711: Bootrapping into Silicon Valley
Daniel Fagella. He started a mixed martial arts gym when he was an undergrad and sold it after getting a UPenn graduate degree in cognitive science. He did turn his grad school thesis on skill development into an ecommerce business that grew for 4 years, reaching $4.2M in top line sales and recently sold it for a million dollars with 90% paid upfront. He\u2019s now using his funds for TechEmergence.com in order to influence global AI policy for the better.
Famous Five:
- Favorite Book? \u2013 Plutarch\u2019s Lives
- What CEO do you follow? \u2013 Last bio he read was Marcus Aurelius\u2019
- Favorite online tool? \u2014 Asana
- How many hours of sleep do you get?\u2014 6-7
- If you could let your 20-year old self, know one thing, what would it be? \u2013 Daniel would tell himself that dealing with the existential human condition could be done by contributing to a much bigger world
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Time Stamped Show Notes:
- 01:20 \u2013 Nathan introduces Dan to the show
- 02:08 \u2013 Dan was studying skill development and goal setting science in psychology for his undergrad
- 02:17 \u2013 Schooling was expensive; Dan decided that he\u2019d rather use himself as a skill development guinea pig than a pizza deliverer
- 02:40 \u2013 Dan started teaching and making money at the back of a carpet store
- 03:11 \u2013 Dan\u2019s jiujitsu gym was the smallest business back then
- 04:03 \u2013 Dan sold the gym after 3-4 years with $250K ARR
- 04:14 \u2013 Dan was 25 when he sold the gym
- 04:41 \u2013 The membership fee was $157
- 05:07 \u2013 Dan sold it for over $100K with 10% upfront to his right-hand and friend
- 05:45 \u2013 The business ran for over 2-3 years after that
- 06:05 \u2013 Dan took $30K from the $113K
- 06:36 \u2013 Dan was also making $20K a month selling martial arts instructional resources online
- 07:09 \u2013 Dan was using Infusionsoft for his e-commerce business, Science of Skill
- 07:56 \u2013 The e-commerce was doing around $200K top line
- 08:42 \u2013 The biggest cost for Science of Skill was on merchant processing, customer acquisition, advertising and affiliates
- 09:26 \u2013 Dan likes to spend half of his CLV (Customer Lifetime Value) on acquisition
- 09:42 \u2013 The CLV for membership programs were around $100 and affiliates $50-60
- 10:00 \u2013 One of the affiliates was Survival Frog of Byron
- 10:23 \u2013 Byron drove Science of Skill into 6-figures
- 10:44 \u2013 Dan was paying affiliates upfront
- 11:15 \u2013 Byron of Survival Frog was on Episode 395
- 11:44 \u2013 There are agencies who get onto their email list by paying
- 12:14 \u2013 One of the agencies is com
- 13:02 \u2013 Finding the right people to advertise and won\u2019t tag you as spam
- 13:11 \u2013 Dan will find firearm sites in com\u2014go through the website owners and email them to find the right people to target
- 14:11 \u2013 Dan sold Science of Skill in February 2017 for a little over a million dollars
- 14:22 \u2013 Science of Skill was valued by the multiple of net
- 15:11 \u2013 Science of Skill revenue in 2016
- 16:27 \u2013 Dan\u2019s ultimate goal
- 16:31 \u2013 The buyers are a private group of 2 buyers in Ohio who previously ran SaaS businesses then sold them to the government
- 17:05 \u2013 Science of Skill should be at Inc 500 for 2016
- 17:13 \u2013 Dan sold Science of Skill because he believed he has better and bigger things to do in life
- 17:25 \u2013 Dan\u2019s core objective involves the global conversation of neuroscience and AI
- 17:48 \u2013 TechEmergence focuses on the business applications of AI
- 18:08 \u2013 TechEmergence is not making money, but will make money primarily through advertising
- 19:09 \u2013 The goal now is to scale and make traction
- 19:21 \u2013 Current cash burn
- 20:05 \u2013 The Famous Five
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3 Key Points:
- You can start your business literally anywhere.
- Focus on your goals and objectives, even if it means having to burn cash.
- The future will probably evolve around n_euroscience and AI.
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Resources Mentioned:
- The Top Inbox \u2013 The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences
- Klipfolio \u2013 Track your business performance across all departments for FREE
- Hotjar \u2013 Nathan uses Hotjar to track what you\u2019re doing on this site. He gets a video of each user visit like where they clicked and scrolled to make the site a better experience
- Acuity Scheduling \u2013 Nathan uses Acuity to schedule his podcast interviews and appointments
- Host Gator\u2013 The site Nathan uses to buy his domain names and hosting for the cheapest price possible
- Audible\u2013 Nathan uses Audible when he\u2019s driving from Austin to San Antonio (1.5-hour drive) to listen to audio books
Show Notes provided by Mallard Creatives