Two Millionaires on the Worst Mistakes They Made Early

All right, it's a new year, but it's the

same old us. And we wanted to do

something for you guys. So, we wanted to

do a mailbag of fan questions. So,

people have written in questions. We are

going to answer them. You ready to jump

in, Sam?

>> Yeah.

>> All right. Here we go. Question number

one. What is the biggest mistake you've

made in your business that you have not

spoken about publicly yet? And how has

it shaped your decision making? Man,

I've got a great one for this. Tell me

if your experience has been with this.

So, I tend to hire ambitious young

people and I take chances on them. And I

hate to say it, but the majority of the

time that is a horrible plan. And it's

significantly better to hire more

experienced people and pay them a lot

more money and I get way better results.

>> So, uh, when was this mistake? Is this

like I've been making this mistake

forever or this is forever?

>> Man, look, this is like my mistake. It's

like the American dream, you know, like

give me your your your broken, your

weak, and your and your like ambitious

young

>> I can fix him.

>> Yes. And like I always want to do that

because I'm so, you know, I'm into the

romantic idea of that and just I uh

recently, you know, uh at our at

Hampton, we've hired like significantly

more experienced people and they cost

like two or three times more than a

young and upcoming person, but the

results are like five or 10 times

better, right? and and and I just make

this I always in my I get so emotional

and I always find the people say hire

high agency people or hire these people

whose growth rate is really high but in

general it's just kind of better to say

hey you already did this at this other

company do do it here please

>> so we were just going through a hiring

process I wanted to hire somebody on my

content team and um we found this kid

who was great and he sent in this like

wonderful video like he made this video

application that was super funny and it

was well done and I was like yes this is

my kind of guy young green yeah he used

to do this you know he just graduated

but like this video is amazing I got to

talk to this guy talked to him I like

him good dude and right before we hired

him you know we asked a very simple

question which is like so we want this

to go well right we want this to be

great and we want this to work and so

like does it make sense to just go with

somebody who has never done anything

even remotely like this or are there

people in the world who have done very

similar things that we could go talk to

first and should we not like lean in

that direction and as soon as we had

that like very simple sanity check cuz

I'm like you I fall in love with the the

sort of angel investing in people idea

it's like the like the raw upandcomer

never done anything found this diamond

in the rough why do I like that it's not

for generous reasons it's cuz it's like

I feel cool that I found that thing

right it's like finding a needle in a

hay stack the diamond in the rough. Um,

but that's in it is like I have such a

low hit rate with that, right? By

definition, you're going to have a low

hit rate with that strategy. And if it

matters and if there are people who have

done it before that are way more proven

in this category, like why are you not

going in that direction? So, I've

definitely had that that same mistake

sometimes. It can work. And when it does

work, it's the best story. It's the

best. But like check this out. This

strategy that I've been doing, it's been

working well. So, I love hiring

consultants and agencies, but I'll say,

"I'm only going to hire you for 2

months, and I'm going to you're going to

do the work for the first 30 days, but

then the second 30 days, it's just you

teaching me what to do." Uh, and so I

have found experience of like getting

like a young, ambitious, high agency,

green person and teaming them up with an

agency, and I have had some results with

that. But in general, just hiring more

experienced people and paying them more

money, it's just typically the way to

go. And that sounds so duh, but I that's

the biggest mistake that I've made.

>> Well, most of business is just figuring

out what are your own leaks in your

bucket. And then of course to other

people who don't have that leak, they're

like what I mean obvious, right? But you

have to know what are my biases and and

in your case your biases are like I like

to be cheap as hell when I build my

companies. This was like how you were

before with the hustle at least. It's

like,

>> of course,

>> get the cheap office, put the, you know,

get the free desk off Craigslist. You

know, our dog will be security and, you

know, like you're like, I'm going to

build this the frugal way. And then

secondly,

>> what if I found a guy like me, just a

lovable [ __ ] who could be fixed? And

it's like, you know, so those are biases

that would lead you too far in that

direction. It's not to say you never

hire a junior person, but too often

defaulting to that. And so you got to

know your bone biases.

>> What about yours? Do you have one? I

wrote project selection. So my the my

theory is this. If you are hardworking

and you are sufficiently talented, then

the only variable that matters is

project what project you pick to work

on, right? Because if you're going to

work really hard on it and you're

talented, then either you're going to be

a 10 out of 10 person working on a two

on a two out of 10 opportunity or a 10

out of 10 person working on a 10 out of

10 opportunity. And uh I think I have

picked some real dog [ __ ] projects in

the past. So, I tried to start a sushi

restaurant chain, which like restaurants

are one of the worst businesses. Sushi

would be one of the worst types of

restaurants to do. And by the way, that

makes no sense for me as a person to do.

The second one, I tried to make the next

hit social media app. I tried to make

the next Twitter, the next, you know,

Facebook, the next Snapchat, and I spent

six years going after that as a project

to select. And God, that is hard to do.

>> You try to make a hit social media app,

which frankly, you don't really use

social media. used Twitter, but like

seldomly to be honest, even though

you're good at it. And two, you

eventually made a streaming video game

like or that's who your market was.

Neither of us know or play video games

or like streaming

>> or had ever streamed a video game in my

life, dude. I made a I made a craft beer

app for craft beer enthusiasts. Dude, I

can't spell beer. Like, you know, like

beer is gross. It makes me burp. I don't

know. Like, I don't like it. So, I just

picked all these terrible projects that

were bad founder fit,

>> just weak mark market opportunities in

general, right? So, this is like very uh

very poor projects. I started my

e-commerce brand is a clothing brand.

You've seen

>> clothing. You love clothes.

>> You've seen me dress.

>> You know what I'm doing? And that one

worked, but it's such a grind cuz ecom

and fashion and apparel and inventory.

It's like, dude, one of the like worst

projects you can select. I think I've

been together. Just those projects I

just mentioned, and by the way, those

are just the the ones I remember just

off the top of my head. There's some

other doozies in there, those are 10

years of my professional life. I've only

had 17. So, the the majority of my

professional life has been spent on

really poor project selections. And and