Not Boring (with Packy McCormick) - Extended Cut

David Rosenthal 0:00 Okay, we gotta get you over 100K. This episode is a failure if we don't get you over 100K subscribers.

Packy McCormick 0:04 Right, so let me, let me timestamp where we are right now, just so we know what we need to do. [chuckles] So we are at eighty-eight thousand four hundred and sixty.

David Rosenthal 0:12 Oh, we can so do that.

Ben Gilbert 0:13 Oh, we'll juice this. [laughing]

Packy McCormick 0:16 [laughing]

Speaker 0:16 Who got the truth? Is it you, is it you, is it you? Who got the truth now? Is it you, is it you, is it you? Sit me down, say it straight. Another story on the way. Who got the truth?

Ben Gilbert 0:33 Welcome to season nine, episode six of Acquired, the podcast about great technology companies and the stories and playbooks behind them. I'm Ben Gilbert, and I am the co-founder and managing director of Seattle-based Pioneer Square Labs, and our venture fund, PSL Ventures.

David Rosenthal 0:48 And I'm David Rosenthal, and I am an angel investor based in San Francisco, and I am back, sort of, from paternity leave. [chuckles]

Ben Gilbert 0:59 An, a, an abbreviated, partial, ongoing paternity leave.

David Rosenthal 1:02 Yeah, you know, we're, we're making it work, but-

Ben Gilbert 1:05 And we are your hosts. [chuckles] Well, today we have a first for Acquired. We are covering a business that is only one person, Not Boring, the newsletter-gone-media-and-investment empire run by Packy McCormick. I did some research last night. Not Boring is the number one Substack newsletter on business. If Packy decided to switch to the technology category, from everything I can tell, he would be number one there, too. In fact, even in the crypto category, there are only two newsletters with more reach, and they've existed much longer. Not Boring is only a year and a half old. The Not Boring story isn't just impressive because of its explosive growth. Packy is reinventing the media business model, and simultaneously, the startup investing business model. He's done all this with a very distinct personal flair, writing in a unique, whimsical voice that makes us all just wanna have fun and play the great online game. And we're very lucky that he is a part of our liquid super team here at Acquired, so he could join us today, live, to help tell the story. Welcome, Packy.

Packy McCormick 2:13 That was amazing. Thank you, Ben and David. Great to be here.

Ben Gilbert 2:18 I was doing my best, uh, my best Packy impression, trying to write, you know, whimsically in the unique style you've cultivated.

Packy McCormick 2:24 It was beautiful. [chuckles]

David Rosenthal 2:26 Got some good buzzword bingo in there with Not Boring piece titles over the y- I wanna say years, but it hasn't been years. It feels like years.

Ben Gilbert 2:33 I had two-

David Rosenthal 2:33 Feels like you've always been here.

Ben Gilbert 2:34 I had two more. I cut them. It, it, it turned into just, like, a long series of Not Boring titles. Anyway, Packy, uh, we do have to let you know, this is not gonna be all softballs. We're gonna, like, actually do the, the full Acquired deep dive here, if that's okay with you.

Packy McCormick 2:48 I mean, Acquired is... I think, particularly for the first year when I wrote about SoftBank, when I wrote about Tencent, when I wrote about all these companies, like, getting deep, the work that you did to, to go deep on those companies was hugely instrumental in being able to write those pieces. So I would expect nothing less than the full Acquired treatment.

Ben Gilbert 3:07 All right, let's do this. Well, listeners, we have a huge announcement, a gigantic, exciting piece of n- news, uh, to share with all of you today. For the 98% of you out there who have not joined the Acquired LP community, we are opening up every single episode of the LP Show back catalog to you today. We have created a new public podcast feed in Apple, Spotify, or wherever you get your podcasts, called the Acquired LP Show. Very creative. That is right, that includes our series on VC fundamentals and our startup deep dives on pricing, marketplaces, SaaS investing with top investors and founders. And in fact, we are about to drop an episode that, right there in that feed, where I interview 15-year president of Blue Origin, Rob Meyerson, on how he sees the space landscape today. Now, of course, members of the paid LP community still get great benefits, like exclusive access to new episode for two weeks before we drop it in the public feed, the ability to join LP calls, Zoom, book club, you know, all this stuff. But if you aren't an LP and you really wanna start getting these episodes, you can click the link in the show notes or go search Acquired LP Show wherever you get your podcasts, and subscribe.

David Rosenthal 4:19 Thank you to all of our LPs for being on this journey with us, and, um, we are very excited to now share all this content more broadly. There's some good stuff. Man, uh, Ben, you interviewed Joseph Gordon-Levitt the other day [chuckles] on the LP show.

Ben Gilbert 4:32 Super fun, yeah. [chuckles]

David Rosenthal 4:34 So fun. [chuckles]

Packy McCormick 4:35 You guys kind of look alike.

Ben Gilbert 4:36 Uh, we've gotten that a few times.

David Rosenthal 4:38 [laughing]

Ben Gilbert 4:38 I, uh, uh, since Joe is a professional Hollywood actor, I take that as a great, unbelievable compliment, so thank you, Packy.

David Rosenthal 4:46 Ben, you've g- you've got a future in, uh, in video.

Ben Gilbert 4:48 [chuckles]

David Rosenthal 4:49 [chuckles] All right.

Ben Gilbert 4:50 Well, David, uh, take us into Pilot.

David Rosenthal 4:52 Yeah, all right. Before we dive in with Packy, I'd like to welcome our presenting sponsor for all of Season 9, Pilot.com. Pilot is the backbone of the modern financial stack for startups, and they are backed themselves, as you know, by all-star investors like Sequoia, Index, Bezos Expeditions, and Stripe. They are truly the gold standard in startup bookkeeping, including maybe solo corporations that we'll have to dive into here on this episode. Uh, now over to our conversation with Pilot co-founders Waseem Daher and Jessica McKellar. So for this episode, let's talk about how Pilot actually works. You have both software and a large team of human accountants and finance professionals. What does the software look like, and how do the humans and the software interact together to help your customers?

Speaker 5:46 Our interface to you is that you have this really delightful and useful way of understanding your finances, and you have a person who understands you and your business, and engages with you on questions that we have for you, questions that you have for us, insights about your business.... under the hood, we're using software to ensure an exceptionally correct experience and consistent experience, and then we're also able to use software to surface key observations, insights, concerns about your finances so that you can engage on those in a really accessible way, and also with a person, if you want to.

David Rosenthal 6:29 I love that answer, Jessica. You know, one thing I've heard Waseem say in the past about Pilot is that it's like an Iron Man suit for your finance professionals that you have working at Pilot, and I just love that. Pilot is the Tony Stark of accountants for your customers. Thanks, Waseem and Jessica. You can learn more about Pilot and whether they can help your company, solo or otherwise, eliminate the pain of tax prep and bookkeeping by going to Pilot.com/Acquired. And all Acquired listeners, if you use that link, you will get twenty percent off your first six months of service. Thank you, as always, for being with us this season, and go check them out.

Ben Gilbert 7:09 Thank you, David. Well, before we dive into history and facts, we should say this show is not investment advice, though David and I are both investors in multiple Not Boring entities. So not only are we conflicted, we want to be extremely open about that. Uh, we definitely have investments that we are discussing today. This show is for informational and entertainment purposes only, and I promise you it will be both of those.

David Rosenthal 7:31 All right, so to kick this off, we gotta, you know... Look, we're gonna do the whole Acquired treatment on you, Packy, but, um, [chuckles] I gotta start. The first place I went when I was like, "All right, I'm gonna start researching, build the script here for the Not Boring story," I went to your LinkedIn. You know, I know that's kind of a boomer thing to do, but, uh, I did, and, um, it, uh, it lists-- You are listed there as the, quote-unquote, "founder of Not Boring." How on earth did you decide on what to put there? [chuckles]

Packy McCormick 8:03 It's a really tough question for me. Still, when I get asked to do... You know, if I'm going on a panel or joining, you know, a podcast or something, I get asked to send over a short bio, and sometimes-

Ben Gilbert 8:12 Or CNBC.

Packy McCormick 8:13 Or, you know, if I'm on CNBC, or I get asked for a short bio, uh, bio, and, and sometimes it's writer, sometimes it's author, sometimes it's founder. I don't know really what I do or how to describe what I do, and then if you m- mix that in with Not Boring cap, like, the whole thing gets very confusing. Founder feels like a catch-all, like I did definitely start this thing, uh, and so anything else beyond that I think is subject to change.

David Rosenthal 8:37 Love it. You are definitely the founder of the Not Boring empire. [chuckles] All right, so let's tell the story. We will start back in... I actually couldn't find this. This is something I couldn't find. Uh, I'm assuming you were born in either 1986 or 1987.

Packy McCormick 8:53 1987.

David Rosenthal 8:55 1987.

Packy McCormick 8:56 January 26, the same birthday as-

David Rosenthal 8:59 Ooh

Packy McCormick 8:59 ... Wayne Gretzky, Vince Carter, you know, a lot of the great athletes.

David Rosenthal 9:03 Okay, so January 26, 1987, in Bryn Mawr, Pennsylvania, just outside Philadelphia, there's the birth of a baby boy named Patrick?

Packy McCormick 9:15 Patrick.

David Rosenthal 9:16 Also known as Packy McCormick. So Urban Dictionary tells me that Packy is a very common diminutive form of the name Patrick that is especially popular amongst residents of County Cork, Ireland. Is that where your family is originally from?

Packy McCormick 9:32 I believe so. My dad has done kind of the Ancestry.com deep dives. I think we're, you know, on his side of the family, I think we're probably fourth generation over here, uh, and so we think it's County Cork, but not one hundred percent positive.

David Rosenthal 9:44 Nice. All in the Philadelphia area?

Packy McCormick 9:47 All in kind of the Lehigh Valley. Allentown is where my dad grew up. We have a bunch of family in Scranton, so the Joe Biden country.

David Rosenthal 9:55 Yeah, totally. Uh, Billy Joel, Allentown, growing up in Allentown. Um, so what were you like as a kid? Like, uh, you know, i- is there anything, like, ooh, any, any little glimmers of the future Not Boring empire that were popping up, uh, when you were growing up?

Packy McCormick 10:14 Yeah. So I, I think probably there, there are a bunch of glimpses. I used to make these little books or newspapers on Post-it notes. So one of my dad's-- My dad was a consultant, uh, at Arthur Andersen, uh, and, but luckily got out before Enron, thank God. Um, but one of his early clients was the Miami Herald, and so when I was, like, you know, six years old, I would make these little Post-it note versions of the Miami Herald. I also have this one, which is creepy, and maybe we cut this part, but, uh, it was called Golden Memories of a Young Boy's Life. And so I had all these au pairs, and they would take me in, like, you know, the women's locker room at the pool or something like that, and I was, like, a five-year-old kid, and I would come home and draw stick figures of boobs, [chuckles] uh, on, in this little book called Golden Memories of a Young Boy's Life.

David Rosenthal 10:57 [chuckles]

Packy McCormick 10:57 So that was probably the earliest version of, of Not Boring.

Ben Gilbert 11:01 Wow, you, you could have taken a very different career direction after that.

David Rosenthal 11:04 Yeah. [chuckles]

Packy McCormick 11:04 I could have. I wasn't a particularly good artist, you know, I don't-

Ben Gilbert 11:07 [chuckles]

Packy McCormick 11:07 ... don't know if anybody would've, uh, would have signed up-

Ben Gilbert 11:10 Which actually has carried through perfectly. [chuckles]

David Rosenthal 11:12 Perfectly to today. [chuckles]

Packy McCormick 11:14 I'm still not a good artist. I think it's part of the charm.

David Rosenthal 11:16 [chuckles]

Packy McCormick 11:16 Uh, but, you know, even in, in high school or middle school... In middle school, we had an eighth-grade teacher, Mr. Algeo, who, uh, would make you write a composition or an essay if you got in trouble, and so for me, I would actually sometimes try to get in trouble-

David Rosenthal 11:29 'Cause for most kids, that's punishment. Like, for me, like, if I have to write as much as you write, like, I, I, I couldn't do it. There's no way. [chuckles]

Packy McCormick 11:36 I mean, I did cross country and track in high school, too, and that was kind of a similar vibe, where for most people, that's punishment, making them run many miles, and I love that. But Mr. Algeo, you know, you'd have to write a composition, and I would love to do it because I would try to write a composition that was so funny that Mr. Algeo would let me read it in front of the class. Or, you know, in high school, I would try to write essays that were a combination of, like, very well done and well-researched and all that, but funny, uh, so that, you know, even my most serious teachers would have to laugh and give me a good grade, despite the fact that I, that I turned them into a joke. So I think kind of always combination of-... class clown with the backing of kind of serious research. [chuckles]

David Rosenthal 12:11 That's exactly what I was gonna say. Like, you know, most, uh- it's pretty rare to find those two combinations together in one person, right? Like, somebody who is both the class clown and has a work ethic. [chuckles]

Ben Gilbert 12:24 Well, and, and, and I think that comes through in Not Boring. Like, I think, uh, that, uh, all of us who read every or close to every one of your posts, I think that's the charm. Like, that is the style, is that you're diligent. You've written many times about how, like, the process works, and how you go into your basement and, you know, like, spend the time and do the research and start writing and tear it down and write something... I mean, there's real diligence there, and for sure, you are the class clown of serious business newsletter writers. [chuckles]

Packy McCormick 12:56 For sure. I mean, you know, if there are people who've read every or close to every Not Boring, thank you. I think it takes a, a work ethic to read all of the Not Borings. It's been probably close to a million words in a year and a half at this point. To get people to read that much, it has to be both kind of informative and entertaining.

Ben Gilbert 13:12 I think I'm using your phrase here when I say that the reason it works is because you don't put on your serious business pants.

Packy McCormick 13:18 I don't even own serious business pants. [laughing]

David Rosenthal 13:22 So I think [chuckles] as your, your little vignettes from, uh, uh, golden memories of, uh, of a young boy show, you're, you're the class clown, I think was already- are probably just innately in your personality. Where, uh, where does the work ethic come from? Like, was there anything... Is that something may- like, your family impressed upon you, or?

Packy McCormick 13:42 Totally. I mean, I think that is, that is certainly from, from both of my parents. Uh, so, you know, my, my dad, as I said, was a, a consultant at, at Arthur Andersen, and would literally fly to Germany for a day and come home, or fly down to Miami to go to the Miami Herald and then make it home by four o'clock that night to take us to the fair, and then fly back out the next morning. So he was working all of the time. My mom was getting her PhD, and working, and raising two kids, and so, like, both of them, both entrepreneurial. They both ended up starting their own kind of consulting practices, both incredible work ethic, and then there was just the way that they parented. My absolute favorite story growing up was when I was, I think, in fifth grade, I got A's in most of my classes. I was terrible at French.

David Rosenthal 14:24 Did your parents, like, expect you to get A's, or was that, was that you?

Packy McCormick 14:28 My parents definitely expected me to, to get A's because they saw that I could get A's, right? Like, uh, uh, I don't think it was any, any, like, undue pressure. It was just that they saw that if I applied myself, I could get A's, and if I didn't, which was also often the case, then I didn't. So in fifth grade, I had told my parents everything was going really, really well. I was probably gonna get straight A's, maybe, like, a B-plus maybe, but probably not, and then I got my report card, and I remember my dad was coming home from a business trip, and, you know, he was a fancy consultant, so he had a, a cellphone way back in the day in his car. We got our report card, and my mom made me call my dad and tell him the grades that I gotten. So I was like: "Science, A; English, A; French, C-plus; blah, blah, blah, A." [laughing]

David Rosenthal 15:10 Oh! [laughing]

Packy McCormick 15:10 And he was like: "All right, Packy, I'm gonna be home in an hour." [laughing]

Ben Gilbert 15:13 [laughing]

David Rosenthal 15:13 Ooh.

Packy McCormick 15:14 "By the time that I get home, I want all of your certificates, all of your trophies, anything that would suggest that you might be a winner, I want them in a box in the attic. We're calling that box the loser box because you're a loser."

Ben Gilbert 15:26 What?

David Rosenthal 15:27 Whoa! [chuckles]

Packy McCormick 15:28 And my mom said that my dad went to, like, the, the Mo Maquet Offie school of parenting for this. I actually think it was awesome because what he was mad about wasn't that I got a C-plus, like, that wasn't the big deal. It was that I lied all semester and said that I was doing really well in the class.

David Rosenthal 15:39 Ah.

Packy McCormick 15:41 And so I thought that was, you know, the best parenting lesson that I could have ever received because it was a really good lesson, both in honesty and in work ethic. 'Cause, uh, after that, I actually started trying in French, and I ended up taking it all the way through college and got pretty good at it. I can't really speak it anymore, but it was a really good lesson that if you're not gonna do well, at least be honest about the fact that you're not gonna do well. And so now I think, you know, when I get things wrong in Not Boring, I blare it from the rooftops, and probably it comes back to that, that moment.

Ben Gilbert 16:04 Yeah, you feel, like, an intense need to own the mistake or own the... I think, uh, uh, there's a tweet that you had at around, uh, it was probably in some version of the crypto winter, uh, where you said, "Them's the rules. You gotta play fair," and I think you were owning the fact that a lot of things that you thought were gonna go up did not go up.

Packy McCormick 16:22 I mean, our Ideas Dinner podcast, I think, is a- [laughing]

Ben Gilbert 16:25 [laughing]

Packy McCormick 16:25 ... a testament to the fact that I get things wrong all the time.

David Rosenthal 16:28 Oh, we all do. Well, the-

Ben Gilbert 16:29 By the way, Packy, the- we have in our notes here, there's a, a thing where you say, we're all soulmates, and [chuckles] from the outline we were collaborating on, of, of all the similarities. My only C-plus ever in anything middle school, high school, was Spanish.

Packy McCormick 16:42 There we go.

Ben Gilbert 16:43 Foreign language, just not the, not the thing.

Packy McCormick 16:45 And look at us using language all the time now.

Ben Gilbert 16:47 Yep.

David Rosenthal 16:49 So I maybe... I, I may be reaching for threads here, but, like, it's funny, that story, uh, kinda- I mean, that's kind of what you happened in Not Boring, right? Like, you got it wrong. [chuckles] You- the whole thing was like... I mean, we're gonna get into it in a sec, but it was an in-person social club, right? [chuckles] And, uh, and here we are. Uh, so okay, before we get there, so you go to Duke. Uh, you were on the debate team at Duke, right? [chuckles]

Packy McCormick 17:15 I was.

Ben Gilbert 17:16 Shocking.

David Rosenthal 17:17 We, we were able to unearth some, uh, [chuckles] some pretty awesome photos from, uh, from that time, that maybe we'll link to in the show notes, but...

Packy McCormick 17:24 I mean, I was, I was incredibly cool. I was, uh, you know-

David Rosenthal 17:27 [laughing]

Packy McCormick 17:27 ... in the debate club. I was, uh, in an a cappella group. Uh, I... You know, there were a couple of big all-male a cappella groups. I was in the cool one. On the debate team, we were the, you know, me and my partner, who was my best friend from high school also, we were, like, the cool team. So I was, like, in all the nerdy things and tried to be cooler than I was probably in, in all of those things, but that was certainly my, my kind of college vibe, was just getting involved in, in a lot of different things.

David Rosenthal 17:51 So, okay, you graduated in 2009, which also, naturally, was the year that my wife, Jenny, graduated from college. And, uh, I mean, I remember I graduated in '07. I sailed through. I was a French literature major. I get the investment banking job. I'm like: "Oh, this is good." Then, of course, I got my butt kicked on, on- when I actually got to Wall Street. But, um, so-... you got an investment banking job in 2009. Like, nobody got investment banking jobs in 2009. This was the middle of the recession. How, you know, like, how did this happen? Was this something that you, like, worked all through college to get? Like, what-

Ben Gilbert 18:26 Also, just to drive David's point home here, even French lit majors could get investment banking jobs in 2007, and by the time the door slammed in '09, it took something special, Packy, for you to, to get there.

Packy McCormick 18:39 Yeah, so I, I was, to be fully fair, uh, kind of an investment banking lite in public finance, but it started the summer before in 2008. When I got my internship, things were actually still pretty good. So I got an internship at Bank of America on the energy trading desk. That was a wild experience in itself because Bank of America's energy trading desk was all ex-Enron people. Uh, and so they were not psyched to not be at Enron anymore and not psyched to be on a desk that didn't take physical delivery. So there are two types of kind of energy trading desks. Some, like, you know, the bigger banks, Morgan Stanley, all of that, which will take delivery if they need to, of barrels of oil or whatever else. Like, those are the kind of serious desks, and then there are more just pure financial desks like we had, uh, at Bank of America. Worked my butt off that summer. Like, you know, there's the intern programs, and there's drinks, and there's speeches, and there's all these things that you do when you're, uh, an intern on Wall Street. My desk wouldn't let me go to any of those things. Like, I, I had to sit there, and you don't do anything when you're a trading intern. Like, you literally sit on these people's shoulders. You're not allowed to trade. You're not licensed to trade, so you sit on their shoulders-

David Rosenthal 19:44 Wait, you're not licensed? You don't have the Series 7, Series 63, is that the other one you need?

Packy McCormick 19:48 Exactly right. So I, I, you know, I, I asked them dumb questions throughout the day while they were trying to focus on these multimillion-dollar trades. It was, like, the worst experience. They didn't like me being on the desk, but they also didn't want me to have any fun, so they wouldn't let me go to any of the other things. Uh, the summer before my internship, uh, they, they didn't like the intern, and so they took him out drinking until, like, 4:00 a.m., and then when he came in a little bit late the next morning, they marched him to the HR team's office and got him fired, and so that was kind of the... That was the environment that I was coming into.

David Rosenthal 20:16 This is like liar's poker.

Packy McCormick 20:17 Totally. But, you know, there's definitely the, the work ethic there, where I just didn't let it bother me, and so got an offer to come back. Bank of America merged with Merrill Lynch. I, I don't know what the league tables look like now, but certainly Merrill Lynch was-

David Rosenthal 20:29 Merged, quote, unquote

Packy McCormick 20:30 ... higher quality. Merged, quote, unquote. So we bought them, uh, but there were higher-quality interns, quite frankly, uh, at Merrill Lynch. Uh, and so when we merged, I guess the other problem was we all got put at, on the Bank of America side in a rotational program. So you got your offer from a specific desk, but you came back and had to rotate around different desks, whereas Merrill got hired into specific desks. So all the Merrill kids, for both of those reasons, they were probably smarter than I was, and, uh, and they already had their desk kind of placement locked in. They got their desk. We rotated around, and about half the people in the trading program ended up getting spit into public finance, which, for those listening at home, is municipal bonds. So I worked, you know, on the State of New Jersey's [chuckles] uh, the State of New Jersey's bonds that were backed by their tax obligations or the Pennsylvania Turnpike when they wanted to build new roads and issued debt to do that.

David Rosenthal 21:19 Wow, that sounds kind of, uh, boring.

Packy McCormick 21:23 [sighs] It was a little bit boring.

David Rosenthal 21:24 [chuckles]

Packy McCormick 21:24 I think hopefully, hopefully, that's the first of hundreds of funs, uh, throughout this, this podcast. But yeah, it was, it was boring, but I actually... You know, I, I liked it. I was number one in my class, kind of each of the years that I was there, and I realized, like, very early on, 'cause I had friends who were... I remember a New York Times article came out about the fact that really top-quality investment bank analysts were getting their PE offers way, way earlier, and I think they quoted two of my friends, uh, in that article. So, like, I had friends who just loved this stuff, and I just was not one of those people, so I knew that I'd, you know, want to get out of finance at some point, and so I was really just playing to get, you know, to be as, uh, in the top of my class and go to business school.

David Rosenthal 22:05 So you apply to business school, right? And astute readers of Not Boring will know, or, and, and trawlers of your LinkedIn profile will note that you do not have an MBA. [chuckles] Uh, walk us through that and what happens.

Packy McCormick 22:20 One other thing to add was, while I was in finance, I started a company called Throgo, which was a terrible name. I had bought the site for something else, and then I applied it to, uh, building this company that essentially took people from New York down to the Jersey Shore and to the Hamptons every weekend. Uh, [chuckles] so it was a party bus ride. It was so much fun, paid for my summers. I took it, you know, way too seriously and, and thought that this was gonna be my ticket to a great business school. Applied to Stanford, got summarily rejected, uh, from, from GSB. Um, ended up getting into Chicago, had my deposit down, was going to go, and then, one, I kind of visited, and it was snowing, and it was, like, May or something, you know, April or May, and I also found a company called Breather on AngelList and had just started a conversation with the founder of Breather, uh, where there was no guarantee of even an interview or anything, but I asked Chicago if I could defer. They told me, "No, I couldn't defer. Your deposit's already in." If it were Harvard or Stanford, they would've let me defer, but Chicago wants to... You know, they know that people might try to say they want to defer, so they can go to Harvard or Stanford, so they wouldn't let me defer. And so I just said, "All right, cool, not going to business school." Uh, had already quit my job, and so really spent, uh, kind of the next four months, I think, in this weird, kind of winding interview process just with Breather. Um, you know, traded pretty actively, made some of the dumbest trades in the history of the world. I think I bought Tesla during that summer at, like, 19 or $29 and sold it. I bought Facebook at $19-

David Rosenthal 23:51 [chuckles]

Packy McCormick 23:52 ... sold that. Plowed a bunch into, like, Apple options-

David Rosenthal 23:55 [chuckles] God

Packy McCormick 23:55 ... into e- into earnings, which, you know, is just not-

David Rosenthal 23:57 You're admitting your mistakes here.

Packy McCormick 23:59 Oh, I admit, admit all of it. So it was a t- uh, I bought Bitcoin at 100, sold it at 150, so, like, you know, really had a fun, a fun summer where I was-

Ben Gilbert 24:06 You got some nice little returns here, some nice pops. [chuckles]

Packy McCormick 24:08 Yeah, a few percent pop, pretty good. Um-... So, you know, had this, had this kind of summer, uh, where I had no job. I didn't have a future job lined up, but I was interviewing and trading and making a bunch of dumb decisions that I think would kind of make me a better investor later on, but-

Ben Gilbert 24:22 I will say, it's, it's hard to buy and hold when you're in that position in life where, like, the cash is useful and a material amount of your net worth.

David Rosenthal 24:29 And you don't have a job. [chuckles]

Ben Gilbert 24:31 You can listen to all the- ah, like Acquired wasn't around back then, but you could listen to us have all these people on over the years saying how great it is to let compounding do its thing, or the Berkshire episodes, or e- even if you're a deep student of all this on your own and you know this, you kind of can't at that point in your life when you're, like, looking to, A, learn, or B, potentially use the cash in a pretty short period of time.

Packy McCormick 24:56 I mean, the, the Bitcoin sale was a result of going to Oktoberfest with my friends while I was unemployed, and they all had jobs in finance still. And so they went out to the club, and I was like: "Yeah, of course, I can do that. I, you know, I just got my bonus." And then I woke up the next morning in, in the hotel a- and I was like: "You know what? That, that was stupid. I shouldn't have done that. I should've conserved my cash. Let me sell these stupid Bitcoin so that I, like, just kind of refill the coffers with USD." And so that was why I sold all 38 of my Bitcoin at 150.

David Rosenthal 25:24 Whoa! Whoa. Okay, wait, we... So we gotta [chuckles] we can't let you gloss over a couple things here. We gotta rewind. Am I hearing you right that you wrote your business school application about starting a, quote-unquote, company to bus drunk people from Manhattan to the Jersey Shore and the Hamptons?

Packy McCormick 25:44 I mean, it wasn't about busing drunk people from the Jersey [chuckles] from New York to the Jersey Shore and the Hamptons. It was about community and bringing people together. I mean, people who had never met somebody going to the beach town that they were going to made friends. People got married, who met on the party bus. You know, it was, it was, it was... That it was about community. But yeah, no, seriously, like, that is, that is how I tried to spend my business school essays, 'cause I was like-

Ben Gilbert 26:05 Wait, wait, wait. So [chuckles] to, to quote a writer named Packy McCormick, uh, "The hard part about being a great writer is that you can convince people that a really bad idea is a really great idea," and you just did that to me. [laughing]

Packy McCormick 26:20 I legitimately... I, I mean, I- that is another one of those kind of, you know, formative experiences where obviously, it wasn't a startup, it was startup-lite. It was, it was stupid, and it was fun, and it paid for my summers and all of that. When I was applying to Breather, though, I mean, like, I had done marketing, I had done operations, I had, like, had to deal with a bunch of shitty situations. And so, like, that company in particular, like the CEO, is kind of an iconoclast. He runs a company now called Practice. Julian, great guy, um, but he didn't give a shit about finance, and I don't know if I'm allowed to curse here. But he didn't care at all about the finance background other than it proved that I could work hard and, like, maybe I could help with some business stuff. But he really cared that I, like, got my hands dirty and, like, had to deal with all of the junk in just being kind of a one person running this company. So it was definitely a silly experience, but I think it also kind of helped with the next chapter.

David Rosenthal 27:13 Well, I'll say there, I, uh, have had two, um, observed two experiences in, uh, my life, uh, with companies where people have gotten married as a result of meeting on, uh, in the company's product. Uh, one was Facebook, [chuckles] uh, back when we were in college, and two was Rec Room. And, uh, so both of those are doing pretty well. So I, I don't know, maybe, maybe the... What was the name of the party bus company?

Packy McCormick 27:44 Throwgo.

David Rosenthal 27:45 Throwgo. Maybe Throwgo- maybe you just threw in the towel a little bit too early.

Packy McCormick 27:49 I actually don't think, uh, I've actually technically shut down that LLC, so [laughing] who knows?

Ben Gilbert 27:54 I have one of those, too.

David Rosenthal 27:55 [chuckles]

Ben Gilbert 27:56 Did, did you, did you use Throwgo to answer the question, what matters to you most and why, or did you-

Packy McCormick 28:02 I don't know. Uh, that, that was probably about some, like, hike that we took through the wilderness in Costa Rica. Or, I, you know, they're all, all overwrought and corny. I mean, I really thought... I, I, I used that to show, like: Look, even while I was working all these crazy hours in investment banking, I still have this entrepreneurial itch, and that's why X school is gonna help me start a company, and blah, blah, blah, blah, blah.

David Rosenthal 28:22 Yep, which is so funny. That's what every- I mean, that's like... I wrote, uh, my essays were a little bit different 'cause I, I was in venture at that point. I knew I wanted to stay. But, uh, so many people write those things, and, you know, so many of my classmates in business school had come from finance, and they're like: "I wanna be entrepreneurial," and their definition of what [chuckles] entrepreneurial is, is not... You know, it's funny, you know, actually doing the gritty stuff of, like, dealing with tour bus operators and, like, you know, like, that's what it means to, like... You gotta do that when you're an entrepreneur, and so many people that go to business school think: "Oh, I'm gonna get all this glory and start some internet company." And it's like, yeah, you gotta be willing to shovel your fair share of, uh, you know, manure, manure here.

Packy McCormick 29:06 I mean, that's like the Chris Sacca quote about, you know, he won't hire or work with anybody who hasn't had a just a shitty job kind of growing up. So I had that. I'd, you know, I'd washed dishes. I had my fair share, share of kind of those types of jobs, and I think that all, that all helps 'cause, I mean, we'll get to Breather, but that was my first, you know, first year's experience was doing that exact same thing.

Ben Gilbert 29:26 Yeah, so let's, let's jump to Breather.

Packy McCormick 29:28 So yeah, so that summer, I had, you know, thrown away my money in business school as well. That deposit was gone. Terrible summer from a financial perspective, but the way that I was thinking about it was like: I'm either gonna spend the next two years not making a single dollar and paying for business school and racking up debt doing that, or I can go somewhere, anywhere really, that will pay me more than negative dollars and, you know, learn on the job and get that experience. And so that opened the door. I mean, I think when I ended up... You know, so my interview process at, at Breather was doing a bunch of really random things. I don't think they knew what they were doing from a hiring perspective. I wrote the JD for the job that I ended up getting, which was New York City general manager.

David Rosenthal 30:08 How big was the company at that point?

Packy McCormick 30:10 It was six people in Montreal, so I was gonna be our first US employee. One of my jobs was, Julian said, "There's a guy at Uber who does a job similar to the one that you want to do.... go track him down, and then get him to interview you, and then he'll tell me what he thinks. And so that ended up being Josh Moore, who was the New York City general manager at Uber. So I met him. He's, you know, remained a friend. That was a lot of fun.

Ben Gilbert 30:34 I think he works at Levels now.

Packy McCormick 30:36 He- yeah, exactly. He's at, he's at, ah, Supersapiens' competitor, Levels, now. Um, and so [chuckles] that was one. Another was, you know, our other co-founder, Katarina, was a designer by background, and so she was like, "Go to a Marriott business lobby, and go to the Ace Hotel lobby, and then make a presentation on why they're different." And they're obviously very different, but I'm not a designer, ah, as everybody who reads Not Boring knows, and so I, like, had this whole thing about, you know, the vibe of both of the spaces, and it wasn't particularly good, but the fact that, that I did it is probably what they wanted to see. I learned later that it came down to me and somebody who ended up working for the company later, who's way more talented and smarter than I am, and they went... Julian and Katarina went point by point on both of us, in the lobby, actually, of the Ace Hotel, the night before they made their decision, and I won by one point and got the job, or else I would've had, you know, four months down the drain and absolutely nothing. [laughing] So I ended getting the job, and the job for the first year at Breather was, we needed to... So what, what Breather did was it rented out meeting and workspace, in the beginning, these very small meeting rooms for as little as half an hour at a time. So my job was twofold. My job was, first, convince landlords to rent spaces to this random Canadian company that wants random people to come in and out of the building for half an hour at a time throughout the day. So that was challenge number one, and I literally, like, got on my knees, and, in one case, this is actually like, I mean, literally, got on my knees and begged to one of the landlords to give us the space, and they ended up giving us the space-

Ben Gilbert 32:01 Oh, my God!

Packy McCormick 32:01 ... 'cause Julian told me I was gonna get fired if I couldn't get three spaces by X date.

Ben Gilbert 32:05 And you're probably competing against WeWork for a lot of these leases, right?

Packy McCormick 32:09 Ours were, like, really tiny in the beginning. So ultimately, we ended up competing with WeWork. In the beginning, we were looking for, like, the 150-square-foot, really quirky space somewhere in the building, where someone could come take a nap or, like, maybe get a little bit of work done. But the idea was that you should... Like, your phone should be able to unlock all these spaces that are underused throughout the city. Turns out, one of the challenges of that thesis is, in Manhattan, there's really no underused space [chuckles] in the city, and so we ended up just having to compete with whichever firm wanted to rent that space. Ended up, I think, kind of figuring out how to make that pitch, and so that was one side of it. Once we made it, we had to design and furnish and all these things, these spaces, and then we had to get people to clean them. So we worked with one cleaning company that ended up getting acquired by a company that got acquired by Google, and the day after they got acquired, they were like, "By the way, we don't wanna do these terrible five-minute jobs that we have to run all over the city for anymore. You're on your own." So some of that was me going and literally just cleaning Breather spaces. I would leave dinners with friends and whatever, kind of after hours. The other was, because I had met Josh during this process, I called Josh and was like: Hey, you have that Uber Rush thing. Is there any chance that we could get Uber Rush messengers to clean Breather spaces, since they're moving around the city anyway? And so we actually- I was the largest consumer of Uber Rush messengers in the world for a while.

Ben Gilbert 33:26 We never had that outside New York, I don't think.

Packy McCormick 33:28 It was a New York test, that might have gotten to a couple of other markets, but really kind of a, a New York test, where the idea was, if you wanna deliver documents from one place in the city to another, or-

Ben Gilbert 33:37 Which is super common in New York.

Packy McCormick 33:39 It was super common.

Ben Gilbert 33:40 From, you know, our banking days, we know, oh, you're always couriering documents around, and-

Packy McCormick 33:44 Exactly, and I think part of that is probably what became Uber Eats, ultimately, is these people kind of, ah, moving around the city on, on their bikes. But we had a slider in the Uber app where I would call. Hopefully, there was somebody nearby. I would hit the button. I would drop the pin on the space, hit the button, and then have to text with that person and be like: "Hey, by the way, like, this isn't a delivery job. You're cleaning a space."

Ben Gilbert 34:03 [laughing]

Packy McCormick 34:03 And if you go... And, and, and to be fair, these people opted in, so we had our own view, where it's only people who opted in, and they made a little bit more by doing that. But I'd be like: "All right, so this particular space, you go into the room. There's a set of cleaning supplies under the couch. There's instructions there. If you have any questions, just text me. This is my number." And so seven days a week, 6:00 AM to 11:00 PM, pretty much when we closed, I was just on my phone, texting messengers who were gonna go clean Breather. So there, there was like, you know, talking about startups not being glamorous, like, there was absolutely nothing glamorous about this. The fun part, on the, on the flip side of that, was, you know, I had equity in the company. I was our only US employee. I designed the system myself. I chose to work with, with Uber, and so it's all on, it's all on me, and the, the fun thing about startups is, it's all on you. All the crappy stuff is, you know, a product of the way that you designed the system. Uh, and so that was a really fun experience, and then, you know, hired a team, signed a bunch of leases, ah, got promoted a couple of times, and ultimately ended up kind of like running our operations and real estate and design [chuckles] which doesn't make any sense, but managed a really talented design team, uh, and a bunch of stuff that our COO didn't wanna do. I did all of that, ah, kind of globally for us, so incredible experience at Breather, but none of it was particularly easy.

Ben Gilbert 35:16 And how big was your, your team and the company by the time you left?

Packy McCormick 35:20 So in New York, my team grew to about 25 people, and we were about half the revenue, ah, in the company, which was 10 markets. Um, and then, ah, when I got promoted to VP of Experience, which is a fancy title for a bunch of junk jobs, not junk jobs, but like n- not jobs that would normally go together.

Ben Gilbert 35:38 It's a catch-all, yeah.

Packy McCormick 35:40 It was a catch-all, um, that, that sounded probably fancier, way fancier than it was. Um, but that was about 150-person team, including kind of our operations associates, who were full-time employees at Breather and, and cleaned and maintained the spaces, all the way to our team of designers, our customer care team, our real estate team, operations team, and all of that.

Ben Gilbert 36:00 All right, so I'm assembling sort of the, the, the cornucopia or the puzzle pieces that, that would become Not Boring eventually. I mean, you started w- pure finance, pure analysis, pure spreadsheet jockey, so disconnected from what actually happens at any of the companies or even in the physical trading of the commodities that you're looking at. Ah, then, of course, you have one of the most operational jobs one could possibly imagine, and of course, you have the entrepreneurial, um, the entrepreneurial moment before that, of, of starting your own company. Ah, now you have leadership, so you have that piece of the puzzle, too, of understanding, like, ooh, the... It turns out, actually, the hardest thing at any of these companies is the people.

Packy McCormick 36:42 ... And that was the most amazing thing, too. I probably stayed at Breather for two years longer than I should have because I really loved the team of people that I, that I was working with. I'd say the last kind of turning point, uh, and the last kind of thing that contributed to Not Boring was we deeply over-expanded, uh, our supply because we had been given advice by people on the board and others who said, "You're pretty much like Uber. The job for Uber is to get as much supply on the map as humanly possible. You should also get as much supply on the map as humanly possible," which we did.

David Rosenthal 37:15 The catch was there was actually demand for Uber. [laughing]

Packy McCormick 37:18 There was demand for Uber, and Uber's supply could come and go, and Uber didn't have to pay them anything. We signed five-year leases and did construction, and so it was just a very different situation. So we added a space per day, uh, in 2016, 2017. For about a year there, every day, we were launching a new space. And so we were deeply oversupplied. Our gross margins were awful, negative, I think negative 25%. And then me and Ben Rolert, who now runs a company called Composer, which just launched, congrats, Ben, who was, uh, kind of our head of data science at the time, decided to spend a Christmas break just figuring out how we could fix this thing. And we had always had this thing where we only did short-term rentals, we only did meetings, whatever, but we, like, just went deep into the com- we read, like, a bunch of Ben Thompson, and we read Good Strategy, Bad Strategy, and we're like: We're gonna turn this company around using strategy. And so we wrote this, like, detailed memo full of his data science and my crazy ideas on how we could actually turn the company around by adding monthly space and competing kind of more at the margins with companies like WeWork and Knotel, and then we sent it out to the company. When we got back, we got the blessing of the exec team. We sent it out to the company.

David Rosenthal 38:24 Did it have GIFs and, and, like, Taylor Swift references in it?

Packy McCormick 38:28 I actually don't think it had GIFs and Taylor- we took this very seriously.

Ben Gilbert 38:31 You put on your serious business pants for this.

Packy McCormick 38:32 We put on our serious business pants for once, and the company was on the li- uh, really on the line. Like, it was gonna be really hard fundraising or doing anything when we had negative gross margins and, and too much supply. And the craziest thing that happened was, one, everybody bought in and got really excited by this vision, even though it was a ton of work. Like, we had to flip spaces. Part of the thesis was, we have this crazy thing that nobody else has, which is that we can rent spaces out for as little as an hour, and we have this data science team that can price spaces for as little as an hour. So if somebody wants to rent a space for one month, and then we wanna put it on- uh, back online for hourly bookings in three days, we'll flip it back and forth, depending on what the market is telling us, which meant that for the ops team, it was an absolute nightmare. For the design team, having to design between the two types of spaces, absolute nightmare. But everybody bought in, and we turned the thing around, and we went from negative 25% margins to positive 25% margins, and, like, things were going really, really well. And so I think Ben and I were both like: Wow, strategy, like, actually kind of matters here. Like, having a plan and getting people to buy into it and having something that makes sense and fits within the market, like, all of that actually, like, it's not just BS. Like, it's a real, meaningful thing. Um, and so I think that was probably also part of why I ended up writing a newsletter that was, that was about strategy.

Ben Gilbert 39:43 To foreshadow, I think at s- at one point, early on, you described Not Boring as if, uh, Bill Simmons and, and Ben Thompson had a baby, and so clearly, this is where the sort of Ben Thompson side comes from.

Packy McCormick 39:52 100%.

David Rosenthal 39:53 There's a quote from your first, uh, your first newsletter post, [chuckles] which was not called Not Boring, uh, that says, uh, uh, it's about this course that you're taking, this writing course, and it says, "The first piece I wrote for the course was an introduction to Ben Thompson, and if you check it out, I would love your feedback." [chuckles]

Packy McCormick 40:13 It was, so- I mean-

David Rosenthal 40:14 The spiritual godfather.

Packy McCormick 40:16 Spiritual godfather, yeah. The fun thing about that course was, you know, it got me, it got me writing. I took the course because then we brought in a professional management team, and strategy was less valued, and my brain was dying, and so I decided to take a writing course, and I wrote about Ben Thompson because they're like, "You know what? Instead of starting from scratch," and I think this actually just showed up in my last piece, kind of like, "Go remix other people who you respect. Go remix their ideas, and, like, kind of just get a sense for what it feels like to write about and to write like the people that you respect." And so that's how this whole thing kicked off, by writing about Ben Thompson.

David Rosenthal 40:48 And so that was David Perell's Rite of Passage course, right?

Packy McCormick 40:51 Exactly right.

David Rosenthal 40:53 And you also did On Deck at the same time?

Packy McCormick 40:56 I did On Deck at the same time because I... after I left Breather, so, you know, it was a little bit later that I did On Deck. But after I finally left Breather, I, I had tried to quit a few times. In 2019, I took a sabbatical, went to Japan, and while I was there, I called our general counsel and was like: "Get me out of here, please." Uh, and so at that point, I decided to, to go, uh-

Ben Gilbert 41:15 Whoa, you quit from Japan?

Packy McCormick 41:18 It was... You know, it was, the, the sabbatical was, like, the last-ditch effort to get me to stay. It was kind of like: "All right, go take a month off and see if there's any way that you'd wanna come back." And while I was there, I just realized that I did not want to, did not wanna stay there, uh, and so I quit from Japan by, by calling our general counsel.

Ben Gilbert 41:34 Does that ever work? It feels like when people get to disconnect and they're already sort of emotionally disconnected, all it does is make them more sure that they're ready to be done.

Packy McCormick 41:43 For sure. I think it's also valuable to give, like, the team... I had a 150-person team that I think I, I got along really well with, and so I think the sabbatical is also useful in being like: "Look, Packy's away in Japan right now, and the company hasn't fallen apart, and your life is not miserable, so everything will be fine when he leaves."

Ben Gilbert 42:01 Yeah, that's a good point. Okay, so when you did leave, uh, and, uh, I think many people, uh, know some of your history here, you didn't start Not Boring as we know it today right away. Uh, am I right that you started two things concurrently with the Not Boring Club, this social in-person experiment, but also a different email newsletter?

Packy McCormick 42:27 Yes. I'd, I'd had Per My Last Email going, and that was really, like, kind of a link roundup, where it was an assignment from the Rite of Passage course to start a newsletter and to get 20 people to sign up. And so while I was at Breather, I was, I was writing that, and I realized I like writing, and occasionally, I would do an essay. Um, but for the most part, it was like: Here are the five things that I've read and listened to this week that I, that I really liked.

David Rosenthal 42:48 And they're all still on the Not Boring Substack. You can go read them.

Packy McCormick 42:53 ... But if you go to permylastemail.substack.com, this, like, the day that I took it down, somebody else took the site over, and I think it's maybe-

Ben Gilbert 43:01 Ah

Packy McCormick 43:01 ... advertising shampoo or something. It's, like, some scam that, uh, is now on permylastemail.substack.com.

Ben Gilbert 43:07 Everything turns into a link farm eventually.

Packy McCormick 43:09 Exactly. So I had that going, and then I used that to, like, kind of just think through and write about different ideas that I had for a company that I wanted to start. I mean, like, even while I was at Bank of America, when I was in college, when I was at Breather, I always knew that I wanted to start what I thought, you know, would be a real big startup. I had just managed a big team, and I thought I'd-- I was actually interim CEO for a little while at Breather and thought that I did a fine job there, and so I was like, "Oh, I can do this." Like, every level that you go up in a company, I thought that there were, like, these godlike people above you who had all the answers, and realized that, like, they're all as dumb as me, so why not, you know, start something myself? [chuckles] And so I used writing as a way to kind of think through in public a bunch of these different ideas, and somehow, despite that tool, the best idea that I came up with was a social club that kind of combined Soho House and college extracurriculars. So I was a, a debater in high school and college, and one of the tests that I ran was starting a debate club in New York and got, you know, 20 friends to come and debate, and people loved it. I had a blast. People really enjoyed it, and so I was like, "That's a really good signal. This is gonna be a huge business because 20 people like debate club."

Ben Gilbert 44:10 This was the NYC Debate Club, right? Which you can go read about in the Per My Last Email archive. [chuckles]

Packy McCormick 44:16 Yes, you can. Uh, but it was... I mean, like, all of this stuff is a blast, and I think it all comes from the same spot as, you know, the name Not Boring comes from, which is I had dinner with my mom and her business partner one night in New York while I was still at Breather, and her business partner asked me what I liked to do outside of work, and I, like, just did not have an answer. Like, you know, other than I like traveling and I like hanging out with my friends. Like, I had no passions, which is crazy, 'cause in college, like, that was all I did. I spent a lot more time doing other things than, than I did actually probably studying. Uh, and so, you know, I think that kind of just, like, put a, put a bug in my head that I wanted to figure out how to, like, get some of that back. And then I talked to a bunch of other people, and they realized that they had kind of the same thing going on, that once you kind of got out of school, it was work, and then it was your tight group of friends and whoever became your significant other, and then your family, but you didn't have those, like, kind of small groups that were bonded around a particular kind of passion or hobby. So I was like: Oh, cool, like that plus Soho House, that sounds like the coolest thing in the world. Let me go start that.

Ben Gilbert 45:18 And, of course, you're coming from a physical real estate company that you just spent six years at.

Packy McCormick 45:22 Well, that was part of the thing, too, is, like, I, I just thought that, you know, if I tried to build a software business, I'd have a lot less credibility, even with investors, than if I said: Look, you know, I know how to do all of this. I can go... Like, here's the model. All the numbers work. Like, I wrote a bunch, and you can see these essays, too, trying to justify, like, how this could be a venture scale thing if you added a bunch of stuff on top and started community first. And, like, maybe that would've worked. I don't know. I mean, today, what Not Boring Club would've been is really a DAO, probably with physical locations. I think actually that model works really well for what I was trying to do. At the time, it was a real stretch.

Ben Gilbert 45:58 So did you, did you pitch any VCs or investors about investing in Not Boring Club as it was coming together at the end of 2019?

Packy McCormick 46:07 Yeah, so I had a, a few early conversations with friendly VCs that I knew from, uh, from Not Boring, and some people actually were like: "Cool, when you actually start raising, like, let us know. This is actually pretty interesting, and, like, you'll, you'll figure it out. Like, we'll, we'll back you. You'll figure it out."

Ben Gilbert 46:20 Oh, my God, if any of these people had actually invested in Not Boring, like, wow. [chuckles]

Packy McCormick 46:25 I know. I, I might have shut that one, shut that one down and, and started fresh, but, y- you know, it was more of a, I think, we'll back you, this idea, like maybe you can do something with it that gets interesting at some point, but we'll back you. But I got a, a bunch of advice from a bunch of other people who were like: "Don't raise money, and don't sign a lease. Please, for the love of God, don't sign a lease before you actually try to build a community, because it sounds like the other stuff is hard, but what's really hard is actually building a community around this kind of stuff." So I started a Slack group. I used the newsletter that had, you know, 400 people at the time to try to get the early applicants. Got the community up and running. We were doing, like, some, you know, book clubs. We did debate club. There were about 150 of the first people, and before we had a club to welcome people in, I was like: Great, we're gonna do a bunch of small group dinners starting in February of 2020. Uh, late February, we had, I think, our first four 10-person group dinners. They were a lot of fun. People were really enjoying getting to know each other, and then I think it was March 10th, we had these, like, separate Slack groups for each one of the dinner groups, and somebody was like: "You know what? I'm not feeling particularly good. I'm gonna just... I'm gonna bow out tonight." And other people were like, "Uh, you know what? I'm gonna bow out tonight, too, because I'm hearing a lot about this Covid thing." And so, you know, I was trying to start Not Boring Club in the middle of this Covid thing, and, [chuckles] uh, so, so, you know, we put it, we put it on pause, uh, canceled that dinner, out of an abundance of caution, canceled the next night's dinner and the next night's, and I was like: Guys, we'll be back in, you know, two weeks here.

Ben Gilbert 47:55 [chuckles] Do you remember that? We're, we're all gonna be back in two weeks, right? [chuckles]

Packy McCormick 47:58 We're all gonna be back in two weeks. As soon as this blows over, we'll be back.

Ben Gilbert 48:03 I'm gonna put a pin in here. Uh, I was trying to figure out, listeners, how to do the thing that I did during the Uber episode, where I bring in the share price at every moment throughout history, and I, I don't have Packy's internal numbers, so I don't have the newsletter count, but what I do have is, uh, his personal Twitter following as of every month along the way. So here we are, uh, today, where Packy has 105,000, 110,000, something like that, followers. Here in, uh, February of 2020, taking us back to the story, 956 followers.

Packy McCormick 48:35 And that was good. That was like a triple from earlier in the year before- [chuckles] ... I started writing Per My Last Email, and we can talk about this, but one of the things that I wanted to do, I, from, like, very, very early on, I would say, like: Welcome to the new X subscribers. Now there are Y of us here.

Ben Gilbert 48:51 Ah, such a good growth hack.

Packy McCormick 48:53 ... and it wasn't even meant to be a growth hack. It was really kind of like, just in case this works out and becomes a big thing, like, there are all these people with a big Twitter following or a big audience, like, certainly you were in that conversation, where I was like, there's all these people that seem, again, like, kind of godlike and like it was just, like, preordained that they were gonna be successful. In case this newsletter becomes anything, I just kinda wanna show, like, that I was just a random, unemployed idiot who started writing this thing, and so we can kind of like track the whole progression of number of subscribers and all of that throughout the, throughout the journey.

Ben Gilbert 49:24 It's so funny you had that impression of us because, uh, I had, like, zero credibility before starting Acquired. I mean, I felt exactly like you did. Like, I had these startup experiences, and I've worked at this-

Packy McCormick 49:34 Well, to be fair, there was a front-page Seattle Times article [chuckles] about you before, uh, you started Acquired, but-

Ben Gilbert 49:41 One day, one moment in time. Yeah, but, but Packy, like, I know that exact feeling, and it's so funny how, like, at some point, i- and, and there's no, like, clear moment in time when it changes, but at some point, then people look at you like you're on the other side of that valley, and you're like: "Wait, how did I get to the other si- What?"

Packy McCormick 50:00 It's crazy, and like, you know, I, I try to be the same idiot that I was then. It, it is... You know, as you know, like, I, I still tweet dumb stuff, and maybe that's good, and maybe, like, the SEC is gonna knock down my door at some point. But I'm, like, really trying to just be the same person that I've been the whole time. Uh, not in any, like, you know, fame hasn't changed me, but really just, like, I don't, I, I don't want to care that, like, a respon- uh, I'm gonna get responses from a bunch of trolls now if I say something. I really... Like, I think this breaks when I let that change me, and I, like, I get a little bit safer in what I write about because, or what I tweet about or anything, because there are more trolls out there, more people who are paying attention to what I'm writing and, and all of that. And so that's been important to me the whole time, is, is kind of remaining the same idiot that I was in the beginning.

Ben Gilbert 50:45 I think it's super important. I, I... This is the Not Boring episode, not the Acquired episode, but I, I've had a few conversations recently with people who have grown, um, a brand, a personal brand, very quickly online, and I think a lot of people make a lot of trade-offs to do that, where they play a part on the internet and play a character rather than being themselves. And y- you sort of have this magical thing, at least my perception, knowing you personally and following your work, is that they're pretty much the same person. But you've managed to, like, grow very quickly by being yourself, which is remarkable, 'cause I, I, I think in three conversations that I can think of recently, people have told me, like: "I really wish I could be more myself, but I played a, a character on the internet so that I could quickly grow."

Packy McCormick 51:33 It's easy to make that trade-off, and I probably did a little bit of that, frankly, early on, like, where I would do more threads and different things to, like, try to boost engagement and all of that. But I still- it was, like, so small that nobody was paying attention. By the time that I had anybody kind of following, I've just decided to be myself because I'm spending so much time doing this, both writing and tweeting and meeting people and all of that, that if you're not yourself... It's not like a be true to yourself kind of thing. It's like, you're gonna have a miserable experience because all of your interactions are gonna be other people wanting to interact with this persona, or if I were writing from a different voice, everyone would expect me to write from that, and it would just make it twice as hard to both figure out the content and the voice every week. And so I realized really early on that I just needed to, like, kind of be as close to myself as humanly possible, or else it was just gonna be too much work.

Ben Gilbert 52:22 And once you admit that, you're kinda like: "Okay, well, if it works, it works, and if I don't have product market fit with some subsegment of the internet who can discover me, then, shoot, I'll take my ball and go home." But if it works, it's actually remarkably scalable for a one-person operation.

Packy McCormick 52:37 Exactly.

David Rosenthal 52:39 So we can debate when you crossed this valley [chuckles] , but certainly at this point in time, you have not. [chuckles] Um, what are you feeling now in March 2020? Like, you're, you're unemployed again, but you're older, you're married. Your wife is pregnant at this point, right?

Packy McCormick 52:56 Correct.

David Rosenthal 52:58 You are [chuckles] working on a, mmm, I won't say harebrained, but, uh, [chuckles] maybe a, a, a startup idea in a physical real estate space with maybe some p- some issues with the business model.

Packy McCormick 53:10 Not particularly venture backable business.

David Rosenthal 53:12 Not particularly venture backable. What are your emotions like right now? Are you just like: "I'm happy-go-lucky, it's all gonna work out," or are you, like, kind of tearing your hair out?

Packy McCormick 53:22 I'm, to a fault, and, like, uh, you know, everybody has their double-edged sword, and mine is optimism. Um, and so, you know, like, never, never once was there a time when I was like, uh, my life is absolutely over. You know, like, when I joined Breather and took a lower salary, and it was a risky thing, my mindset was like: "You know, my absolute worst-case scenario here is that I move back to my parents' house, and I can still eat meals, and I can still sleep in a bed, and there's a roof over my head," so, like, the floor is not that low. Certainly, this time around, you know, there's s- there's 100% an ego piece of this 'cause I have a bunch of friends who are doing really, really great things, and I was... You know, when I tried to bring Not Boring Club online, I was sitting there. I had trivia nights that I, like, spent all day writing trivia questions and making slides, and seven people showed up, and I was like: "This is with my Duke education, my expensive high school education, m- all my experience. Like, this is what I'm doing with my... This is incredibly embarrassing." And so, you know, I, I decided to kind of just let Not Boring Club, the digital version, uh, fall by the wayside. In, uh, you know, February, early February, Pooja and I decided, or learned that we were, uh, learned that we were pregnant, um, and then really, you know, COVID, COVID kind of hit, and I remember, uh, this was probably April when I decided to, like, really go all in. It was, like, a bunch of soul-searching conversations with, like, Pooja, with my mom, just, like, really, you know, pathetic, pathetic stuff here. Like, I'm, like, you know, just-... talking to my mom and being like, "I don't, you know, I don't, I don't know what to do here." And she's like, "Well, I like the name Not Boring Club. Like, maybe you should just, like, apply that to the newsletter and just go all in on, on the Not Boring thing." So that was my mom's idea to port the name over.

Ben Gilbert 54:56 Nice!

David Rosenthal 54:57 Wow. Thanks, Mom.

Packy McCormick 54:59 Thanks, Mom.

David Rosenthal 55:00 We should all thank our mothers more. Thank you, Mom. [chuckles]

Packy McCormick 55:02 Totally. Thank you, Mom. Uh, and, like, even, you know, my dad, who's always been kind of like, "Don't close off doors," and like, you know, very like, just serious about me, me making sure that, you know, I did the best that I possibly could, was super supportive of this, this whole thing. Maybe just because they saw that there was, like, nothing else on the table. I- to be fair, I could have gotten a job somewhere, but, you know, there were... I, I just didn't want to get a job yet. I didn't want to quit on the idea of being an entrepreneur and doing my own thing. Um, and so I went to the beach with my brother for a week, and it was just like, all right, like, my... What if I just start writing this, this newsletter, and what if I start writing essays? And it needs to be different than Ben Thompson. So I came up with this idea to do kind of a mix between business strategy and pop culture, and so my earliest essays were like, "Creative Destruction" and "The Mickey Mouse Club" to explain why COVID was actually a really good thing because it meant that people were no longer gonna be stuck in bullshit jobs and were gonna be freed up to go do the things that they actually wanted to do, which, you know, I think is kind of borne out and, and-

Ben Gilbert 56:00 Which is ironically also the subject of your most recent piece.

Packy McCormick 56:04 A little bit.

Ben Gilbert 56:05 It's a different twist on it, for sure. It's, it's more about the, the sort of community and societal impacts of that, but of the same impetus.

Packy McCormick 56:12 Totally. Yeah, I mean, I- the there are definitely some through lines through, through a lot of, a lot of the pieces. I wrote about Amazon had a fashion show, and I tried to examine Amazon's strategy through the lens of this fashion show and, you know, like, did a bunch of those like, direct pop culture X business strategy type essays. That also, like pretending to be a character, became too much, where I'd have to both think of, like, the business side of it and then also figure out what movie that business was like, and that became too much. So I kept the tone, and I dropped that, that direct thing. But, uh, yeah, I mean, I just like... I asked Puja if I could have three months to, to grow the newsletter and see if there was anything there, and, like, maybe one day I'd start making money. But for now, let me just see if I can grow this. Uh, a friend of mine, Tommy Gamba, who was at Airbnb and, uh, and getting ready to leave, helped me out on the growth side of things, and, uh, you know, just had, had this brilliant idea to launch a landing page so that we could launch on Product Hunt, and that alone, I think, took us from, uh, you know, something very small, like a thousand subscribers to two thousand subscribers, so that was a huge leap. And I remember sitting with Puja at dinner and being like: "Oh, my God, I could actually... Like, this newsletter could be a full-time thing. I have two thousand subscribers now. [chuckles] This is amazing!"

David Rosenthal 57:20 You had seven people at trivia night. Now you have two thousand people on the internet. Maybe this internet thing is a good idea. [chuckles]

Packy McCormick 57:27 The internet thing is a good... As, as we like to say, we're talking orders of magnitude difference here. That's a VC term. So-

David Rosenthal 57:33 [chuckles]

Packy McCormick 57:33 ... Um, yeah, so, I mean, things, like, kind of started looking up from that point and wasn't making any revenue for a long time, and I still remember having conversations, like, deeper into the pregnancy, where it was, like, clearly going to be a thing, and I had planned to turn on subscriptions and decided to keep holding off on that because I really liked the growth. And I had conversations with Puja, where she was like: "Are we gonna do, like, a revenue thing here?"

David Rosenthal 57:56 [laughing]

Packy McCormick 57:56 And mind you, now we're living at, at my, at my in-laws' house in New Jersey during COVID, and I was writing from-

David Rosenthal 58:01 With her parents.

Packy McCormick 58:02 With her parents, and I was writing from a basement.

David Rosenthal 58:04 [chuckles]

Packy McCormick 58:04 So, like, none of this is glamorous. But she's like: "Are we gonna, like... You know, at some point, we'll need, like, health insurance and blah, blah, blah.

David Rosenthal 58:10 [chuckles]

Packy McCormick 58:10 Like, are you gonna turn on revenue?" And I was like: "No, no, trust me. If we can, like, get-

David Rosenthal 58:14 [chuckles]

Packy McCormick 58:14 ... If we can keep not having, [chuckles] not having subscriptions turned on for a while, then we can grow to a point where, like, I'll be able to turn on subscriptions, and if I convert ten percent of the audience at five dollars a month, then, like, we could be making a couple thousand dollars a month." [chuckles] Yeah, so like, that was-

David Rosenthal 58:26 Which is such a fal- not that, like, subscriptions work as a business model if you architect the right way. There, there's nothing wrong with it, and ob- obviously, our friend Mario Gabriele is doing great with it, The Generalist. But, oh, that's such a fallacy, that, like, way of thinking of the like: "Oh, if I only get X percent, uh, to convert," uh, like it's... Oh, it's just... Oh, I'm so glad you went a different direction.

Ben Gilbert 58:48 There's also the dirty secret, which it seems like you kind of intrinsically knew, which is even ten percent of, is gonna be a pretty big stretch. Like, creators can typically convert, at best, two to three percent to a paid offering, unless they're significantly handicapping the main content, where you'd say, like: "Sorry, every other main post is behind the paywall," or, or something, uh, you know, big like that. But even then, I think it's like ten, fifteen percent if you b- bring out your big stick.

Packy McCormick 59:16 And that prevents growth, and so, like, it's hard to model out exactly how that's going to play out, but my big thing was, like, I was just addicted because I had locked myself into this thing where I was telling people how many I grew every week.

David Rosenthal 59:27 [chuckles]

Packy McCormick 59:27 Like, I was kind of addicted to that number continuing to go up, and so I just kept pushing off, kind of turning on subscriptions so that that number would keep going up. And then, and Mario did it well. Lenny Rachitsky obviously did it really well and, and has a great business. So there are ways to do it. I think a huge difference between, like, someone like a Lenny and, and someone like me is that Lenny's audience is so specific, and, like, you know exactly who you are and who should be paying for that, which is people who do product or people who do growth. And not only do they know that they should be reading that and that they need to pay for it, their companies are gonna be willing to pay for it for them, whereas I could not imagine a company that'd be willing to pay so somebody could read about the Mickey Mouse Club. And so that was the other kind of thing that kept me from, from going to the subscription model, is, like, I just don't know if companies will be able to pay for Not Boring.

David Rosenthal 1:00:14 Well, I think that was the secret when I was at The Wall Street Journal. Like, uh, and this was in the days of, like, paid content was such a thing, and it was everybody thought: Oh, The Wall Street Journal, they did it so right. The New York Times was wrong. And it's like, yeah, this is the dirty secret. Most people who pay for the Journal, it's their companies that are paying for the Journal.

Ben Gilbert 1:00:30 And it's hyper-specific. It's, you know, business, finance. Like, uh, it's the most reputable of that.

David Rosenthal 1:00:37 Yeah, if you're gonna go the paid subscription route, it's great, but you need, like, you need to architect your whole business and content strategy around that, and obviously, you had taken a different path.

Ben Gilbert 1:00:48 ... Packy's just gonna be Packy on the internet.

Packy McCormick 1:00:50 [chuckles] Yeah, so I was too lazy to do the subscription thing, too, and think about which should go behind the paywall and which shouldn't, and, like, could I possibly double the amount of content that I was doing so that I could still grow and have some things behind the paywall and keep the quality? And so I just frankly couldn't figure all of that out, and so that was one of the reasons that I decided not to go that route, too.

Ben Gilbert 1:01:07 Hmm. Okay, so what month was your baby born?

Packy McCormick 1:01:12 Our baby was born on October 4th. I remember I had my laptop in the hospital. Like, he was supposed to be born, like, a day later, and so I was gonna be able to finish a piece I was writing about Reliance, and so I was, like, almost done that piece, sitting in the hospital while we were waiting for him to be born, and I just couldn't get it finished. So he was born, uh, Devin, who is the absolute best. Shout out to Dev, if you're listening to this in the future. Um, but, you know, he, he was born on October 4th, uh, uh, that year.

Ben Gilbert 1:01:41 Okay, well, I asked for our tracker here. So you were talking about sort of, like, later into the pregnancy when Pooja was asking you, like, "Hey, are we gonna do this revenue thing?" I'm gonna assume somewhere end of the second trimester, beginning of the third trimester, you're at 3,500 Twitter followers when you get that question. Then we fast-forward to, you know, Devin is born. It's a big moment in your life. You're already up to 12,000 Twitter followers, so you're starting to feel like, geez, I, I'm assuming that this maps similarly to newsletter subscribers. You're kind of looking at this like, well, if it's gonna keep growing like this, and it's actually gonna grow geometrically, not linearly, we could be in good shape pretty soon. But I imagine you're probably also pinching yourself and going, "This can't continue, right?"

Packy McCormick 1:02:24 I remember having a conversation with Pooja, and, and this is, I think, after... So I- in the summer, kind of late summer, somebody was nice enough to reach out. Chris at Market or Hire was nice enough to reach out and be like: "Hey, I like your newsletter. Are you thinking about taking advertisers?" And I was like: "Yeah, I'd love to have you advertise." And he's like: "Great, send me your deck," and I didn't have a deck. And so I surveyed the audience, and I asked them for their characteristics, and they all came back, like, exactly like you'd want, 25 to 34, uh, high-income households, leadership positions at companies, well-educated. Like, I was- I was-

Ben Gilbert 1:02:57 Owning big budgets-

Packy McCormick 1:02:58 Yeah

Ben Gilbert 1:02:58 ... decision-makers.

Packy McCormick 1:03:00 Exactly.

David Rosenthal 1:03:00 Well, the this deck is amazing, by the way. Well, uh, it's still on the internet. We'll link to it in the show notes. [chuckles]

Packy McCormick 1:03:05 It's still, it's still on the internet, which haunts me, actually, 'cause people reach out, and they're like: "Great-

David Rosenthal 1:03:09 [laughing]

Packy McCormick 1:03:09 ... I'd love to do a sponsorship at $1,000"

David Rosenthal 1:03:11 [laughing]

Packy McCormick 1:03:11 ... or whatever price I put in, in the deck at that point. But after I made that deck, I was like: You know what? This internet thing has been pretty amazing, and Twitter's been pretty great. I'm just gonna tweet the deck out. And so that filled up, and, you know, Public came in, and Market to Hire came in. A few other, uh, sponsors came in from that, but that filled up pretty much through the end of 2020, all of, all of my sponsorship slots, which was great. And I was like: Oh, wow! So then I remember having a conversation with Pooja, and I was like: I don't- if things go really well, I, I think maybe there's a chance that, like, in the future, we could do, like, $300,000 or $400,000 on this newsletter on sponsorships. And, like, I, I, you know... She thought it was crazy. I thought it was a little bit crazy, but I kept-

David Rosenthal 1:03:49 You're an optimist

Packy McCormick 1:03:50 ... relying on, like, yeah, optimist, and I kept relying on the math. Like, I, like, had some sophisticated formula here. I was like: Pooja, it's like, it's purely math. Like, it's just a CPM thing, and so as long as we have enough readers, and then, like, you know, the rates will grow, and this will be something that, you know, at least I can make what I was making when I was a 24-year-old in investment banking again.

David Rosenthal 1:04:09 So before Chris at Market or Hire reached out to you about sponsorship, had you been thinking about advertising, or were you totally focused on one day, when we get to a certain point, we're gonna flip to subscription?

Packy McCormick 1:04:21 No, I mean, I think the other thing about me is I have an addictive personality, and so, you know, I, I think we had probably crossed a point where I just realized that I liked the growth too much, and I realized that I liked the fact that, you know, if I was gonna be spending all of this time, like, you know, 40, 50 hours to write an essay, I didn't want 1,000 people to read that essay, and I wanted people tweeting about it and talking about it and all of that. And so at some point, I realized it was probably gonna go ads. I just, like, hadn't made the leap because I thought even ads would, would slow growth and that people wouldn't like me doing ads. Uh, and so I was trying to hold off on that for a little while, too. Uh, but yeah, so, th- you know, a, a few companies kind of pushed me, pushed me in that direction and proved that I could actually make a dollar doing that, which was great. There is another moment where I wasn't allowed to buy an iPad until, uh, I actually made money from Not Boring. Uh, and so finally, I had made, like, $10,000, and Pooja let me buy an iPad, so, like, a bunch of, a bunch of little wins, late 2020.

David Rosenthal 1:05:13 How proud were you at that moment? Like, it's so- it's quaint now, looking back on it, but, like, these are the things along the way that I'm sure you remember.

Packy McCormick 1:05:19 Totally, and it is a glorified Kindle for me. I read books on it, and, like, occasionally, I'll draw something and, and throw in the essay. Like, this last week's, uh, title image, I actually drew myself. It's, it's horrendous. Uh, but I, I, I was like, "You know, I'm gonna be Ben Thompson. As... All, all I need is an iPad."

David Rosenthal 1:05:35 [laughing]

Packy McCormick 1:05:35 "Like, Pooja, can I please, like, dip into savings here and get an iPad?" And she's like: "No, you don't make any money on this newsletter.

David Rosenthal 1:05:39 [laughing]

Packy McCormick 1:05:39 Like, you cannot buy yourself an iPad that you don't need. You have a computer. You're fine."

Ben Gilbert 1:05:43 Okay, so two questions for you. One, did you experience the thing where the period of time where, "Hey, this isn't gonna cover our lifestyle," is long, and then, "Hey," the period of time where, "Whoa, this is gonna more than cover our lifestyle," is long, but the period of, like, "Hey, this is great, we're, we're, like, right at break even, sustainable," is, like, remarkably short, so you sort of, like, blow by it, and then you're like: "Whoa, holy crap! I expected that to be, like, a longer period of the journey?"

Packy McCormick 1:06:17 100%. Yeah, that, that happened really quickly, and again, to be fair, covering our lifestyle was, like, not particularly difficult when we were living in my in-laws' basement. Um, obviously, you know, like, we had a baby, and so that was a real meaningful thing. But when you have a baby, David, you know this, people send you probably, like, the first at least six months' worth of clothes and diapers and all of that kind of stuff. So you, you don't really start incurring expenses on the kid for a bunch of months, uh, and we were living in a basement, and my mother-in-law is a phenomenal cook, and so, like, you know, I was maybe paying for, like, a Wawa hoagie every once in a while.

David Rosenthal 1:06:51 Yes, Wawa hoagies! Yes.

Packy McCormick 1:06:53 It's the best. Uh, and you guys, you guys need to do an Acquired on, on Wawa at some point.

David Rosenthal 1:06:58 Oh, we totally should.... total digression. My, one of my proudest moments in business school was I was in this super boring class that was, um, I forget, the title was, it was something like, you know, board management or something. And I was like: "Oh, I'm a VC, this will be really helpful." It turned out it was about, like, public company board, like, like compliance, [chuckles] and it was so boring. And so I just, like, zoned out the whole semester or the whole quarter. And then one day, I was just completely zoned out, and I hear Wawa, and I'm like: "Oh, I know all about this." And the professor was like: [laughing] "I don't know why it's called Wawa." My hand goes right up in the air, [laughing] and I'm like: "I can tell you exactly why it's called Wawa." [laughing]

Packy McCormick 1:07:41 When I was a freshman at Duke, during freshman orientation, they did the thing where, like, they had improv comedy or something, and all the freshmen went to it, and they would call a couple people up on stage, and they'd ask you questions like: "What do you miss most about your hometown?" And I was like, "Wawa!" And, like, the six people from Pennsylvania and New Jersey cheered, and everybody else was like: "What is this guy talking about?" So that was the beginning of my, my college career.

Ben Gilbert 1:08:01 For us Ohioans, that is, uh, Swensen's.

David Rosenthal 1:08:04 Ooh.

Packy McCormick 1:08:04 Ah.

David Rosenthal 1:08:05 What is Swensen's?

Packy McCormick 1:08:05 So probably, probably not quite as good, but-

Ben Gilbert 1:08:07 It's a diff- it's a little bit of a different thing. It's a drive- uh, drive-in burger joint, but unbelievable.

David Rosenthal 1:08:12 Ah. Oh, like Dick's in Seattle.

Ben Gilbert 1:08:13 Yeah. Yeah, yeah.

David Rosenthal 1:08:14 Got it.

Ben Gilbert 1:08:15 Wait, so, okay, let me, let me get to question number two then. And I asked question one because a- as I've talked with other creators who experienced that moment, there's this really weird thing where you feel like because phase one was so long and you've been looking forward to phase two, the break-even phase, that, like, it's almost, like, unsatisfi-- I mean, and it, it's great to be in phase three, but it's, like, weirdly unsatisfying how fast you blow through phase two because you've been looking forward to it for so long.

Packy McCormick 1:08:40 I guess it's the optimist thing again, like we're... I'm telling you, like, because I set the first three months up as an experiment and knew that I could go, you know, find another job somewhere, and that hopefully, maybe the newsletter would have introduced me to somebody who might be willing to hire me because they liked what I wrote, so that wasn't, like, a revenue-desirous period. And then there were those months in between, uh, kind of after that, where it was growing, and I was like: "This is gonna happen." So probably everybody around me was relieved that it happened, but for me, it was kind of like, no, no, no. Again, it's math here, and so, like, this will happen, and as long as it keeps growing, then, you know, it'll, it'll become, like, a number that is really exciting. I didn't think it was gonna go as well as it did, but i- there was no point where I was like: I really hope that I'm like, you know, able to eat and that I can scrape things together. Again, probably because we were living in my in-laws' basement. Uh, but, you know, I, I think that probably would've made it a little more satisfying if I was like, every month, like, dreading the rent check. But fortunately, uh, you know, that was, that was not an issue for us [chuckles] .

Ben Gilbert 1:09:39 Yeah. Okay, so then that leads me to question number two, which is, y- you have pioneered a pretty unique sponsorship format. Like, we thought we pioneered a unique sponsorship format in, in the, the presenting sponsorship, where you'd- we, like, really throw our lot in with, with the presenting sponsor for, for three months. Shout-out to Pilot.com, Albemarle, website, you know, uh, everything, interview on the, the top of the show. And then here comes Packy McCormick and says: "You know what? Like, every week, one of the two posts that I do is gonna be pure, unadulterated, I'm getting paid by the subject to write this. I am doing the thing that is gonna make classically trained journalists, like, freak out, and I'm just gonna own that." How did you come to this, and, and how did you... What were your fears around it? How did it come to be, all that?

Packy McCormick 1:10:29 Totally. So I'm gonna get the origin story somewhat wrong. I'd started talking to Nick Abate at, that Main Street, and if you use Twitter, you've probably gotten a sponsored tweet from him about using Main Street. Also happens to be a phenomenal guy. Love, Nick. Thank you. And he was like: "By the way, like, these posts that you write on companies, like, you could write those on startups, and I bet people would be willing to pay." And he had just come over from Shrunk Capital to run marketing at Main Street, and he's like: "You know, we'll be the first ones who, who do this." And I was like: "All right, cool. Let's try it. Like, I'm gonna caveat the hell out of it and tell everybody right up front that it's sponsored, but, like, I think Main Street is really cool, so I would actually love to write about Main Street and explain, and, like, my audience is a bunch, bunch of entrepreneurs and founders, and I bet my entrepreneur and founder audience would love to make money back from the government that otherwise they might not have. And so Main Street will get you kind of your tax credits back in, in an easy way."

Ben Gilbert 1:11:21 By the way, what, what month was this, that you're having this conversation-ish?

Packy McCormick 1:11:24 This was also... This was actually pretty early in the sponsorship journey, so this was probably also in, like, the August, September range.

Ben Gilbert 1:11:31 Okay, so still at ten thousand-ish Twitter followers?

Packy McCormick 1:11:35 Still at ten thousand, ten thousand-ish Twitter followers. And it ended up... You know, so my fears were, obviously, like, this is not what you're supposed to do. You're not supposed to use a newsletter to shill. Sponsored content is a sturdy word because, you know, at a normal, you know, journalistic institution that has integrity, there's a wall between the people who write, you know, the, the actual journalists and the people who write sponsored content, and it's this thing that is, like, optimized for SEO and, like, kind of, like, clickbaity and, like, all that kind of stuff. So sponsored content, like, does not have a particularly great name. But I was like: All right, so if I do this, like, really, my kind of bar for myself has to be as high as it would be writing a normal piece, and I'm only gonna write about things that I'm actually bullish on and, you know, companies that I would actually invest in myself. And this is before there was a fund or anything, but, you know, that I'd put my personal money into. Uh, and so that was kind of the bar that I set for myself, and I was like: You know what? I'm gonna, like, ask the audience even, like: Did you hate this? Like, please let me know if you hated this. And I- probably one, you know, one or two people every time I write a sponsored post is like, "You're shilling. This is sponsored. No sponsored content, please." But the vast majority either don't care, although the open rates are actually, like, fairly consistent, maybe a little bit higher on the Monday pieces, uh, or they get something out of it. So, you know, Main Street, a bunch of people went and got a bunch of money back, so they loved that. It's interesting because I serve a bunch of different audiences. When I talk to founders for Not Boring Capital now-... A lot of their favorite pieces actually end up being some of the sponsored posts because I get behind-the-scenes access into some of these really fast-growing, successful startups and get to write something more detailed on them than anybody else has written before.

Ben Gilbert 1:13:11 Oh, yeah. I am an investor in Modern Treasury, and I learned a lot about the company from your recent sponsored post on Modern Treasury. [chuckles]

Packy McCormick 1:13:18 Yeah, even Ben Thompson, on his podcast, I think it was back in February, without calling me by name, was like:

Ben Gilbert 1:13:24 [chuckles]

Packy McCormick 1:13:24 "You know, there is, there is somebody who writes a newsletter who does this thing where the, the startups actually pay him to write about them, but it's actually kind of good because he gets more information for these companies that aren't publicly available." He was, he was kind of saying that he doesn't write about private companies as much because he doesn't have as much material to analyze, but that if I actually work with the company, I have a bunch of stuff to analyze. And I'm very honest with them that, like, I'll- I will, you know, talk about what I think isn't great if, if there are things, and I will talk about competitors in a positive light, and I will never say, just, like, you know, do a hatchet job on competitors in the piece unless the competitor is, like, a straw man. Like, you know, I talked a lot of shit on passwords when I wrote about Stitch, and that's fine 'cause nobody loves passwords. Um, but, you know, as long as I keep that bar high, and I'm, like, very honest, I say upfront every time, "This is a sponsored post. This is how it works. Here's a link to a doc that I wrote about how I choose them," people end up, uh, people end up liking the posts. And so what I was saying was, founders end up liking those because it is, like, oftentimes, they're either at the same spot in their journey, or they're a little bit behind where those companies are, and so they're learning kind of like practical, on-the-ground things that those companies are doing and can take lessons from that. So those actually feed, in a lot of different ways, really well into the fund.

David Rosenthal 1:14:38 I wanna pause for a second in the, [chuckles] in the, the sort of like action movie story of the Not Boring story. And I think this is a good point to talk about a few things kind of just, like, going on in the world around you doing this. Like, um... And one, you know, o- obviously, what you're doing wouldn't be possible without all the platforms and infrastructure, you know, to Substack, Twitter, you know, what have you, all of, all of the things that we take for granted now but ten years ago didn't exist. Like, it just wouldn't be possible to have a solo corporation like Not Boring to do- be doing what you do. Even when Ben Thompson did it, he had to roll his own for so much of this.

Ben Gilbert 1:15:22 I mean, you, you are, you are operating a venture fund with no other employees. Like, uh, AngelList makes that possible.

David Rosenthal 1:15:29 But it's interesting, right? Like, you said something that, uh... Uh, oh, what was the word you used when you were talking about, uh, uh... Oh, the, uh, traditional media organization would have journalistic integrity and would never do this, right? Well, what is journalistic integrity, right? And, like, I think, like, you know, post-2016 and Donald Trump and everything, like, you know, this is kind of one of those second, third-order effects of the last five years in the world and this country of like... Well, maybe, like, you know, mainstream journalism still has a great place, but maybe it's okay to also do things differently, and maybe they don't have all the truth, and maybe, maybe you can think differently about what journalistic integrity means. And then you kind of looked at this, like, ghetto [chuckles] of sponsored content, and it truly was a ghetto. Was it a ghetto because it wasn't, didn't have integrity, or because it just nobody tried, like, put the work in to make it great, you know? [chuckles] Like, you made it great.

Packy McCormick 1:16:29 Yeah, there's, there's a lot to, a lot to unpack. So first of all, the platforms, like, you know, I'm all in on Web3 now, certainly rely on Web2 platforms in a really big way. The most beautiful part about Substack is because they've taken such a strong stand for subscriptions and against advertising, no one on their team has ever even reached out to me. Uh-

David Rosenthal 1:16:48 Whoa!

Packy McCormick 1:16:48 ... and so I've paid zero dollars for my main platform-

David Rosenthal 1:16:51 Oh

Packy McCormick 1:16:51 ... because they wanna pretend like ads don't exist, and I hope they don't hear this and-

David Rosenthal 1:16:54 That is-

Packy McCormick 1:16:54 ... and start charging me.

David Rosenthal 1:16:55 They've never reached out to you?

Packy McCormick 1:16:57 Never reached out. Uh-

David Rosenthal 1:16:57 Oh, my God. [chuckles]

Packy McCormick 1:16:58 Yeah, so, you know, uh, that, that is just, like, kind of this happy accident where my main platform ends up being free. And so people will pitch me-

David Rosenthal 1:17:07 [chuckles]

Packy McCormick 1:17:07 ... kind of new newsletter platforms all the time, and they're like: "Bet you're pretty bummed that you're paying 10% of your revenue to Substack, right?" I'm like: I actually haven't paid anything to Substack.

David Rosenthal 1:17:15 [chuckles]

Packy McCormick 1:17:15 Twitter is free, and I've written about this before but it's, like, you know, the least... Actually, I pay for Twitter Blue now just out of, like, a thank you. It's a garbage product so far but, like, just as a, out of a thank you for a- all that Twitter has done, I, I pay $2.99 a month-

David Rosenthal 1:17:29 [chuckles]

Packy McCormick 1:17:29 ... for that now, so that's a cost. But, you know, these-

David Rosenthal 1:17:31 [chuckles]

Packy McCormick 1:17:31 ... these platforms have been hugely helpful in making Not Boring what it is and, and are low cost. On the other side, the, the point you're talking about, uh, journalistic integrity, uh, we're catching me at a time where I'm, like, kind of in this mini self-proclaimed, nobody cares, but, like, kind of war against all the cynicism that's happening out there. I think everybody has incentives and motives, and at least if I'm saying, "I am sponsored, and this company is paying me right now to write about this," it is just very out in the open what I'm trying to do, or if I say, "I invested in this company," or whatever else. Like, everybody can go into the piece kind of knowing that that is the table stakes. I don't know what the incentives are for traditional tech journalists, and they're not certainly all this bad, but I think a lot of the reason that Not Boring works is 'cause there's so much snark about tech out there. For all of these companies that are, one, just groups of, like, people not making a ton of money, and, like, now maybe salaries are a little bit better and all of that, but for the past decade, people at these small companies not making a ton of money and, like, actually trying to change the world, and that's, like, a corny phrase, but, like, that is how you can recruit people to come work somewhere and, and not make a lot of money. Trying these new things, like, taking different pieces off the shelf, like, going and trying to build something, and then there's, like, you know, snarky 50-year-old men sitting back and being like: "Oh, no, I've seen something like this before. This is really stupid," or, you know, like, X, Y, and Z. And a- I actually, like... This, uh, this is not well thought out enough even for me to, like, be saying this publicly, but it feels like a lot of journalism is, like, left over from an era where journalism was, like-... really needed, because not everything was out in the open, and, like, you needed journalism to expose corruption and, like, take down Tammany Hall, and, like, all this stuff. And so there's- And then you apply all of that to, like, these little tech companies that have raised, like, $5 million, and you, like, try to dig through the garbage. There was an article in Business Insider on Spring Health about their, their work culture the other day that was, like, trying to be a hatchet job, but there was nothing bad in there. It was, they, they, like, people worked hard at the company. A marketing guy said his team was working too hard, and so they want- he wanted to lower the goals, and the CEO said, "No, we're not lowering the goals, but I'll hire more people for you." Like, that is a tale as old as time in startups that, you know, there's a battle between the CEO and the marketing team about what the goals should be, and the CEO sets an overly aggressive goal. And the fact that somebody think it's, it's worth investigating for four months, this story about this company, or, like, the hit job that they just did on Ro, which was, like, also total BS. Like, you can always find someone who's unhappy in a company when you're not making that much money and when you're working a lot, and then to use these people who have gotten fired as sources for these, like, hit pieces that are poorly done and nobody believes, like, that is just abysmal. And so I think, like, you know, i- if I end up being... I, I think when the, the market turns and when we enter, like, a bit of a bear market in, in tech, in Web3, like, it will be really easy to s- to throw stones at me. Like, I am, I am unabashedly optimistic about all of this, and, like, things are gonna turn, and I'm gonna, like... You know, the tide's gonna go out, and my pants are gonna be down. I'm also totally fine with that because I do think that, like, the, the overall tone of tech journalism is like: What's wrong with these companies? Like, they're making too much money. They're bu- And so if somebody has to be on the other side saying, like, "No, this is awesome," I'm happy to be that guy.

David Rosenthal 1:20:42 I- it's exactly what you said. It's, it's incentives and it's audiences, right? And, like, you put your... planted your flag from the very beginning that you are going to be an optimist, and your audience is founders and people who, like, who are also optimists about this whole industry. There's a viable audience of people who are pessimists out there [chuckles] and who don't like it, [chuckles] and that's what the other media outlets can write for and to, but it's like, you know, nobody was doing what you're doing.

Packy McCormick 1:21:13 The other piece of it, too, is like, you know, I want to be optimistic 'cause that's, like, naturally what I am, and it goes back to doing the thing that you actually are, and there's a reason I worked at a startup. And even though that startup didn't do well, I'm still optimistic about this, 'cause I think, like, a lot of really great stuff has come out of this. I also wanna be realistic, so, like, I'm not gonna just be like, "This is always the greatest thing in the whole entire world." My favorite kind of audience are the people who come in, and they're like, "I was frankly really skeptical about crypto or about Web3 or about tech in general until I read this piece, and it explained it really well in ways that make sense." So I still try to tie this stuff back to, like, business principles. I mean, we're both huge Seven Powers fans, so I'll try to actually tie back to, like, what is the competitive advantage of this protocol or of this company? And so I don't want it to just be, like, pie-in-the-sky optimism. So if I can convert people who were, like, either pessimistic or skeptical over to at least being thoughtful about it, like, that's all I'm going for, is be thoughtful about it, and I think if you're thoughtful about this industry, you're gonna come away at least being like, "Wow, [chuckles] they've done a lot in the past few decades."

Ben Gilbert 1:22:09 Well, and you seem to operate under the same primary principle that we do, and David and I text ourselves this phrase all the time or text each other this phrase when one of us is straying from it. But rule number one at Acquired is assume the audience is smart, and if you assume that, the cool thing is long term, it means you'll get a whole bunch of smart people, as long as you keep doing your thing and you stay true to that, that'll, that'll pay attention. The, th- it comes with these interesting trade-offs, where you can, uh, never allow yourself to hide the ball, or else you're compromising that long-term goal. And so you always... Like, to the extent that you are assuming your audience is smart, you have to write well-reasoned stuff, or else you are just gonna take an enormous amount of shit for what you put out in the world. And so it's not like you can go write some- it's not like you can say, "Hey, here are my incentives. This thing is sponsored," and then write a total fluff thing with zero serious analysis in there, 'cause everyone's just gonna look at it and go, "Well, yeah, you told me that y- you- your, your, um, independence was compromised, and then it wasn't useful, like, then it wasn't something that I enjoyed thinking about."

Packy McCormick 1:23:15 You can't waste people's time, certainly. Um, uh, one of the tests that I always run for myself, and I probably actually would've failed this test, is if Theranos had come to me on a sponsored post, you know, however many years ago, chances are, frankly, I would've written something positive on Theranos because I assume the best, and I'm not technical, and so I'm not digging into that machine and being like, "Actually, do you know the, the science doesn't make any sense at all?" [chuckles]

Ben Gilbert 1:23:40 It's impossible with that small of a blood sample.

Packy McCormick 1:23:42 Right?

Ben Gilbert 1:23:42 How could you possibly? [chuckles]

Packy McCormick 1:23:44 So, so, and that's the downside, and I, I'm sure-

David Rosenthal 1:23:46 And, and that's where traditi- that's where investigative journalism has a very valid role. [chuckles]

Packy McCormick 1:23:52 100%. 100%, and so, you know, like, there, there are, there are goods to both and there are bads, bad things to my approach, and, and I don't know which company, probably none of them, but, you know, like, maybe there's a company that I've written about that ends up being a total house of cards, you know, in five years, and I look like an idiot for writing that piece. I probably would've written it about Theranos, and that's, you know, that's an okay trade as long as I'm like... You know, nobody's expecting me to analyze the science behind Theranos. If I could analyze, like, the, the business side of the business at least, like, a- and do the work, and maybe somebody learned something that is, you know, not just about Theranos but about some other concept that I'm using to analyze the company, then, then that's okay. So I guess that's, you know, that's the risk.

David Rosenthal 1:24:29 Well, that gets back to this, you know, frankly, I don't know if it was intentional or not, but this brilliant, um, you know, sort of jujitsu you did with taking content marketing that was a ghetto [chuckles] and sucked because people-

Ben Gilbert 1:24:44 Sponsored content.

David Rosenthal 1:24:45 Uh, yeah, uh, sponsored content that was a ghetto and sucked because nobody actually put it... gave a damn, put any effort in to make it great. You've done that, and, uh, but, but you, you do have to put the effort in to make it great.

Packy McCormick 1:24:59 100%, yeah. The worst thing that could possibly happen is if I did one of those and wasted people's time because people would unsubscribe, people wouldn't read the next sponsored post. So it doesn't... Like, the whole thing falls apart if I lose my-... integrity throughout this process. The lucky thing is that I've been a pretty, like, open optimist the whole time, so no one's like: "That's so weird. You rip apart tech on Monday, and then on Thursday, [laughing] when people pay you, you're, like, really generous to this whole industry." So it, it's all consistent, at least.

Ben Gilbert 1:25:26 So I told you at the beginning this wasn't gonna be all softballs. I don't wanna pretend that, like, every Thursday piece is exactly as interesting as every Monday piece. Because I, I, I think, and, and again, I think this is okay, but there are a lot of Thursday pieces that the headline doesn't sound interesting to me, and I end up either not reading it or just, like, skimming it to make sure I, like, didn't miss some huge piece of information where I'm like, "It would be good for me to know this." However, when the Monday pieces come out, I'm like, "Ooh, this could be the next great online game," or, like, "This could be the next, uh..." What's the one about the cooperation economy? And, and l- I just- uh, it's rare that I think that a Thursday piece is going to be that, but I don't think... A- actually, may- except for, like, Solana Summer, that kind of was that. Uh, but I, I do think that that's probably in line with your sponsor's expectations, is that it's gonna appeal to a group of people that they particularly want to appeal to, who wants to know about their company and happens to be a subset of your audience, but it's probably not going to be like, "Hey, let's all close our eyes and, and, uh, and, and pray and do kumbaya," that this is exactly the same thing as the non-sponsored content.

Packy McCormick 1:26:34 That's totally fair. I try to make it as good as I possibly can. I'm often writing, though, about either, you know, a specific company, which is just, like, a smaller design space than something like a great online game would be. Uh, and I'm also writing, uh, I guess about a, you know, a company that has less of a history and, like, less complexity to it maybe than some of the, the larger public companies that I write about. So, you know, my, my goal is to write the best thing that's been written on that company every time I do a sponsored deep dive. And chances are, in a lot of cases, it's a two-year-old company. Like, the best thing that's ever been written on that company isn't going to be as interesting as breaking down Tencent over 20,000 words, because Tencent is a sprawling business that has this, like, crazy, innovative business model. And so, you know, it, it's- uh, while I want it to be as close to the Monday as humanly possible, like, my real bar for myself is, can this be the best thing that's ever been written on this particular company? Plus, is this a company that I would invest in, and all of that. And so if the open rate is, you know, 37% instead of 45% on Thursdays, I'm totally fine with that. And, you know, everybody's come away very happy from, from the sponsored d- deep dives on the company side, but-

David Rosenthal 1:27:40 Yeah. Well, and I think the, I think the... To my mind, the right question to ask isn't necessarily, is every Thursday piece gonna be as good as every Monday piece? It's, if I'm the company, if I'm your customer, is this going to be the- is this blatantly, obviously, the very best thing that is- that I can do to get something written, a- and, and a great deep analysis done about my company? And that is so obviously yes [chuckles] , right? Like, what, what are their alternatives, you know? I'm sure there'll be more people like you who pop up, and that's great. It's not a zero-sum game. But, um, if I'm a two-year-old company [chuckles] and, uh, and I'm the founders of, of that company, and I want to- I think I've got something great, but I need to cross the chasm to have people know about it, uh, you know, I- it's not like you're gonna write a Monday piece about it otherwise [chuckles] necessarily.

Packy McCormick 1:28:35 The other fun thing, too, is, like, companies can almost choose how interesting they want it to be. Like, I, I think the best example of a sponsored deep dive that I've done was... And, and this was, uh, you know, this was kind of early on, but it was, was Ramp. Um, and, like, their kind of double unicorn round when they raised at a $1.1 billion valuation and a $1.6 billion valuation in the same transaction. And the reason that one worked so well was 'cause Eric, the, the CEO there, was like, "Dude, completely open kimono. Ask us anything. I will give you the timeline of how this round game came to- came together. I will give you exactly how we think about cap table construction. I will, like... You tell me what you need to make this the most interesting piece possible, and I will give that to you." And a lot of companies make the trade on the other side, which is also totally fair, that they wanna keep some information private, uh, that, that, you know, they think there's an advantage to keeping private. And so that's the, the trade that, that I think you make there. But that- there's a reason, like, I think people refer to that piece often when, you know, they're reaching out to me about sponsored posts. And then a lot of companies aren't willing to make that trade-off, when I'm like, "Cool, the reason that one worked so well is 'cause they told me everything." And they're like: "Cool, do that, but, like, you know, with maybe 90% of the information." [chuckles]

Ben Gilbert 1:29:42 [chuckles] Uh, uh, before we move on, I wanna, um, cover one final topic of journalistic integrity. So c- 'cause David, I think, like, your take, uh, may come across, when we go back and listen to this, as a little bit too, like... "And this is when the downfall of democracy started." [laughing]

David Rosenthal 1:30:00 [chuckles]

Ben Gilbert 1:30:00 "Uh, like, we can point to this moment where David Rosenthal said that journalistic integrity is not important."

David Rosenthal 1:30:04 I don't mean it that way. [chuckles]

Ben Gilbert 1:30:04 A, I don't think that's, like, really the right takeaway, but it could be heard that way. I think there's, like, two pieces, when you really unpack it, of, like, why is journalistic integrity important? The first one is that the reader, uh, is fully disclosed on the incentives and knows what they're getting, and we've covered that topic. Like, Packy, you wave your arms around all over the place, and, you know, everyone knows what they signed up for. The second- so that's almost like the microeconomic or, like, the, uh, micro to your business, but then there's a macro one, too, where it could be a bad thing for the state of the republic if every journalist looks over at what you're doing, Packy, and says, "Uh, I could do that." And you have the very best writers from The New York Times or Forbes or The, The Wall Street Journal that are just like, "I could go make five to 10 times as much and have a much more independent lifestyle with control over my life." Uh, okay, like, do, do we slowly ch- by, by opening this up, this independent journalism, [chuckles] quote-unquote journalism, I think it's important to not call it journalism, independent content creation that is entertaining to read and fully disclosed, incentivized-... uh, i- is do we chisel away at the third estate?

Packy McCormick 1:31:22 So one of the things that I think has been really interesting is that people have jumped over the fence from working for a publication to going independent, and then now have started to jump back. And, like, I couldn't do what they do, and this is not like, you know, a lack of respect for those people. Like, my brain wouldn't work. If someone hired me to be like, "You have to go be an investigative journalist," it just, like, it wouldn't work, right? And so th- that's one part. I, I do have respect for that, particularly where it's applied the right way. My problem is when it's applied to, like, a one-year-old startup that maybe, like, overworks their over, quote-unquote, um, you can't see me on, on the audio, but quote-unquote, "overworks their employees" a little bit, uh, as startups occasionally do, and as a lot of companies occasionally do. Like, when you apply the same rigor to that as, like, Watergate, like, that's when I, I kind of have a bit of an issue with it. So going back to the, the piece on kind of people jumping over and back, like, there's a lot that goes into that, and I think it's really hard to do that kind of journalism independently because you need lawyers who have your back, and you need, uh, editors to make sure that you get everything right, and you need, like, all this stuff to protect you when you're doing this really brave work, that I think is tougher to do on the, on the independent side. So I 100% think that there's a place for, uh, for that kind of journalism. It's just like, don't apply that to, like, a, a startup that makes hot dogs and, like, you know, came in over budget one quarter, and, like, that shows how stupid startups are. Like, that kind of article is what, what really gets me.

David Rosenthal 1:32:49 Well, I think it also works the other way, too, which is that it's hard to do what you're doing. Uh, w- this whole episode, the goal of this episode has been to tell your story, and I think, you know, to me, like, the... one of the takeaways that I'm not surprised by is, like, your whole life and career led to this. [chuckles] You know, so if you were an investigative journalist at XYZ publication doing very much not this, [chuckles] and then you're like: Oh, I'm just gonna jump over and do what Packy does, you wouldn't be equipped i- in the same way that you are. You know, you worked for six years at a startup, from employee six through hundreds of people.

Packy McCormick 1:33:26 And through failure, which helps.

David Rosenthal 1:33:28 Through failure, yeah, exactly.

Packy McCormick 1:33:30 I, I think that's right. Like, there's definitely an empathy there, too, and, like, I go into this knowing full well that it's wild that I was an employee, not a founder, at a startup that sold for $3 million after raising $120 million. So, like, unless the content stands for itself, like, nobody should be listening to me because, like, there are many more successful people to listen to out there. Uh, and so, you know, like, all of that has led in, and I think gives me a great empathy for what, what founders are, are doing, but the content has to stand for itself.

Ben Gilbert 1:33:59 Okay, so taking us back to the story, you mentioned February is when, uh, Ben Thompson mentioned you as some guy who writes a newsletter, whose name I can't remember, or something like that. And of course, the, the funny thing about compounding, you went from zero Ben Thompson mentions your whole life to, like, n- now it feels like every, every few, uh, w- newsletters I read from him, I'm like, "Oh, there's Packy again." Um, but that, that first no-name name mention, uh, I think was in February, when you had 22,000 Twitter followers. Uh, you also sent out a tweet in February that you wanted Not Boring to make $1 million this year, which, as David has in the notes, uh, sounds effing crazy, and I, I'm curious, like, how, how did you... What happened in your brain as you formulated that tweet? W- was it that the sponsored posts had been going well? Were you already contemplating Not Boring Capital? What was that moment like?

Packy McCormick 1:34:55 Yeah, so I probably... I mean, like, I'd been thinking a little bit about Not Boring Capital, uh, and so that was there, but really was talking about just purely making a million dollars off of the newsletter. A couple of things had happened around that time, like me and Ben from Composer wrote this piece, uh, on Excel that got picked up, I think, by two separate New York Times articles and got to the top of Hacker News and all of that kind of stuff. So I was like: Whoa! That was my first taste of, like, this thing really going kind of, kind of mainstream. Uh, had written a sponsored post, I think, probably, you know, either that week or was in the middle of writing the post, um, and the company was really happy with it. And so, like, a- and I was in Miami, and the weather was nice, and I could have been in, in, uh, New York in the middle of February, and I probably wouldn't have tweeted the same thing. But I woke up, and the sun was shining, and I was like: You know what? Life is pretty good. Like, I'm probably making, at this point, call it 10 or $15,000 a month or something like that, so, like, not close, maybe 20. I, I, I don't know. Um, but I just woke up feeling, like, really good, and I was like: You know, I'm just gonna, I'm just gonna say this, and, like, I'll prob- people will probably think I'm an asshole, but, you know, I, I've, I've, like, struggled on zero dollars for the past X number of, uh, months, and I'm just gonna say it. And then, as I think happens often with those tweets, like, the support was actually huge from them. Like, nobody reads that as a cocky signal, 'cause first I didn't say, like: Guess what I just did? It was more like: I hope [chuckles] that it'd be wild if this happens. Uh, but also, people, like, wanna see other people take risks and succeed at them, I think.

Ben Gilbert 1:36:20 It's like, if Packy's making it, maybe, maybe I'm, I'm kinda making it in a way. [chuckles]

Packy McCormick 1:36:24 I think that was, I think that was pure, pure WAGMI. And the other thing is, like, yes, there is, like, a tiny buffer between just, like, me saying, like: I'm gonna make a million-dollar salary this year, and saying, like, Not Boring will make a million dollars. 'Cause it's still a business, and for a business, a million dollars a year is, like, fine. You could probably raise, like, a seed and maybe a Series A in this market on, on that, uh, and certainly not in a media company. So, uh, you know, it's not, like, anything crazy from a business perspective, but, you know, that was, that was where that came from.

David Rosenthal 1:36:50 All right, so give us the update. We're now in, uh... it'll be December by the time this comes out. How we trending?

Packy McCormick 1:36:56 Yeah. I think, I think WAGMI. And so, you know- [laughing] ... we're talking about, we're talking about Pilot, and I certainly probably need, uh, the help of bookkeepers. I just pulled my, uh, my Mercury account, uh, that, you know, I, I do all of my banking in, and, and I think that probably has about 750,000 in revenue. There's a bunch of invoices outstanding. Some people send checks, some goes to my, like, personal banking. Like, this is not a well-run business by any stretch of the imagination.... and I have a few pieces kind of coming up, and so I think chances are we're gonna just kind of cross, uh, a million dollars in 2021.

Ben Gilbert 1:37:32 Wow!

David Rosenthal 1:37:34 Ooh, so great.

Ben Gilbert 1:37:35 To-- w- [chuckles] what, what would you have put the percentage chance at when you sent that tweet?

Packy McCormick 1:37:41 I would've put the percentage chance that we got to a million-dollar run rate pretty high. I thought probably, given that I kind of, like, knew what my sponsorship calendar was for the next couple months at that point, and that it wasn't the, the right run rate to get me there, I probably would've put it at, like, twenty percent that I actually hit a million this year. But it is, I mean, like, you really-- it, it is the power of compounding kind of happening, where, like, it just keeps getting, like, the numbers just keep getting bigger to the point where it's like, you know, what would've taken me ten sponsored deep dives, I can now do in one sponsored deep dive. And so that, like, just kind of all grows and, and compounds, I guess, but still, ah, absolutely crazy.

Ben Gilbert 1:38:18 I mean, speaking of compounding, so you had spent, like, you had gone from a, a few hundred followers to twenty thousand followers or twenty-two thousand followers by that February when you sent that tweet. You'd already doubled that then by June to f- to forty-two thousand, and, like, uh, it, it, it probably-- it's crazy that you're now over a hundred thousand. Like, y- you definitely have this thing where you're growing somewhere from twenty to forty percent per month. It kinda bumps up and down, but, uh, [lips smack] th- there's-- at this point, it's, uh, probably for you, more of a market saturation question of like, when does that S cur-- uh, the top of the S curve start to hit? Or when does this thing linear out a little bit?

Packy McCormick 1:39:01 Well, also, this, there's a little bit of a bummer in those Twitter numbers, which is a point of pride for a while, was that I had more subscribers than I had Twitter followers, and now I have more Twitter followers than I have subscribers. I'm at, like, you know, a hundred and five or something on Twitter and eighty-eight in the newsletter.

Ben Gilbert 1:39:17 Aw.

Packy McCormick 1:39:18 And so, like-

Ben Gilbert 1:39:18 Let's change that

Packy McCormick 1:39:19 ... it probably means that I should spend a l- [chuckles] I, I should probably spend a little less time tweeting.

David Rosenthal 1:39:23 Everybody, we need, we need to help Packy out here. [chuckles] Go subscribe if you haven't already.

Ben Gilbert 1:39:28 In some ways, it would shock me, actually, if the, if... Well, I know numbers-wise, there are people who listen to Acquired who aren't, um, subscribed to Not Boring, but I don't-- in my head, I'm like: Who are those people? 'Cause I, like, I want... Like, we're a little bit less, I think, and this is something I wanted to talk to you about, like, ethereal, theoretical, abstract, uh, and frankly, like, a little bit less future-looking. Like, one question I have for you is like: At what point did you skeptically walk up to the web3 cliff and then just jump off it without a parachute? 'Cause, like, you did way more of that than we've done here at Acquired. So I can imagine maybe that's a difference in audience, but let me bring it back to, if you're not subscribed to Not Boring, oh, my God, go, go, go subscribe.

Packy McCormick 1:40:10 Thank you. notboring.co. Um, yeah, so the web3 point, I, I think did, I think the web3 was a turning point, and so, you know, I wrote about, for a lot of twenty twenty, a lot of the... A lot of companies that are super fascinating and that I, I've always wanted to just, like, dig really deep into, and frankly, that, you know, you all have done way better work on than I have and was able to kind of build on the back of, of what you'd done there.

Ben Gilbert 1:40:34 Thank you. Not true. Different approaches. Continue.

Packy McCormick 1:40:37 You were first, and so, like, I, I can tell you for a fact that without, you know, again, we'll go to the Tencent episode, but without the Tencent episode on, uh, uh, on Acquired, there wouldn't probably be that Not Boring two-parter on Tencent. Um, and so, you know, uh, either way, like, that is just foundational stuff, and I realized, I think, probably something that I realized when I was in finance in the first place, is that there are people who are just so much better at digging into public companies than I am and analyzing public companies than I am. And so it wasn't really kind of that clean a choice to say, like: You know what? Instead of public companies, I'm gonna do this web3 thing. But when I started writing about web3, I remember there was one, uh, one essay that I wrote, The Value Chain of the Open Metaverse, back in January, where I was really apologetic, almost [chuckles] even in the intro to that piece, that I was writing about crypto and the metaverse, and I was like: Everybody, this is really weird. My audience had become, like, fairly fin-twit and finance-heavy, and I thought-

Ben Gilbert 1:41:32 That's this year. That's Packy McCormick writing in twenty twenty-one, apologetically, that, "I, I'm sorry, I'm talking about crypto."

Packy McCormick 1:41:39 Right? I mean, it shows how much the world has changed since then. This was before Beeple's sixty-nine million dollar sale and a bunch of stuff, but I talked about kind of some of the early, early Beeples.

David Rosenthal 1:41:48 Before you tried to buy the US Constitution. [chuckles]

Packy McCormick 1:41:50 Before I tried to buy the US Constitution with a bunch of friends. Um, but, you know, that piece ended up being, I think, really well-received because it was a, you know, again, optimistic take, I guess, on crypto. It was, like, a non-dismissive take, at least on, on what was going on, but it was really back to, like, the basics of like: All right, take a value chain. What happens when you take the middleman out? Like, I didn't like the language that was used around crypto at the time, and I think it had scared me away, where it was like: We're gonna take down the institutions, and we're gonna remove the middleman, and we're gonna blah, blah, blah. And I was like, "No, no, all right," so just taking a step back, if you take out somebody from the transaction, and you let the consumer and the creator interact directly, more value accrues to the consumer and the creator, and everybody out there reading is more likely to be a consumer or a creator than you are likely to be Facebook or Twitter. So, like, this is actually probably a pretty good thing for most of us that, you know, there's just more value that can accrue to both sides of this equation. And so that was kind of, I think, my, my jumping-off point into it when people were like: Oh, this is actually really interesting, and I didn't understand this stuff at all before, and now I really, like, I don't understand it still, but I understand it a little bit better, and I understand that maybe it's worth looking into. And I even set myself a rule that I would just do kind of, like, maybe one web3, I'd probably call it crypto back in the day before it was even called web3, one crypto piece, uh, a month, and then something else interesting happened, and so then it was two. And then other ideas that I was thinking about, like, you know, I wrote this piece called Power to the Person, which wasn't ostensibly about crypto, but it certainly was partially about the things that crypto lets a, a solo creator or solopreneur-... do, and then there are a few more articles like that where I wanted to write about something else, and crypto just kind of kept creeping back into it. Uh, and then, you know, wrote a piece, uh, that we discussed on a previous Acquired episode about Ethereum, and then dove into Solana. And I think hopefully what I can do, and I actually need to keep myself honest 'cause I'm getting so excited that I might, like, actually lose some of this, but really wanna give the, like, somewhere between this is a scam and this is, like, going to save the world and take down the institutions. I wanna be able to give that take in the middle that is like, "Here's where it's good." So I think the thing about the Solana piece maybe that worked is that it's like, here's what this thing is. Like, it's a blockchain, and that's crazy. It's a platform, and it needs to attract developers to build on top of the platform, and those developers need to attract users, and if that happens, then Solana will probably be in a pretty good shape. And, like, here's maybe one way you'd think about valuing the blockchain and, and go from there. But it- it's really that's kind of the approach that I'm trying to take to all of this, is like, "This is amazing, and let's tie it back to some sort of, like, business concept that you're familiar with."

Ben Gilbert 1:44:28 I like that. I mean, I think it is totally... That, that is a thing that doesn't exist. There, there's a clear divide between the "let's look at regular companies' world and invest in regular companies' world" and the people who have, for lack of a better phrase, gone down the rabbit hole. And, and that divide is really around business fundamentals and structure fundamentals. Because a lot of people are like, "Oh, well, with DAOs, we throw everything out, so no one even, like, has a manager. Uh, uh, and, like, of course, there's no board, and of course, there's no shares, and of course, there's no contracts, and of course, there's no employment agreements, but, like, yeah, this way, everyone gets to do what they want." And I liked your point when you were writing about the cooperation economy, where you're sort of like, "Well, at the end of the day, humans are still humans and do need to organize in ways that... Like, if our goal is to ship a product, like, we do have to figure out some [chuckles] structure to ship a product."

Packy McCormick 1:45:17 Yeah, I mean, nothing is a panacea. I think this is a really amazing new toolkit to have, and it opens up... Again, I'm just probably have spent too much time in tech and VC, and so I say design space now too often, but it opens up this, like, new design space where you just have a new set of tools that you can build with. And so DAOs, I think, are really great in certain situations. I think eight out of 10 DAOs might totally fail because they, they have, like, kind of that leadership issue, or, like, who is the final decision-maker issue. But I think those other two are gonna do things that, like, you might not have ever thought to do with a traditional corporation, and they'll spin up faster, and they'll be more responsive. And so I think, like, nothing is all good and bad, but I think there are gonna be some emergent properties, uh, to DAOs that are really interesting and probably previously would not have been possible. And so that's a really good thing, and so I don't want people to just dismiss DAOs outright because sometimes they can be a little bit chaotic or whatever else. I mean, like, I got involved in the Constitution DAO, which was trying to buy the Constitution this week, and it shows both the amazing things, which is that you can rally a group of people around this shared mission and raise almost $50 million to go fight to win the Constitution and, and bring it back to the people. And then it's also, like, very hard to make huge decisions in a seven-day timeframe and to organize a 20,000-person Discord, all of whom has been told that they're a part of a DAO and has a voice, and so, like, what's the right balance there? Then you go into the idea of, like, progressive decentralization, which I think makes a lot of sense, which is start out kind of like a company, and then over time, particularly if you're building a protocol or something that is not as, like, consumer-facing maybe, then over time, you can kind of progressively give up control and, and cede more control to the users and the owners. So I guess, yeah, again, there the whole, the whole approach is like, here's where it's good, here's where there's issues, and, like, here's something that might kind of work, and, I don't know, let's go try it. Like, the, the worst thing you could do is just dismiss something.

Ben Gilbert 1:47:07 Yeah. Do you get blowback from people who were really into what you used to write about and are now like, "You, you gotta, like, spin something off," or like, "I, I just can't... I'm, I'm not into... I'm not buying it?"

Packy McCormick 1:47:20 Before, I, I had, and I still have it on, but I, I just don't read them. I had my unsubscribes turned on and, and would literally go through every time someone unsubscribed and be like, "Oh, [sighs] someone unsubscribed." Now I don't care as much. I think this is kind of to your point earlier about kind of, like, getting the audience that you deserve. Maybe there's a little, a little... I'm not comparing myself to Jeff Bezos here, but, like, a little bit of the Amazon shareholder thing, right? Where, like, he had to work his ass off to get the shareholders that would actually appreciate what Amazon was doing, but then when he did, that puts you in a really great spot as a company when you have shareholders who are bought into the fact that-

Ben Gilbert 1:47:52 Well, I think the actual quote, it does make sense. The actual quote is not, "You get the shareholders you deserve," "You get the shareholders you ask for." In the long run, you get the, you get the audience you ask for. [chuckles]

Packy McCormick 1:48:01 Exactly. And I hope, like, I- what I don't wanna do is alienate everybody who has, like, some sense of, you know, uh, that, that fundamentals have va- Like, I- those are people that I really want to read Not Boring, and I want to keep me accountable. Um, but if people are just like, "Hey, you're writing about web3, and I think it's stupid," and they leave, then that's totally fine. It's really, like, the people who are like, "Hey, you're actually, like, losing all sense of fundamentals here," like, uh, "then I'm, then I'm out," like, that's when I'll know that I have an issue. There was one- there was somebody who DM'd me after I wrote the piece on Solana, actually, that was like, "Man, I miss the old Packy when you would give us alpha, and you'd be early on things like Snap or whatever."

Ben Gilbert 1:48:38 [chuckles]

Packy McCormick 1:48:38 And then, of course, Solana, like-

Ben Gilbert 1:48:40 Yeah, [laughing]

Packy McCormick 1:48:40 ... three and a half X'd in the next two months.

Ben Gilbert 1:48:42 You're like, "Here, I just gave you a truckload of alpha." [laughing]

Packy McCormick 1:48:45 [chuckles] But, like, that stuff still hurts. Like, I don't wanna, I don't wanna, like, not, you know, do the thing that I'm promising to people, but I also have been... You know, I've never had a very specific focus, and I've always been honest that I'm gonna follow whatever I think is the most interesting. It makes my schedule miserable because I pick, like, each week what I wanna write about based on what I think is the most interesting thing happening is. But, you know, I do wanna follow whatever I think is, is the most interesting thing going on.

Ben Gilbert 1:49:09 And look, like, that has attracted an audience that includes CEOs of FAANG companies, I mean, that, that are, that are active subscribers to your newsletter. So I, uh, unless they've subscribed, unsubscribed, uh, seems like it's working.

Packy McCormick 1:49:20 [chuckles] Is that... Did Jeff Bezos send you that email?

Ben Gilbert 1:49:24 Yeah, Jeff and I... So the thing about-

Packy McCormick 1:49:25 You're not giving him the alpha anymore?

Ben Gilbert 1:49:28 [laughing] I'm kidding. Jeff, Jeff Bezos and I have never spoken. He doesn't subscribe. Someone, I think, signed up with Satya Nadella's email address, but, like, it certainly wasn't him, and that email address has never opened an email.

Packy McCormick 1:49:36 [laughing]

Ben Gilbert 1:49:36 So I think that was a prank. Um... [laughing] But, like, you know, I do know that, that, uh, that, you know, CEOs of big companies and all that-

Packy McCormick 1:49:42 It's actually Pujat, that, [chuckles] no.

Ben Gilbert 1:49:45 [chuckles] That would be messed up. I was so excited.

David Rosenthal 1:49:48 ... All right, so speaking of web3, uh, you wrote in your Power to the Person piece another sort of, um, crazy-sounding, uh, prognostication, that you predicted that within ten years, within a decade or two, there would be multiple trillion-dollar market cap organizations that were run, quote, unquote, "by just one person," that were, that you called solo corporations. And your point was, hey, it already exists. It's called Bitcoin. [chuckles] Nobody works for Bitcoin, and it's a trillion-dollar market cap. Um, back to Not Boring itself, it's so awesome. It's, like, incredible, and, like, Ben and I are a hundred percent in the camp that are cheering for you, that you made it to your goal of making a billion dollars in revenue this year. A kinda old-school way of thinking about that would be like, Packy is the head of the distribution in the creator economy, and one of the few people that have really broken out and are ... You know, you're gonna make a great- you're gonna be, like, an NBA player, you know, level in the- a professional player in the creator economy. Another way to think about where this could go, though, is, no, you're building a solo corporation. [chuckles] And, you know, it's not just that you're gonna make a few million dollars a year writing a newsletter. Not Boring can be something a lot more. [chuckles] Uh, how do you think about that?

Packy McCormick 1:51:15 This is, I guess, one of the hypocritical things about Not Boring, maybe, is that, you know, I analyze everybody else's strategy and plans and all these things, and there really isn't one for Not Boring. Like, would I love Not Boring to be a big and lasting thing that builds actual products and, like, does, you know, things that, that kind of outlive me? A hundred percent, I would love that. I'm right now worried about what I'm gonna write about on Monday, and so that's, like, both a blessing and a curse. I think so far, I think maybe the, the good thing about Not Boring has been that, you know, I'm fully focused on the content and making sure that's as good as possible. The downside is that I'm not planning ahead by, like, any stretch. I'm, like, one of the worst plan- planners you've ever met.

David Rosenthal 1:52:02 [chuckles] Clearly, if you've been listening to this story.

Packy McCormick 1:52:04 [chuckles] Yeah. So, you know, like, there, there isn't right now a long-term plan for something like that. I think the really fun thing about kind of like, you know, the exponential growth of this is that new opportunities kind of pop up. I do think I need to put, you know, a bit of a structure in place, whether that's formal or informal, around Not Boring, so that I, I can have some time to focus on other opportunities, you know, either as they arrive or, God forbid, proactively. Um, but, but for right now, I mean, I think one of the things that I can... And this is maybe why media businesses are hard and have a hard time transitioning into, into something a lot, lot bigger, is that if I say, "You know what? I really wanna, like, go start building apps, uh, and I'm gonna build- like, I'm gonna launch Packy Coin, and I'm gonna build a bunch of apps and make, like, try to make, like, a billion dollars," and I don't focus on the content, the whole thing probably falls apart. And if I bring in people to, like, help on the research and to ghostwrite for me and all of that, then it loses the thing that's, one, that I like doing, and two, is at the core of it and on which everything else relies. I think there's a really interesting kind of web3 angle here, where, like, how do I figure out how to build, you know, whether it's a DAO or some, like, kind of loose structure around this, where other people can go off and, like, kind of tap into the Not Boring audience and network and all of those things to build things on top that are aligned with, with what we're doing? Obviously, Not Boring Capital, uh, you know, you can kind of scale the, the outcomes with, I guess, both a combination of AUM and actual kind of ability to, to invest in the right companies. Um, but there's not a lot of plans beyond that. Like, if this becomes a thing that is a couple million dollars a year, like, you'll never hear a complaint from me about that. Uh, but, like, certainly, I think when I'm 80, w- would I wanna look back and say, like, that I built something that the second I stop writing doesn't fall apart? Like, 100%, yes.

David Rosenthal 1:53:55 I think it's worth spending a little bit of time on Not Boring Capital, um, which is obviously not wh- other, other... It's not web3, other than you are able to invest in web3 projects via it. But, um, it is this really interesting thing, like, and maybe it's unique to sort of our collective corner of the creator economy, but it is a real business, and it is a real step towards going from just being a... You know, I'm thinking about, like, the Oprah episode that we did, uh, uh, two years ago? A year and a half ago, whatever it was, um, where it was, was it her first agent, if I'm remembering right, who said, like: "Look, you can be the talent in front of the camera, and, like, you can make a few million dollars a year. You'll have a great life, right? Like, or you can own the production," [chuckles] you know, "and then you, and then then you can become Oprah." Right? And, um, it does feel like there's kind of this opportunity for creators now to go from just being, like, an indie version of the talent in front of the camera to a lot more.

Packy McCormick 1:54:58 Yeah, I mean, I think certainly Not Boring Capital is a step in, in that direction. I think the three of us are very lucky that the type of content that we make is also really well aligned with doing venture capital. Obviously, there's a lot of creators who are starting to invest in startups. I'm less dismissive of that, you know, as you can probably tell at this point, than most people are because I think, you know, they probably have really deep insights into certain spaces that other people who haven't been creators and haven't built that kind of business wouldn't understand. But I think for us, in particular, we're really lucky, and, you know, Harry Stebbings falls into this camp, and a bunch of other people do as well. Lenny and Turner, uh, all fall into this camp where we're living and breathing this stuff every day. And this probably goes back to our conversation on journalistic integrity, where like, I actually don't want to do this without having skin in the game, and I don't wanna do this without kind of like-... digging in and getting involved, uh, in the companies that I'm writing about and, like, trying to help shape their trajectories. And, like, I love picking up the phone and talking to a founder about, like, not just like, "Here's this idea that I came up with and wrote about," like, kind of ab- abstractly, but like, "Here's this problem that we're having right now. How should we think about solving this problem?" And so I think, like, that is really, like, a huge benefit of being able to have both Not Boring Capital and Not Boring the newsletter, and there's all sorts of ways that they work together. And from a business perspective, it's phenomenal 'cause it does scale a lot better to run a venture fund than to show up every week and get a sponsor and then write, write an essay. But like, again, like, this wasn't even planned. Like, that's not where it ca- it really came from, like, one time where I, you know, wrote an essay to help a friend who was trying to explain how his company worked, and then he raised a syndicate with somebody else, and then that turned into my own syndicate, which turned into a fund because it was too much of a pain in the ass to write, uh, memos every time that I wanted to do a deal, and founders didn't wanna wait three weeks to see how much money I might be able to give them, and so that turned into a fund.

Ben Gilbert 1:56:50 Wait, you're telling me, as an LP in your fund one and fund two, you don't write investment memos for every single one of your packy?

Packy McCormick 1:56:58 I, I write them up here. Yeah, no, [laughing] so I-

Ben Gilbert 1:56:59 [laughing]

Packy McCormick 1:57:01 ... fund one I did, uh, fund one I did 91, uh, 91 investments, and not all of them have investment memos. Uh, but in, I mean, like, i- in, in all seriousness, like, I do think that all of the time that I've spent writing about all of these different kind of industries and companies and all of that, like, really helped me show up kind of prepared and thinking about what to look for in these different businesses.

David Rosenthal 1:57:20 And a lot of your investments you've written about.

Packy McCormick 1:57:23 A lot of my investments I've written about. A lot of investments, frankly, come in because, you know, I start writing about Web3, and I write something, you know, like the cooperation economy that unlocks, like, how somebody thinks about something, and then they want to start a... I've, I've had that conversation with founders a few times where they're like, "This is actually like... We make all of our employees read this because this is what we're trying to do." And so, like, that kind of helps, you know, on the sourcing and, and winning deal side. But this wasn't planned either, and so I think the next iteration of Not Boring, whatever, like, we kind of add on top here, it probably won't be planned, and it'll probably be because it makes sense with, with what I'm doing. But yeah, I, I think I could not do this, and I didn't plan it this way. I couldn't do this if I didn't have some sort of skin in the game with what's going on here and some sort of like... I, I like being honest when I get stuff wrong. Like Pilot.com, my worst call of all time, being short Pilot.com, only really the only time I've ever gotten kind of pessimistic. I like being called out when I'm wrong on stuff, and I think, you know, to be able to, to run a venture fund that says like, "Cool, here are the ideas," but then also, like, I'm putting money behind it, and you'll see the results and how well fund one, fund two, fund three did, and whether I'm just, like, fully talking out of my ass or only partially talking out of my ass and got lucky a little bit, uh, in the results of, of how these funds do.

Ben Gilbert 1:58:35 Well, it does seem like you're publishing pretty much... Like, I think on Saturday you send out the e- email to LPs, and then come Monday, you send out a public version, and it's pretty much the same. I mean, you are- obviously, there's some things you're, you're, that the companies don't want you sharing, but other than that, it's a pretty- it's a remarkably transparent way of going about venture investing. And it's also super different than, you know, classic venture capital. Like, uh, uh, did you lead a single round? Did you write any term sheets? Were you the biggest check in any one of those 91 investments?

Packy McCormick 1:59:07 Never, and that's, that's all part of the strategy, right? Like, I mean, we all love talking about strategy, and, and strategy isn't doing everything well, it's picking what things you want to do well and, and taking advantage of those things. And so even like, you know, figuring out how to price the round and figuring out what should go into the term sheet and spending time negotiating that and then being on a board, God forbid, like, it actually just doesn't work with my strategy because, like, it is a house of cards already, where you move one thing, and, like, the whole thing breaks. And so if I'm doing kind of the more deeply time-consuming parts of a venture, it, at least as I'm currently constructed, doesn't work. But it really works very well when, you know, I can talk to a founder, and we have the specific area, either kind of internally or externally, where I can be helpful. Not to [chuckles] kind of-

David Rosenthal 1:59:53 [laughing]

Packy McCormick 1:59:53 ... you know, make fun of that, that, that venture pun, but-

Ben Gilbert 1:59:55 Put on your khakis and ask the question, yeah.

Packy McCormick 1:59:57 Yeah, but, uh, you know, like, there, there's a bunch of things that, you know, you make trade-offs throughout, and I wrote in both the public and private memo that, like, I'm doing probably less diligence than most people on a specific company, than most people who are investing in a company will. And that's, like, an embarrassing thing to say publicly when LPs are reading that or when, like, the world is reading it. But it's a, it's a fact of the business that, like, there's just no way in the world that by myself here, while I have another job and I'm investing in 91 companies, I'm going as deep looking for the flaws in a company and, like, calling references to look up, like, what this person did wrong managerially. Like, I trust that if a good fund is leading the round or somebody that I trust is, is leading the round, that they've done that stuff, and my job is, you know, as it is with Not Boring, to look for like what can go really, really right here. And so, you know, this will either blow up totally in my face, or we're in this crazy bull market, and, you know, I should have been a lot more conservative and, like, gone for, like, VC value investing, or it'll work. But, you know, the, the whole thing is transparent.

Ben Gilbert 2:00:57 Which is a thing that's never worked, by the way.

Packy McCormick 2:00:59 Which is a thing that's never worked. I mean, I'm, I, I do base everything on... Like, it sounds footloose and fancy-free. I do base everything on-

David Rosenthal 2:01:05 Even Ho and Altus would probably agree with that. [chuckles]

Packy McCormick 2:01:08 [chuckles] Uh, on, like, the analysis and, and the numbers and-

David Rosenthal 2:01:10 Well, I think you're, um... I, I would argue, I mean, I'm sort of doing very similar things with, with Kindergarten Ventures, with, with Nat, as, as what you're doing with Not Boring Capital. But, um, so I'm arguing my own book here to a certain extent, but I would argue you're selling yourself short with Not Boring Capital, and I love how... You know, everything you've done is, like, emergent, you know? [chuckles] It, it's not, uh, uh, it's not like you cooked it all up in a, on a whiteboard. Um, but it's kinda like the content, uh, like the, like the sponsored posts, right? Like, people used to think about venture capital in a box and only one way.... you did a lot of diligence, you wrote the term sheet, you came to evaluation, you negotiated, you joined the board, you did all these things, right? [chuckles] And obviously, that wouldn't work for what you're doing. [chuckles] You know, you're writing a- y- you've got a big, big business writing a newsletter. But there's aspects that work, of what you're doing, that work way better [chuckles] than that old way of thinking. Old- not old, old, it's still valid, but than that one specific way of thinking, right? Uh, and you're able... You know, you've already scaled capital under management doing this. You could probably keep scaling even a lot further with this strategy. Um, and but what you're bringing to the table and how you're doing it is, is just this kind of new way of thinking, right?

Packy McCormick 2:02:38 Yeah, and there's a group of people who I think are doing this, and, uh, I mean, you're certainly involved in this, and, and it's great that we kind of like... It's maybe a liquid super team, to quote myself, which is always fun. Um, but, you know, that, that's coming together and, like, sharing deals with each other and, like, trading, you know, thoughts and advice and, you know, "Here's where I think you were maybe wrong on that investment," the kind of things that maybe before you would've gotten out of a partnership at a firm, and certainly that right now you get out of a partnership at a firm. And it's not as formal, and I will still make more mistakes than probably a firm will make, at least on the, like, saying yes to things that maybe I shouldn't say yes to.

David Rosenthal 2:03:12 Ah, but venture capital's never about the mistakes. [chuckles] The only thing that matters in venture capital are the ones you get right. [chuckles] And that's kind of the point, right?

Ben Gilbert 2:03:19 There may even be one founder committing fraud that you've invested in, and it kind of doesn't matter.

Packy McCormick 2:03:24 To the best of my knowledge, [chuckles] none of my founders are committing fraud, and they're, they're all amazing. But, I mean, I- you hope that doesn't happen, right? Like, that, that's, that's... I, I don't want to, like, leave room for people to commit fraud and for me to just kind of look the other way and make a quick decision and be like, "I, I don't really care." But I'm- I am probably putting too much... Or, or, you know, I'm putting trust in the overall kind of ecosystem and, and system, um, that other people are doing their jobs well, which, again, could totally blow up in my face, or not, but that's just the trade-off.

David Rosenthal 2:03:55 Well, the way you're constructing your portfolio with 91 companies is... You know, of course, look, absolutely, we don't want [chuckles] any fraud to happen. Like, that's not the goal. But y- you've kind of shifted the mindset from, like, playing defense of, like, "We're going to make sure fraud doesn't happen," but in venture capital, the zeros are meaningless. [chuckles] You know, the most you can lose is your money. [chuckles] The most you can make is 1,000 times your money. Uh, and so you wanna maximize the winners. And the thing is, because of what you're doing with Not Boring, you're getting access to these great investment opportunities that otherwise, if you were a traditional venture investor, you would have to do all of that effort and work to build it. "We're gonna take board seats. We're gonna give you great advice. We're gonna do all this stuff." For you, it's a by-product.

Packy McCormick 2:04:42 I think that part is totally true. I mean, the, the portfolio construction thing is super interesting, too, because I spent way longer than you should spend inside of even a successful startup, at a startup that ended up failing. And so I saw, you know, the other side of that, where there are investors who, you know, were a write-off, and at some point, you just kind of stop caring about that particular company, and you move on to the next one. You really, like, I, I really don't want to take that attitude towards it. Like, if there are companies that are not doing well, I want to answer their call as quickly as the companies who are doing really, really well, 'cause, like, I know how it feels to be on the other side of that. But at the same time, like, uh, this is why I'm totally cool with founders being investors as well, and all that. Like, you should diversify and not put all of your eggs in one basket. Obviously, if you're a founder and you have 1,000 employees, or 100 employees, or even 20 employees, you have people who are relying on you. You should be giving a vast majority of your time to make sure that those people who are definitely putting all of their eggs in one basket get the best possible outcome and as much care as they need from a leader. But I do think there's obviously value to constructing a portfolio, and having been on the other side of that, I appreciate that, I think, even, even more.

Ben Gilbert 2:05:46 All right, so we're talking about portfolio construction. You invested in 91 companies. You're on your second fund. First fund was how many?

Packy McCormick 2:05:54 $9.99 million.

Ben Gilbert 2:05:56 9.99. Second fund's-

David Rosenthal 2:05:57 You couldn't get it to 10? Oh.

Ben Gilbert 2:05:59 25 million.

Packy McCormick 2:06:00 You're not allowed to get it to 10.

David Rosenthal 2:06:00 Oh, I see. I was gonna say, you could've called me up, I'd give you an extra 100 bucks, like [laughing]

Ben Gilbert 2:06:05 [laughing]

Packy McCormick 2:06:06 Um, and, and fund two, were it to exist, uh, would potentially be in the $25 to $30 million range.

Ben Gilbert 2:06:13 In that range? Okay. Well, listeners, if you are interested in data like this on funds, and how many investments they have, and what fund size it is, like, if you're thinking about, "Geez, I wanna pitch that fund, but I don't know... When was it raised? Oh, it was raised a long time ago, and wow, they've made a lot of investments. Is it actually worth my time to meet with them? Do they have the dry powder to invest? Does Packy have a new fund that he, he can even invest out of?" I have a great product for you, and that product is PitchBook. You like what I did there, guys?

David Rosenthal 2:06:44 That was, that was good.

Packy McCormick 2:06:45 That was so good.

David Rosenthal 2:06:45 That was inspired.

Ben Gilbert 2:06:46 [laughing] Uh, PitchBook-

David Rosenthal 2:06:47 I saw Packy's eyes get wide when you were talking about, [chuckles] fund two. Hey, go ahead.

Ben Gilbert 2:06:52 Yeah, yeah, yeah. Well, uh, I think as, uh, as folks know, PitchBook is the, like, no-brainer, leading financial data provider for VC, private equity, M&A. I, I should have these numbers memorized by now, but 3.1 million companies are in the database, and over 1.5 million deals. Only half of those are ones that Packy did, so, you know, plenty of other deals in, in PitchBook's database, too. 96% of PitchBook's clients rate their coverage of private companies better than any other data provider. I use it all the time. We use it here for Acquired. I was looking Packy up in there before the show, and, um, just a, just a great product, great company. So, uh, you should totally go check out pitchbook.com/acquired if you are interested in, uh, in signing up, and that way, they'll know that we sent you. So, um, our thanks to our friends at PitchBook for sponsoring the show, and, um, Packy, go do more deals so they can grow the dataset.

Packy McCormick 2:07:45 We've, we've texted about this before, too, how jealous I am that PitchBook is a sponsor and that, that you, uh, are PitchBook clients and get access to the database. Because I, I had the trial one weekend, and I'm still a solopreneur, and so I can't, you know... I, I, I can't justify paying for any tools, really. I think Substack has spoiled me.... but the weekend or the week that I had access to the PitchBook data, I wrote a post called Dreams All the Way Up, where I compared kind of public company valuations to private company valuations, and I was really a kid in a candy store. This is-- You know, I'm not getting paid at all for this, but I, I will second that PitchBook recommendation a hundred percent, 'cause that was as much fun as I've ever had writing something when I was able to just kinda think of a question, and then the answer was right there. It was amazing.

David Rosenthal 2:08:26 Oh, so great.

Packy McCormick 2:08:28 And if you're listening at PitchBook, uh, I would love a free [laughing] trial again, please. [laughing]

Ben Gilbert 2:08:33 Yeah, we'll make sure to get you hooked up.

David Rosenthal 2:08:35 Okay, so the-- I think before we move on from Not Boring Capital as sort of this, you know, next phase, maybe it's the final additional phase of Not Boring, maybe there's more phases to come in the future. Um, we talked about Substack, Twitter, et cetera, you know, the platforms enabling Not Boring, the media company. AngelList enables Not Boring [chuckles] Capital, enables Kindergarten Capital. Like, this-- You know, f-- I, I've spent, uh, eleven, twelve years i- in venture now, uh, nine or ten of those as a traditional professional venture capitalist. Th- this would not have been possible. You are one person. [chuckles] You did ninety-one deals in fund one. Who knows how many you'll do in future funds? Uh, there-- Now having the equivalent of Substack for a venture firm, it's game-changing. This was not possible before.

Packy McCormick 2:09:29 It's more than I'd say the equivalent of Substack for a venture firm, because Substack, I still have to write everything, and edit everything, and make all of my own graphics, and all of that. I work with Jen on the AngelList team. I will give Jen a shout-out anywhere that I possibly can, because it is like having, like, more than just a teammate, like, a whole team of people working with me. Like, I will come up with a crazy idea and be like: Hey, we need this crazy idea done kind of, like, tomorrow. Is that okay? I'm so sorry. And she's like: "Yeah, a hundred percent. I went and talked to our legal team, and, like, we can make it work if we do X, Y, and Z thing." And so having, you know, both the platform itself, which is great and makes it really easy to raise money from LPs and for LPs to get visibility into kind of how the portfolio is performing, although that data is a little bit delayed, LPs, so it's actually performing better than it looks on there. Um, but, but really, like, having a teammate over there who is, like, fully responsible for making sure that things go smoothly lets all of this happen. If there was no Jen at AngelList, the, this Not Boring Capital would not, a hundred percent would not be a thing.

Ben Gilbert 2:10:35 It's a total reorganization of the value chain by dismantling the vertical integration of venture firms. And it's so interesting that... I mean, my- be- going into this episode, I thought: Oh, I see. Uh, Packy doesn't need to... And this is a, this is a crude oversimplification, but for Not Boring Capital, Packy doesn't need to have associates that are pounding the pavement out in the community, meeting with entrepreneurs, because he has a digital way to do that called Not Boring, the newsletter, and that way, he gets deal flow from that. But it's so much more fundamental than that. Like, you look at a venture firm that has fifty employees, that has several funds, and has been around for a while, it's like, it's not just that there's-- there's a massive back office that you now don't need to have, too. There's like... I mean, traditionally, at venture firms, you have an IT person. Like I mentioned, you don't have an IT person. So it's not only does your media company not have a vertically integrated staff associated with it, but your venture capital firm also doesn't have a staff associated with it. And so you actually can, like, leverage all this new value chain that is completely reorganized for both the media and the venture capital business to stay a one-person corporation.

Packy McCormick 2:11:42 I mean, none of this is possible ten years ago. I'm not nearly technical enough to make any of this happen on my own. I'm not organized enough to build the systems to even make it happen, even if I couldn't build software. Having these software tools is the only reason that Not Boring exists. I mean, this is kind of the point of, of the power of the person piece, was that there are just all of these things that you can snap off of a shelf. And so instead of having to deal with all of the organizational headache of m- managing and organizing a firm, like, it's very easy then to just snap one piece in at a time when you need it. Now, it's great, like, you know, Substack i- is not an as-needed thing, it's every week I'm sending on that. AngelList is, like, snapping a whole huge, sophisticated back office into place, and so-

David Rosenthal 2:12:26 It's really like, it's, it's, it's n- not even like Substack for a venture firm. It's like AWS for a venture firm.

Packy McCormick 2:12:31 It's like AWS for a venture firm with a little bit of, like, also the person doing... You know, like, let's say I'm not technical, like, also the person doing the integration when setting up AW- uh, AWS in the first place, 'cause that's, that has been the big thing for me, is like, not just the fact that there's the software there that makes it really easy, but that, like, even when I don't know what to do, there's somebody that I can ask about, like: Hey, is this a thing? Like, we ask about, you know, nine point nine nine nine million dollars for fund one. That was, you know, through a conversation with Jen, where she's like: "By the way, like, I looked into it. This fund actually has this many beneficiary owners, but if they're less than ten percent of this, then you can do X, Y, and Z thing." And so it's even better than normal software until AI gets a lot better, because, like, all the things that I'm too stupid to know that I don't know, or like, to, to know that I, that I don't know, they can kind of anticipate and, and show you the ropes. And so this is not an [chuckles] AngelList ad, but it is maybe a Jen ad. Jen's the best.

David Rosenthal 2:13:24 Nicole is also great. She's our person there. [chuckles]

Packy McCormick 2:13:26 There you go.

David Rosenthal 2:13:27 Thank you, Nicole.

Packy McCormick 2:13:28 It is amazing that it's not just software, and, like, there are... Like, I think when you think about kind of the, the future and tech and, like, AI stealing everyone's job, like, maybe that happens at some point in the future, but I think the really great thing is that it's just people kind of, like, pulling resources in the right place, and then you can go access, uh, access them at, at the time it makes sense. So AngelList's model would never work if I could onl-- if I only paid them twenty-five thousand dollars a year to do what they're doing for Not Boring. Like, I'm getting hundreds of thousands of dollars' worth of, of advice and service and all of that from AngelList, but they also have thousands of other clients, and so it works, and the more there are places that get really, really good at one specific thing, the easier it is for one person to start a business that draws from all of that.

Ben Gilbert 2:14:09 ... you're championing specialization of labor. It's like, "Hey, pie growth happens when [chuckles] when everybody gets really good at one thing, and we have a super, super liquid way of stitching all those together."

Packy McCormick 2:14:21 Exactly.

Ben Gilbert 2:14:23 Okay, so we're, we're sitting here evaluating, like, in all the most positive ways, and sunshine, and butterflies around this one-person corporation thing. What are the trade-offs? Like, you're a strategy person, where does it get hard?

Packy McCormick 2:14:35 So the trade-offs right now are, like, I don't have any outside investors, right? Like, I mean, I have LPs for the fund, but if I get hit by a bus, like, Not Boring is just done. And that's, like, the extreme example and the example that everybody uses when they talk about one-person things, but that means that, like, every week, if I don't show up and write something, the momentum slows a little bit. And so it's, like, very, very, very hard, I think, from, from that perspective. Like, you'll hear zero complaints out of me, but it's really hard to take a week off because I'm worried every time that the momentum will slow, and there's not, you know, somebody else on the team who's just gonna, like, go write something else and keep the momentum going that particular week. So I think