Porter Stansberry founded Stansberry Research with a laptop and $36k of financing from Bill Bonner.
(You can meet Porter in person at the June 14-15th www.FinancialMarketingSummit.com)
He and his partner, Steve Sjuggerud, and the team they built, turned that 36k into a $3 billion valuation at their IPO.
That initial money was to fund what would become one of the most successful promotions in the history of financial publishing.
In this conversation, I wanted to dig into the pivotal decisions Porter made along that journey to $3 billion.
What decisions did he make that really MATTERED?
And how were those decisions different than the decision other publisher's made along the way.
He did not disappoint.
We touch on how he got Bill to fund his now legendary direct mail promotion, "There's a new railroad across America," that launched his business.
Porter tells the story about how not long before that breakthrough another publisher had told him he would never make it in this business.
And what he realized about the quality problem in the early investment newsletter business said about some of his colleague's world views.
Porter's full presentation at The Financial Marketing Summit on his 8 Keys to Breakthrough Customer Value is available in the members area of The FMS PRO Community
FinPub Pro is produced by The Financial Marketing Summit, the #1 networking and marketing conference for financial newsletter publishers, trader educators, and digital financial media.
John Newtson, host and founder of The Financial Marketing Summit can be reached via LinkedIn at John Newtson
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
John Newtson (00:03):
All right, everyone.
It's John again from FMS.
I'm really excited todaybecause we have with us Porter
Stansberry, who, for most of youwho've been in the industry
Porter doesn't need anintroduction, but for those of
you who may be a little bit newto the industry, Porter is the
only person I know, who I think.
He took what Jeff like 36K anda laptop and basically grew it
to a $3 billion value.
Porter Stansberry (00:24):
Overnight success 22 years later.
John Newtson (00:28):
But also, I think, like and just for everyone,
like Port is, he's coming to FMS, he's going to be talking about
how he's managed to build abusiness that has what 3X the
lifetime value of a customercompared to pretty much everyone
else in the industry.
But when we were talking and Irealized, like I have a whole
lot of questions about a lot ofthings besides simply the
publishing side, and so wedecided to do this, have this
(00:51):
conversation, which is, you know, I think everybody's been
following other people in theindustry and I think of you as
the person that most peopleactually have followed and that
other people are following themin terms of what they've done in
the business, and then otherpeople are following them in
terms of what they've done inthe business.
I remember when I came in thebusiness Stansberry Research was
, I think, the largest Agoragroup at the time and everyone
(01:12):
was following what you guys weredoing.
And then, even over the years,other groups put up larger gross
numbers.
You guys were still taking homemore actual money than
everybody else.
And so I was talking to a friendnamed Pete Monson, who's a
financial copywriter.
He's worked around, you know,for quite a while in the
industry and he was saying youknow, it always seems like
Porter's been working from adifferent roadmap than anyone
(01:34):
else and I was like that seemedreally appropriate, not just on
the publishing side but on thebusiness side.
And so, porter, that's kind ofwhat we want to talk about today
is the business decisionsyou've made from the beginning
that are kind of pivotal inbuilding a company from startup
to a $3 billion IPO, and youwould know better than I where
(01:57):
that would start.
Porter Stansberry (02:00):
Well, I think it's interesting that they
thought I was on a differentroadmap because I really was.
Well, I think it's interestingthat they thought I was on a
different roadmap because Ireally was my original business
partner and I his name is SteveSugarwood and he wrote the True
Wealth newsletter for many years, still does and he and I looked
(02:21):
at the newsletter business backin the mid-1990s, 95, 96.
And at the time Steve wasrunning a global mutual fund and
I was just getting out ofcollege, so I knew nothing about
the financial newsletters orabout the financial publishing
industry as opposed toinvestment banks and brokerage
firms.
And Steve basically said look,there's two ways of doing
business.
You can be regulated and be abroker, or you can be
(02:42):
unregulated and be a newsletterwriter.
And being a newsletter writeris way more scalable.
You don't have to deal withclients one-on-one, you don't
have to be a fiduciary.
If you have good investmentideas and you can write, then
you can be successful as anewsletter writer and not just
as an individual broker.
And I didn't really care, Ijust wanted to be involved in
(03:03):
finance.
I love the challenge of capitalallocation, I love the research
process, I love the incredibledifferences in business models,
and I still do.
You know, the reason whyMcDonald's has been a great
investment for 40 years isn'tbecause their food isn't any
good, it's not.
It's because they are a royaltybusiness, right.
They don't even really ownrestaurants.
(03:24):
Yes, technically they own, theyown they own maybe 25% of their
locations but their wholebusiness is is getting people to
buy franchises, and they get 7cents on the dollar every time
you buy a Coke.
That's a hell of a business.
I mean, they're a marketer anda brander.
They're not really arestaurateur, and so if you
understand that, then you're waymore likely to invest in
(03:45):
McDonald's and you would havedone very well if you had.
But my point is just that somuch in finance isn't what it
looks to be from the outside,and that was always my
fascination and that's what Iwanted to be involved in, and I
didn't really care whether itwas as an analyst at a hedge
fund or writing a newsletter,and I don't know that.
That is very true.
I don't know if that passionfor finance is the same thing
(04:08):
and a lot of the onlinemarketers and copywriters that I
have met.
I think they're more interestedin marketing and they're more
interested in advertising than Iwas, and I think if you
actually read the copy that Ihave written and you, you look
at the different things I'vedone on the front end and the
back end, the one thing thatunites them all is that they're
(04:30):
all poorly written.
I'm a complete hack, but thefinancial ideas are very deep
and I just thought if we couldhave better ideas we would
probably win, and so that's whatwe tried to do, and I don't
think that was the same as a lotof other publishers.
The other thing that I thinkthat really set us apart was I
figured out really early on thatthere was a quantum difference
(04:52):
between a really good financialwriter and the average financial
writer.
And when I say really good, I'mtalking about a guy like, for
example, david Lashman.
I hired him out of theUniversity of Florida.
He was a medical researcher atFlorida.
He studied the history ofvirology, which is a really
(05:13):
niche space.
But he's kind of like a Mensamember kind of mind.
He's extremely smart and he'sdone a lot of bench science in
his time, and for the last 20years I've paid him to go to
every major medical conferenceand get to know every important
scientist and read everyimportant paper.
So when he writes a reportabout a biotech new product,
(05:37):
it's written at a level and witha density that nobody else can
compete with in the financialnewsletter space.
There isn't another person likethat in the world, much less in
financial newsletters.
Well, to keep him, I had to payhim a bloody fortune because he
could go to work at any hedgefund.
He'd go to work at anyinvestment bank tomorrow, but he
wants the freedom and he likesto be his own boss.
(05:58):
So it's a good relationshipthat we have.
But I had to be able to pay hima lot or I wouldn't have been
able to get him or keep him.
And that was really toughbecause most financial
publishers frankly, they paypeople peanuts and as a result,
they end up with a lot ofmonkeys on their staff.
And if you're going to writeabout something as complex as
modern biotech, you really haveto know what you're doing or
you're just selling schlock.
(06:19):
And if you're selling schlock,that becomes really apparent
really quickly and you can't youcan't get the prices for the
products that we had.
So my model was yeah, I got topay a guy like David Lashman
five times or 10 times more thanmost people in this industry
make for being a financialnewsletter writer, but in the
marketplace he's worth a hundredtimes more, and so I was.
(06:42):
I always thought that was thebigger fatter margin and that
would lead to the largerlifetime values and the higher
prices for products.
So we're able to sell ourlifetime product now for $35,000
, which, when we started intothis, that was just completely
implausible.
No one ever thought that wouldbe possible.
But I knew that if we hadenough talent and if the content
(07:03):
was actually worth it, we couldget the price.
And we did, and so that's whatI've always tried to do Go out.
If you're going to have aproduct, go find the guy who's
the best in the world at it,recruit him and then build the
business.
And so for a guy with like, forexample, with empire financial,
I wanted Whitney Tilson.
Whitney Tilson had startedwriting about stocks in the
(07:24):
1990s.
He had a very successful hedgefund he's been on 60 Minutes
three times.
Like he is credibility and whenhe got out of his hedge fund
business, the two places he waslikely to go work were either
Stansberry or Motley Fool, andso I'd been recruiting him since
2003-2004.
And I sent him lots of you knowgood information on stocks.
(07:45):
I'd helped him him since 2003,2004.
And I sent him lots of goodinformation on stocks.
I'd helped him.
It helped him with his hedgefund.
So he knew me and he waswilling to come over and we
started in 2017.
And that business now, empireis probably worth $100 million
now, and so those timelines andthose recruiting takes a long
time, takes a lot of capital,but it does work, and so that's
(08:07):
just what we did.
We didn't launch products untilwe had the right analyst, and
we insisted on having somebodythat we could completely and
fully believe in.
John Newtson (08:17):
So let me parse that out a little bit, because I
feel like when we say thingslike the quality of the product,
the editor, and you talk aboutpassion, about financial markets
, a lot of people in our spacegloss that over.
They're just like yeah, yeah,yeah, we have that.
Or I have a guy who he has thisminor level of experience.
(08:37):
Often, or in some cases, thereare people who never had any
experience and they were justgoing to kind of just figure
stuff out as they go becausethey figure they needed somebody
to fill a product hole.
The focus on, like, quality ofeditor and actually putting
somebody who's actually went outthere on the ground and
(08:57):
involved in the industry thatthey're in, like I feel like
that is completely overlookedalmost across the board by most
people.
A lot of publishers will takesomebody who's like well, they
used to be this, they used to beat a hedge fund and now they
want to write, but now they'renot really involved in the
markets anymore.
They're not going toconferences, they're not out
there actively, it's not aliving business for them.
(09:20):
It's like I have someexperience, I'm going to write
about what I did, you know, 30years ago and you know when I
find something on Yahoo Finance,I'm going to write it up that
quality and that active pursuitof quality, I think.
So you have somebody who'sreally amazing at understanding
(09:41):
a sector, but you're you'retalking about putting them on
the ground continually, over andover again, throughout the
business.
They're not just like I wasreally good before and now I sit
at home, don't do anything butright.
Porter Stansberry (09:53):
You know, it just depends.
You can definitely do well witha guy who was a senior person
and is now, you know, partiallyretired.
But I would just tell you, as apublisher, your most important
employee is not your head ofmarketing or your head
copywriter.
Your most important employee isthe managing editor.
And if the managing editor hasthe budget and the mandate and
(10:18):
the chops to do a great job, youcan definitely build great
products.
And the first question themanaging editor should ask every
editor when he's assigning a,you know, a monthly newsletter
or any kind of project, is youknow who?
Who are you going to speak toabout this?
You know, and if you're notgoing to do five or six
interviews, then don't bothertaking the assignment.
(10:38):
And I think that's one of thebiggest things that most people
getting into the business reallyscrew up is man, if I talk to
two people, just two people andI have two 20-minute phone calls
with two people who are in theindustry and who really know
what's going on, that saves me100 hours of online research.
And sure I've got to go readthe 10K, I've got to read the
(11:00):
10Q.
Obviously I have to do thatbefore I can have those
interviews, but the context thatcomes with those discussions is
irreplaceable and you can'tfind it online.
So if you are getting startedand you don't have a pedigree
and you don't know where to goto get somebody who does, and
you can't afford to spend amillion dollars a year on an
editor, then you just got to getreally good at working the
(11:22):
phones.
And that goes for copywriterstoo.
If you're writing copy about aninvestment trend, how many
people did you talk to about thecopy?
And if the answer is less than10, you haven't done your job
and your copy is going to suckcompared to somebody who's made
those phone calls and has allthose little actualities, those
little, those little you know,family stories, all the stuff
(11:42):
that really adds the textualcredibility that makes it
believable and makes it reallymemorable.
And if you don't have thatstuff, then you haven't done a
good job writing.
And let me just say one morething about this the more people
that you talk to, the moreyou're going to learn and the
more you're going to know.
And one of the most importantthings that Stansberry Research
ever did was identify in 2009that the Eagle Ford and the
(12:07):
Permian Basin and the MarcellusShale, among others, were going
to transform the oil industryglobally.
And that was a time when mostpublishers were still selling
peak oil running out of oil.
The other publishers said peakoil running out of oil.
The other publisher saidMeanwhile Stansberry Research
was saying we're going to gofrom producing 5 million barrels
(12:30):
of oil in the United States outof all sources to producing 15
million barrels a day just inTexas and that's going to happen
in the next 10 years.
And of course it has.
And the changes that that hasbrought to our economy and to
that industry are incomparable.
And so we would have neverknown about that.
That wasn't on the Internet.
You know what was on theInternet was peak oil.
(12:51):
But of course we had.
We had deep industry contacts.
We had a professional geologistwho had spent 10 years in the
industry working for us and,believe it or not, my best
contact in Texas is a guy namedCactus Schroeder whose family
has been in the oil business for, you know, for three
generations and he literallyknows every single person in
Dallas and it's in the oilbusiness.
(13:11):
And so you don't make thosecontacts, you don't get that
kind of information unlessyou're out there talking to
people and you're not going tobe able to talk to people if you
don't have products that aregood and respectable and so
that's just it all.
It's not one thing you do.
It's a constant evolution and aconstant improvement, and
(13:33):
unless you have that dedicationto the editorial, it's going to
be very difficult for you to getgood prices for your products
because, frankly, they're notworth anything.
John Newtson (13:41):
Yeah, I think that's again.
It's so nice to hear you saythat.
Just because most people in ourspace could name a copywriter
from a bunch of differentbusinesses, they could name the
managing editor or even, often,cases the editors themselves.
The marketers and thecopywriters are kind of the ones
who everyone looks to because,like you said, everyone's
(14:01):
obsessed with that part of thebusiness.
When you look at the talent sideof this, one of the things that
I think that you've done betterthan most other groups is
retain talent, and that'seditorial talent, but that is
also your marketing and otherpeople that you kind of stars
(14:22):
that you have on the team.
So, like, what have you donedifferently in that space?
Like, how do you whether it wasthe recruiting piece, like you
said these long-termrelationships like that speaks
to me personally, because I seethis with myself, that there are
just relationships that ittakes years.
You know this is a good person,you have a good dynamic, this
is a star.
Like, over the course ofseveral years, maybe you keep
(14:44):
trying to do things where it'sjust the timing's not right, but
then eventually the time hitsand you can work together.
What else have you done?
Porter Stansberry (14:54):
You know, superstars, don't jump ship.
You know, they're very hard torecruit but they stick around.
So I started recruiting MichaelPalmer in 1996.
In 1996, he finally came towork for me in 2002.
And when he came to work for meat the end of 2002, he told me,
porter, I'm only going to workfor it for a year.
(15:16):
I really like being freelanceand I'm a good copywriter and I
can work for all publishers.
I don't have to work just foryou.
And I said, mike, if you giveme a year I'll be flattered and
of course you know whatever youwant to do.
And then it was really simple.
It wasn't just pay.
Of course I paid him more thananybody else would, that's fine.
But it wasn't just pay, it wasI gave him more tools and
(15:37):
ammunition to get the job done,to get the job done.
So, man, it's a lot easier tobe a copywriter when you
actually have really goodeditors to work with, with
really good ideas, and when theeditors are all pulling together
as a team.
So Mike doesn't have to writethe whole package, he just has
to write the headline and thelead and then he's going to have
two or three assistant peoplewho help him with the body copy
(15:58):
and the editors are handling allthe premiums and we work
together as a team and everybodygets paid as a team.
You know, it's interesting tome that the industry figured out
real quickly how to pay peopleas a team to do something like a
webinar, because it takes a lotof coordination the editors,
the marketers, the technicalstaff and the copywriters.
People still haven't figuredout how to do that.
On the front-end packages, well, we write front-end packages in
(16:19):
two weeks and the only way thathappens in two weeks and the
only way that happens if youhave a good copywriter and you
have good editors and you havegood assistant editors and you
have good lawyers, and of course, it also helps when you're
actually writing stuff that'sreal and meaningful and novel.
You know, it's not, it's not umanyways, but my whole point is
(16:39):
if you want to attract, ifyou're, if you're trying to
attract the Yankees, you knowyou can't have a triple A dugout
.
You got to have a bunch ofother stars for the Yankees to
work with, and so thecompensation structure is a big
part of it, of course, but man,people like to work with the
best, and so among the thingsthat I did that was different
(17:01):
was when I realized so this is aconcept.
I call it gravity.
And here's the thing If you getthree or four superstars
together, working together, whatthey can accomplish is
unparalleled.
One star, you got to have agroup, and that group creates
(17:21):
this gravity that attractseverybody else.
So you're going to get the bestmarketers.
You're going to get the bestcustomer service people.
You're going to get the bestsales people, because they want
to work with Steve Sugar, mikePalmer and David Lashman, and
I've got them.
And then an interesting thinghappens If you start letting C
players into the universe,you'll lose your A players.
The company culture will change.
(17:46):
Now I probably shouldn't tellthis story because I probably
violated some employment rule,but I walked into my office.
This is a long time ago.
This is 10 years ago roughly.
I walked into my office one day, actually more than 10 years
ago, and I just didn't like thepeople I saw walking down the
halls.
You know we were probably at100 employees, maybe 120
employees by that point.
And when I say I didn't like thepeople walking down my halls, I
(18:08):
wouldn't have wanted to befriends with them.
If I had gotten stuck at anairport with them for five hours
.
I would have been miserablebecause they didn't have
anything interesting to say.
They weren't the kind of peoplewho read books, they were the
kind of people that watchedtelevision.
They just weren't for us.
They shouldn't have beenworking in a research
organization, they shouldn't beinvolved in creative activities,
because they were duds.
And one of these duds this is atrue story.
(18:29):
I don't want to say if it was aman or a woman, because it
doesn't matter but they builtbasically a bunker of canned
food on their desk.
So they had like a bunch ofChef Boyardee cans of food
around their workspace and let'sjust say they weren't in the
best physical condition and Iwas like, man, nobody wants to
(18:51):
come in and watch an obeseperson eat Chef Boyardee out of
a can at their desk.
This is just not.
This is not helping ourrecruiting or our culture.
And so I figured out this is atrue story.
I figured out that there was oneperson in our organization who
had hired 12 or 14 duds and Iwas like, ah, that's the cancer
(19:13):
that needs to be cut out.
And so I had him and all 14people come to a meeting and I
fired all of them in one meetingand they all had a nice check
in front of them I said all yougot to do is sign a piece of
paper that says we can befriends and I won't disparage
you and you won't disparage meand we can all go on our way and
have a new start.
And you guys definitely need anew start because you're not
(19:35):
going to succeed here.
This isn't the rightenvironment for you.
And so they are all shocked andchagrined and, you know, signed
their checks and were gettingready to leave and a guy knocks
on the door of the meeting andopens the door and goes Porter,
hi, nice to meet you.
I'm Joe Smith.
I'm new here.
Today's my first day, andeveryone in my group got called
(19:55):
into this meeting and I thoughtmaybe you wanted me here too,
but you just didn't know toinvite me because it's my first
day.
And I was like Joe who hiredyou and he pointed to the guy
who was the source of all theseproblems and I said oh, yeah,
definitely, come on in.
You're fired, oh, poor guy.
John Newtson (20:20):
But you know, this person.
Porter Stansberry (20:22):
This person was hiring people who just
didn't measure up.
He just he wasn't going to workin our group and what you
needed to, what you needed to besuccessful in our group, was
you had to have a relativelyquick mind.
So I told people at a meetingrecently that if you didn't make
a 1400 on the SAT, I wasn'tgoing to hire you.
Now I don't mean that literally.
You know, if you, if you got aperfect score in the English and
(20:43):
you weren't that good at math,you'll probably be fine or vice
versa.
But like you got to have a,really you got to have a passion
for intellectual growth and forintellectual challenge, or
you're not going to get alongwith any of your peers.
So hiring really smart peoplewas sort of the number one thing
.
And then the number two thingwas I really liked it if you had
a background in competitiveteam sports.
So if you were a collegelacrosse player or you were a
(21:05):
college football player or youwere a woman's soccer player,
you know I didn't really carewhat your passion was, but it
was way more fun to be aroundpeople who were passionate about
their, about their lives, youknow, not just their careers and
I just, I wanted to be inspiredby the people that I was
working with.
I didn't want to have to do allthe inspiration myself, and
that was that was a big, thatwas a definitely a big
(21:27):
difference.
We were a very, verycompetitive bunch.
John Newtson (21:31):
That's fascinating .
I remember when I first cameinto copywriting years ago and I
don't I haven't written copy inyears because we kind of moved
with the conference into otherbusinesses but there was a list
that I got from ClaytonMakepeace when I worked with him
, from you actually.
It was a list of books thatevery copywriter should read and
100% of them were finance books.
(21:53):
They were not like GeneSchwartz or copywriting books.
It was like no intelligentinvestor.
It was like you had to actuallyunderstand financial concepts
in history in the market to beable to write in that space.
And since then I've seen nobodysay or do anything that suggests
(22:14):
that they think that that's thecase, at least not in recent
years, and that to me, I guessspeaks to me about the culture
you're kind of talking about.
You have an actual mind for theindustry.
You have a passion for markets,because finance, when you look
at it, it's one of the mostfascinating areas in the world,
(22:34):
or subjects in the world,because one is so broad.
It intersects with businesspolitics, there's the economy,
there's investing, there's skill, there's all these different
things.
It's like this fascinating kindof central hub of how the world
works.
And so if someone's notpassionate about that.
It seems like they probablyshouldn't be writing for
products in that space yeah, Iagree with you.
Porter Stansberry (22:55):
I also just think that I mean I was just
shocked at the at the reallypoor level of basic financial
knowledge amongst virtually allthe marketers or copywriters
that I met in the industry whenI got into it.
It was just shocking to me thatthey didn't truly they didn't
know the difference between apenny stock and an actual
business.
They didn't know the differenceand I mean I was just blown
(23:18):
away by that.
I mean I just blown away.
I mean I remember this is atrue story.
I remember a publisher at Agorawas writing a penny stock
package and he was claiming thatstocks like Intel were penny
stocks.
Because he was looking athistorical prices and he didn't
understand the impact of stocksplits going backwards.
(23:40):
So you know, there was never atime that Intel actually traded
for 13 cents.
That's not the actual nominalprice, that's the current price
after you know a dozen stocksplits in reverse.
And he had no idea of that andas a result, his work was just
(24:01):
embarrassing.
I mean it was nonsensical.
Of course it still worked in themail, you know, because the
people he's writing to didn'tknow any better either, right,
but I would just beenembarrassed to be associated
with that kind of publication.
I mean that's just bad right.
And so if you're, you know, ifyou're a marketer or a
(24:22):
copywriter and you say, I don'tcare what the damn editorial
says, it matters that theresponse rate is, well, look,
that's certainly one way ofdoing business and I'm not going
to be overly critical of it.
It just wasn't for me, and Idon't think that you can be very
successful doing that for long,because you might start just by
shining on your clients, buteventually, if that's your
mindset, you end up shiningyourself on too, and that leads
(24:45):
to a catastrophe, yeah, and it'sgoing to have a knock on
effects with recruiting talentlater.
John Newtson (24:51):
Who knows what's going on with partnership
potential, with regulators, withall kinds of people, absolutely
.
Porter Stansberry (24:58):
And that business, by the way, it
collapsed spectacularly, youknow about 18 months later and
caused them a lot, of, a lot ofproblems.
So it's just, it's just, Idon't know how.
You know, it's a verycompetitive space and I don't
know what you're thinking.
If you, if you think you'regoing to be really successful
and you and you don't, and youhaven't even read those books.
And I remember that listthere's probably 20 books on the
list and like that's the stuffthat every first year finance
(25:22):
student would have read.
Like it's not, that wasn'tthose.
Those things were easy to read.
We're not talking about theblack Scholes theory of options,
pricing or something, somethingthat's pretty complicated, you
know.
Or I'm just saying like, uh, itreally.
It's like, think about ifyou're trying to open a
restaurant, you didn't know howto cook an egg.
Like you know, you're the ownerof the restaurant.
(25:43):
You may not be the personcooking eggs, but you sure as
hell better know how they'recooked.
John Newtson (25:48):
Yeah, or how can you basic level of knowledge
that's needed.
Porter Stansberry (25:51):
Yeah, so that's always.
That's always struck me as asas as interesting.
But yeah, I, I, uhno-transcript legend.
John Newtson (26:26):
maybe that when you first started coming into
the industry, there was somebodywho fired you and said that you
would never be successful as anewsletter publisher?
Is that true?
Porter Stansberry (26:36):
That's very true.
Yeah, I don't want to use hisname cause I don't want any more
litigation.
There was a.
There was a very seniorpublisher at Agora, the most
senior publisher at Agora at thetime, and he and I had a very
terrible personality conflict,in part because I'm not a very
good employee.
I didn't mind in a meetingtelling him flat out that he was
dead wrong about anything and Ifigured, as long as I was right
(27:00):
, then I would be okay.
No, if you embarrass your bossrepeatedly in meetings you will
(27:23):
get fired, and I certainly wasfired.
I was fired the first week inJanuary 1999.
And he told me when he fired methat I was the least
entrepreneurial person he'd evermet.
And then I was sure to be afailure and I thought that was a
little gratuitous.
But you know, one of us went onto become a billionaire
publisher and one of us was outof the industry and a couple of
years later Fair enough.
John Newtson (27:34):
I think that says it.
So you started with kind of thethe full Agora mothership
behind you and then over theyears you've move Stansberry,
and then Legacy and the otherbusiness units that became
MarketWise away from the Agoramothership.
Why did you decide to do thatand what was the impact of that?
(27:57):
Because it seems to me that youstarted with one business that
was tied to Agora and then, asyou moved away, you ended up
building your own ecosystem ofcompanies that became more
substantial now, I think, orclose to as substantial as the
Agora ecosystem itself.
Porter Stansberry (28:14):
Yeah, that's a very interesting story and I
don't think that I've ever toldit publicly anywhere and I don't
have any reason not to.
But we don't normally talkabout the things the way.
We don't want to talk aboutthings that are structured, but
I'm happy to.
But what really happened wasbecause I had been fired from
Agora when I wrote what we callthe railroad package, which was
(28:37):
the first direct mail package Iever wrote, and the headline
across America there's a newrailroad across America is
making some people very rich, meincluded.
I didn't say that, but um, itdid.
You know, there was a railroadpackage and it was a story that
talked about the historicalsignificance of the new fiber
optic networks and the way thatthey would change the world in
(28:58):
commerce, the way that railroadshad, and it was a new way of
understanding um, thistechnological boom.
That really helped people whowere older and who weren't
familiar with computers get whyit was important.
It's hard to believe this, butback in 1999, there was an
argument being made that none ofthis, this, that the internet
was just a fad and it wouldn't.
You know, it was no moreimportant than a fax machine.
(29:18):
And so you know, explaining whythat wasn't exactly the case
was important and the packagereally caught traction and you
know, at the time it was thebest selling thing that had ever
happened in the financialnewsletter space we made.
This is back when you had topay for stamps and postage and
printing.
We still made 800% ROI on thosemailings.
(29:40):
I mean, we were mailing thephone book.
It was an amazing takeoff.
Well, the interesting thing wasI did all that before I was out
of gore.
I did all that from my kitchentable.
And so I sent that package toBill Bonner, who is the
principal at Agora, and I said,hey, I think this will work and
you've always been really goodto me, and he has been, and it's
(30:03):
not your fault that this otherguy fired me.
And if you want this package,I'll sell it to you for 50 grand
, which I thought was, you know,would have been the highest
price that I'd ever seen somepaper package.
And I didn't think it waslikely that Bill would pay me.
But I thought it'd be a goodplace to start the negotiation
and I said I'll give you 24hours on an, exclusively, but if
you don't buy it from me, thenI'm going to send it to your
(30:25):
biggest competitor, which at thetime was Phillips Publishing,
and I knew Tom Phillips fromSocial Connections, and so I
kind of put Bill in a little bitof a bind there and he said
well, I don't know about theprice, but I'll definitely buy
it from you.
Let's talk with some people andfigure out a way to get you
back into the fold and justtrust me, we'll work something
(30:45):
out.
And I did trust him becauseBill is the most honorable
person I've ever met in my life.
In fact, we ran StansberryHoldings, which became
MarketWise, from 2014 until 2019on a handshake.
We didn't have a contract ofany kind or an operating
agreement.
Yeah, and by that point it wasa you know 300, $400 million a
year in sales business.
But dealing with Bill is noproblem because he completely is
(31:09):
good for his word.
And so he said, hey, we'll worksomething out.
And I was like, okay, and so itended up.
He never paid me for thepackage in cash.
Instead, he agreed to financethe marketing of it, which he
did to the tune of 36 grand.
And then so we had sold thepublic Porter Stansberry's
investment advisory.
(31:29):
But Bill didn't have a contractwith Porter Stansberry and
didn't really even own thepackage because he had never
bought the copyright from me.
And so we struck a deal where Iwas going to get 25% of the
equity of the business and hewas going to put up all the
money and a lot of the backendstuff.
(31:50):
You know I didn't have.
I didn't have a legaldepartment.
Obviously.
I didn't have customer service,I didn't.
So I thought that was a reallygood deal for me and I think at
the time it was a really gooddeal and we went forward, but of
course, we never paperedanything.
We just had an agreement, andso over time, that agreement
changed and Bill gave up moreand more of the equity to
(32:12):
different employees, as I, as Ikind of demanded and and then.
So what happened was then in2014,.
Really, we needed to.
We had gotten to a size wherewe just had to paper everything,
and so we we moved completelyoff of Agora Systems and we set
up a different, we recapitalizedand set up a whole different
legal structure to own thecompanies and we gave all the
(32:33):
employees real equity.
But it took us five years toget all that work done because
we were so far behind the eightball in papering everything, and
so that schism in 2014 was inpart a legal matter, but it was
also in part a cultural andstructural matter.
We had really what StansberryHoldings was doing was really
(32:57):
different than what Agora wasdoing at the time, and Agora
more and more copied our model.
But we were really focused onlifetime value and we innovated
this thing called the allianceoffer, which is where you pay a
certain price and you get all ofour products, including all the
products we build in the futureand we really pioneered that
whole model because I justfigured lifetime value was the
(33:19):
thing to keep investing in, notjust more marketing, and that
really worked well for us.
That really influences theculture of the company too,
because everyone in theorganization understands that
what's important is not just thenext new promo but instead the
fulfillment process, the renewalprocess, the upselling process,
the onboarding and everythingelse that goes along with it.
(33:44):
That process because we weretreating customers sort of
differently than a lot of theirbrands were and we were, but we
still shared some database stuff.
So like their customer numberwould be the same at Stansberry
Research as it was at ZagoraFinancial and that was really
confusing and hard to explain.
So by really separatingeverything completely, it was
(34:06):
helpful for us in building outour own real unique brand and
style.
John Newtson (34:12):
That makes sense.
That's great.
I appreciate you sharing that.
So as you did start to bring ondifferent business units then I
know at some points I'm notsure exactly what year that was
you brought Mark in.
I met him when he was I thinkhe was the head of biz dev at
the time and then he became theeventual CEO.
And you described to me in theprevious conversation that you
(34:34):
know he's kind of the outsideCEO and you're kind of the
inside CEO.
Could you kind of like what'sthat dynamic work and why did
you kind of evolve into thatmodel?
Porter Stansberry (34:42):
Yeah, just to be clear, I'm no longer at
MarketWise, I'm no longer theoutside CEO.
I resigned and retired inDecember of 2020.
And now Mark Arnold is both thechairman and the CEO.
But the way I kind of sawMark's role was you're exactly
(35:02):
right, he started out helping usroll up some of the companies
that we liked in the industryand improving their operations,
and those M&A processes wereunbelievable home runs.
So if you have a good list andif you have a good lifetime
relationship with your customers, you can introduce them to lots
of new products and they'llkeep buying, and that's what
really drove those M&A processes.
So we had Mark doing that andas a result, he was just sort of
(35:29):
working a lot more outside thebusiness, meaning he was going
out to the conferences to meetother publishers.
He was more involved in thatoutside process.
It was also just his backgroundas a deal lawyer for a venture
capital law firm.
That's just what he understoodthat part of the business and
structuring things.
(35:50):
Meanwhile, sort of my job was toteach the new, the new people
who are joining our company,about our culture and about our
writing techniques and about youknow what we wanted to see
editorially and in our copy, andsometimes it meant introducing
people to direct response forthe very first time, because
some of the companies we boughthad never done that kind of
marketing before.
So in some cases I had to getpeople to be more aggressive and
(36:17):
in some cases I had to getpeople to be less aggressive.
I just spent a lot of timetalking to people about what our
style and tone was and what wewanted to see and the way we
thought that we could make thebusinesses work better, and so
that's just how it functioned.
I just kept my hands in thecontent and Mark basically
handled the the business and thedeal-making side of things, and
then my title was chairman andhis was CEO, but really we ran
(36:41):
the company together.
In fact, I'll tell you somethingvery interesting about
Stansberry holdings.
We were a pro, we were aprivate company and we had, as a
private company, we had a boardand we had five members on the
board.
Two of them were from Agora,two of them were from Stansberry
Holdings and I was the chairmanof the tie breaking vote, so I
had a central control of thebusiness anything that was
(37:02):
significant or material, withouteveryone's approval.
So anytime we did anacquisition, anytime we
established some new paystructure or anything important,
we all had to agree that it wasa good idea and for a long time
.
That was very frustrating tosome folks who wanted us to be
(37:22):
able to change faster, do moreor whatever their you know,
whatever their little petproject was.
But I actually think that was afantastic idea.
It kept us from doing thingstoo fast and in many cases it
saved us a ton of heartache anda lot of trouble.
And so if you're involved in aprivate business that gets to
any size or gets to any scale,and you can do that informally,
(37:45):
if you have that, hopefully youhave that kind of relationship
with your other owners, yourother partners.
I really think that works thebest.
John Newtson (38:03):
So, whatever you're going to do an
acquisition or buying a newbuilding, whatever it is,
whatever is a big decision,everyone's got to agree it's the
right decision.
Wow.
So when you look back, though,like on building this business,
what do you think?
So I know we're going to setthe lifetime value discussion
aside, because you're reallygoing to focus out in depth at
FMS, and you know we've gonethrough several things.
What do you think were the like?
If you had to name, like thethree to five most pivotal kind
of decisions you've made, whatwould you be in your top three
(38:26):
Like?
Porter Stansberry (38:28):
definitely.
You know, I think the mostimportant decision was how we
decided to treat our employees.
You know, I just I just knewthat I wasn't going to get
anywhere in business without alot of help.
And so when I recruited MikePalmer, one of the things I did
that I think most people willthink was kind of crazy is I
said hey, listen, I'm probablygoing to end up writing a lot of
(38:50):
the copy with you and I don'twant this to ever be a problem,
so I'm never going to take aroyalty.
And most copywriters would belike, ooh, you gave up a lot of
income.
Yeah, I did.
And then you know I had I had Ihad deals with my partners that
I would get management bonusesbased on the net income of the
total group, and I just knewthat that was great for me, but
(39:11):
it wasn't going to lead togrowth for the business.
So over time I gave up allthose bonuses in order to
recruit other people and to makesure that the company was
successful.
And so when I left I don't knowif this is still the case or
not, but when I left the company, 10% of the net income every
year went directly to employeesand bonuses.
John Newtson (39:35):
that's a very large amount of money, that's
fascinating because I've heardother people from other large
publishers like, who didn't have, um, any type of real stake in
anything, who ended up leavingover time um and um.
I know in one case inparticular, there was a you know
kind of an argument wasactually, you guys were used as
an example of like look, lookwhat porter did for palmer and
(39:59):
these other guys and, um, like,why would you do the same for
your, the team that helped buildthis company?
And the response was uh, youknow, you're making enough money
, it's fine.
Porter Stansberry (40:12):
Yeah Well, I think it's just a different
philosophy, Just a verydifferent philosophy.
I knew that I wouldn't be ableto get rich unless a lot of
other people got got rich too.
So just so one thing was the way, the way that I, the way that I
thought of employees and theway that I wanted partners.
(40:33):
And then, secondly, you know itseems obvious, but we just
always put the customer first,and I know that sounds really
obvious, but we really truly putthe customer first.
So like, in every way, anytimethere was an issue, we would
just make sure the customer won.
So like, if you're going toroll a product, what should you
(40:54):
give them?
Instead, give them whateverthey want.
What if it costs more Doesn'tmake any difference.
Give them whatever they want.
You know, are we going to ownstocks?
Are we going to trade stockswhile writing about them?
Hell, no, why not?
Well, because we want to putthe customer first.
Well, that means we're notgoing to make as much money.
(41:14):
So be it.
Like we're not going to do that.
I can't manage all thoseconflicts and it just doesn't
make sense to the customer, sodon't do it.
You know, are we going toinvest in a lot of customer
service people?
Are they going to be collegeeducated?
Are we going to put them in ourbuilding?
Are we going to treat them likeactual coworkers?
Yeah, we are.
Why?
Because that's what's best forthe customer.
Oh, you're going to spend afortune on it?
(41:35):
Yeah, but that's an investmentin the customer, we'll get the
money back.
So you know, really reallytreating your employees really
well and generously and thentreating them and then, of
course, doing everything you canto treat, to put the customer
first, and then, I guess, theother.
The other thing is going tosound again kind of obvious in
retrospect, but wasn't at thetime at all.
It's just I always shied awayfrom doing anything at a very
(41:56):
low cost.
You know, if you, if youdiscount your products, you're
going to get a lower qualitycustomer.
And I didn't.
It's not that I.
It's not that I don't thinkthat those businesses can work
well.
I just always thought, you knowthat I bet, I bet Louis Vuitton
makes a lot more money thanKmart.
Not sure if that's the case,but I bet they do.
And I definitely want to be inthe Louis Vuitton business, not
(42:19):
the Kmart business, because theKmart business is just a shit
show and I don't want to be apart of it.
So we just tried to price ourproducts very aggressively, even
though the marketers would tellme all the time you're going to
have more subscribers if youprice it less and I'm kind of
like, well, maybe, but they'regoing to be the wrong kind of
subscribers and what I'm, thebusiness I want to be in as a
lifetime value business, not inthe, not in running the
(42:41):
marketing hamster trail business.
John Newtson (42:44):
Right, you kind of get.
You get the customers you askedfor.
Porter Stansberry (42:47):
Yeah, and you're going to get the.
You're going to get theemployees that you asked for too
, and so those are just the sortof the two things that I really
think made a big difference.
It allowed us to get goodpeople, keep good people, both
as employees and customers.
John Newtson (43:01):
It makes a lot of sense.
It seems like I know, withinternet marketing and financial
marketing and digital, likecopyright and all of it the
there's, it's an easy thing fora lot of entrepreneurs to get
distracted with what's the newmarketing thing, and it's a
constant thing, and what strikesme about what you guys have
done is really like thismastering and focus on
(43:25):
fundamentals, um, which issomething that's so ignored.
I feel like across the board,blocking and tackling.
Porter Stansberry (43:32):
Yeah yeah, it's awfully hard to beat a
football team who's got the bestline and can get four yards of
carry.
They win a lot of footballgames.
It might not look great, butthey usually win.
John Newtson (43:49):
Fair enough.
So the I want to move a littlebit to your decision on why you
decided to do this back, why youdecided to go public.
I feel I feel like I've heardrumors about that like desire to
go public for years before youguys did it.
I don't know if that's just memisremembering or not, but it
(44:11):
seemed like it was somethingthat you really focused on,
obviously.
And then when you did it, itwas, you know, we it's almost
like a watershed moment in theindustry and I think it made a
huge splash.
Obviously.
Why did you decide to do that?
And you know what's yourexperience with that.
Would you do it again?
Porter Stansberry (44:30):
Yeah, well, you know I told you that from
the beginning.
Steve and I are reallyfascinated with finance.
Steve and I are reallyfascinated with finance, and his
experience as a money managerand a broker had taught him that
a lot of the regulation isactually bad for the customer.
It's nonsensical, and so wethought that by getting into
this unregulated space we couldbuild a better product.
(44:51):
That would be better for thecustomer, and I'm convinced it
is.
If you look at the track recordof any of our model portfolios,
they're world-class.
And instead of having to pay usa percent or two of your assets,
you paid a one-time fee, andmaybe three or four years ago, a
lot of brokers started doingthe same thing.
They said look, if you want tojust pay us $1,000 a year, you
(45:14):
can.
I mean, I don't know exactlywhat the pricing was, but I know
they started offering flat feefinancial services.
And that was my question why inthe world do I have to pay a
percentage of my assets to useyour service?
When I go to a hotel, theydon't say, mr Stansberry, how
much money is in your wallet oryour luggage?
Give us a percent of that.
You stay at our hotel.
No, they say, our hotel costs X, okay, so why would you buy
(45:35):
financial services in this otherbizarro way?
It didn't make any sense.
The other thing that I alwaysresented was that the wealth
management industry alwaysclaims that they're going to
make their clients wealthier.
Trust me, that's not the way itworks.
The wealth management industryexists by siphoning wealth from
their clients into their ownpockets, and I liked being able
to write about that and likedhaving a business model that was
(45:58):
the opposite of that.
I just think it's more ethicaland certainly more fun.
And so the main reason why wewanted to go public was because
we think and this is still truethat there is room for us to
compete with every financialservice provider, not just other
publishers, and so we'vedesigned our products and we've
hired the right people to dothings that other.
(46:21):
You know that other wealthmanagement companies do, from a
fiduciary standpoint, that wethink we can do very
successfully from a publishingstandpoint, and to get there,
you have to actually behave likea fiduciary, which we always
have.
We don't buy the stocks wewrite about.
We put the customer first.
They can always have theirmoney back X, y, z, and, of
(46:44):
course, the products are prettygood, and so to do that, the
number one thing I thought weneeded to do to get there was we
needed to have a product thatwas similar to a Bloomberg
terminal that would allow peopleto interface with us in a
format that was more similar toother financial service
providers.
Right, you don't interface withinteractive brokers by getting
something in your email.
You interface by going onto awebsite or an app and using
their services.
So I wanted to create that, anddoing that was going to be
(47:06):
expensive, especially all thetechnological backend stuff that
we had to do to do that.
So we have that problem.
It is competitive, I think,with other similar things from
Bloomberg and other people.
And then the other issue wasthat we found that we were
pretty good at M&A.
We were pretty good at buyingcompanies, improving their
(47:29):
products and processes andmerging them, but to do that
requires a lot of capital.
So we were looking at oneacquisition which I'm not going
to name because I know it'sstill in play, you know and we
needed probably $300 million tobuy them.
And you're like, well, that's alot of money.
Well, not really not to acompany that's doing $300
million a year in revenue.
Right, you could afford it.
But we couldn't find a bank togive us a loan because we
(47:53):
weren't public, and you knowjust all of things that go along
with that.
You just cannot.
You cannot do business at thatscale, um, unless you're, unless
you're public, unless you haveaudited financial statements,
unless you see stuff.
So we just, it was just thenext stage in our growth.
You just it's awfully hard tohave a billion dollar a year in
sales business that isn't public.
Very difficult, I'm not sayingit can't be done, it just very
(48:16):
difficult.
And then, of course, there'sother factors.
We have partners, some of whomwanted liquidity for estate
planning and family planningreasons, like Bill, who's much
older than we are, and sothere's a raft of things.
The other thing I always wantedone last point is we would make
our customers promises like wedon't buy the stocks we write
(48:36):
about.
But how do they know we werereally telling the truth?
And I, you say that an secfiling, you better be telling
the truth.
So we, I thought that thattransparency would help us and
give us an advantage over ourcompetitors as well.
John Newtson (48:50):
That's fascinating , okay, um, so now you're.
You, like you said, you retiredfrom uh, from market wise, and
you started.
You're starting something,started something new.
What?
Porter Stansberry (49:00):
are you doing ?
Well, it's called PorterCompany and this is our offices.
Behind me.
I'm starting a much smallercompany I don't ever want to
have more than maybe a dozenpeople and I want to pursue just
kind of a niche business wherewe have really great, highly
specialized financial researchproducts and there's just a
(49:21):
couple of spaces that having theright information makes an
enormous difference inperformance.
And that's property andcasualty insurance, which is one
of these black box businessesthat outside investors really
can't understand, where we havereally good longstanding
connections and sources ofinformation, and biotech, which
of course requires a whole lotof scientific knowledge, and
(49:43):
those are really high marginproducts that don't require a
lot of staff.
They just require the rightstaff.
Another example is distressedcorporate bonds, a very niche
product in finance but onethat's very, very lucrative.
I think that if you look at ourprevious product called Credit
Opportunities, you find thatannualized results are above 20%
(50:03):
and 85% of those trades arewins, and that's really hard to
do in finance if you're doing itfor real.
I don't mean the typicalnewsletter track record system,
I mean real dollar returns.
So there's things that I justknow how to do in finance, that
most people don't know how to doand I don't think I need a
company of 600 people to do them.
And you know, after 22 years Iwas kind of worn out with
(50:28):
managing 600 people and andmanaging the expectations of a
lot of partners and having allthat responsibility.
So, going forward, I just wantto have a very small group that
does a couple of things reallywell and I'm not going to really
be competitive with market-wiseI'm still a major shareholder
there.
None of my products will sellfor less than $1,000 a year, so
(50:50):
they're not going to bemainstream products.
It's just going to be peoplewho know me and know my work,
who are family office investorsor brokers with a big client
base.
John Newtson (51:02):
I think that piece right.
There is something that peopledon't realize in the publishing
space, which is that if you havethe quality of product that
you're talking about, it's notjust the mom and pop retail
investor who's buying them.
Porter Stansberry (51:17):
Oh no, not at all.
Yeah, Every hedge fund in theworld reads my work.
John Newtson (51:22):
Yeah, yeah, and I think I think that's something
that people don't think aboutthat the business itself is.
There's a lot of differentcustomer segments and publishing
media.
I think this is one of the this.
I've been preaching this for awhile that one of the bigger
trends in the industry as awhole is that all areas of
(51:42):
finance are really kind ofcoming on the table.
All areas of investor areavailable as customers to the
right types of businesses.
Porter Stansberry (51:52):
It's so funny .
I can't tell you how many timesI have seen my work plagiarized
at conferences, and almostalways, almost always, by people
who are very critical of us.
John Newtson (52:02):
Yes, just terrible .
Porter Stansberry (52:04):
Okay, it's like the Howard Stern thing I'm
sure you remember from fromHoward Stern's movie.
You know this marketing managercame to him and said Howard,
we've got a big problem.
You know, 75% of the people inNew York radio market hate you.
Oh geez, that's terrible.
Well, the good news is thepeople that hate you listen
twice as long as the people whoI sure hate that Stansberry guy.
(52:27):
Where's his latest letter?
John Newtson (52:29):
Yeah, that's great .
Well, I appreciate you takingthe time today and talking with
me about this stuff, because I'minfinitely fascinated by kind
of what you guys have done andthe industry, and so I think a
lot of our people are too, andso we're really excited to have
you join us for the FinancialMarketing Summit in, I guess, a
(52:50):
month and a half.
Porter Stansberry (52:52):
Great, yeah, and I want to pitch that, if you
don't mind, just for one second.
Yeah, because I would love to.
There are eight.
This is the copywriter to meright.
There are actually eightdefinitive steps that can lead
your organization to lifetimevalues that are two or three
times what they are now, andsome of them are obvious that we
discussed, but some of themaren't obvious and, uh, I I have
(53:13):
a pretty good track record ofdoing that and I will give you
my actual playbook at yourconference, and I do appreciate
being invited and I doappreciate what you have done
for our industry.
I think that the more that weshare best practices, the more
credibility the industry as awhole can have and, of course,
the more success people can havein the business, and that's the
(53:34):
thought that I would leave youwith.
I can't tell you how many timesin my career marketers and
copywriters actually said to medon't give me a really good idea
, because those don't sell.
That's just not true.
You just don't know how to sellthem.
Let me show you.
And so I just think that therehas been in the past this
(53:57):
mindset that you know, quoteunquote you know, good finance
or complicated finance can't besold to the public, and that
just isn't true.
I mean me and Steve Sugarwood.
We had a package that was calledPortfolio Repair.
It came out in 2002, rightafter the bear market of 2001,
2002.
And it was about mortgage REITs.
(54:18):
Now, mortgage REITs are a realsubset of finance.
They're a real complexspecialty and you cannot explain
to the average newsletter buyerwhat the hell a mortgage REIT
is.
But we didn't explain it thatway.
We explained it asgovernment-backed portfolio
repair, which it is.
And so you know it's just it's.
It's it's learning how to dothat stuff that I think can
(54:40):
really make a big difference inyour results.
If you can start with goodfinance and then you take the
time to put it in everydaylanguage, you'll be way more
successful than if you just makea bunch of empty promises and
you don't have a very goodfinancial product.
John Newtson (54:53):
Yeah, and just to kind of like put the cherry on
top for everyone who's listeningon the LTV conversation, the
lifetime value conversationyou're going to have at the
summit.
Like, what do those numberslook like just comparatively?
Porter Stansberry (55:06):
Yeah, well, I can tell you that when I left
MarketWise in December of 2020,the average lifetime value the
average lifetime value of aconverted customer, and what
that means is someone who boughtanything besides one thing.
So we're not counting thepeople who came in and bought,
you know, one $5 book and neverbought anything else again.
Not counting that, callinganyone who bought more than one
(55:29):
thing from us.
So you came in and you bought a$5 book and then you had a
renewal, or you bought anotherproduct, or then that's a
customer.
So anyone who bought at leasttwo things from us as a
converted customer, and theaverage lifetime value when I
left was twenty eight hundreddollars.
Um, I'm sure now it's well overthree thousand and that's on
hundreds of thousands ofcustomers yeah, that's on, uh,
(55:53):
approximately four hundredthousand people, so you can do
that math.
John Newtson (55:58):
Yeah, and that's very high for, like I've seen,
like in a very niche, tiny likeday trading spaces where they
might have a higher customervalue because you have
essentially 20 customers you canget, but they're going to pay a
lot and to have a scaledbusiness and have that kind of
numbers.
That's dramatically higher thananybody else I've seen in the
space, dramatically higher.
Porter Stansberry (56:25):
Yep, and we're not there yet, but I do
believe that getting to alifetime value of over $10,000
at scale meaning at least100,000 people is certainly
possible with the right kind offinancial products, and that's
what I'm aiming to do at PorterCompany.
So we'll see if it can be done.
John Newtson (56:39):
That sounds amazing.
So again, thank you, porter.
I'm aiming to do at Porter andCompany, so we'll see if we can
be done.
That sounds amazing.
So again, thank you, porter.
I'm looking forward to seeingyou in person in Orlando, and so
I really appreciate you takingthe time today.
This was amazing for me and, Ithink, everyone else is going to
really enjoy it.
Porter Stansberry (56:52):
Well, I'll see you in June All right.
All right, bye-bye.
John Newtson (56:55):
Take care Bye.
All right, everyone.
It's John again from FMS.
I'm really excited todaybecause we have with us Porter
Stansberry, who, for most of youwho've been in the industry
Porter doesn't need anintroduction, but for those of
you who may be a little bit newto the industry, Porter is the
only person I know, who I think.
He took what Jeff like 36K anda laptop and basically grew it
to a $3 billion value.
Porter Stansberry (00:24):
Overnight success 22 years later.
John Newtson (00:28):
But also, I think, like and just for everyone,
like Port is, he's coming to FMS, he's going to be talking about
how he's managed to build abusiness that has what 3X the
lifetime value of a customercompared to pretty much everyone
else in the industry.
But when we were talking and Irealized, like I have a whole
lot of questions about a lot ofthings besides simply the
publishing side, and so wedecided to do this, have this
(00:51):
conversation, which is, you know, I think everybody's been
following other people in theindustry and I think of you as
the person that most peopleactually have followed and that
other people are following themin terms of what they've done in
the business, and then otherpeople are following them in
terms of what they've done inthe business.
I remember when I came in thebusiness Stansberry Research was
, I think, the largest Agoragroup at the time and everyone
(01:12):
was following what you guys weredoing.
And then, even over the years,other groups put up larger gross
numbers.
You guys were still taking homemore actual money than
everybody else.
And so I was talking to a friendnamed Pete Monson, who's a
financial copywriter.
He's worked around, you know,for quite a while in the
industry and he was saying youknow, it always seems like
Porter's been working from adifferent roadmap than anyone
(01:34):
else and I was like that seemedreally appropriate, not just on
the publishing side but on thebusiness side.
And so, porter, that's kind ofwhat we want to talk about today
is the business decisionsyou've made from the beginning
that are kind of pivotal inbuilding a company from startup
to a $3 billion IPO, and youwould know better than I where
(01:57):
that would start.
Porter Stansberry (02:00):
Well, I think it's interesting that they
thought I was on a differentroadmap because I really was.
Well, I think it's interestingthat they thought I was on a
different roadmap because Ireally was my original business
partner and I his name is SteveSugarwood and he wrote the True
Wealth newsletter for many years, still does and he and I looked
(02:21):
at the newsletter business backin the mid-1990s, 95, 96.
And at the time Steve wasrunning a global mutual fund and
I was just getting out ofcollege, so I knew nothing about
the financial newsletters orabout the financial publishing
industry as opposed toinvestment banks and brokerage
firms.
And Steve basically said look,there's two ways of doing
business.
You can be regulated and be abroker, or you can be
(02:42):
unregulated and be a newsletterwriter.
And being a newsletter writeris way more scalable.
You don't have to deal withclients one-on-one, you don't
have to be a fiduciary.
If you have good investmentideas and you can write, then
you can be successful as anewsletter writer and not just
as an individual broker.
And I didn't really care, Ijust wanted to be involved in
(03:03):
finance.
I love the challenge of capitalallocation, I love the research
process, I love the incredibledifferences in business models,
and I still do.
You know, the reason whyMcDonald's has been a great
investment for 40 years isn'tbecause their food isn't any
good, it's not.
It's because they are a royaltybusiness, right.
They don't even really ownrestaurants.
(03:24):
Yes, technically they own, theyown they own maybe 25% of their
locations but their wholebusiness is is getting people to
buy franchises, and they get 7cents on the dollar every time
you buy a Coke.
That's a hell of a business.
I mean, they're a marketer anda brander.
They're not really arestaurateur, and so if you
understand that, then you're waymore likely to invest in
(03:45):
McDonald's and you would havedone very well if you had.
But my point is just that somuch in finance isn't what it
looks to be from the outside,and that was always my
fascination and that's what Iwanted to be involved in, and I
didn't really care whether itwas as an analyst at a hedge
fund or writing a newsletter,and I don't know that.
That is very true.
I don't know if that passionfor finance is the same thing
(04:08):
and a lot of the onlinemarketers and copywriters that I
have met.
I think they're more interestedin marketing and they're more
interested in advertising than Iwas, and I think if you
actually read the copy that Ihave written and you, you look
at the different things I'vedone on the front end and the
back end, the one thing thatunites them all is that they're
(04:30):
all poorly written.
I'm a complete hack, but thefinancial ideas are very deep
and I just thought if we couldhave better ideas we would
probably win, and so that's whatwe tried to do, and I don't
think that was the same as a lotof other publishers.
The other thing that I thinkthat really set us apart was I
figured out really early on thatthere was a quantum difference
(04:52):
between a really good financialwriter and the average financial
writer.
And when I say really good, I'mtalking about a guy like, for
example, david Lashman.
I hired him out of theUniversity of Florida.
He was a medical researcher atFlorida.
He studied the history ofvirology, which is a really
(05:13):
niche space.
But he's kind of like a Mensamember kind of mind.
He's extremely smart and he'sdone a lot of bench science in
his time, and for the last 20years I've paid him to go to
every major medical conferenceand get to know every important
scientist and read everyimportant paper.
So when he writes a reportabout a biotech new product,
(05:37):
it's written at a level and witha density that nobody else can
compete with in the financialnewsletter space.
There isn't another person likethat in the world, much less in
financial newsletters.
Well, to keep him, I had to payhim a bloody fortune because he
could go to work at any hedgefund.
He'd go to work at anyinvestment bank tomorrow, but he
wants the freedom and he likesto be his own boss.
(05:58):
So it's a good relationshipthat we have.
But I had to be able to pay hima lot or I wouldn't have been
able to get him or keep him.
And that was really toughbecause most financial
publishers frankly, they paypeople peanuts and as a result,
they end up with a lot ofmonkeys on their staff.
And if you're going to writeabout something as complex as
modern biotech, you really haveto know what you're doing or
you're just selling schlock.
(06:19):
And if you're selling schlock,that becomes really apparent
really quickly and you can't youcan't get the prices for the
products that we had.
So my model was yeah, I got topay a guy like David Lashman
five times or 10 times more thanmost people in this industry
make for being a financialnewsletter writer, but in the
marketplace he's worth a hundredtimes more, and so I was.
(06:42):
I always thought that was thebigger fatter margin and that
would lead to the largerlifetime values and the higher
prices for products.
So we're able to sell ourlifetime product now for $35,000
, which, when we started intothis, that was just completely
implausible.
No one ever thought that wouldbe possible.
But I knew that if we hadenough talent and if the content
(07:03):
was actually worth it, we couldget the price.
And we did, and so that's whatI've always tried to do Go out.
If you're going to have aproduct, go find the guy who's
the best in the world at it,recruit him and then build the
business.
And so for a guy with like, forexample, with empire financial,
I wanted Whitney Tilson.
Whitney Tilson had startedwriting about stocks in the
(07:24):
1990s.
He had a very successful hedgefund he's been on 60 Minutes
three times.
Like he is credibility and whenhe got out of his hedge fund
business, the two places he waslikely to go work were either
Stansberry or Motley Fool, andso I'd been recruiting him since
2003-2004.
And I sent him lots of you knowgood information on stocks.
(07:45):
I'd helped him him since 2003,2004.
And I sent him lots of goodinformation on stocks.
I'd helped him.
It helped him with his hedgefund.
So he knew me and he waswilling to come over and we
started in 2017.
And that business now, empireis probably worth $100 million
now, and so those timelines andthose recruiting takes a long
time, takes a lot of capital,but it does work, and so that's
(08:07):
just what we did.
We didn't launch products untilwe had the right analyst, and
we insisted on having somebodythat we could completely and
fully believe in.
John Newtson (08:17):
So let me parse that out a little bit, because I
feel like when we say thingslike the quality of the product,
the editor, and you talk aboutpassion, about financial markets
, a lot of people in our spacegloss that over.
They're just like yeah, yeah,yeah, we have that.
Or I have a guy who he has thisminor level of experience.
(08:37):
Often, or in some cases, thereare people who never had any
experience and they were justgoing to kind of just figure
stuff out as they go becausethey figure they needed somebody
to fill a product hole.
The focus on, like, quality ofeditor and actually putting
somebody who's actually went outthere on the ground and
(08:57):
involved in the industry thatthey're in, like I feel like
that is completely overlookedalmost across the board by most
people.
A lot of publishers will takesomebody who's like well, they
used to be this, they used to beat a hedge fund and now they
want to write, but now they'renot really involved in the
markets anymore.
They're not going toconferences, they're not out
there actively, it's not aliving business for them.
(09:20):
It's like I have someexperience, I'm going to write
about what I did, you know, 30years ago and you know when I
find something on Yahoo Finance,I'm going to write it up that
quality and that active pursuitof quality, I think.
So you have somebody who'sreally amazing at understanding
(09:41):
a sector, but you're you'retalking about putting them on
the ground continually, over andover again, throughout the
business.
They're not just like I wasreally good before and now I sit
at home, don't do anything butright.
Porter Stansberry (09:53):
You know, it just depends.
You can definitely do well witha guy who was a senior person
and is now, you know, partiallyretired.
But I would just tell you, as apublisher, your most important
employee is not your head ofmarketing or your head
copywriter.
Your most important employee isthe managing editor.
And if the managing editor hasthe budget and the mandate and
(10:18):
the chops to do a great job, youcan definitely build great
products.
And the first question themanaging editor should ask every
editor when he's assigning a,you know, a monthly newsletter
or any kind of project, is youknow who?
Who are you going to speak toabout this?
You know, and if you're notgoing to do five or six
interviews, then don't bothertaking the assignment.
(10:38):
And I think that's one of thebiggest things that most people
getting into the business reallyscrew up is man, if I talk to
two people, just two people andI have two 20-minute phone calls
with two people who are in theindustry and who really know
what's going on, that saves me100 hours of online research.
And sure I've got to go readthe 10K, I've got to read the
(11:00):
10Q.
Obviously I have to do thatbefore I can have those
interviews, but the context thatcomes with those discussions is
irreplaceable and you can'tfind it online.
So if you are getting startedand you don't have a pedigree
and you don't know where to goto get somebody who does, and
you can't afford to spend amillion dollars a year on an
editor, then you just got to getreally good at working the
(11:22):
phones.
And that goes for copywriterstoo.
If you're writing copy about aninvestment trend, how many
people did you talk to about thecopy?
And if the answer is less than10, you haven't done your job
and your copy is going to suckcompared to somebody who's made
those phone calls and has allthose little actualities, those
little, those little you know,family stories, all the stuff
(11:42):
that really adds the textualcredibility that makes it
believable and makes it reallymemorable.
And if you don't have thatstuff, then you haven't done a
good job writing.
And let me just say one morething about this the more people
that you talk to, the moreyou're going to learn and the
more you're going to know.
And one of the most importantthings that Stansberry Research
ever did was identify in 2009that the Eagle Ford and the
(12:07):
Permian Basin and the MarcellusShale, among others, were going
to transform the oil industryglobally.
And that was a time when mostpublishers were still selling
peak oil running out of oil.
The other publishers said peakoil running out of oil.
The other publisher saidMeanwhile Stansberry Research
was saying we're going to gofrom producing 5 million barrels
(12:30):
of oil in the United States outof all sources to producing 15
million barrels a day just inTexas and that's going to happen
in the next 10 years.
And of course it has.
And the changes that that hasbrought to our economy and to
that industry are incomparable.
And so we would have neverknown about that.
That wasn't on the Internet.
You know what was on theInternet was peak oil.
(12:51):
But of course we had.
We had deep industry contacts.
We had a professional geologistwho had spent 10 years in the
industry working for us and,believe it or not, my best
contact in Texas is a guy namedCactus Schroeder whose family
has been in the oil business for, you know, for three
generations and he literallyknows every single person in
Dallas and it's in the oilbusiness.
(13:11):
And so you don't make thosecontacts, you don't get that
kind of information unlessyou're out there talking to
people and you're not going tobe able to talk to people if you
don't have products that aregood and respectable and so
that's just it all.
It's not one thing you do.
It's a constant evolution and aconstant improvement, and
(13:33):
unless you have that dedicationto the editorial, it's going to
be very difficult for you to getgood prices for your products
because, frankly, they're notworth anything.
John Newtson (13:41):
Yeah, I think that's again.
It's so nice to hear you saythat.
Just because most people in ourspace could name a copywriter
from a bunch of differentbusinesses, they could name the
managing editor or even, often,cases the editors themselves.
The marketers and thecopywriters are kind of the ones
who everyone looks to because,like you said, everyone's
(14:01):
obsessed with that part of thebusiness.
When you look at the talent sideof this, one of the things that
I think that you've done betterthan most other groups is
retain talent, and that'seditorial talent, but that is
also your marketing and otherpeople that you kind of stars
(14:22):
that you have on the team.
So, like, what have you donedifferently in that space?
Like, how do you whether it wasthe recruiting piece, like you
said these long-termrelationships like that speaks
to me personally, because I seethis with myself, that there are
just relationships that ittakes years.
You know this is a good person,you have a good dynamic, this
is a star.
Like, over the course ofseveral years, maybe you keep
(14:44):
trying to do things where it'sjust the timing's not right, but
then eventually the time hitsand you can work together.
What else have you done?
Porter Stansberry (14:54):
You know, superstars, don't jump ship.
You know, they're very hard torecruit but they stick around.
So I started recruiting MichaelPalmer in 1996.
In 1996, he finally came towork for me in 2002.
And when he came to work for meat the end of 2002, he told me,
porter, I'm only going to workfor it for a year.
(15:16):
I really like being freelanceand I'm a good copywriter and I
can work for all publishers.
I don't have to work just foryou.
And I said, mike, if you giveme a year I'll be flattered and
of course you know whatever youwant to do.
And then it was really simple.
It wasn't just pay.
Of course I paid him more thananybody else would, that's fine.
But it wasn't just pay, it wasI gave him more tools and
(15:37):
ammunition to get the job done,to get the job done.
So, man, it's a lot easier tobe a copywriter when you
actually have really goodeditors to work with, with
really good ideas, and when theeditors are all pulling together
as a team.
So Mike doesn't have to writethe whole package, he just has
to write the headline and thelead and then he's going to have
two or three assistant peoplewho help him with the body copy
(15:58):
and the editors are handling allthe premiums and we work
together as a team and everybodygets paid as a team.
You know, it's interesting tome that the industry figured out
real quickly how to pay peopleas a team to do something like a
webinar, because it takes a lotof coordination the editors,
the marketers, the technicalstaff and the copywriters.
People still haven't figuredout how to do that.
On the front-end packages, well, we write front-end packages in
(16:19):
two weeks and the only way thathappens in two weeks and the
only way that happens if youhave a good copywriter and you
have good editors and you havegood assistant editors and you
have good lawyers, and of course, it also helps when you're
actually writing stuff that'sreal and meaningful and novel.
You know, it's not, it's not umanyways, but my whole point is
(16:39):
if you want to attract, ifyou're, if you're trying to
attract the Yankees, you knowyou can't have a triple A dugout
.
You got to have a bunch ofother stars for the Yankees to
work with, and so thecompensation structure is a big
part of it, of course, but man,people like to work with the
best, and so among the thingsthat I did that was different
(17:01):
was when I realized so this is aconcept.
I call it gravity.
And here's the thing If you getthree or four superstars
together, working together, whatthey can accomplish is
unparalleled.
One star, you got to have agroup, and that group creates
(17:21):
this gravity that attractseverybody else.
So you're going to get the bestmarketers.
You're going to get the bestcustomer service people.
You're going to get the bestsales people, because they want
to work with Steve Sugar, mikePalmer and David Lashman, and
I've got them.
And then an interesting thinghappens If you start letting C
players into the universe,you'll lose your A players.
The company culture will change.
(17:46):
Now I probably shouldn't tellthis story because I probably
violated some employment rule,but I walked into my office.
This is a long time ago.
This is 10 years ago roughly.
I walked into my office one day, actually more than 10 years
ago, and I just didn't like thepeople I saw walking down the
halls.
You know we were probably at100 employees, maybe 120
employees by that point.
And when I say I didn't like thepeople walking down my halls, I
(18:08):
wouldn't have wanted to befriends with them.
If I had gotten stuck at anairport with them for five hours
.
I would have been miserablebecause they didn't have
anything interesting to say.
They weren't the kind of peoplewho read books, they were the
kind of people that watchedtelevision.
They just weren't for us.
They shouldn't have beenworking in a research
organization, they shouldn't beinvolved in creative activities,
because they were duds.
And one of these duds this is atrue story.
(18:29):
I don't want to say if it was aman or a woman, because it
doesn't matter but they builtbasically a bunker of canned
food on their desk.
So they had like a bunch ofChef Boyardee cans of food
around their workspace and let'sjust say they weren't in the
best physical condition and Iwas like, man, nobody wants to
(18:51):
come in and watch an obeseperson eat Chef Boyardee out of
a can at their desk.
This is just not.
This is not helping ourrecruiting or our culture.
And so I figured out this is atrue story.
I figured out that there was oneperson in our organization who
had hired 12 or 14 duds and Iwas like, ah, that's the cancer
(19:13):
that needs to be cut out.
And so I had him and all 14people come to a meeting and I
fired all of them in one meetingand they all had a nice check
in front of them I said all yougot to do is sign a piece of
paper that says we can befriends and I won't disparage
you and you won't disparage meand we can all go on our way and
have a new start.
And you guys definitely need anew start because you're not
(19:35):
going to succeed here.
This isn't the rightenvironment for you.
And so they are all shocked andchagrined and, you know, signed
their checks and were gettingready to leave and a guy knocks
on the door of the meeting andopens the door and goes Porter,
hi, nice to meet you.
I'm Joe Smith.
I'm new here.
Today's my first day, andeveryone in my group got called
(19:55):
into this meeting and I thoughtmaybe you wanted me here too,
but you just didn't know toinvite me because it's my first
day.
And I was like Joe who hiredyou and he pointed to the guy
who was the source of all theseproblems and I said oh, yeah,
definitely, come on in.
You're fired, oh, poor guy.
John Newtson (20:20):
But you know, this person.
Porter Stansberry (20:22):
This person was hiring people who just
didn't measure up.
He just he wasn't going to workin our group and what you
needed to, what you needed to besuccessful in our group, was
you had to have a relativelyquick mind.
So I told people at a meetingrecently that if you didn't make
a 1400 on the SAT, I wasn'tgoing to hire you.
Now I don't mean that literally.
You know, if you, if you got aperfect score in the English and
(20:43):
you weren't that good at math,you'll probably be fine or vice
versa.
But like you got to have a,really you got to have a passion
for intellectual growth and forintellectual challenge, or
you're not going to get alongwith any of your peers.
So hiring really smart peoplewas sort of the number one thing
.
And then the number two thingwas I really liked it if you had
a background in competitiveteam sports.
So if you were a collegelacrosse player or you were a
(21:05):
college football player or youwere a woman's soccer player,
you know I didn't really carewhat your passion was, but it
was way more fun to be aroundpeople who were passionate about
their, about their lives, youknow, not just their careers and
I just, I wanted to be inspiredby the people that I was
working with.
I didn't want to have to do allthe inspiration myself, and
that was that was a big, thatwas a definitely a big
(21:27):
difference.
We were a very, verycompetitive bunch.
John Newtson (21:31):
That's fascinating .
I remember when I first cameinto copywriting years ago and I
don't I haven't written copy inyears because we kind of moved
with the conference into otherbusinesses but there was a list
that I got from ClaytonMakepeace when I worked with him
, from you actually.
It was a list of books thatevery copywriter should read and
100% of them were finance books.
(21:53):
They were not like GeneSchwartz or copywriting books.
It was like no intelligentinvestor.
It was like you had to actuallyunderstand financial concepts
in history in the market to beable to write in that space.
And since then I've seen nobodysay or do anything that suggests
(22:14):
that they think that that's thecase, at least not in recent
years, and that to me, I guessspeaks to me about the culture
you're kind of talking about.
You have an actual mind for theindustry.
You have a passion for markets,because finance, when you look
at it, it's one of the mostfascinating areas in the world,
(22:34):
or subjects in the world,because one is so broad.
It intersects with businesspolitics, there's the economy,
there's investing, there's skill, there's all these different
things.
It's like this fascinating kindof central hub of how the world
works.
And so if someone's notpassionate about that.
It seems like they probablyshouldn't be writing for
products in that space yeah, Iagree with you.
Porter Stansberry (22:55):
I also just think that I mean I was just
shocked at the at the reallypoor level of basic financial
knowledge amongst virtually allthe marketers or copywriters
that I met in the industry whenI got into it.
It was just shocking to me thatthey didn't truly they didn't
know the difference between apenny stock and an actual
business.
They didn't know the differenceand I mean I was just blown
(23:18):
away by that.
I mean I just blown away.
I mean I remember this is atrue story.
I remember a publisher at Agorawas writing a penny stock
package and he was claiming thatstocks like Intel were penny
stocks.
Because he was looking athistorical prices and he didn't
understand the impact of stocksplits going backwards.
(23:40):
So you know, there was never atime that Intel actually traded
for 13 cents.
That's not the actual nominalprice, that's the current price
after you know a dozen stocksplits in reverse.
And he had no idea of that andas a result, his work was just
(24:01):
embarrassing.
I mean it was nonsensical.
Of course it still worked in themail, you know, because the
people he's writing to didn'tknow any better either, right,
but I would just beenembarrassed to be associated
with that kind of publication.
I mean that's just bad right.
And so if you're, you know, ifyou're a marketer or a
(24:22):
copywriter and you say, I don'tcare what the damn editorial
says, it matters that theresponse rate is, well, look,
that's certainly one way ofdoing business and I'm not going
to be overly critical of it.
It just wasn't for me, and Idon't think that you can be very
successful doing that for long,because you might start just by
shining on your clients, buteventually, if that's your
mindset, you end up shiningyourself on too, and that leads
(24:45):
to a catastrophe, yeah, and it'sgoing to have a knock on
effects with recruiting talentlater.
John Newtson (24:51):
Who knows what's going on with partnership
potential, with regulators, withall kinds of people, absolutely
.
Porter Stansberry (24:58):
And that business, by the way, it
collapsed spectacularly, youknow about 18 months later and
caused them a lot, of, a lot ofproblems.
So it's just, it's just, Idon't know how.
You know, it's a verycompetitive space and I don't
know what you're thinking.
If you, if you think you'regoing to be really successful
and you and you don't, and youhaven't even read those books.
And I remember that listthere's probably 20 books on the
list and like that's the stuffthat every first year finance
(25:22):
student would have read.
Like it's not, that wasn'tthose.
Those things were easy to read.
We're not talking about theblack Scholes theory of options,
pricing or something, somethingthat's pretty complicated, you
know.
Or I'm just saying like, uh, itreally.
It's like, think about ifyou're trying to open a
restaurant, you didn't know howto cook an egg.
Like you know, you're the ownerof the restaurant.
(25:43):
You may not be the personcooking eggs, but you sure as
hell better know how they'recooked.
John Newtson (25:48):
Yeah, or how can you basic level of knowledge
that's needed.
Porter Stansberry (25:51):
Yeah, so that's always.
That's always struck me as asas as interesting.
But yeah, I, I, uhno-transcript legend.
John Newtson (26:26):
maybe that when you first started coming into
the industry, there was somebodywho fired you and said that you
would never be successful as anewsletter publisher?
Is that true?
Porter Stansberry (26:36):
That's very true.
Yeah, I don't want to use hisname cause I don't want any more
litigation.
There was a.
There was a very seniorpublisher at Agora, the most
senior publisher at Agora at thetime, and he and I had a very
terrible personality conflict,in part because I'm not a very
good employee.
I didn't mind in a meetingtelling him flat out that he was
dead wrong about anything and Ifigured, as long as I was right
(27:00):
, then I would be okay.
No, if you embarrass your bossrepeatedly in meetings you will
(27:23):
get fired, and I certainly wasfired.
I was fired the first week inJanuary 1999.
And he told me when he fired methat I was the least
entrepreneurial person he'd evermet.
And then I was sure to be afailure and I thought that was a
little gratuitous.
But you know, one of us went onto become a billionaire
publisher and one of us was outof the industry and a couple of
years later Fair enough.
John Newtson (27:34):
I think that says it.
So you started with kind of thethe full Agora mothership
behind you and then over theyears you've move Stansberry,
and then Legacy and the otherbusiness units that became
MarketWise away from the Agoramothership.
Why did you decide to do thatand what was the impact of that?
(27:57):
Because it seems to me that youstarted with one business that
was tied to Agora and then, asyou moved away, you ended up
building your own ecosystem ofcompanies that became more
substantial now, I think, orclose to as substantial as the
Agora ecosystem itself.
Porter Stansberry (28:14):
Yeah, that's a very interesting story and I
don't think that I've ever toldit publicly anywhere and I don't
have any reason not to.
But we don't normally talkabout the things the way.
We don't want to talk aboutthings that are structured, but
I'm happy to.
But what really happened wasbecause I had been fired from
Agora when I wrote what we callthe railroad package, which was
(28:37):
the first direct mail package Iever wrote, and the headline
across America there's a newrailroad across America is
making some people very rich, meincluded.
I didn't say that, but um, itdid.
You know, there was a railroadpackage and it was a story that
talked about the historicalsignificance of the new fiber
optic networks and the way thatthey would change the world in
(28:58):
commerce, the way that railroadshad, and it was a new way of
understanding um, thistechnological boom.
That really helped people whowere older and who weren't
familiar with computers get whyit was important.
It's hard to believe this, butback in 1999, there was an
argument being made that none ofthis, this, that the internet
was just a fad and it wouldn't.
You know, it was no moreimportant than a fax machine.
(29:18):
And so you know, explaining whythat wasn't exactly the case
was important and the packagereally caught traction and you
know, at the time it was thebest selling thing that had ever
happened in the financialnewsletter space we made.
This is back when you had topay for stamps and postage and
printing.
We still made 800% ROI on thosemailings.
(29:40):
I mean, we were mailing thephone book.
It was an amazing takeoff.
Well, the interesting thing wasI did all that before I was out
of gore.
I did all that from my kitchentable.
And so I sent that package toBill Bonner, who is the
principal at Agora, and I said,hey, I think this will work and
you've always been really goodto me, and he has been, and it's
(30:03):
not your fault that this otherguy fired me.
And if you want this package,I'll sell it to you for 50 grand
, which I thought was, you know,would have been the highest
price that I'd ever seen somepaper package.
And I didn't think it waslikely that Bill would pay me.
But I thought it'd be a goodplace to start the negotiation
and I said I'll give you 24hours on an, exclusively, but if
you don't buy it from me, thenI'm going to send it to your
(30:25):
biggest competitor, which at thetime was Phillips Publishing,
and I knew Tom Phillips fromSocial Connections, and so I
kind of put Bill in a little bitof a bind there and he said
well, I don't know about theprice, but I'll definitely buy
it from you.
Let's talk with some people andfigure out a way to get you
back into the fold and justtrust me, we'll work something
(30:45):
out.
And I did trust him becauseBill is the most honorable
person I've ever met in my life.
In fact, we ran StansberryHoldings, which became
MarketWise, from 2014 until 2019on a handshake.
We didn't have a contract ofany kind or an operating
agreement.
Yeah, and by that point it wasa you know 300, $400 million a
year in sales business.
But dealing with Bill is noproblem because he completely is
(31:09):
good for his word.
And so he said, hey, we'll worksomething out.
And I was like, okay, and so itended up.
He never paid me for thepackage in cash.
Instead, he agreed to financethe marketing of it, which he
did to the tune of 36 grand.
And then so we had sold thepublic Porter Stansberry's
investment advisory.
(31:29):
But Bill didn't have a contractwith Porter Stansberry and
didn't really even own thepackage because he had never
bought the copyright from me.
And so we struck a deal where Iwas going to get 25% of the
equity of the business and hewas going to put up all the
money and a lot of the backendstuff.
(31:50):
You know I didn't have.
I didn't have a legaldepartment.
Obviously.
I didn't have customer service,I didn't.
So I thought that was a reallygood deal for me and I think at
the time it was a really gooddeal and we went forward, but of
course, we never paperedanything.
We just had an agreement, andso over time, that agreement
changed and Bill gave up moreand more of the equity to
(32:12):
different employees, as I, as Ikind of demanded and and then.
So what happened was then in2014,.
Really, we needed to.
We had gotten to a size wherewe just had to paper everything,
and so we we moved completelyoff of Agora Systems and we set
up a different, we recapitalizedand set up a whole different
legal structure to own thecompanies and we gave all the
(32:33):
employees real equity.
But it took us five years toget all that work done because
we were so far behind the eightball in papering everything, and
so that schism in 2014 was inpart a legal matter, but it was
also in part a cultural andstructural matter.
We had really what StansberryHoldings was doing was really
(32:57):
different than what Agora wasdoing at the time, and Agora
more and more copied our model.
But we were really focused onlifetime value and we innovated
this thing called the allianceoffer, which is where you pay a
certain price and you get all ofour products, including all the
products we build in the futureand we really pioneered that
whole model because I justfigured lifetime value was the
(33:19):
thing to keep investing in, notjust more marketing, and that
really worked well for us.
That really influences theculture of the company too,
because everyone in theorganization understands that
what's important is not just thenext new promo but instead the
fulfillment process, the renewalprocess, the upselling process,
the onboarding and everythingelse that goes along with it.
(33:44):
That process because we weretreating customers sort of
differently than a lot of theirbrands were and we were, but we
still shared some database stuff.
So like their customer numberwould be the same at Stansberry
Research as it was at ZagoraFinancial and that was really
confusing and hard to explain.
So by really separatingeverything completely, it was
(34:06):
helpful for us in building outour own real unique brand and
style.
John Newtson (34:12):
That makes sense.
That's great.
I appreciate you sharing that.
So as you did start to bring ondifferent business units then I
know at some points I'm notsure exactly what year that was
you brought Mark in.
I met him when he was I thinkhe was the head of biz dev at
the time and then he became theeventual CEO.
And you described to me in theprevious conversation that you
(34:34):
know he's kind of the outsideCEO and you're kind of the
inside CEO.
Could you kind of like what'sthat dynamic work and why did
you kind of evolve into thatmodel?
Porter Stansberry (34:42):
Yeah, just to be clear, I'm no longer at
MarketWise, I'm no longer theoutside CEO.
I resigned and retired inDecember of 2020.
And now Mark Arnold is both thechairman and the CEO.
But the way I kind of sawMark's role was you're exactly
(35:02):
right, he started out helping usroll up some of the companies
that we liked in the industryand improving their operations,
and those M&A processes wereunbelievable home runs.
So if you have a good list andif you have a good lifetime
relationship with your customers, you can introduce them to lots
of new products and they'llkeep buying, and that's what
really drove those M&A processes.
So we had Mark doing that andas a result, he was just sort of
(35:29):
working a lot more outside thebusiness, meaning he was going
out to the conferences to meetother publishers.
He was more involved in thatoutside process.
It was also just his backgroundas a deal lawyer for a venture
capital law firm.
That's just what he understoodthat part of the business and
structuring things.
(35:50):
Meanwhile, sort of my job was toteach the new, the new people
who are joining our company,about our culture and about our
writing techniques and about youknow what we wanted to see
editorially and in our copy, andsometimes it meant introducing
people to direct response forthe very first time, because
some of the companies we boughthad never done that kind of
marketing before.
So in some cases I had to getpeople to be more aggressive and
(36:17):
in some cases I had to getpeople to be less aggressive.
I just spent a lot of timetalking to people about what our
style and tone was and what wewanted to see and the way we
thought that we could make thebusinesses work better, and so
that's just how it functioned.
I just kept my hands in thecontent and Mark basically
handled the the business and thedeal-making side of things, and
then my title was chairman andhis was CEO, but really we ran
(36:41):
the company together.
In fact, I'll tell you somethingvery interesting about
Stansberry holdings.
We were a pro, we were aprivate company and we had, as a
private company, we had a boardand we had five members on the
board.
Two of them were from Agora,two of them were from Stansberry
Holdings and I was the chairmanof the tie breaking vote, so I
had a central control of thebusiness anything that was
(37:02):
significant or material, withouteveryone's approval.
So anytime we did anacquisition, anytime we
established some new paystructure or anything important,
we all had to agree that it wasa good idea and for a long time
.
That was very frustrating tosome folks who wanted us to be
(37:22):
able to change faster, do moreor whatever their you know,
whatever their little petproject was.
But I actually think that was afantastic idea.
It kept us from doing thingstoo fast and in many cases it
saved us a ton of heartache anda lot of trouble.
And so if you're involved in aprivate business that gets to
any size or gets to any scale,and you can do that informally,
(37:45):
if you have that, hopefully youhave that kind of relationship
with your other owners, yourother partners.
I really think that works thebest.
John Newtson (38:03):
So, whatever you're going to do an
acquisition or buying a newbuilding, whatever it is,
whatever is a big decision,everyone's got to agree it's the
right decision.
Wow.
So when you look back, though,like on building this business,
what do you think?
So I know we're going to setthe lifetime value discussion
aside, because you're reallygoing to focus out in depth at
FMS, and you know we've gonethrough several things.
What do you think were the like?
If you had to name, like thethree to five most pivotal kind
of decisions you've made, whatwould you be in your top three
(38:26):
Like?
Porter Stansberry (38:28):
definitely.
You know, I think the mostimportant decision was how we
decided to treat our employees.
You know, I just I just knewthat I wasn't going to get
anywhere in business without alot of help.
And so when I recruited MikePalmer, one of the things I did
that I think most people willthink was kind of crazy is I
said hey, listen, I'm probablygoing to end up writing a lot of
(38:50):
the copy with you and I don'twant this to ever be a problem,
so I'm never going to take aroyalty.
And most copywriters would belike, ooh, you gave up a lot of
income.
Yeah, I did.
And then you know I had I had Ihad deals with my partners that
I would get management bonusesbased on the net income of the
total group, and I just knewthat that was great for me, but
(39:11):
it wasn't going to lead togrowth for the business.
So over time I gave up allthose bonuses in order to
recruit other people and to makesure that the company was
successful.
And so when I left I don't knowif this is still the case or
not, but when I left the company, 10% of the net income every
year went directly to employeesand bonuses.
John Newtson (39:35):
that's a very large amount of money, that's
fascinating because I've heardother people from other large
publishers like, who didn't have, um, any type of real stake in
anything, who ended up leavingover time um and um.
I know in one case inparticular, there was a you know
kind of an argument wasactually, you guys were used as
an example of like look, lookwhat porter did for palmer and
(39:59):
these other guys and, um, like,why would you do the same for
your, the team that helped buildthis company?
And the response was uh, youknow, you're making enough money
, it's fine.
Porter Stansberry (40:12):
Yeah Well, I think it's just a different
philosophy, Just a verydifferent philosophy.
I knew that I wouldn't be ableto get rich unless a lot of
other people got got rich too.
So just so one thing was the way, the way that I, the way that I
thought of employees and theway that I wanted partners.
(40:33):
And then, secondly, you know itseems obvious, but we just
always put the customer first,and I know that sounds really
obvious, but we really truly putthe customer first.
So like, in every way, anytimethere was an issue, we would
just make sure the customer won.
So like, if you're going toroll a product, what should you
(40:54):
give them?
Instead, give them whateverthey want.
What if it costs more Doesn'tmake any difference.
Give them whatever they want.
You know, are we going to ownstocks?
Are we going to trade stockswhile writing about them?
Hell, no, why not?
Well, because we want to putthe customer first.
Well, that means we're notgoing to make as much money.
(41:14):
So be it.
Like we're not going to do that.
I can't manage all thoseconflicts and it just doesn't
make sense to the customer, sodon't do it.
You know, are we going toinvest in a lot of customer
service people?
Are they going to be collegeeducated?
Are we going to put them in ourbuilding?
Are we going to treat them likeactual coworkers?
Yeah, we are.
Why?
Because that's what's best forthe customer.
Oh, you're going to spend afortune on it?
(41:35):
Yeah, but that's an investmentin the customer, we'll get the
money back.
So you know, really reallytreating your employees really
well and generously and thentreating them and then, of
course, doing everything you canto treat, to put the customer
first, and then, I guess, theother.
The other thing is going tosound again kind of obvious in
retrospect, but wasn't at thetime at all.
It's just I always shied awayfrom doing anything at a very
(41:56):
low cost.
You know, if you, if youdiscount your products, you're
going to get a lower qualitycustomer.
And I didn't.
It's not that I.
It's not that I don't thinkthat those businesses can work
well.
I just always thought, you knowthat I bet, I bet Louis Vuitton
makes a lot more money thanKmart.
Not sure if that's the case,but I bet they do.
And I definitely want to be inthe Louis Vuitton business, not
(42:19):
the Kmart business, because theKmart business is just a shit
show and I don't want to be apart of it.
So we just tried to price ourproducts very aggressively, even
though the marketers would tellme all the time you're going to
have more subscribers if youprice it less and I'm kind of
like, well, maybe, but they'regoing to be the wrong kind of
subscribers and what I'm, thebusiness I want to be in as a
lifetime value business, not inthe, not in running the
(42:41):
marketing hamster trail business.
John Newtson (42:44):
Right, you kind of get.
You get the customers you askedfor.
Porter Stansberry (42:47):
Yeah, and you're going to get the.
You're going to get theemployees that you asked for too
, and so those are just the sortof the two things that I really
think made a big difference.
It allowed us to get goodpeople, keep good people, both
as employees and customers.
John Newtson (43:01):
It makes a lot of sense.
It seems like I know, withinternet marketing and financial
marketing and digital, likecopyright and all of it the
there's, it's an easy thing fora lot of entrepreneurs to get
distracted with what's the newmarketing thing, and it's a
constant thing, and what strikesme about what you guys have
done is really like thismastering and focus on
(43:25):
fundamentals, um, which issomething that's so ignored.
I feel like across the board,blocking and tackling.
Porter Stansberry (43:32):
Yeah yeah, it's awfully hard to beat a
football team who's got the bestline and can get four yards of
carry.
They win a lot of footballgames.
It might not look great, butthey usually win.
John Newtson (43:49):
Fair enough.
So the I want to move a littlebit to your decision on why you
decided to do this back, why youdecided to go public.
I feel I feel like I've heardrumors about that like desire to
go public for years before youguys did it.
I don't know if that's just memisremembering or not, but it
(44:11):
seemed like it was somethingthat you really focused on,
obviously.
And then when you did it, itwas, you know, we it's almost
like a watershed moment in theindustry and I think it made a
huge splash.
Obviously.
Why did you decide to do that?
And you know what's yourexperience with that.
Would you do it again?
Porter Stansberry (44:30):
Yeah, well, you know I told you that from
the beginning.
Steve and I are reallyfascinated with finance.
Steve and I are reallyfascinated with finance, and his
experience as a money managerand a broker had taught him that
a lot of the regulation isactually bad for the customer.
It's nonsensical, and so wethought that by getting into
this unregulated space we couldbuild a better product.
(44:51):
That would be better for thecustomer, and I'm convinced it
is.
If you look at the track recordof any of our model portfolios,
they're world-class.
And instead of having to pay usa percent or two of your assets,
you paid a one-time fee, andmaybe three or four years ago, a
lot of brokers started doingthe same thing.
They said look, if you want tojust pay us $1,000 a year, you
(45:14):
can.
I mean, I don't know exactlywhat the pricing was, but I know
they started offering flat feefinancial services.
And that was my question why inthe world do I have to pay a
percentage of my assets to useyour service?
When I go to a hotel, theydon't say, mr Stansberry, how
much money is in your wallet oryour luggage?
Give us a percent of that.
You stay at our hotel.
No, they say, our hotel costs X, okay, so why would you buy
(45:35):
financial services in this otherbizarro way?
It didn't make any sense.
The other thing that I alwaysresented was that the wealth
management industry alwaysclaims that they're going to
make their clients wealthier.
Trust me, that's not the way itworks.
The wealth management industryexists by siphoning wealth from
their clients into their ownpockets, and I liked being able
to write about that and likedhaving a business model that was
(45:58):
the opposite of that.
I just think it's more ethicaland certainly more fun.
And so the main reason why wewanted to go public was because
we think and this is still truethat there is room for us to
compete with every financialservice provider, not just other
publishers, and so we'vedesigned our products and we've
hired the right people to dothings that other.
(46:21):
You know that other wealthmanagement companies do, from a
fiduciary standpoint, that wethink we can do very
successfully from a publishingstandpoint, and to get there,
you have to actually behave likea fiduciary, which we always
have.
We don't buy the stocks wewrite about.
We put the customer first.
They can always have theirmoney back X, y, z, and, of
(46:44):
course, the products are prettygood, and so to do that, the
number one thing I thought weneeded to do to get there was we
needed to have a product thatwas similar to a Bloomberg
terminal that would allow peopleto interface with us in a
format that was more similar toother financial service
providers.
Right, you don't interface withinteractive brokers by getting
something in your email.
You interface by going onto awebsite or an app and using
their services.
So I wanted to create that, anddoing that was going to be
(47:06):
expensive, especially all thetechnological backend stuff that
we had to do to do that.
So we have that problem.
It is competitive, I think,with other similar things from
Bloomberg and other people.
And then the other issue wasthat we found that we were
pretty good at M&A.
We were pretty good at buyingcompanies, improving their
(47:29):
products and processes andmerging them, but to do that
requires a lot of capital.
So we were looking at oneacquisition which I'm not going
to name because I know it'sstill in play, you know and we
needed probably $300 million tobuy them.
And you're like, well, that's alot of money.
Well, not really not to acompany that's doing $300
million a year in revenue.
Right, you could afford it.
But we couldn't find a bank togive us a loan because we
(47:53):
weren't public, and you knowjust all of things that go along
with that.
You just cannot.
You cannot do business at thatscale, um, unless you're, unless
you're public, unless you haveaudited financial statements,
unless you see stuff.
So we just, it was just thenext stage in our growth.
You just it's awfully hard tohave a billion dollar a year in
sales business that isn't public.
Very difficult, I'm not sayingit can't be done, it just very
(48:16):
difficult.
And then, of course, there'sother factors.
We have partners, some of whomwanted liquidity for estate
planning and family planningreasons, like Bill, who's much
older than we are, and sothere's a raft of things.
The other thing I always wantedone last point is we would make
our customers promises like wedon't buy the stocks we write
(48:36):
about.
But how do they know we werereally telling the truth?
And I, you say that an secfiling, you better be telling
the truth.
So we, I thought that thattransparency would help us and
give us an advantage over ourcompetitors as well.
John Newtson (48:50):
That's fascinating , okay, um, so now you're.
You, like you said, you retiredfrom uh, from market wise, and
you started.
You're starting something,started something new.
What?
Porter Stansberry (49:00):
are you doing ?
Well, it's called PorterCompany and this is our offices.
Behind me.
I'm starting a much smallercompany I don't ever want to
have more than maybe a dozenpeople and I want to pursue just
kind of a niche business wherewe have really great, highly
specialized financial researchproducts and there's just a
(49:21):
couple of spaces that having theright information makes an
enormous difference inperformance.
And that's property andcasualty insurance, which is one
of these black box businessesthat outside investors really
can't understand, where we havereally good longstanding
connections and sources ofinformation, and biotech, which
of course requires a whole lotof scientific knowledge, and
(49:43):
those are really high marginproducts that don't require a
lot of staff.
They just require the rightstaff.
Another example is distressedcorporate bonds, a very niche
product in finance but onethat's very, very lucrative.
I think that if you look at ourprevious product called Credit
Opportunities, you find thatannualized results are above 20%
(50:03):
and 85% of those trades arewins, and that's really hard to
do in finance if you're doing itfor real.
I don't mean the typicalnewsletter track record system,
I mean real dollar returns.
So there's things that I justknow how to do in finance, that
most people don't know how to doand I don't think I need a
company of 600 people to do them.
And you know, after 22 years Iwas kind of worn out with
(50:28):
managing 600 people and andmanaging the expectations of a
lot of partners and having allthat responsibility.
So, going forward, I just wantto have a very small group that
does a couple of things reallywell and I'm not going to really
be competitive with market-wiseI'm still a major shareholder
there.
None of my products will sellfor less than $1,000 a year, so
(50:50):
they're not going to bemainstream products.
It's just going to be peoplewho know me and know my work,
who are family office investorsor brokers with a big client
base.
John Newtson (51:02):
I think that piece right.
There is something that peopledon't realize in the publishing
space, which is that if you havethe quality of product that
you're talking about, it's notjust the mom and pop retail
investor who's buying them.
Porter Stansberry (51:17):
Oh no, not at all.
Yeah, Every hedge fund in theworld reads my work.
John Newtson (51:22):
Yeah, yeah, and I think I think that's something
that people don't think aboutthat the business itself is.
There's a lot of differentcustomer segments and publishing
media.
I think this is one of the this.
I've been preaching this for awhile that one of the bigger
trends in the industry as awhole is that all areas of
(51:42):
finance are really kind ofcoming on the table.
All areas of investor areavailable as customers to the
right types of businesses.
Porter Stansberry (51:52):
It's so funny .
I can't tell you how many timesI have seen my work plagiarized
at conferences, and almostalways, almost always, by people
who are very critical of us.
John Newtson (52:02):
Yes, just terrible .
Porter Stansberry (52:04):
Okay, it's like the Howard Stern thing I'm
sure you remember from fromHoward Stern's movie.
You know this marketing managercame to him and said Howard,
we've got a big problem.
You know, 75% of the people inNew York radio market hate you.
Oh geez, that's terrible.
Well, the good news is thepeople that hate you listen
twice as long as the people whoI sure hate that Stansberry guy.
(52:27):
Where's his latest letter?
John Newtson (52:29):
Yeah, that's great .
Well, I appreciate you takingthe time today and talking with
me about this stuff, because I'minfinitely fascinated by kind
of what you guys have done andthe industry, and so I think a
lot of our people are too, andso we're really excited to have
you join us for the FinancialMarketing Summit in, I guess, a
(52:50):
month and a half.
Porter Stansberry (52:52):
Great, yeah, and I want to pitch that, if you
don't mind, just for one second.
Yeah, because I would love to.
There are eight.
This is the copywriter to meright.
There are actually eightdefinitive steps that can lead
your organization to lifetimevalues that are two or three
times what they are now, andsome of them are obvious that we
discussed, but some of themaren't obvious and, uh, I I have
(53:13):
a pretty good track record ofdoing that and I will give you
my actual playbook at yourconference, and I do appreciate
being invited and I doappreciate what you have done
for our industry.
I think that the more that weshare best practices, the more
credibility the industry as awhole can have and, of course,
the more success people can havein the business, and that's the
(53:34):
thought that I would leave youwith.
I can't tell you how many timesin my career marketers and
copywriters actually said to medon't give me a really good idea
, because those don't sell.
That's just not true.
You just don't know how to sellthem.
Let me show you.
And so I just think that therehas been in the past this
(53:57):
mindset that you know, quoteunquote you know, good finance
or complicated finance can't besold to the public, and that
just isn't true.
I mean me and Steve Sugarwood.
We had a package that was calledPortfolio Repair.
It came out in 2002, rightafter the bear market of 2001,
2002.
And it was about mortgage REITs.
(54:18):
Now, mortgage REITs are a realsubset of finance.
They're a real complexspecialty and you cannot explain
to the average newsletter buyerwhat the hell a mortgage REIT
is.
But we didn't explain it thatway.
We explained it asgovernment-backed portfolio
repair, which it is.
And so you know it's just it's.
It's it's learning how to dothat stuff that I think can
(54:40):
really make a big difference inyour results.
If you can start with goodfinance and then you take the
time to put it in everydaylanguage, you'll be way more
successful than if you just makea bunch of empty promises and
you don't have a very goodfinancial product.
John Newtson (54:53):
Yeah, and just to kind of like put the cherry on
top for everyone who's listeningon the LTV conversation, the
lifetime value conversationyou're going to have at the
summit.
Like, what do those numberslook like just comparatively?
Porter Stansberry (55:06):
Yeah, well, I can tell you that when I left
MarketWise in December of 2020,the average lifetime value the
average lifetime value of aconverted customer, and what
that means is someone who boughtanything besides one thing.
So we're not counting thepeople who came in and bought,
you know, one $5 book and neverbought anything else again.
Not counting that, callinganyone who bought more than one
(55:29):
thing from us.
So you came in and you bought a$5 book and then you had a
renewal, or you bought anotherproduct, or then that's a
customer.
So anyone who bought at leasttwo things from us as a
converted customer, and theaverage lifetime value when I
left was twenty eight hundreddollars.
Um, I'm sure now it's well overthree thousand and that's on
hundreds of thousands ofcustomers yeah, that's on, uh,
(55:53):
approximately four hundredthousand people, so you can do
that math.
John Newtson (55:58):
Yeah, and that's very high for, like I've seen,
like in a very niche, tiny likeday trading spaces where they
might have a higher customervalue because you have
essentially 20 customers you canget, but they're going to pay a
lot and to have a scaledbusiness and have that kind of
numbers.
That's dramatically higher thananybody else I've seen in the
space, dramatically higher.
Porter Stansberry (56:25):
Yep, and we're not there yet, but I do
believe that getting to alifetime value of over $10,000
at scale meaning at least100,000 people is certainly
possible with the right kind offinancial products, and that's
what I'm aiming to do at PorterCompany.
So we'll see if it can be done.
John Newtson (56:39):
That sounds amazing.
So again, thank you, porter.
I'm aiming to do at Porter andCompany, so we'll see if we can
be done.
That sounds amazing.
So again, thank you, porter.
I'm looking forward to seeingyou in person in Orlando, and so
I really appreciate you takingthe time today.
This was amazing for me and, Ithink, everyone else is going to
really enjoy it.
Porter Stansberry (56:52):
Well, I'll see you in June All right.
All right, bye-bye.
John Newtson (56:55):
Take care Bye.
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