financial-samurai-po_sam-dogen-financial-samurai-dan_full-length-jun-8-2023-001_composer-qmtq5ttpp_clip_2023-jun-07-1634pm-utc-riverside
00:00:00.000 | - Hello everybody, it's Sam from the Financial Samurai podcast and in this episode I have
00:00:05.520 | a special guest with me, Dan Andrews from the Tropical MBA.
00:00:10.560 | Say hello.
00:00:11.560 | - Hey, thanks for having me man.
00:00:13.160 | This is cool.
00:00:14.160 | - No worries.
00:00:15.160 | I thank you for joining.
00:00:17.000 | So I first discovered the Tropical MBA when I started Financial Samurai in 2009 and you
00:00:22.900 | also started the Tropical MBA in 2009.
00:00:26.480 | And one of the things that was so interesting about your site was that you were living,
00:00:31.200 | I think in Thailand at the time or somewhere in Asia, and I wanted to live that digital
00:00:37.200 | nomad lifestyle because it was the financial crisis and the recession and you were living
00:00:42.480 | it.
00:00:43.480 | You were living the dream.
00:00:44.480 | So I'd love for you to talk about why you started the site and how did you get the gumption
00:00:49.160 | to go out to Thailand and to do the things you were doing?
00:00:54.920 | - Well first off it started with China, which was my, I'm not a good business person necessarily,
00:01:00.040 | but I would walk around and touch everything and be like, "Is this made in China yet?"
00:01:04.000 | That was my way of having a business idea.
00:01:06.560 | So I become acquainted with sending faxes and emails abroad and then waiting 12 hours
00:01:12.720 | for them to come back and this idea of globalization was very real to me when I started reading
00:01:18.160 | books like 4-Hour Workweek and stuff like that and I'm like, "Yeah, I do work at 9pm
00:01:22.800 | to make sure that our partners abroad are carrying on."
00:01:27.440 | So 4-Hour Workweek was kind of a really seminal book for a lot of people because at that time
00:01:33.080 | people felt like the workday didn't end at 5 and that felt new.
00:01:38.400 | I don't know, that felt like, or just something that was very frustrating about our careers,
00:01:43.720 | that it was just like all the time.
00:01:45.160 | And so I started spending more time in China and then when I realized SEO was going to
00:01:50.760 | be a thing.
00:01:51.760 | >> So search engine optimization for those who don't know.
00:01:54.240 | >> That's right.
00:01:56.040 | But also that we couldn't afford it as a small manufacturing company.
00:02:00.240 | I started seeing these gurus pop up online, people like John Jonas who were saying, "Hey,
00:02:05.720 | did you know that there's over 100 million Filipinos that speak English?"
00:02:08.600 | And I was like, "No, I did not know that at all."
00:02:11.480 | And started kind of going down that rabbit hole and with the combination of traveling
00:02:14.780 | to Asia I got a sense that we could really build a strong digital marketing presence
00:02:19.000 | in Asia and that's really how the whole journey started for me.
00:02:23.120 | >> And before that decision to move to China and do that, what was your educational background
00:02:28.440 | and how did you decide, "Well, let's just go to China because I don't think most people
00:02:33.560 | would think that."
00:02:34.560 | I think 60 plus percent of Americans don't even have a passport.
00:02:37.760 | >> Yeah, I probably had early formative travel experiences which blew my mind and I didn't
00:02:44.680 | really control my time or my location my whole life.
00:02:47.600 | I was always in school or at a job and it was incredibly frustrating to me especially
00:02:52.080 | as my work hours and my salary started to go up.
00:02:54.880 | I remember when I started making $100,000 a year I was working for a small manufacturing
00:02:59.240 | company and I realized, "My God, I can't travel anywhere."
00:03:03.840 | I mean between dentist appointments and family responsibilities and some fun here and there,
00:03:08.880 | I really can't do much even though I've reached this goal I had for myself to "make a lot
00:03:15.600 | of money."
00:03:17.260 | My background was I studied philosophy and with the sense that I might be able to go
00:03:22.440 | into academia so I'd have the freedom to read and write for a living.
00:03:26.640 | What I found was it was extremely competitive.
00:03:31.200 | The compensation was really poor and also you got kind of locked into these random locations
00:03:36.160 | like "Yes, Iowa State" or whatever.
00:03:39.400 | That would be a really good job and I thought, "I can't."
00:03:41.920 | >> Oh, but that's where the Writers Guild is, right?
00:03:44.680 | That's like the top.
00:03:45.680 | >> Well, yeah, I mean for sure but you have to live in Iowa so I don't know if I'd make
00:03:50.000 | the trade.
00:03:51.000 | >> Okay.
00:03:52.000 | Iowa's got some good stakes though but yeah, I hear you.
00:03:54.320 | >> Yeah, I mean it was always just sort of a thing in the back of my mind that I guess
00:03:57.720 | I equated travel with freedom and that I would ultimately need to find a career that would
00:04:04.240 | allow me that freedom.
00:04:05.400 | >> Yeah, why not do both, right?
00:04:08.100 | Instead of maybe what most people do is they work all their years in one country and then
00:04:13.840 | when they retire, then they go and travel the world.
00:04:17.480 | >> Essentially, yeah.
00:04:20.000 | >> How long were you in -- when did you go to Thailand and how long were you there?
00:04:23.840 | I think was it in Chiang Mai?
00:04:26.200 | >> So basically what happened was I moved to the Philippines to start recruiting a back
00:04:31.280 | office staff.
00:04:32.280 | We started hiring developers and writers and I was spending a lot of time in Manila and
00:04:36.800 | things thinking, "Oh, you know, Manila's a great place to hire but not really where I
00:04:40.720 | want to live."
00:04:41.720 | >> Oh, interesting.
00:04:42.720 | >> So I started exploring the region and at that time, we were having so much fun.
00:04:48.120 | I thought, "Man, I bet other people would want to come out and do this."
00:04:52.240 | I bet people would take a pay cut to come work for an e-commerce company.
00:04:57.400 | And so that's where the Tropical MBA came from.
00:04:59.920 | It was literally like, "Come to the tropics and I will teach you how to be a marketer
00:05:05.020 | for an e-commerce company.
00:05:06.640 | I will teach you SEO.
00:05:08.240 | I will teach you all these skill sets and then you'll be able to go start your own company
00:05:12.960 | in the next couple of years."
00:05:14.640 | And that's really, it wasn't even a blog at the beginning.
00:05:16.640 | It was really just a job offer.
00:05:18.520 | "Hey, I'm paying this developer in Manila a thousand bucks a month.
00:05:22.480 | I'll pay you two thousand bucks a month and just come hang out with me and we're going
00:05:26.520 | to build this business."
00:05:27.520 | And that was kind of the concept.
00:05:29.720 | >> I mean, yeah, I was very back in the financial crisis.
00:05:33.280 | I was thinking to myself, "If I lost my job, I would hopefully get a severance and then
00:05:37.920 | maybe I would try to do that internship.
00:05:40.000 | Even if I couldn't get that internship, I would go anyway and just try to live my life
00:05:44.880 | out there and see what you all are up to."
00:05:46.840 | Because it was the new frontier then and now it seems pretty ubiquitous about people making
00:05:52.360 | money online.
00:05:55.560 | During your business time, where did the main source of revenue come from?
00:05:59.360 | Like what was e-commerce but then you had marketing.
00:06:02.140 | So how did that look like?
00:06:03.140 | >> Just to piggyback on that instinct, Sam, it's funny you mentioned that because we had
00:06:07.880 | ended up doing 12 internships and a lot of it was fun.
00:06:12.680 | One is a very famous dividend investor right now.
00:06:16.080 | A handful of them turned out to be very wealthy.
00:06:19.320 | It was a lot of people that were on the fast track that just wanted to see what was going
00:06:24.280 | on.
00:06:25.280 | And then the other half was people just out of college that wanted to do the classic internship.
00:06:28.860 | So it was this very vibrant community when we ultimately got a villa in Bali and had
00:06:33.880 | a pool.
00:06:34.880 | >> I mean, that sounds amazing.
00:06:36.240 | >> It was super fun and it really felt like a moment.
00:06:39.920 | We couldn't believe that you could do it.
00:06:41.840 | It was still kind of that, "This is so crazy.
00:06:44.760 | We're making more than we made in jobs, but here we are in this affordable, fun paradise."
00:06:52.080 | Now it's a cliche, I think, the digital nomad thing, but at the time it really felt special.
00:06:57.800 | It really felt, to me at least, like a dream come true.
00:07:01.680 | So at the time we ran a company that had a warehouse in Temecula, California that warehoused
00:07:08.800 | parking products.
00:07:10.440 | So especially valet key stands that you see outside of hotels.
00:07:14.820 | That was our best product.
00:07:16.480 | And so in Manila, in Bali, we'd be building this website called the valetspot.com.
00:07:22.400 | You can still go there.
00:07:23.400 | We'd be doing outreach to partners.
00:07:26.440 | We'd be putting up SEO optimized articles.
00:07:29.520 | Maybe one of the big challenges for us at the time was there's not a lot of good e-commerce
00:07:33.520 | solutions like Shopify today.
00:07:35.840 | So we were building our own shopping carts and website using systems like, I think at
00:07:42.280 | the time we were using Drupal, which is quite a complicated web framework.
00:07:47.120 | So that's why we needed these developers.
00:07:49.280 | In California, I was getting guys nights and weekends for like $3,500 a month.
00:07:54.800 | And in Manila, I sat right next to a partner who was a high level developer for a thousand
00:07:59.680 | bucks a month.
00:08:00.880 | And that was the arbitrage that we were taking advantage of at the time.
00:08:04.520 | So for listeners listening to this, I mean, that sounds so random.
00:08:08.240 | You're creating valet parts in California in a factory and then you're in Asia arbitraging
00:08:14.160 | the developers.
00:08:16.320 | I can't even imagine how to start thinking about that.
00:08:21.960 | With listeners thinking, most of the folks probably have day jobs, maybe they're investors,
00:08:25.640 | entrepreneurs, I don't know.
00:08:26.640 | How do you even conceptualize that idea and then execute?
00:08:30.960 | Because it feels like a lot of people have a lot of ideas, a lot of places to exploit
00:08:35.440 | profits, but execution is a real big problem.
00:08:39.080 | I think one of the mistakes people make is they read a book like 4-Hour Workweek or Dan
00:08:43.600 | Kennedy or name your business guru and they say, "I want a business like that."
00:08:47.520 | But then to forget about the fact that you're already probably getting paid a lot of money
00:08:50.660 | for your skill set, kind of start with where you're at, like a moneyed skill set.
00:08:55.040 | At the time, I did contract manufacturing.
00:08:57.760 | That was what I was good at.
00:08:59.240 | If Sam, you come to me and you say, "I want 150 tables that are built out of this material
00:09:03.160 | and I want them delivered in St. Louis in six weeks."
00:09:06.120 | I would go to China, I would have my designers in California figure it out and we would do
00:09:09.760 | that for 150 pieces.
00:09:12.120 | Now at the time, I'm starting to think to myself, this really sucks that every time
00:09:14.680 | Sam or Paul or Jane calls me, I got to build whatever they're talking about.
00:09:19.320 | I thought, "Wouldn't it be great if I could just make a thousand of something and keep
00:09:22.440 | selling it?"
00:09:23.440 | So that was a problem I saw.
00:09:25.560 | And then we say, "Well, how would then you identify what to build?"
00:09:30.040 | And at that time, there was this concept called keyword research that people on the internet
00:09:34.680 | were starting to talk about.
00:09:36.560 | And I was learning about it because we were trying to market this contract manufacturing.
00:09:39.360 | I thought, "Wow, you can really figure out how many people every month search for something."
00:09:44.600 | And you can get a sense for whether or not they're buying intent keywords.
00:09:49.920 | And so we had all these ideas like, "We're going to do cat furniture and dog furniture
00:09:55.160 | and we're going to do..."
00:09:57.820 | It was all across the board.
00:09:59.480 | And we found this really tasty small niche of valet parking products.
00:10:05.800 | And when we started to do research on the incumbent players, we thought, "Man, we're
00:10:10.960 | actually a little bit more sophisticated.
00:10:12.720 | Some of these people are welding in Los Angeles and then they're shipping on pallets."
00:10:17.680 | We do knockdown fabrication.
00:10:19.840 | We build in China at high-class factories.
00:10:22.840 | There was all these things that gave us the confidence that, "Hey, maybe we could get
00:10:25.480 | involved in this space."
00:10:26.480 | And we just pieced it all together.
00:10:28.080 | And of course, we were broke.
00:10:29.080 | We were young kids.
00:10:30.660 | And so we were like, "Well, we can't afford to build an e-commerce site."
00:10:33.980 | So that's really where the Philippines connection came in.
00:10:37.000 | So we just pieced it together by what was right in front of us and trying to improve
00:10:41.080 | our situation rather than saying, "Oh, I'm going to be Tim Ferriss and sell supplements
00:10:44.960 | on the internet."
00:10:46.260 | We were inspired by that.
00:10:48.660 | But we looked at what we were already doing and good at in our current relationships and
00:10:52.480 | kind of improved from there.
00:10:54.780 | That's fascinating.
00:10:56.240 | And you actually just kind of went and did it.
00:10:59.260 | So for me, I...
00:11:00.260 | Well, part of the reason I did it, Sam, is that I didn't have a lot going for me.
00:11:04.200 | I mean, you know what I mean?
00:11:05.440 | I think it's a lot harder if you have a great career, if you went to a great school.
00:11:09.480 | That's true.
00:11:10.480 | I don't think I necessarily would have taken this path, but I don't know.
00:11:13.400 | I didn't go to a great school.
00:11:14.880 | I didn't have a great career in front of me.
00:11:17.840 | I was just working really hard for a small manufacturing company.
00:11:20.760 | I thought, "It's better to try out the Thailand thing."
00:11:23.880 | If I'm going to toil away at my desk for the next 30 years to go to Thailand someday, I
00:11:28.840 | might as well test it out to see if it's worth it.
00:11:33.320 | Where did you go to school and how much did you make before you decided to be an entrepreneur?
00:11:37.540 | So I went to Clemson.
00:11:39.400 | I was lucky enough to get a scholarship my second two years.
00:11:42.160 | It was about $14,000, $15,000 a year.
00:11:45.160 | I studied philosophy.
00:11:47.200 | So I accumulated about $45,000, $50,000 in debt during college.
00:11:54.480 | And so I kind of had that.
00:11:55.600 | And then when I came out my first job, I think I made $32,000 a year.
00:12:01.280 | And within a four-year period, I got four or five-year period, I got not up to $100,000.
00:12:05.640 | And that was kind of like the ... I was still in debt at that time.
00:12:09.720 | That was at the moment in my mind when I thought, "I don't think a higher salary solves this
00:12:14.960 | problem for me."
00:12:17.040 | I've got a spending problem.
00:12:18.600 | I've got an earning ... Because I was living in San Diego, I've got a cap on my income.
00:12:27.360 | I'm going to have to work for a very long time to get percentage increases.
00:12:30.440 | And then I also have a lack of freedom and time.
00:12:34.480 | I used to do these calculations where between doing my laundry and purchasing new khaki
00:12:39.240 | pants and driving to the office on the 5, I really only had a few hours a week to invest
00:12:46.200 | in myself.
00:12:49.480 | I was listening to these books and podcasts on the drive.
00:12:53.160 | And I realized I didn't have enough time to implement or chase after the things I was
00:12:58.160 | learning.
00:12:59.320 | And I think it was the combination there that really started to crack my worldview.
00:13:03.400 | And I thought, "Man, I need time.
00:13:06.320 | That's my constraint here."
00:13:07.320 | Now, you said you were making 100 grand four years after college, so around '26, '27, but
00:13:14.600 | you still had some student debt.
00:13:17.400 | Did you have a financial kind of buffer or target where you had to save up before you
00:13:22.360 | said, "You know what?
00:13:23.360 | I'm going to try this and take this leap of faith"?
00:13:26.440 | No.
00:13:27.440 | I don't know.
00:13:29.440 | No.
00:13:30.440 | I was just saying, "Well ..." Let's go for it.
00:13:32.440 | Not at all.
00:13:33.440 | Not that I recall.
00:13:34.440 | I mean, I probably had $2,000 or $3,000 in my bank account, maybe $6,000 or $10,000.
00:13:39.840 | It wasn't a lot.
00:13:42.400 | And the buffer for me was cash flow.
00:13:44.660 | So at the time, I had started this business and it was cash flowing.
00:13:49.640 | And I remember I walked into my boss's office and it was a terrifying conversation.
00:13:53.520 | I should have read your book first.
00:13:55.400 | And I said, "Look, I got to go."
00:13:57.920 | And he's like, "What do you mean you got to go?"
00:14:00.920 | I was like, "I got to see this through.
00:14:03.560 | I got to figure out what this business is going to be about, what web marketing is going
00:14:07.080 | to become."
00:14:08.080 | And I said, "I think I'm going to go to like Vietnam or Buenos Aires."
00:14:11.320 | I was 27.
00:14:13.760 | And I remember he said to me, he said, "You can't go."
00:14:17.000 | Well, I was like, "Well, what do you mean?"
00:14:20.120 | He's like, "Well, I'd like to continue working with you."
00:14:22.280 | He's like, "I want to see what you're going to see too.
00:14:24.440 | I want to be involved in the web marketing stuff."
00:14:26.080 | And I said, "Okay.
00:14:27.080 | Well, you can't keep paying me $100,000.
00:14:29.160 | So how about you pay me $50,000 and we'll work on the stuff together?"
00:14:33.360 | And sure enough, we worked together for the next four years.
00:14:36.320 | That $50,000 I made from him was a critical part of my entrepreneurial journey.
00:14:40.160 | That severance or that consulting gig with my former employer made it so much easier
00:14:46.680 | to be more aggressive with my own business.
00:14:49.520 | And because that client had cash to invest.
00:14:53.920 | So I took another $50,000 from that company, which at the time had about 40 employees,
00:14:59.160 | and I was investing that money into a web marketing team on their behalf.
00:15:04.240 | And I learned a lot from spending and investing that money.
00:15:06.860 | And so it turned out that it's a classic example of if you close a door, maybe another would
00:15:12.800 | open.
00:15:13.800 | I would never have expected that to happen.
00:15:14.880 | I wasn't depending on it, but it became a critical part of my journey.
00:15:18.840 | Wow.
00:15:19.840 | Actually, that sounds like a great severance.
00:15:22.680 | Great cash flow, great backup plan.
00:15:24.720 | I mean, that's really smart in being intentional to give you that financial buffer to take
00:15:29.640 | the leap of faith and do something else.
00:15:31.320 | Because as you know, most businesses fail after maybe five years, definitely after 10
00:15:37.720 | years, they just can't keep on grinding because of whatever exogenous variable.
00:15:43.000 | So that's pretty amazing.
00:15:45.220 | And so now-
00:15:46.220 | Well, one of the ways your audience can apply that is, my partner recently did this where
00:15:51.200 | if you make a good amount of money as a professional, you can typically downshift and fractionalize
00:15:56.800 | out your skill set for a small amount of time of your week.
00:15:59.240 | So as an example, if you make $150,000 a year as a director of marketing, you could take
00:16:04.760 | on one client for $2,500 a month and do one day or $5,000 a month and do one or two days
00:16:11.680 | of work for that money.
00:16:13.080 | And then now you've freed up three or four days.
00:16:16.020 | In particular, if that client has budget and you're just deploying and managing the budget,
00:16:20.600 | which was my case, so I actually didn't work at all for that money, I simply deployed the
00:16:24.840 | budget and managed the team.
00:16:26.960 | So it took me half a day a week and that was a really good deal.
00:16:29.920 | Got it.
00:16:31.600 | Now just on procuring products from China, so I have a business idea.
00:16:36.800 | I play a lot of tennis and my shoes, the soles, they wear unevenly.
00:16:41.800 | And so on the outside of the sole, it just wears and then it's just unbalanced.
00:16:45.600 | So how hard or easy would it be for me to come up with a prototype and then go to China
00:16:51.240 | and say, "Manufacture these soles that I could just plug on to my sole of my shoe so it's
00:16:57.480 | flat again and then I can just elongate the life of my shoe," because the sole is what
00:17:02.480 | wears out first, for example.
00:17:04.920 | Cool product idea.
00:17:05.920 | I love it.
00:17:06.920 | Now I'm waiting to hear your golf swing aid coming next.
00:17:14.080 | For me, nowadays, the hardest part about manufacturing in China is really the demand part.
00:17:19.400 | From which side?
00:17:21.440 | Well, making sure you can sell the things.
00:17:24.600 | So for example, if you told me, "Here's what I suspect the margins will be," which would
00:17:30.440 | be pretty easy for us to figure out.
00:17:32.120 | Yeah, 50% margins.
00:17:33.800 | Yeah, okay.
00:17:35.000 | So then we can project out on a pro forma, we get a sense for what this is going to mean
00:17:40.680 | for us financially if we can sell X number of them.
00:17:43.640 | Now that's the hard part.
00:17:46.400 | If you can figure out the demand part, if I come to you, Sam, and I say, "I think based
00:17:50.280 | on this funnel I built or whatever, we're going to sell 10,000 units in our first 12
00:17:56.560 | months," then for sure we can get it made.
00:17:59.960 | The hard part is how are you going to fund your trip to China?
00:18:03.120 | How are you going to invest in that relationship?
00:18:06.640 | The hardest part of the equation with 90% of products is the demand side.
00:18:11.000 | Interesting.
00:18:12.220 | When you go to most of these industries in China, it's been there, done that.
00:18:16.080 | Yeah, they have built replacement soles.
00:18:17.640 | So it's just a matter of digging into the details of what that's going to mean in your
00:18:20.800 | particular case.
00:18:21.800 | Interesting.
00:18:22.800 | Yeah, because I talk to a lot of entrepreneurs.
00:18:24.800 | Depends how innovative, I guess, is what I'm getting at.
00:18:27.120 | I mean, this is going to be really innovative, cool colors, amazing material.
00:18:32.400 | It's going to make your shoe greater.
00:18:33.720 | It's going to make you taller, all that good stuff.
00:18:36.240 | And I talk to a lot of entrepreneurs who have product, but their number one problem is distribution
00:18:42.000 | to get that demand.
00:18:43.000 | So for Financial Samurai, there is distribution because there's an audience.
00:18:46.760 | Correct.
00:18:47.760 | But I got no product, except for, well, I got my "How to Engineer Your Life" e-book,
00:18:54.200 | and then I've got a book.
00:18:55.200 | And other than that, I'm not selling anything, really.
00:18:58.680 | I think, by the way, I was doing an episode about how to have business ideas recently.
00:19:04.320 | And I think that going to, well, we call you an influencer, a thought leader, with solid
00:19:14.800 | operational business plans to responsibly capitalize on their distribution is such a
00:19:20.440 | cool idea.
00:19:21.440 | So, for example, in my case, I could imagine a world like I have group coaching experience
00:19:27.720 | where I could find a way to get on your calendar and say, "Hey, Sam, would you consider a joint
00:19:33.600 | venture for six months where here's how we would address your audience?"
00:19:37.480 | We'd walk through it.
00:19:38.480 | I have my whole team involved, and we'd responsibly walk your readers through financial training
00:19:42.600 | in a group setting.
00:19:44.100 | And you would be able to watch it in these ways, and here would be the revenue split
00:19:47.280 | for that.
00:19:48.280 | I feel like that is, especially for creators who mostly want to build out what they're
00:19:54.320 | really good at, their work, having an operational partner that could come in and responsibly
00:19:59.280 | monetize the audience, I think, is a great business idea.
00:20:02.200 | In terms of product people, you asked earlier, "Why are our products so random?"
00:20:07.440 | It's because I think something about the literature we were reading at the time, it made us understand
00:20:12.560 | that in this new world, the demand part was going to be where the winners became the winners.
00:20:21.360 | And also, for us, it was a new opportunity.
00:20:24.160 | In the good old days, you had to have a rent place on Main Street.
00:20:28.760 | Well, now, with Google Search, you could have the equivalent of the nicest real estate for
00:20:35.240 | just hard work.
00:20:37.720 | And that, as young kids with no money, was a very obvious opportunity.
00:20:44.060 | So when we saw something like valet parking products, which we estimated to be worth...
00:20:50.560 | It's like having the storefront on the corner of Main Street, because it's a multimillion
00:20:57.800 | dollar industry, well, we could have that for free.
00:21:01.400 | And so that's why we did it.
00:21:02.680 | It wasn't because we were passionate about parking products.
00:21:06.640 | It was because we were passionate about whatever we could own the best real estate for.
00:21:13.120 | That totally makes a lot of sense.
00:21:15.240 | And especially post-pandemic, with a business that can't be shut down, having an online
00:21:19.580 | business is even more valuable, more lucrative.
00:21:23.680 | So I guess my question is, why don't more people do this?
00:21:27.360 | Why don't more people think about the online business world instead of just going to a
00:21:32.440 | day job where they make $50,000 a year out of college and then just grind it out for
00:21:37.280 | the next 20 years or 30 years?
00:21:40.080 | That's funny.
00:21:41.080 | It was the same question we were asking at that pool in Bali.
00:21:46.040 | Why does everybody want to come?
00:21:49.000 | I remember asking that question.
00:21:51.520 | And the answer that I got from my friend David McKeegan, who ended up building one of the
00:21:58.040 | businesses I admire the most.
00:21:59.980 | It's called Greenback Tax Services.
00:22:01.560 | And what he does is taxes for expats in a productized level.
00:22:04.600 | They have really made an incredible business out of this.
00:22:08.920 | And he turned to me and he said, the reason is, is because it's going to take 1,000 days
00:22:13.240 | of effort where you're making less than what you'd make at your professional job.
00:22:17.040 | And he says, I just don't think that people are willing to go through those 1,000 days.
00:22:21.840 | And I since just ripped the idea off from him and I just went around and writing about
00:22:25.240 | it and it seems to really resonate with a lot of entrepreneurs because a lot of us remember
00:22:30.240 | fondly that being broke to do this.
00:22:32.880 | I just don't think people want to be that broke to build cat furniture or parking products
00:22:39.680 | or to write blogs on the internet and to be mocked and derided by your former colleagues
00:22:45.120 | and your family.
00:22:46.120 | Oh, man.
00:22:47.120 | Man, you're bringing back all these memories I had.
00:22:50.120 | I was totally mocked.
00:22:51.120 | I mean, my parents were not – I mean, they were – support is not the word I'd use
00:22:56.720 | but they were great.
00:22:57.720 | But like –
00:22:58.720 | Yeah.
00:22:59.720 | I mean, they thought I should have stayed in my job which I think is decent advice from
00:23:02.840 | parents but I think that's a journey that's for people who are willing to take that risk,
00:23:09.920 | I guess.
00:23:10.920 | Yeah.
00:23:11.920 | I think we mostly optimize for safety, stability.
00:23:14.280 | We invest in index funds instead of taking concentrated home run bets.
00:23:18.740 | But as a result, you end up just kind of average, average life which is fine.
00:23:22.800 | If you have no regrets, then I guess that's fine.
00:23:26.640 | But I resonated with A Thousand Days because I started Financial Samurai in July 2009 and
00:23:31.800 | I didn't leave my day job until what, May, April, May 2012.
00:23:37.720 | I remember when you left.
00:23:39.160 | Yeah.
00:23:40.160 | It was really scary times but I mean that's almost three years of just kind of grinding
00:23:45.360 | it and just writing what I wanted until I felt confidence.
00:23:48.360 | But it was really that severance package that gave me the confidence to say, "Oh, do or
00:23:52.440 | die.
00:23:53.440 | Let's do it."
00:23:54.440 | So I hope more listeners think about entrepreneurship not as such a scary, impossible thing but
00:24:01.600 | something you can actually do on the side before you go to your day job or after your
00:24:05.120 | day job because you never know what could happen.
00:24:07.360 | And clearly you, Dan, have crushed it and have continued to do what you're doing.
00:24:14.080 | And I think it's way better now than can you imagine still being whatever you were doing
00:24:17.960 | at your day job making now maybe $160,000 a year?
00:24:22.000 | I remember my business partner, we were having dinner last night after a bike ride and we're
00:24:27.020 | all sitting around a bunch of founders and he's like, "Sometimes I wake up and I pinch
00:24:30.920 | myself.
00:24:31.920 | I haven't gone to a job for 20 years."
00:24:34.920 | Yeah, jobs were hard for us, I think, emotionally.
00:24:40.200 | It was hard for me.
00:24:41.200 | I don't know why.
00:24:42.200 | It was hard for me to feel nervous about getting a dentist appointment.
00:24:46.080 | There was some of these small indignities.
00:24:48.280 | I couldn't…
00:24:49.280 | I had to ask for permission to kind of be somewhere.
00:24:52.440 | As an adult now.
00:24:53.440 | I feel guilty about it.
00:24:54.440 | Yeah, and it wasn't even necessarily about the money or not having more than three weeks
00:24:59.200 | vacation or two.
00:25:00.200 | It was more those small indignities about my day-to-day life that became untenable for
00:25:07.440 | me.
00:25:08.440 | But I do like your advice a lot about finding parlays and sticking in your day job as long
00:25:13.920 | as possible because there's…
00:25:16.040 | By definition, you're making…
00:25:17.960 | You're a profitable business if you have a job.
00:25:20.560 | And so really digging into how you can be better at your career, how you can have a
00:25:24.040 | side hustle, how your career could support you in your next…
00:25:28.360 | And keeping the cash flow going.
00:25:29.640 | So I think having a mind to entrepreneurship and not just cutting the cord is a better
00:25:34.720 | strategy generally.
00:25:36.720 | Yeah.
00:25:38.840 | So tell me, you were in Asia for a long time.
00:25:42.040 | And when did you decide to come back to America and why?
00:25:46.960 | Well, one of the simple insights that your writing recognizes that not a lot of financial
00:25:51.040 | writers say is you talk about relative wealth.
00:25:53.680 | And so one of the cool things if you do have a writing or podcasting or creative project,
00:25:58.700 | you can just move to Chiang Mai and you'll have a hard time spending more than $3,000
00:26:04.200 | a month and living a good lifestyle.
00:26:06.600 | And all of a sudden, you're relatively wealthy.
00:26:09.760 | Yeah.
00:26:10.760 | Very wealthy.
00:26:12.280 | And so that's a nice little hack if what you want to do is free up your time and you
00:26:16.040 | have some savings or a smaller cash flow.
00:26:18.320 | Or that would be the reason to get that one client that's paying you stress-free $3,000
00:26:23.240 | a month to do what you do at high stress for your job right now six days a week.
00:26:28.860 | You can move to a place like Chiang Mai and leverage those other four days.
00:26:32.820 | So I ended up, I think what happened for me was I was doing better financially.
00:26:41.620 | And a lot of places in Asia are developing and have frustrations that come along with
00:26:45.260 | living there.
00:26:46.260 | And at first, it's an adventure.
00:26:48.220 | But then it becomes frustrating.
00:26:49.820 | And so I thought, I went to a few conferences in Barcelona and different places in Europe.
00:26:55.460 | We started another business where we started pulling together founders at events.
00:26:59.300 | So I got to see all these new cities.
00:27:01.380 | And I remember the first time I came to Barcelona, you know how when you have an image in your
00:27:05.180 | head of a place and then you go there, and it can be a lot different.
00:27:09.100 | Sometimes people think Tokyo is going to be a bunch of robots running around.
00:27:11.900 | And then you see a bunch of hipsters.
00:27:14.980 | It's more subdued in terms of maybe the branding.
00:27:18.820 | And for me, Barcelona's brand was so understated at the time.
00:27:23.180 | When I got there, I was really blown away by how beautiful it was and how close to nature
00:27:27.780 | it was.
00:27:28.780 | And so I thought, well, I can afford it.
00:27:29.780 | I'll move to Europe now.
00:27:31.740 | I did that for about three or four years.
00:27:34.100 | And when the pandemic hit, I finally decided that was time to return back to America.
00:27:38.780 | Oh, yeah.
00:27:41.140 | I love Barcelona.
00:27:42.260 | It's an unbelievable place.
00:27:43.820 | Good nightlife, good food.
00:27:46.380 | I remember going to Barcelona, then Mallorca.
00:27:49.820 | People love life in Europe.
00:27:51.380 | Compared to the United States, people really live it up.
00:27:54.980 | Maybe that's why the unemployment rate is so much higher, taxes are so much higher,
00:27:59.180 | and there's less innovation out of Europe.
00:28:02.000 | But strategically, making your money in America and then moving to Europe is a good plan,
00:28:08.060 | I think, for a lot of people.
00:28:10.740 | If you have a hustle mindset and you want to get something off the ground, America and
00:28:15.060 | Asia are better places.
00:28:16.540 | But if you want to enjoy your money, the fruits of your labor, Europe is a better place.
00:28:20.140 | If you're the one person there that's hustling in Europe, you're swimming upstream a little
00:28:24.940 | bit because the whole point is to enjoy yourself, or at least a lot of places in Southern Europe
00:28:30.500 | that I hang out in.
00:28:31.500 | So, yeah, I'm really looking forward to it.
00:28:34.020 | Travel has never left that passion for travel.
00:28:36.620 | So for example, my partner and I, we're taking off here in a few weeks.
00:28:40.140 | We're going to be going to Paris, to London, to Barcelona, to the mountains, to Italy,
00:28:46.380 | to New York, to ... It sounds exhausting, doesn't it?
00:28:49.940 | Then we'll be going to Bangkok.
00:28:51.500 | Then we'll be going to Osaka.
00:28:53.020 | So the whole rest of half our year is a bit of a digital nomad party, so to speak, because
00:28:57.780 | we'll probably be building a family here in the next year.
00:29:00.620 | So it's kind of just that last hurrah.
00:29:02.300 | Go around, visit as many friends as possible.
00:29:05.260 | Go to as many cool conferences as possible, and to bring my bike, too.
00:29:08.740 | So yeah, that's, for me, my version of enjoying what we've built is being able to ... I love
00:29:21.380 | taking a few days off and then opening up my laptop in Paris and genuinely working,
00:29:26.100 | like working on the business for a few days, but also being able to meet people there and
00:29:29.980 | enjoy a different sort of life.
00:29:32.640 | It's pretty exciting for me still.
00:29:35.020 | No, it's the magical lifestyle that I dreamt about, but I was stuck in the grind and banking,
00:29:41.660 | and then I had kids in 2017.
00:29:44.260 | So it's really like if you have the opportunity to travel and do something and go on an adventure,
00:29:49.980 | go take it, because I don't think you'll ever regret it.
00:29:53.020 | No, but I don't think you'll ever regret having kids, too.
00:29:56.340 | Kids to me is like higher up on the achievement level.
00:30:01.140 | Anybody can get a plane ticket, but ...
00:30:04.620 | That's true.
00:30:05.620 | Yeah, it's not easy having kids.
00:30:06.620 | I mean, I don't want to take it for granted that we have kids, but I'm kind of in a holding
00:30:10.420 | pattern now where I got to wait until my kids are old enough, so the youngest one is only
00:30:14.540 | three and a half, so maybe when she's five and a half, then we can go travel.
00:30:18.060 | So then that way she can sleep better and remember her travels.
00:30:21.660 | Yeah, my best friend and business partner, his son is five and a half, and he knows that
00:30:27.700 | he's going to Barcelona in a few weeks.
00:30:28.940 | I just called him the other day and we were talking about it.
00:30:31.540 | And he goes to a different school there, and he has different kind of ways to play there.
00:30:36.980 | And one of the things that I think is interesting when you leave America with kids is how much
00:30:41.600 | more kid-friendly a lot of other societies are around the world.
00:30:45.100 | Strangers will interact with children.
00:30:47.620 | There's safer places to play.
00:30:49.980 | There's sort of spaces where parents maybe have some food and drinks while there's like
00:30:54.500 | a communal playground where there's a bunch of restaurants surrounding it.
00:30:58.420 | It's really kid-friendly in Europe and in Asia, I found, relative to America.
00:31:03.100 | That's actually good to know.
00:31:04.980 | A lot of my friends who are parents, they really look forward to that time of year when
00:31:11.580 | they go abroad for a few months.
00:31:13.300 | And it's just a lot easier to have kids in a lot of these cities that are more walkable
00:31:17.620 | and less traffic and things like that.
00:31:21.380 | Did you experience any reverse back to America besides the kids thing or what you noticed?
00:31:32.540 | Reverse culture shock.
00:31:33.820 | I think the most shocking thing about America is how expensive it is.
00:31:38.500 | There are certain things that are very good value in America, maybe square footage, clean
00:31:43.220 | air, recreational, national parks, stuff like that.
00:31:46.620 | But a lot of the services, luxury stuff, it's a really sticker shock.
00:31:55.780 | My little heuristic I've been rolling with is in order to have consumer freedom, I feel
00:32:01.420 | like you need to be making four times what an average professional would make in wherever
00:32:07.740 | country you're at.
00:32:08.740 | I've been going around doing that math.
00:32:11.540 | And for here in Austin, Texas, you have to make over $200,000 a year, I think, to just
00:32:15.420 | basically have the sort of freedom that I've been working for.
00:32:22.100 | So that's the first shock.
00:32:25.380 | But honestly, I think a lot of the culture shock stuff for me was in my head.
00:32:30.780 | Maybe I was trying to figure out who I was and build an identity for myself.
00:32:35.140 | And when you come back to go to a wedding or to do a family responsibility or a conference
00:32:42.980 | or something, you think, "Man, I worked so hard to get free from all of this."
00:32:47.820 | I think a lot of that was really in my own head, Sam.
00:32:50.860 | So no, not really.
00:32:53.300 | Sticker shock, not culture shock.
00:32:54.700 | Sticker shock, not culture shock.
00:32:57.780 | Got it.
00:32:58.780 | Well, it seems like you're still going to have the best of both worlds.
00:33:02.180 | You're going to go on your lounge like maybe family is in the works.
00:33:07.260 | Are you excited about that new stage?
00:33:11.180 | Absolutely.
00:33:12.180 | Yeah, 100%.
00:33:13.180 | Yeah, I'm thankful I was able to build the business in a way that I think is sustainable
00:33:22.340 | and has longevity.
00:33:24.220 | And also, yeah, travel and go on a bunch of adventures.
00:33:26.860 | I'm ready to go on the big adventure.
00:33:28.660 | Yeah, yeah, yeah.
00:33:30.300 | The big 18-year-plus lifetime adventure.
00:33:34.400 | So what is your latest business now and how can listeners follow you and keep in touch
00:33:38.980 | and see what you're up to?
00:33:40.860 | Yeah, I mean, we've built, much like you, we have a podcast called Tropical MBA and
00:33:47.340 | essentially that's our distribution.
00:33:49.660 | And so every few years we sort of ask ourselves, "Well, what does the audience want?"
00:33:55.540 | It started with events and then it became a private forum.
00:34:01.700 | And our most recent, oh, then it became recruiting services and hiring services.
00:34:07.080 | So we started providing those to the audience.
00:34:08.540 | And we would bring in division heads, performer recruiting professionals to run those different
00:34:13.020 | divisions.
00:34:14.020 | And our most recent one is seven and eight figure founders.
00:34:18.620 | They want a cool kids table.
00:34:21.380 | They want a cool kids lunch table.
00:34:22.880 | They want their own private community and mastermind where they know that when they
00:34:26.980 | go to an event or show up to a mastermind call that everyone has built wealth from their
00:34:31.780 | own location independent business.
00:34:34.820 | And so we recently started this new community and we've got over a hundred applications
00:34:39.480 | for it and it's been going great.
00:34:41.380 | So it's been fun to pick up the phone and speak with people with much larger businesses
00:34:45.360 | than our own that are seeking to connect with each other.
00:34:48.260 | So it's essentially like a networking and mastermind business.
00:34:51.980 | So it's been a fun and exciting year.
00:34:56.660 | That's great, Dan.
00:34:57.660 | Well, thanks so much for chatting with me for this past half hour.
00:35:02.140 | It's been great seeing your journey and I'm really excited for your next journey.
00:35:06.600 | Being a dad is probably, I think, harder than being an entrepreneur, especially harder than
00:35:11.260 | being a day job employee.
00:35:14.200 | So best of luck to you and if you have any questions or want any advice, just shoot me
00:35:18.500 | an email.
00:35:20.420 | I will do so on that, Sam.
00:35:21.940 | And to all the respect in the world for what you've built, I've been following since day
00:35:27.220 | one.
00:35:28.220 | And I think you're an incredibly unique voice in this space and we appreciate it.
00:35:33.020 | Thank you.
00:35:34.020 | Cool, man.
00:35:35.020 | Thank you.
00:35:36.020 | Let's see.
00:35:36.900 | Cool, man.
00:35:40.340 | Thank you.
00:35:41.840 | Thanks for watching!