally kind of gave in and it was like, well, that’s what the users, that’s where the demand is. That’s what the users want this war. And like, of course, now PayPal can do a lot more than it did when it started, but it went after that very small market initially and finally rejected the founder vision idea, uh, going in.
Um, there’s always exceptions to the rule, so I, I never.Say, you know, definitively that’s the way to do it, but I can tell you in that every consumer success case that I’m aware of, um, the, the pathway looked like that.
I’m looking at the, uh, March 2020 web archive. I think how, how into the company are you in March 2020?
Uh, it’s like 4 months in.
OK, I’m looking at the website on web archive, looks pretty good, it says, uh, browse fandoms, so I guess that means like different niches of Funko, so you can look at sports, Star Wars, Star Wars, Rick and Morty, and if you click on it, uh, I’m not sure if it will show you, but it looks like you have sellers on there.You’re only 4 or 5 months in, but it looks like a lot of sellers, sellers are on there actually, and it even has staff picks, like you guys are curating some cool ones. How many sellers were actually on there and how did you convince them? And also feel free to admit if there’s any black hat tactics there. There’s a statute of limitations.
Yeah, yeah, yeah,there’s a, yeah, there’s some, um, unique tactics at play. Um, I think by, by March 2020 we probably did have in the hundreds or maybe.Maybe 1000 sellers at that point. So the way we got things going is, so classically with the marketplace, you have a chicken and egg problem. How do you get sellers if you don’t have buyers? How do you get buyers if you don’t have sellers? So the way you solve that is you solve for one side of the equation. And so, we were initially the, the, the seller on whatnot.And so all of the early inventory was, was us. Now, obviously we can’t own 28,000 funkos. So what we did is we would go and authenticate them, and by doing that, that gave us additional value to add to the customer.And then we would, when someone would purchase them, we’d go and buy it from a number of like 100 different stores online. I had like a team of people in Brazil who would help me hunt down the right funggo pops. Oh,
so you they, they, they didn’t exist then. It was just photos of them, and you’re like, but I’ll, I’ll go out and find them, and uh I’ll I’ll.Yeah, I
mean, it was, it was a little more, you know, there’s a little bit more to it than that. So one of the things that we did, I don’t know, there’s like 100,000 fungal pops out there. It’s like an obscene number of Funko Pops. And so you do have to be able to secure them and secure them at a reasonable price and be able to price them at a reasonable price. And so,We ended up having to build like a pricing algorithm. We basically scraped all of the sites that had various Funko Pops, and then looked at the amount of liquidity in each version of the Funko Pop. And based upon like, we’d sort of set a liquidity floor, because if that thing had like one liquidity, you know, one sold over a 90 day period, you’re never going to be able to secure it. I forget what the liquidity floor was now, but let’s just say you had to sell 10 over aA 30 day period. We use the past 10 sales, plus the amount of liquidity per item, to then be able to price it at a reasonable price, such that we could then go and resell it authenticated, and then make sure we could actually secure it, um, from one of thesites.
And then did you buy Google ads for the buyer? Were you buying Google ads or posting on Reddit or something to get the, the buyers?
There’s 22 tactics, um, that we initially used.So tactic number one was we partnered with a bunch of the funko pop influencers on YouTube.So, you know, I can remember in December calling up every funko pop influencer and they’re like, who is this company? I don’t trust you. I found someone that I knew from prior world to to work with, and that was sort of the starting place.So that was tactic number 1. Then tactic number 2 was we built this sort of, um, viral Funko Pop giveaway mechanic in the app. So if you’re into collecting anything, the thing that you most want to collect are like the grails or the chases. So if you’re into sports card, maybe, maybe that’s, um, you know, rookie, Topps Chrome, LeBron. If you’re into Funko, maybe that’s like the Tony the Tiger flocked Funko.And what we would do is once a week, we’d give away like a $500 1000 dollars Funko Pop. And in order to be able to enter, you would have to share it.And, and we sort of built these mechanics where you could sort of have like unlimited sharing. So someone could sign up with your referral link, someone could sign up with your code, um, you could share it on Twitter, you could share it on Instagram, and each time someone used your link or your code, they would get an extra ticket in the raffle. So it gave this like, it it it sort of, um, encouraged everyone who wanted to win it, to share it with everyone that they knew and keep on sharing it. And so we basically took over.All the funko pop, subreddits, Facebook groups.Uh, etc. because we were giving away the beststuff.
This is basically stuff, like, this is gritty internet entrepreneurship stuff that everyone, Sean and me, everyone listening who has an internet business, everyone has done something where it’s like, uh, we’re just gonna like do this and do this, and maybe I won’t want to tell everyone, like 10 years looking back, so it’s really cool to see that that was only 6 years ago, now you’re worth $20 billion.
It even extends, uh, we had Mike Posner, the music artist who did I Took a Pill in Ibiza on.And, uh, he’s, he, you know, I think a lot of people didn’t even listen to the episode because it’s like, oh, it’s like a musical artist on our business show. But he had this amazing story that was just like any other entrepreneur where he was in college when he was trying to be an artist. So he realized he could post onto, he wanted to be on, on the top of the charts of iTunes, but that’s where like, you know, Jay-Z and Rihanna, whoever were at the top, he realized iTunes had an iTunes you section for like college lectures.So, he’s a student, so he called the guy, he hustled to find the guy who like controls that board. He’s like, I’m a student. Can I upload audio to that? And he became the number one on iTunes U. Then he emailed all these campuses being like, I’m number one on iTunes, parentheses you. You know, people didn’t, people didn’t realize the distinction. He got booked for, for gigs, and then he had all his friends at other colleges and, in, in fraternities. He was in a fraternity, so he said, great. Everyone in the, the same fraternity in every college, on this day, change your profile picture to this picture.Just to create some mystery, like, what is that? And then people went and hunted down that, oh, it’s about this album release, and that was the start of his music career. He growth hacked his way to success there too. And I love these stories. As a founder, like,You know, uh, the front door is not the, not always the only way in.
Yeah, well, my, my theory has always been the same, which is if you try and copy the obvious pathways, you’re basically going to get stonewalled, because you don’t have the resources. In the early days, everyone wants to spend a ton of money on paid ads.You know, we spent virtually no money on paid ads in the early days. It was never going to be an effective acquisition channel for us. We spend an obscene amount of money on paid ads today. But you have to get your way there. And in each step of the way, you know, sort of unlocks new and interesting things. But I do think in the early days, you have to find unique advantages that, um, other people aren’t going to.Be able to leverage.
Do you remember whenyou first started doing the grails giveaway, because, you know, some part of you has got to be nervous. You’re giving away things that are worth thousands of dollars. Did it work right away? Did it take, uh, you know, a few tries, I guess. Do you remember the math? The first time it worked, were you like, holy shit, we just, this is like 10 cents a user or whatever, you know, like, can you take us back?
Yeah, I, I do remember the first, the first one was definitely a flop. So we avoid this like $500 item, and I think 104 people, there were 104 entries total in the raffle.You know, maybe that’s like 30 or 40 accounts or something like that, and no one purchased anything. You’re like, uh oh, and we didn’t have, we, we had like, you know, no money for the business back then. It was like all coming out of my bank account. So, like, oh, this is painful, and I’m not working. So like, you know, the bank account’s dwindling at that point.Yeah, I, I think there’s, there’s always just a sweet spot between when do you know a thing is actually, when have you proven a thing wrong, that it’s not going to work, and when have you given it enough legs to make it work. And so,For us, it was like, OK, well, now we have all those accounts who joined and we can send a push notification. And when we do the next one, and then the next one, they’re going to be encouraged to share out to more people. And so, if we can see that in the next one, we can go from like 100 to 300, maybe there’s a pathway there. And so I think I, I forget what the, the, the second one is, 250 sort of rings to mind. So maybe it wasn’t exactly 3X, but it’s 2.5X.And so you started to get this like exponential on it, and then you can sort of make the math work.
Was the number of sellers like the metric where you’re like, we need more sellers, more sellers, more sellers. Well,
back then, um, it was just us as the seller. And what we were trying to do is we’re trying to build the buyer base, because we couldn’t add any seller other than us, because no one was going to purchase anything.Uh, from any of the new sellers, and they weren’t going to stick around. And so the early days were about, was about getting enough demand on the platform, such that we could open up selling. And so I think we, you know, we, we launched the platform I think December 2019, was when we launched our app. And then we didn’t open it up to our first seller until I think towards the end of February, was when we started to have enough.Demand in the marketplace. And even then, we, we did another hack, which was anytime a seller would come on, whatnot, they’d get our audience, and then we figured out a way to cross-list it across other marketplaces.Using our whatnot account. Got you. And so,
which is like another classic thing, right? That’s what Airbnb did. That’s what a lot of people did. That’s what I did when I had a miniature marketplace you post on Craigslist.
Yeah, and so between our demand plus the demand for other marketplaces, we got to a place where we were able to, uh, retain sellers and then slowly get that flywheel spinning. And
it probably didn’t take a lot. It’s probably like if you just get a sale within the 1st 10 hours or days.You’ll stick around, is it? Did you find some metric like that?
I, I think our data was too sparse, and we were just like, I don’t know, let’s just try and get them as many sales as we can so that people stick around. It took us a long time to get the precision around the metrics that mattered and retained and kept people coming back. We definitely weren’t that sophisticatedback then.
How many transactions happened in the 1st 12 months?Uh, and did that account for any meaningful revenue to you guys at all?
So sort of the, the, the journey for us was December 2019, we started it, and I bet you we did.30 sales.You know, like, pretty, pretty, pretty grim numbers.
exciting. What a day. That’s exciting.
Yeah, but, so most, so the way it actually went was the 1st, 1st week of December, which was the first time we were all full time on what, uh, was like one sale, and the second week of December was.One sale. And then I managed to like work with a funko pop influencer the third week of December, and then we got like 30 sales, something like that. And a bunch of them we priced incorrectly. So there’s like a bunch of the sales were people finding mispricings in our algorithm and taking us to the cleaners, bounty hunter. Yeah, it was, it’s like selling a $500 funko pop for $150 because the liquidity bit of the equation wasn’t very good. So that, that was, that was December. And then.We in July of.2020 is when we launched our first version of Alive.And, and that’s when the business really started.
Where did that insight come from? Because it sounds like the insight for Funko came from looking at data and trends on eBay. Where did they, the second big insight, which was live selling, where did that come from?
So,We, when we first started the business, uh, in January, went through Y Combinator. So we initially, originally we were in LA and went up to San Francisco to go to Y Combinator.And we thought we were doing well, the business was growing, etc. And then we went to fundraise in the middle of COVID as a funko pop marketplace.You’re like, everyone hated our business.
They were, they were very smart, to be honest, um.And they bet on us many times throughout our journey. Like when the business started to take off, they were like tremendously helpful and helped put in more money into the business ahead of when many of the other investors who you would know their names, um, were passing. The thing we were really good at and are, are still pretty good at is we’re, we have pretty good taste.And we know how to execute.Um, and so if ever we said we were going to do a thing, we did the thing. But
that firstYC interview is 15 minutes. What could you have shown them in the 1st 15 minutes?
I don’t know, I just flip a coin, you know, we, we, we, we, we had pretty good backgrounds relative to like what we were doing.
Wait, that’s a funny line. We had good backgrounds relative, meaning like, there’s no way someone this smart is working on something so silly. Surely that’s a sign.
Uh, well, I guess like Logan, um.I was like running engineer running engineering at like pretty large resale marketplaces. Um, I worked at Facebook. I worked at YouTube, so like, you know, we, I’d started a company before I got Aqua hired we weren’t like hugely known commodities but clearly had a background for doing things. We built our product.For the YSC interview in like a week. Like we built it and launched it and pushed it live, so that we had something and could like talk about real stuff that we had done. So yeah, we just went all
in. You want to hear, read my, uh, hear my notes from that I, I just found my my notes.From when I talked to Grant and I was looking at investing. By the way, this is my, this is my personal notes. So no, no, no insultant attend. I go, looks like a soccer dad. Quiet intensity, humble confidence. He seems like a serious person who’s actually doing this. I don’t know. Those are my, those are my things that I wrote. I love the ending. I wrote winter energy, we should invest.
Soccer dad, huh?
He only heard one thing. I knew he would only hear the one thing. Get him, Grant. Don’t
that. But dude, here’s what’s the reason why I’m being kind of naggy about timelines is because you’re describing being like,My bank’s dwindling. I’m just trying to make this work. We only got 30 transactions, uh, in the first month. But what’s insane is that I think it’s something like 20 months later, you raised money at a billion dollars evaluation. Is that right?That’s probably about right, yeah. So, like, the rate of the rate of growth is, is astounding here. Do you remember how much funding did you raise and how many employees did you have at the time?
So we came out of YC, we raised probably $250,000 out of YC, um, maybe a little bit less. It was a bunch of people whoknew me and felt bad for me and like maybe they were like scalp checks and some stuff like that.So, uh, you know, I think we had a few $100,000 in the bank and we wereAt that point, we, we brought in one more engineer, and then.Before our seed round, we probably got to like 6.5 folks. So March when we came out of YC we did probably $200,000 to $25,000 in sales, total, total transaction volume.Then we did our seed round.In, I want to say like August or September, that was sort of like the business started to inflect when we, when we launched live, like growth went to like 100+% month over month and probably in September.We did 250,000 to 300,000 in sales, like 10x
our takes probably like 10% of that then.You know, continue to inflect up. By December of2020, we sort of ended the year at $2.3 million in total sales.And the number of employees in the business would have been.I think about 17 or 18.Then we closed the following year, at, um.168 million,
2 million to 100, 100 million plus
163 million, and we would have closed that year at about 100 employees. So 10 employees 2 and then, so.Um, the following year, we did a billion dollars in sales.
What happened? How did you go from 2 million to 163, 163 to a billion? What happened?
The core live experience we built, this is really fun.And it ends on the seller side.Uh, you know, transformational for business building. And so if you’re a seller, what was happening to you was, you were very quickly starting on whatnot, and, and again, it’s not for everyone, but for, you know, a lot of the people who invested deeply and, and, and, and tried to build a really large business.Um, whatnot was a bigger channel than anything else you’ve done.And, and that was that was also a time like this is during COVID, and so you’d have people like, hey, I had a comic book shop and people stopped coming in. Now I’m on whatnot.And my comic book shop is doing more sales and whatnot than, than it ever did in a physical brick and mortar shop. I’m closing down my brick andmortar shop.
You had the COVID forces everything online, but then you had the benefit of, if I’m a, if I’m selling a niche thing, I’m gonna find more buyers when I use the, the sea of the internet versus just whoever’s in a five-mile radius, 10 mile radius of wherever my shop is. So that helped for sure, in that first year.
Yeah, I mean, COVID definitely helped, but, you know, our business has continued to do, you know, incredibly well throughout COVID. So I think, anyways, the core value is there, and then I think we, we had a really good team. It’s like the first.30 people we hired and whatnot are lights out good. And we knew, we figured out how to, like the big unlock was sort of how to, how do you launch multiple categories and what is the mechanism for doing that fast. And as you start to launch multiple categories on marketplace, people in each one of those categories start to cross-pollinate.And everything that you had working in one category sort of compounds across all the categories.
What did you have to change about your personality to grow because you went from being a very scrappy guy doing everything to being the CEO of a company that’s worth a billion dollars+ dollars. What had to, that you’ve just compressed a lot of personal growth in a very short amount of time, I’d imagine.
I, I think probably people overemphasize the like.Um, I need to change because I’m a leader of a large organization, because I think they look at certain models of what success looks like at really large companies, and those are sort of like stoic, slightly stilted people who operate in a corporate manner.And you know, there are, there are definitely things that you have to learn and adjust as you go.But I would say I actually just generally try and be me. And, you know, the, the nuances to that, of course, there are, and by the way, I had to learn this. I, I thought I would have to change more. Like I think one of, one of the mistakes we made early on in the business was just trying to be, you know, too corporate for lack of a better word, which is like hire some executives from well-known companies, hire people from well-known companies. And it’s sort of like one of those things where the story sounds good, but the reality is, is often, um, you know, a lot different.Cause you, you’d sort of go like, oh, you ran such and such at this big company, you must know what you’re doing. AndThat’s actually turns out to be like broadly incorrect. Like, no, someone needs to know and be able to sort of articulate in specific detail what what they’re doing and how they’re doing it. So one of, one of the biggest lesson that I’ve learned through the history of, of whatnot is to just be really maniacally focused on what the problems and opportunities are, and don’t let anyone necessarily tell me what the right pathway is into those problems becauseRunning, whatnot, I, I tend to have a much, and my team has a much better grasp of what the nuance and context around those things is. And so be focused on what we’re trying to achieve, and then be really, really nimble around how to achieve it, as long as we know the details around it. OK, now back to your question, what do I have to learn and change?So one was actually not to change too much, because actually we’re pretty good at what we do. There’s a real, you know, again, we got really lucky, but, you know, there’s also a reason we were able to take advantage of the luck. Then the things that I had to personally adjust is, you know, the company’s 1400 people today as an example. And you do need really good systems and process to run a company at this scale.And so you have to learn how to, like, you know, one of the products you end up building is, you know, I call it my operating system. How do I run the company to make sure that we’re moving in the right direction. We’re making good decisions, and we’re executing at a really fast pace. So I had to learn how to like construct an operating rhythm across the business. There were certain points in time in the business where the accountability wasn’t high enough, growth drifted, people’s focus drifted, and we had to like fix that. We’re a pretty straightforward group of people.Um, we always have been, like if you went into the early slack of whatnot, when someone did bad work, we’re like, you did bad work, this is bad. Let’s fix it. And as you get bigger, the people, you know, 400 people or whatnot, there’s a bunch of people who sort of like know me as like the person on Zoom they’ve seen in like a, uh, a team meeting and like a, a title that would scare people. And so I’ve had to soften my approach to try and get the best out of people. And again, because, oh, we always want to get the best out of people, you want to get the best work.You know, what would have worked in the early days, be like, yo, this sucks. We got to do better. Someone might cry today if I do that. We don’t want anyone to cry. Um, and so you, you just sort of have to like know how to flex a little. Again, you don’t want to be dishonest and you don’t want to be like this fake person, but you have to know how to flex, get the best out of people. I think those are probably my, my biggest things is just like be maniacally focused on the problem, be, be conscious of the context andAround how other people are going to view things and, and adjust that to make sure you’re getting the best out of people in the company. There’s so much corporate gobbledygook from people.I think most of it’s bullshit. It’s all about like, what’s your problem? How do you solve your problem, how do you do it in the best way.
You, you, we’ve kind of coined this term, we call it like. Like if you read Warren Buffett’s book.You learn that, uh, even though he has this attitude that he, uh, this image that he’s like, oh, I just, you know, I just hold forever and I just buy good companies, and you’re like, oh, anyone can do it. And then you read about them and you’re like, oh well, you were a math prodigy at a very young age, and you’ve been like, you’re just super high IQ and patient, and you have this beautiful temperament.With you, you have that same thing where you sort of are like, you kind of have this Canadian Midwestern energy where you’re like, you know, we’re just, I think we just made decent decisions and we got a little bit lucky, and then, but the reality is, is that there’s like personality traits or something underneath there that is like world class, and it’s very clear you have that. What would you say your reports would say or investors would say this guy’s world class atblank?
I think one of the, coming back to like my distaste in stories.One of the, one of the faults in human behavior is people tend to follow stories and they tend to follow other human beings. One of the things that I consider myself lucky with is I’ve, I’ve obviously learned a tremendous amount over 6.5 years.But I, I was put in this situation and there will be plenty of other people if they were put in the right set of situations would be able to learn. So that’s, you know, the luck element. The things that I, I think we’re, we’re pretty good at areGetting to the root. So when you, like, what is actually happening here and how do we know? So seeking the truth maybe is a is a is a simple form. And so, one of the things that always breaks at whatnot is our discovery systems. As the company grows and grows and grows, you get more and more supply and and you’re balancing all sorts of like competing objectives. You got to make comic books succeed, and you got to make women’s fashion succeed, you got to make fresh food succeed, and you got to make the UK succeed, and we have this feed that recommends people all of these things.And our discovery team is very studious. They’ll go really deep in the data, they’ll AB test a bunch of things. I’ll see something, a metric go down the business, and I’m like, uh, this looks like a discovery problem. I’ve seen this before. I’ll talk to the team, team like, no, we tested it. We know exactly what’s happening. I’m like, no, how do you know exactly what’s happening? Walk me through every little thing in the system.So what’s happening to this seller? Have you gone and looked at every individual seller, how impressions have changed for that seller, how that’s happened across category, how it’s happened across country, how many lost this much in impressions, how many gained this many? Because just because the AB test as an example, so AB tests are notoriously bad on network systems. So if you like AB test a thing, you change the feed, um, which means you change what users see.And then people will all of a sudden start to go into different streams. You know, as they start to go into different streams, the sellers will behave in different ways, which means you pollute both sides of your AB test as an example. You know, there’s an example where we start going through all of this andYou know, we, we sort of get to the bottom, we dissect every bit of, bit of seller behavior and like, OK, well, you know, maybe these sellers, their discovery changed a little bit, but these ones increased and increased engagement. I’m like, well, I’m looking at the metrics. The metrics say everything went down on a macro level, even if it’s not in your AB test. How do you actually know that? Then we plot the elasticity curves of those sellers. We actually see that there are certain parts of the platform where if youUm, even if you improve buyer engagement, if you take away certain impressions from certain sellers, their businesses shrink more than the engagement drop increases it. And so you have to look at these things on much larger time horizons and in different ways. And so, you know, the classic way someone would approach that problem, particularly like a lot of the ranking companies are like social media companies that look at near term engagement. And you go, OK, of course you’re right, you’ve done this before. You’ve worked at Facebook and Google and wherever.And I would go like, I don’t think, how do you actually know that? Everything’s a little bit different. Let’s go all the way to the bottom. And then we unearth like an incredible insight that will shape our discovery systems for the future. So that would be like the example of like, just going immensely deep into the problem. I love how
like 2 minutes ago you were like, business is not that complicated. And then you’re like, so we have, you know, our sellers in our fresh food department, so we plotted the elasticity curve, you know, it’s like, yeah, yeah, yeah, yeah, super simple. Me and you, we do the same thing. Yeah, it’s great.
You, you sort of answered the question in a way where your answer is probably true. You are world class at that, but the real answer is the way that you answered it. You’re just, I think you are very smart and more so, your rate of learning seems very, very, very high.
Yeah, look, you, you do have to learn fast, but even, even what I just described to you, if you whittle it down to simple components, all, all elasticity curves is, is like, what happens to a seller when you increase their viewership and then you decrease their viewership? How much does their business grow or shrink?And that’s like, you know, if you’re, if you’re running a platform where you have a feed and you’re sort of directing traffic around things, it’s probably a thing you should know. And it’s, it’s just, it sounds more complicated to use elasticity, but actually like, how much do businesses grow and shrink subject to the number of buyers that you throw in there, put in their feed. One of the things that tends to happen, you know, we hire all these smart people intact, there’s all these like smart people. They went to like all these fancy schools andWhat have you. And they like to be smart. They like to sound smart, so they use big words and, and the big words will just like obscure a bunch of things. And so my job oftentimes is to try and get to like the simple set of truth around things. What is a simple set of things? What do we know and how do we know it?And so if you start to use a bunch of fancy words, I’m going to make you explain it to you like I’m in, you know, uh, in middle school. And if you can’t explain it to me like I’m in middle school, you probably actually don’t know what you’re talking about. And I just will keep going and going and going and going and going until it can beexplained.
Uh, I love that. I, when I, so we got acquired by Twitch and I got to be at Twitch for a couple, uh, 2 years, and, uh, you know, I didn’t.I, I probably learned, uh, many things, some things not to do in the company, some things, you know, to do, but one of the most important to dos was Emmett was like this. He would sit in these meetings and, you know, a team would come in and they would say something and he would ask them this, is that, well, what do you mean? How do we know that? What does that mean? So no, what, what exactly did we do? Why, why do we think that that was the right thing to do? Very simple questions, questions that, you know, uh, uh, at a 2nd grade reading level.And then the answer would come back at a PhD level, then he would bring them back down. No, no, no, hold on, hold on, hold on, let’s.Walk me through this. And then by the, you know, within 15 minutes, they’ve sort of been undressed. You can realize they don’t know, they themselves don’t know what the hell they’re talking about. They weren’t trying to mislead. They just didn’t really themselves get to the root of it. Um, and everybody was taking things at face value and it was leading to bad decisions.I loved it. I was like, this is amazing. This is like, this is finally like, you know, the, the, the best work is happening in those sessions. Most people in the company hated it. And they used to give them feedback all the time that this sort of Socratic method of, of sort of debating, almost like semantics and getting down to like the the base level of things like talking in binary, basically.
I do that with my wife. I’m like, were you thinking of me when you made this meal? Because you know, I don’t like zucchini.
No, I just want to know.Uh, but I, I, anyways, I loved it and I, it almost gave me, I, I like that you said it here because when I saw him doing that, and in a way gave me permission that like, I didn’t really fully do before that, meaning, A, I didn’t want to be a jerk, but B, I didn’t want to be an idiot. I hired all these smart people. They’re telling me things that sound smart. Maybe I shouldn’t get caught up trying to like,Get, you know, base level understanding of this myself. And what I realized was, no, no, no, that was actually a very good value, uh, virtue to have inside of a company. And when people knew that, they showed up very differently to every meeting after the first few times that it happens.
Yeah, I think, um, one of the, one of the things that we’ve tried to do here is.We try really hard for the culture to be about getting to the right answer.And so if we find people sort of recoil from that, we’ll give them feedback. And when I hire executives, they, I will let them know upfront, they’re not beyond reproach. Their, their methods are at best sort of neutral when they come in. And so we’ve, we’ve sort of built this team now who likes that way of working, who’s given permission to work and seek the truth and go to the bottom.And I think that’s been, I think if you don’t have probably both of those, it doesn’t work. Well, now, that’s a challenge of what we’re hiring, I don’t know we have like 500 people this year or something, you know, keeping up with that. But if you look at like my team of people, my team, I’ve been working with most of my team for 4+ years now.And then most of their teams are pretty similar. And so you get like a really nice, no, this is how we do things here. This isn’t meant to be mean, this isn’t meant to like understand the truth, cause it’s quite unnatural to be challenged at that level of detail. Hey,
can I ask you about that challenge becauseI, I, there’s two phrases and words that I really dislike. One is first principles and two is contrarian, because typically the people who talk about that stuff are either kind of dumb or they’re smart, but they’re an asshole when they deliver it. You seem smart and you seem like a pretty kind, likable guy.Was there a person or a book or something that inspired you to be disagreeable, but not rude, because it’s quite challenging.
I think for for me, what I always try to do is imagine myself in someone else’s shoes.And imagine when I had certain stuff like this, you know, happen to me.And what would enable me to do my best work, and I’m not saying I’m perfect at this. There are definitely times where IAnd not as nice, and where I will, you know, you know, sort of be at the end of my, my level of patience. I, I try to make it few and far between, but it happens. One of the examples that sticks with me for a, a lot, for a while is, and it’s actually one of the reasons I ended up leaving Facebook.I was in, uh, this big product review with a bunch of very well-known and very senior people.And there was the thing I was bringing to a product review was, was a project that I unfortunately got stuck on, I did not want to work on.And it was one of the most politicized projects.Across the entire business.And you know, I put together this thing and I spent boatloads of time because all these freaking VPs would never agree with anyone. It was just me running in circles like this.And you get to the review and the guy who’s running the interview basically just starts yelling at everyone.And I’m like, you know what, I’ve been up the past couple of weeks till past midnight.And I work like hell on this. And no matter who you gave this thing to, it was gonna be an absolute cluster.You know, now running my own large organization, I see what he did wrong. I know what I would do differently. But the way that was handled was never going to make me want to do more great work. And so I basically, at the end of that, I was like, I’m out of here. I’m not dealing with this.And, and so I just think about ultimately what you want to do is you want to get good work out of your organization.And being mean, nasty, or combative.We’ll almost never doit.
I know that you don’t, uh, you kind of said you don’t like talking about numbers because you’re like, there’s still a lot to do. But of all the people who have done business, which is like billions of people, there’s probably only like 3 or 4 or 500 who are worth over a billion dollars below the age of 40, and you’re one of them. I think you’re worth like 2 or $3 billion.Surely there’s been a moment where you’re like, this is pretty awesome. Have you had a moment like that?
From, from, from time to time.It’s, it’s nice to, to reap some of the rewards of what’s been built. You know, it’s really nice to be able to take care of my family and take care of my family properly. And yeah, look, I’m, it’s, it’s not lost on me that, that like, in 6.5 years, we’ve been able to build something, you know, pretty massive. Millions of people build businesses or, you know, hundreds of thousands of people build businesses and whatnot, making billions of dollars, you know, 1400 people and whatnot. A lot of people have been there for the entire journey. Um, yeah, I think, you know, it feels good.But also, I think we still have a lot that we want to do. And, and again, I, I sort of, you know, you get a little, I, I don’t want to get complacent. And so from time to time I’ll have a, you know, I’ll reflect for about 5 minutes and be like, wow, this is pretty insane. But then, you know, I’mI’m in my thirties still. There’s 1400 people who came to work at whatnot that I have high accountability for, raised $1.5 billion from investors who we have high accountability for. And so, um, you know, it doesn’t do me any good, patting myself on the back. That doesn’t get me to the next step. Sam,
I’m gonnastart saying that I take care of my family. I take care of my family properly.I’ll let you figure out what properly means. I’m just going to start using that ever. I, I, I, I enjoyed that one. That was good. You said, you had a good quote. You said, if you think you’re moving fast, you’re probably not. What, what do you mean bythat?
Yeah, almost everyone who says they’re moving fast is moving slow, if I’m being honest. If you have to talk about it, you’re moving too, you’re moving too slow. If you don’t even have time to think about it, you’re moving too slow. And, and frankly, you can always move faster.
Hey, what’s the weirdest trend of, uh, thing that’s, that people are buying and selling and whatnot that, you know, an average person wouldn’t even, wouldn’t even realize there’s a craze going on or a behavior that, that you’ve seen on there.
Yeah, I mean, it’s probably the most popular thing this year.I thought the parents probably know about it is like Neos and squishy toys. I don’t know if you guys have younger kids, you know, you brought up some of the other ones that I think are really fun, like just people selling crab and
meat. I think there’s like people selling gold bars, aren’t there? Like miners selling bars.
Yeah, bars of silver, bars of gold, um, like, who, you know, like
from the mine, like who, who, what’s
happening? I mean, the, you know, huge range, um, could be anywhere from like a coin shop to, you know, there are, there are like mints that like mint coins and
gold cutting out the middleman and just selling direct on whatnot. Is that the kind of the idea?
Uh, yeah, some, some of them are. Do
you think there’s an opportunity, like, you know, with Twitch, for example, people built stream labs, they built other like tools and, and companies on top to service the ecosystem that you weren’t, that the platform wasn’t going to build. What do you think is, is a kind of good tool or business that somebody could be doing on top of the, the growth of whatnot?
Yeah, I mean, I think so. So stepping back on like a macro level, I think you’re going to see over the next decade that live commerce will be 30+% of all e-commerce. It means there’s just like an absolutely enormous market. What is it today?
mean you take the top three biggest players in the market across like US and Europe, you’re probably around 30 billion, something, something like that.
Sorry, but just to show the, the percent you said it’s going to be 30%, that means it’s currently, it’s currently at what, like how much room do you think
there is single, single digit percentages.
So it’s got a 5X from here at least.
I, I, I think 2030.30x plus. And the comp is sort of like what’s happened in China and Asia. So in Asia, it’s in China, it’s about 40% of e-commerce. And, and if you looked at, you know, the growth of whatnot, the engagement of the platform, sort of looked like it’s headed that towards that direction. And so, you know, that’s, that’s a market in the hundreds and hundreds, if not, you know, a $1 trillion into the future if you go outside of China. And so there’s just going to be a, there will be a ton of opportunity. So.The biggest live shopping businesses are going to like the people who are selling are going to do.a billion dollars plus in in revenue. Like our, our biggest seller probably does a couple $100 million.
Did you say your biggest seller is doing 9 figures?
Well, well over, yeah.Many multiple nine-figure sellers.Selling what? Collectibles, you know, we have brands doing 10s of millions, 100 million in fashion,
but are these like, um, these are not individuals, these are just like large companies or what, what is, what’s going on? Like, I guess give us a hero story.
The best, it’s probably like the, the biggest are people who probably started as like individuals, or maybe like 2 or 3 on whatnot, and just took advantage and grew it. So like the, the, the biggest operation that I can think of started initially as like 3 or 43 or 4 people. It’s now probably 150 to 200 people, almost completely built on whatnot. And they’re just like really savvy business people who sort of jumped on the, the live, um, shopping train.Um, and build a really large business. And so if you, you know, if you sort of imagine a future where there’s5, you know, 3 to $400 billion in sales in the US off of live, there’s going to be an immense number of, of really large businesses built. And the biggest sellers in, in China will do a billion dollars plus a year, as, as just like an example.Um, then there’s, there’s a bunch of peripheral services around there. So one of the things we’re starting to see is, um, like wholesale marketplaces directly supply, supplying our sellers is a really big opportunity because they need a lot of inventory. Um, I’ve, I’ve definitely seen a couple of wholesale marketplaces get pretty substantial fundraises.And, uh, I know a huge chunk of that growth is off the back of whatnot as an example. So I think there’s, there’s a lot of opportunity around helping these people source really great supply. And then you’re sort of starting to see what they call MCNs around this stuff. So multi-channel networks, which is a bunch of people who specialize in helping people run their, their live shopping businesses. So I think all three of those will, will probably see a proliferation over the next decade.
This is nuts. I, you’re just a killer. I, I didn’t realize I knew what whatnot was. I’ve, I’ve used it. I did not, I guess I, I saw the numbers, but it’s kind of like now that I see what you’re saying, I’m like.This is insane. This is so much better like originally when Sean first told me about this, I had the reaction I imagine a lot of people did, which is like, this is silly, this is small, this, this is nothing, uh, like a, like a multi tens of billions of dollar company, but this is insane. And I understand why you have helped to lead it there.
Sam, you should start, you should start, start your denim shop on whatnot.
Yeah, I buy, um, I buy a ton of, I, I’m an eBay power user, I buy a ton of, uh, I, I collect old denim, it’s very weird, but, uh, I guess I gotta start using whatnot.
Uh, it’s a, it’s a popular, popular, uh, segment.
Do you have any hobbies? Do you, do you like any weird stuff now that you, uh, see all these other weird things that people buy and sell, do you have any, uh, interesting hobbies? I mean,
I still collect things, but you know, nothing like obscene. I’ve sort of been collecting type one photos, which are like original photographs. Um, uh, that’s probably one thing I’ve been purchasing most recently. And then other than that, my hobbies are, are pretty, pretty tame. I’m Canadian, so I still play hockey.
Sean, you had a good read on him, man.Winter Energy,
I told you.
thanks for coming on, man. This is fun.
Yeah, thank you guys for having me. It was a really fun conversation. You guys made it, made it super fun.
Well, thank you. We appreciate you. That’s it. That’s the pod.
