Doug Demuro on Analyzing the Car Industry, Creator-Led Businesses, and Porsche Episode Follow Up 01:28:07

Doug DeMero, it is great to see your face. It is nice to be here. Thank you for having me.

Here virtually this time instead of in person in your garage. Instead of us literally taking over your garage and house. Thank you so much. But wasn't that fun? Oh, it was. It was awesome. It was a year highlight for me. A, it's fun to travel. B, it's fun to do episodes in person with people. And C, it was very fun to bring you into the fold. Like for you to get to see all the weird idiosyncratic stuff that goes into Acquired.

And for us to get to learn a little bit from you on like how that is very different than how you have built your business. Yeah, no, I agree. It was just as interesting for me for a lot of the same reasons. You guys are so much more legit in terms of production quality and thinking through that sort of thing. And I'm like, let's just wing it. Come on.

Which may or may not matter, right? Like you have built this incredible empire doing your strategy and we have built our business doing our strategy. And I think that's part of what we're going to talk about today. So listeners, we wanted to do this immediately following the Porsche episode, but like after a seven hour day and sitting in a pretty hot garage with

a lot of like particulate in the air from all these Amazon moving blankets that we had just unpacked. We were like, let's get out of here and we can do this another time. I will say the kindest thing that Doug did for us among the many kind things you have done for us is,

you offered to keep the 100 plus pounds of moving blankets. Let me tell you, Cars and Bids, we got an office and we're creating our own studio for me to film in the office. It's like a garage and we need the blankets. And so my production people in the end were thrilled. And you should see, I'm going to send you guys, there's a photo of like 300 blankets sitting on the floor of the office. Yes. We were terrified, honestly, like when we were emailing beforehand, we're like, we don't want to disrupt your house. We'll break everything down. We'll get it all out. And we're like...

How are we going to dispose of several hundred pounds of moving blankets in San Diego? And for listeners who didn't see our tweet about this, the setup that we did in Doug's garage, fortunately yours had a reasonably low ceiling, but that's about the only gift that the space gave us in terms of acoustics. Like garages are notoriously like the absolute worst place that you could record audio, but it is...

historic place. It's the place where you do all of the stuff on your channel, and it's the place where your career GT is. So of course we wanted to do it. And so our solution was hanging moving blankets and coating the floor and moving blankets. Which worked. It was a process. It was a process. So Doug, today I wanted to kind of dive into a bunch of stuff that

are fun, acquired-like topics to talk about with you, but just didn't fit into the Portia narrative, including your business, including now that we've had some time since doing that episode for both of us to reflect on like what we've seen in our analytics and our anecdotal feedback of like changing our format to include a third person, an expert, and frankly, just a bunch of like

car industry stuff that I wanted to ask you about because the car industry over the last few years has gone through one of the most like unique periods in history. Yeah, totally. Maybe let's start with Porsche episode follow up stuff. So listeners, we put that one on YouTube.

We put lots of things on YouTube. Sometimes when we have guests, we'll put the full video up. Sometimes when we don't have guests, we'll put just the audio up and the logo because it's the logo of the episode because it's a lot of work to create a video that, you know, hides all the seams well because we don't shoot B-roll and matches the exact audio that's in our audio episodes and are edited to that caliber, blah, blah, blah. But, you know,

They never get more than like five or ten thousand views. We are primarily an audio format. Right. That's not what we do. We put up this episode with Doug and it's gotten four hundred thousand views and is adding another six thousand a day, which in big YouTuber land doesn't sound like much.

But for us, it's multiple orders of magnitude over anything else we've ever done on the platform. Ben has this amazing chart that he creates of like the amalgamated analytics for all of our episodes. And it's just like, you know, it's a time series graph and you see the dots over time and like it always, you know, goes up exponentially, which is super cool. But like,

Like the Portia episode, it just breaks the graph. Like the scale doesn't accommodate it because of this. It's never happened before. There's obviously a lot of potential reasons for it. But I mean, me is potentially one of them. But adding a third person is an interesting component, huh? Sure. But adding the third person being Doug is the driving factor. For YouTube especially. It has to be. You didn't put it on your channel. So do you have any thoughts on why that happened? I think that and unfortunately, some of my...

haters, for lack of a better term, have found that using my name has an effect on driving traffic, algorithm traffic, search traffic. There was a long time where I didn't do much. Like I didn't do a lot of interviews. I was just busy. I was so busy shooting my own stuff that I just like didn't do a lot. And so like the rare interviews that I would do would really blow up. And I think that sort of still carries through. I've gotten a huge channel.

And people are interested in like, what's this guy really like? What's this guy really doing? And I think any chance they have to like see a little bit more, it seems like it kind of pushes it out. That's what I've noticed. And I say my haters because sometimes people who have negative Doug things will be like, Doug DeMuro's wrong about this. And that will drive traffic for them because, you know, my name has some search impact. Oh, fascinating. It's interesting that it's like literally the name because my thought was, or at least my like best hypothesis was, you did share a tweet about

that linked to the video on our channel. And my thought was, "Oh, because you sent a bunch of people to this video, YouTube learned that

people who like Doug DeMuro's channel also watch this video, so started surfacing it to people who are watching your channel. But the mere string of characters, Doug DeMuro, the idea that your haters put that in their video titles and that gets them views is actually a completely different thing. Yeah, it's an interesting thing. But I think that is kind of what happened. I tweeted it and I shared it on Facebook and I have a pretty large organic Facebook following. Those two things probably helped, maybe drove a little bit more traffic than usual. And then YouTube was like, okay, why is it getting more traffic? Oh,

you know, the name is in it. Their algorithm is probably sophisticated enough to understand this isn't just dumb content of some dude hating on Doug. This is actually like good, thorough content. And so they, you know, that's a big driver for YouTube too. And so they kind of push it out even more from there. And I think each of those things probably kind of built on each other. And there you go. So you guys had your first foray into a large scale YouTube. And so you must've gotten a lot of comments and crazy people. Oh boy. Yeah. I don't even know what to say on this. Yeah.

Podcast world is so different. This doesn't happen. There's no algorithm in the podcast world. So no episode is ever twice as big as your next best episode. It never happens. So this is our first experience in eight years of something that just

became an outlier. Right. Which actually really is annoying to me because we had this like very beautiful exponential graph that like just doubled year over year and like there's no outlier. I mean, like there's little variants here and there, but like you never have to explain away like, oh, this number is really high for that reason. And like, we won't hit that again for years. And like, no, we don't even want to hit that again because our goal isn't going viral on YouTube. No, it's not the right output.

I almost want to like adjust our graph and be like, this is the Doug adjusted. I agree. This is the Barry Bonds of, uh, I agree. When, when, when I was obsessed with my YouTube analytics for years and years, and there would be certain days where like I did a, like an integration and I got paid way more than that. One day the graph spikes and it's like,

I almost wish it, you know, there was some way I could remove it from the graph because the beauty of the consistency of the graph is so important. Oh, there's so much rich stuff to talk about here. Like you mentioned getting paid. So we have monetization turned off for our YouTube channel for us because it's not our primary business model. We're not even a YouTube partner. Yeah, we're not. We have no relationship with them. There's no... But...

For you, especially in those days and for most YouTubers, literally views equals money, like one to one. Yeah.

Because we don't have the incentive in podcast land. Like, listens don't equate to money directly. Wow. So when that would happen for you back in the day, when you were first starting out, like, did you ever have, like, a life-changing, at the time, amount of money in a single day? The thing that was huge, I really started the channel in earnest in 2016. And I was just kind of screwing around. At the time, I was writing more. And the YouTube channel was sort of a complement to my writing. And what really happened...

was in December of 16, I posted a couple of big videos without really knowing it. There was a review of the Tesla Model X, which was kind of early in that space. Not that many people had done that. Oh, I watched that video multiple times. It was like, the title is like, here's why the Tesla Model X is awful. And then I go through all the complaints that people had about it, and I proved that they were actually fine.

And that video blew up. By chance, I posted that video in December. And what happened that month was I made $21,000 in ad revenue. And I was like...

oh my God, like this was more money than I was getting paid in my job. Because you were like a quote unquote struggling blogger, you know, at this point. Previous months, I had made two to 4,000, maybe some months would be six. It wasn't even enough for me to like really register like that this is something like, you know, three grand a month and then you pay taxes on that. It was like a fun little side project. But then that month I made $21,000 and I was like, oh, this could be a career. And then...

The next month was January of 17. It went down back down to like five grand. And I was like, oh, well, I guess that was an anomaly. And of course, what I didn't know at the time, in a sense, come to learn and sort of master is that December has much higher ad rates. That was sort of the beginning of me learning like YouTube and how YouTube like would have to

how you have to kind of game the system and how you have to know how it works and all that. It was that December of 2016. It was like, okay, this is a possibility. Now I got to figure out how to like make it work. This is super cool for us. Like the window into this, we've gotten to know

MKBHD's team a little bit, talking to them, watching and listening to Colin and Samir, who you've been on. They do great. By the way, everyone should go listen to that episode. Doug, your interview on Colin and Samir was excellent, telling the whole history of your origin story and cars and bids. And we'll hit some of that here, but I don't want to be duplicative. People should totally just go listen to that there. I naively kind of used to think that

Oh, you know, over in YouTube land, creators there, they just make great content. And then that translates to money. They don't have to think about business. And what I've realized is just like you're saying, no, you got to think about business. It's just if you're smart, different. You know, I think it's not that naive to think that because I think a lot of YouTube creators, especially when they're getting started, just do kind of throw random content at the wall and hope for the best.

The smart ones don't. The smart ones are paying attention to a lot more stuff than their viewers will probably ever realize.

I was paying attention to not only the content, but the time of day, the day of week, the part of the month, the part of the quarter. All of that had a big effect on ad rates. And if you go back through my videos throughout 18, 19, 20, 21, my best stuff was always uploaded like at the last two weeks of each quarter and the last month of the year. And I never really talked about that, but that was always something I did because advertisers were always trying to spend, you know, get their last spends done through the end of the quarter. It was always clearly a big thing and it always had a big effect. Yeah.

And I paid a lot of attention to that stuff. And then it was the content. You would watch some videos do well, some videos do okay. And then you would think, okay, that video did well because XYZ. I should do more like that. That video didn't do well because of ABC. I should do less like that. It was a constant, constant, constant sort of like, you know, following it around and trying to figure out the best. This is so cool. The viewers are like, oh, Doug, he's just like in his shorts and he, you know, uses an iPhone and like he throws up videos, but like...

Behind the scenes, you're putting a lot of thought into this. That's exactly right. I've always felt that one of my biggest reasons for success is because I've been underestimated at almost every turn. And part of that is because I've wore these stupid shorts and a stupid t-shirt and everybody's like, I could do that. And I think a lot of people said, I could do that. I could do that right up until I had 3 million subscribers. And they were like, damn, he did it. And I didn't. The car and drivers and the road and tracks, they never really got on YouTube. And I think

Obviously, they ended up regretting that and they do regret it now. But like they were watching this idiot with shorts do it and they were thinking, ah, we'll do it better. And they just never did. And suddenly the idiot with shorts, you know, is driving a car. There's a reasonable thing to that. Like, I think I wasn't as much of an idiot as maybe some of these people thought. Well, but to bring forward something that I want to ask you about your production quality, you have capabilities.

kept it so that you can basically always shoot a video in a single morning and be done with it. I really admire the fact that everything fits in a backpack, it's just a lav mic,

I think you shoot on an iPhone, like maybe it's a point and shoot camera, but it's definitely not a Canon Mark five D hanging from a drone. Like you're not doing any of that. And a lot of the people who are looking for like, how do I compete against Doug DeMura with what do you have? 5 million, 6 million subscribers. They're busting out an insane production pipeline to try to like,

Compete against you and it's really fascinatingly like counter position that you can kind of keep a lean mean machine That you can do these videos all on your own and focus elsewhere not on production That's exactly right And I think that is one of the biggest I don't want to call it a mistake because some channels have been very successful doing a lot of great production But I will tell you and I may have told you the story when you were there, but not on camera. I

I have a friend who's a YouTuber who's known for his high-quality production. And I saw him recently, and he was like, I hate myself. I hate my life. I wish I had done this. And it's funny because...

When I first started, low-quality production was kind of the norm on YouTube, so it was no big deal. But there was a three- or four-year stretch where I was like, I wish I had done nicer quality stuff. I wish that I represented the car reviews more. I wish they were just better quality. And now over the last year, having talked to some YouTubers who committed to high-quality stuff early, I actually have no regrets at all. I think I made the right choice in the sense that it's fairly easy. And I think what people are really looking for is just quality.

good content, like simply good. They want to see all the things in the cars. And I do that really well. The really expensive DSLRs hanging off of drones, you can do that stuff, but it slows you down and it limits the amount of content you can do. And then you end up hating your life. Then three, four years down the road, you're kind of married to that. Your audience won't let you get away from it. And you're like, well, I guess I'm firing up the drone again. And it takes you two days to do a car review. Whereas I could, if I wanted to do, do four reviews in two days. Oh,

It's the drug. Like the right before we released this, we released our Costco episode and Costco famously, the rumor is that they make money on their credit cards rather than it being an expense that, you know, they don't have to give the two or 3% that other people do. And it's because they built their whole business only taking cash and check. They never had the crutch of like, sure, I'll accept credit card payments. They only did it when it was like absolutely on their terms. You never use the crutch of like, I'll make the best looking video in order to hook

people's attention. Right. And I think that the results speak for themselves. People can make fun of me and they do all they want to, but like I'm closing in on 2 billion views. Like at the end of the day, like the result, like what can you say? Like I get it. It's not the highest quality. And there are some other YouTubers and some other content creators who do not like me. And I think part of it is because I seem amateurish. But I think what they really don't like is the fact that the audience doesn't mind that. I think that they wish

that the audience was rewarding high quality production more than they do. But the simple truth is, you know, they want to see the car, especially in certain parts of YouTube. I think this wouldn't work for everybody, but it has worked for me. People just want to see the damn buttons and switches. I want to see what they all do. And yeah,

That worked for me. Well, I think there's also to this whole theme for me of like YouTube is a much more nuanced ecosystem than I gave it credit for. It absolutely clearly works for you.

And I think part of that might be like, it's your style and it is a style. You can't just like not have a style. People might be listening and be like, oh, well, all those other creators, they're so dumb. Why don't they just, you know, stop doing that? But because of the YouTube algorithm, like the YouTube algorithm does reward the quality of the video too.

So it's like if they were to stop doing that. Careful with that word quality, David. Quality of production. Right. Well, it's interesting because I think quality can be both. My videos are not high production quality, but they are incredibly high quality in the sense that they're factful. Right. Like if you watch any other car review, I love all of my car review competitors, compatriots, whatever. They are simply do not have as much crammed into a video as mine, like periods.

And so, yes, the other people, I don't want to say they make up for that with high production quality, but their high production quality probably gets people to watch, just like my tons of facts gets people to watch. Either way, they get people there. But to your point, a channel that doesn't have as many like facts that are holding people's attention and starts to kind of slough off on production quality, that's where you start to lose out. I mean, you know, it's YouTube, it's Google we're talking about here. Like this algorithm is very smart. You

You know, some people used to think that it actually is alive, right? Like there was that whole controversy. I suspect if you have built your channel on production quality being a big input to the quality that YouTube thinks. So then if you dial that down, now the algorithm, like you're...

creator channel part of it's you know the way the YouTube algorithm thinks about it is production quality you're lucky you don't have this but like if you have built that up it's not just the individual people listening it's like the algorithm I suspect is we like probably now we got to bury this probably and the sense that there will be some people who wouldn't watch

And so that would probably start your spiral. And of course, that's the thing that every YouTuber is like the most afraid of. So if they do back down on production quality a little bit here and there and fewer people watch, fewer people watch, then suddenly they start to see all their views declining. And that's like the fear.

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that kept you up at night, that splinter in your brain of like, oh my God, this could all go away tomorrow and I need to start another business that sits aside the media business? Quickly. I launched the channel in 13, but I didn't really start pushing it until 16. There was that December of 16 that it really kind of blew up. And then throughout 17 and 18, I refined it like crazy to like really maximize the revenue. By 19, I was already like, I got to do something else, something in addition. Like I'm never someone who just kind of stops. I was always nervous.

You're just a slave to this algorithm. We'll talk about this more, I'm sure, but I'm thrilled that I did because YouTube in general is not quite what it was in 17, 18, and 19. It is still a place to go for DIY videos and MrBeast is great and blah, blah, blah, but TikTok has shown up. TikTok has really had an effect. There's no doubt. Every YouTube creator will tell you their views are down. And

it's not as monetizable. Part of me wonders if we will look back at 17, 18, 19, 20, 21 as like sort of a heyday. And I got lucky. It was like I hit a grand slam in the bottom of the ninth, basically. We may look back at that era and be like, that was the time to make money on YouTube. And I think there's a possibility that in five or 10 years,

you may not be able to do it that easily. And so I just happened to be like in my heyday, just as YouTube was in what is starting to seem like maybe its heyday, and it really worked perfectly. So I was always a little bit anxious, like, you know, what is going to happen? Is this going to stick around? I'm really, really glad I had those thoughts, because the answer is, we're not sure. YouTube may not be as strong in the future as it has been. And so as you were considering business models to sort of

take those listeners or I'm so used to saying listeners, those viewers on YouTube and turn them into like Doug's customers in some way and have a real relationship with these people. I'm sure you considered a bunch of different businesses in order to sort of like secure the metaphorical bag or secure the relationship at least. How did you arrive at cars and bids? And did you consider other stuff?

I definitely considered other stuff. But if you go back in my channel in 17, 18, 19, when it was really a huge, huge, huge, I never really did any ad integrations. I never tried to sell people t-shirts. I always knew that I wanted to save all that promo for something.

I always kind of knew that when I wanted to do a business, I wanted it to be like something other than so many of my fellow content creators sell merch. But I feel like that's just sort of this hamster wheel. Like you sell merch, you do your videos, you sell merch, you do your videos. In my mind, that's not like a business. Like, yes, it is a component of your YouTube channel. But like if you stop doing your YouTube videos, the merch business would stop tomorrow. It's not the same. You got to sell a hell of a lot of t-shirts to like you as a content creator, probably making like a buck from each sale, maybe. Yeah.

And so to answer your question directly, I did look at other businesses. The auction site seemed like a great idea. In retrospect, I had no idea how hard it was to put together a marketplace. And if I had known, I don't think I would have done it. I would have done a podcast. It was really hard. Do you think, though, that there's anything else, maybe a podcast that could have created as much value? Well, in retrospect, no, because we happened to launch this thing into the greatest car market in the

Honestly, since World War II. That's what I hear from dealers who have been in business forever. Their grandpa was running the dealer back then. The last three years have been like soldiers returning from war. Everybody was thrilled. Everybody had some money. We were buying cars. It feels like that. So no is the answer. But I only know that in hindsight that I probably couldn't have created a business this good in any other capacity. Wow.

I never considered the timing. I mean, I always thought this is the best business model because it's a marketplace. You need supply and demand, and both supply and demand happen to watch your channel. So you can independently bootstrap a marketplace. And these are very high value transactions, you know, a lot more than a t-shirt. And you don't have to hold any inventory. And, you know, I mean, there are some real benefits, too, in addition to the drawbacks, which are significant. There are some I complain about marketplaces, but there are some great benefits.

But back to the timing, can you explain what is going on? Like, why is this such an amazing time in the car industry? You know, we launched this business in June of 20, which was not like the height of COVID, but it was close. We were planning to launch April 1st of 20 and we pushed due to COVID. We launched in June. Again, not the height, but like still people were terrified. I thought it was going to fail immediately because no one wanted to like spend money or do anything.

But what ended up happening was the car market absolutely blew up. And this is something that nobody could have predicted. I'd love to take credit for this. I talk about how I'm an idiot in t-shirt and shorts and people underestimate me, but actually I'm smarter than I look. This was not a good example of that. This was pure luck. You were the cloud car that drove into the gold mine. That's right. I mean, in this particular case, it is a good business. We did do it well. I'm thrilled how my team created the website. It worked all great. But

We never could have engineered the timing like we did. You know, what ended up happening, which now is kind of the famous story of the car industry over the last three years, and I suspect will be a story that dealers and people are telling for the next two generations, like this 2020, 2021, 22 kind of situation. Obviously, with COVID, a lot of car companies had to shut down production lines, and they also underestimated demand.

So you have this issue where, you know, the production lines are shut. Automakers are like, we're fine shutting down the production because we don't think people are buying cars anyway. So then supply comes down. Meanwhile, the federal government lowers interest rates to almost historically low levels and pumps a ton of money into the market. That's a different conversation for a different time. But I think everybody agrees that a lot of money was pumped in, whether it was used fraudulently or correctly. There was a lot of money available and there was a lot of cheap borrowing available.

And suddenly there were no cars and there were a lot of rich people. Yeah.

And I guess the nature of the pandemic, too, of like, what are you going to do? Right. You want a road trip. You want to drive. You know, I think people underestimate the effect that that have. I think that that was a real factor. My uncle went out and bought one of those crazy sprinter vans. He was incredibly COVID anxious and he didn't want to drive. He has a house in the north and a house in the south and didn't want to drive. You know, so he like did that and didn't get on a plane for two years. And a lot of people made decisions like that or they were just bored at home and they were like, I want to go and get into a new hobby cars. It's not really something that's risky in terms of COVID. Right.

And we also saw a huge uptick in like off-road overland vehicles over the last three or four years blowing up because I think that's another thing. Which you were so well positioned for. Yeah, it worked out perfectly. The idiot in shorts, like you were doing that all along with your Defender and your off-road and like turned out.

It turned out it all came together just masterfully. It really worked out. And so that's basically the story. And so then, obviously, what has happened since then is the automakers have scrambled to try to restart production. It has not happened with any speed. Finally, supply and demand seem like they're starting to equal out. Obviously, we've seen the Fed raise the interest rates more and more and more, which has had the effect of slowing down demand. The automakers are finally starting to catch up with supply. Things are normalizing again. But there was a period that was just...

I mean, you'd go buy a Toyota dealer. I talked to a Toyota dealership in LA who told me they usually have 800 cars on their lot. And during the peak of that, they had zero. And in fact, the cars that were coming in were all pre-sold. So it wasn't even like a situation where they were getting cars. The cars that were coming in, they would call customers, hey, you want a Corolla, right? We have one arriving tomorrow. It's your only chance. Okay, they come down, they pay sticker or over sticker, and that was how it went. Okay.

Over sticker for new. People were paying over sticker for Toyota Siennas. In fact, my understanding is they still are. We're talking about minivans. We're talking about Highlanders, pilots. We're all going over sticker. I mean, it was a crazy, crazy situation that will never repeat itself. Sticker is like this...

famous thing in the car industry where you walk up, you see the sticker and then you're like, okay, cool. Like, so I get this car for 15% less than that. Great. Right. Right. Totally. The dealers had no cars to sell, but they were thrilled because they were making so much money on a per car basis. Right. Cause the dealer probably kept all of that market. Absolutely. Of course. I mean, the manufacturer sells the car to the dealer for invoice, which didn't change. The dealer sells it to the customer for whatever they can get. And they try to get close to the sticker price and on some desirable cars, they're able to do that

even in a recession, right, or a tougher economy. But in this economy, they could do it on a Chevy Cruze. It didn't matter. Did the manufacturers wise up to this and try to raise invoice and say like, oh, we should split some of this hot margin?

They tried, and on some vehicles they were able to, but it was difficult to move that quickly for the automakers. At the end of the day, the automakers have these dealer agreements in place with dealers that have more power than people realize. The dealers are, in large part, private businesses that can set their own prices wherever they wish.

And so the automakers were kind of at a loss. They kind of just had to do whatever they had kept doing. Plus, the other fear the automakers, I think, had was if we raise the invoice price this year, what happens when we're in an oversupply situation? Then the dealers don't want the cars again. It's very hard to dial it back. Tesla's direct sales model makes it easier to kind of screw with pricing throughout the year. But the automakers don't have that luxury quite as much.

And so the dealers made all that money. And they were charging over... I mean, say they were selling Broncos for $20,000, $30,000 over a sticker. That was like a common thing. These dealers have been living incredibly large over the last couple of years. And frankly...

people have been very angry about this. Like all these dealers are making so much money, they're trying to screw everybody. But the truth of the matter is this was their chance. Like dealers in 09, no one was complaining when supply and demand was working in their favor. Like when they walked into a dealer and dealers were begging people to take anything at invoice. Well, suddenly supply and demand has suddenly made a little turn and it's not working in the favor of the customer anymore. Now they're all upset. In general, being a car dealer doesn't strike me as like a great

business. It's a tough business. I think they make good money, but it's also enormously employee heavy, enormously regulation heavy. You need a large...

space. You have to hold a lot of money in inventory and you're floor planning that, they call it. They're paying interest on all those cars. It's like the opposite of a Costco. Yeah, that's right. It is the opposite of a Costco. It is expensive, difficult, et cetera. Is it like a lumberyard? I remember meeting someone who owned a lumberyard at one point and I was asking all these questions about financial planning for the future when you're a small business owner. How does that work? And I was like, how do you think about retirement? And he just looked out at the lumberyard and he was like,

That's it. Like all that lumber. Like I got $8 million in inventory out there on the lot. And like at some point, I'll just sell all that. And then I'll retire. These dealers, especially I would assume luxury dealers like a BMW dealer, Mercedes or, you know, Porsche might be a little different, but you've got

dozens, maybe hundreds of millions of inventory sitting on the lawn. And they don't own it. They all finance all that. And so it's really a cashflow business, I think, in some senses. They're just trying to move stuff. And unlike lumber, I assume, cars have model years. So there's a push. They got to get these things out the door. They can't have them for all that long. It's like a high-pressure business. Everybody I know in the car dealership industry is divorced some many times. It's like a lot of work on Saturdays and Sundays, a lot of pushing hard to get deals done at the end of the month. I remember...

I don't know if I should tell the story. It's probably true of a lot of automakers. I remember when I was working at Porsche and we were down to our last couple sales trying to hit a goal at the end of the month. You know, we were in Atlanta. We were headquartered in Atlanta and we would call the dealer in Hawaii like 8 p.m. the last day of the month. They were the only ones still open. Can you punch a couple of cars? Like you did that stuff. That was just kind of the way it's a difficult business. Wow. So here you come along in the middle of all this.

With a used car market, like you can't design this any better. I mean, literally you, I don't think you are a clown in a clown car, but like you drove into a gold mine. Yeah. Like, yeah, this is a historic confluence of events. Let's stop oversimplifying this thing. Like you can be a savvy business person and, uh,

also basically no human can time the market. And so it was a pretty reasonably good idea, especially given the fact that you had distribution, but you had no idea the tailwind. Right. That's exactly right. Period. There's no other way to put it. That's exactly right. We got lucky. We didn't know the tailwind. We made a great business. It's like that famous saying, the harder I work, the luckier I get. We've set ourselves up for success. And then we got additional help from the car market. Well, and I guess too, I mean,

Other people must have started companies and they were like, bring a trailer. There were existing players out there too. It is a testament to your savvy and hard work and everything that like, to my eyes, at least it appears like,

Like most of this opportunity that got created, you captured more than your fair share of it relative to competitors. That's right. And you know, going back again, not that this is like a trope of mine, but it's something that's coming up. The people underestimating me, a lot of other people tried to start one of these businesses. You'd be shocked. Like you guys aren't obviously paying as close attention to this as I am and as our team is. But I would say 30 other online car auction sites popped up in the last couple of years and 29 of them have failed or 27 and the other three are barely hanging. You know, it's that kind of thing.

And they saw Doug and they were like, if this idiot can do it. And so they tried. And I with this idiot, with all the distribution to all the people who want to buy and sell all these cars, some of them were other content creators. Honestly, they weren't willing to spend the money up front to create a great website, which I think was crucial. Or they didn't have as large of a following or they just thought it would

they'd roll the dice and it would take off because the car mark was strong. It wasn't as easy as it seemed, but yes, you know, we showed up, we had all the people already there. Bring a trailer has been enormously successful because they built their audience over a long period of time and then transitioned into auctions. And that's been great.

For us, we launched and then had a built-in audience because I had built my audience over a long period of time. Other people who just want to try this, it's not quite as easy. Big names have tried it. Porsche has a business right now, an auction business called Marked that they're running from Porsche Digital. And it's fledgling, to say the least. And I think that they and others have learned that...

that you can't just throw money at trying to get an audience. It's not that easy. And having an audience where people love the dude who's at the top and are fans and want to be a part of his business, that makes it even easier to convert them to real traffic as opposed to just some business going out and spending a lot of money on advertising and trying to buy audience. I'm imagining though, and I've heard you talk about this on Colin and Samir and elsewhere too, that part was certainly easier for you than competitors because

However, there are a lot of other elements to this business that were probably just as hard for you. Like listeners, viewers, think through the logistics of this for a minute. You've got other people that you don't control buying and selling incredibly valuable assets with a lot of money. Used car transactions known to be potentially fraught with complications. Right. How do you make that a smooth experience? Yeah, no. And that was hard. And

The other really great and lucky thing that happened that I don't talk about a lot on podcasts because it's more difficult to discuss, but I had a business partner who was unbelievable. Without him, it wouldn't have worked. I say it's more difficult to discuss because I can't bring him on. But I came with the audience and the idea of...

and the top of funnel, the ability to bring people. And he came with like a knowledge of how this business needed to operate in order to work. And he kind of saw through what were going to be the challenges and that sort of thing, which is crazy because he had never been in the car space before, the auction space, or the marketplace space, and he was just able to figure it out. And so between the two of us, we had it all. And when you said he had the skill, like what was,

had he built websites before? Yeah, that's right. He had had some experience building websites and other like startup type businesses and products. So he kind of knew in a startup world, like what was going to be the stuff that was going to be challenging.

I had worked at dealerships before and for an automaker before, and so I had an idea in the car sense of what was going to be challenging. And we were both car enthusiasts who had done transactions on Bring a Trailer before. We had the whole concept kind of down. It was like a pretty good way to start this if you're going to start it. And so we started hiring employees. And you know, it's funny because one of the things, and maybe we'll get into this, but one of the things you mentioned was, hey, maybe we should talk through some things that people don't realize about the business or whatever. One of the biggest is your audience,

We'll realize this, but a lot of my audience and general audience doesn't. We launched this business. We had 10 employees or something like that. I mean, and now it's grown considerably. There's still a large contingent of people who believe that every dollar made by the business goes directly into my pocket. And this is incredibly annoying to me. They're like, oh, Doug made 30 grand a day. Doug made 50 grand a day. And it's like, yeah, we're

paying all these employees for Christ's sake. But I think a lot of people actually thought I just did this by myself, but I didn't. But part of the magic of why it worked is the perception that you built it. Yeah, maybe that's probably true. It's like this is Doug's website, which I always kind of grimace at because every leader of a business is always like, it

couldn't have been possible without my team. But in this case, it literally couldn't have. I don't know how to do this. I make YouTube videos as a profession. I don't know how to make a website like that's just not. And Dr. Dre doesn't know how to make headphones, but you better believe people bought those because they were beats by Dre, not beats by Jimmy. That's exactly right. The massive team behind Jimmy. That's exactly right. And so Dre looks like he's the brilliant guy doing it. But, you know, there's the whole thing there. And that's the case for us, too. We had a good team. We had support people in place. I think that was one of the biggest things. David, you mentioned like

the difficulty of these transactions. Yeah. And we kind of knew that was going to be an issue. And so we've like really doubled down on like support as part of it, having people direct people to call and deal with if you have issues or whatever. And I think that that makes the transaction a little bit less fraught with like, oh, we're worried this is going to fail or something like that. Which you, you know, kind of uniquely as a marketplace, I think you could afford to do because the transaction values are so high. You know, if you're a marketplace for, I don't know, make something up,

Something not very valuable. eBay, right? Yeah, you can't afford to staff support because you're only making a buck or 50 cents on a transaction. You know, if you're talking about a $50,000 transaction, you can afford to have support. And relatively few of them. Whereas, you know, some of these businesses like eBay are selling a zillion things, but the average value is probably $40 or something. We're selling far fewer things, but with a higher value. And so there's not as many transactions that need handholding.

What does the take rate look like in an online car? You don't have to be specific to cars and bids, but is it 1% of it, 10%? Of submission or like the number of cars we accept or the sales rate or the... Oh, sorry. What percentage cars and bids keeps of the transaction. We take 4.5% of the...

final sale price from the buyer. So there's no fee for the seller. The buyer pays us 4.5%. And we cap it at the $100,000 car, so $4,500. And so if it's a $200,000 car, we still only take $4,500, et cetera, et cetera. And then we make money in some other ways too. We offer financing, we offer shipping. There's now like an inspection that you can get with your car, which we make a little on. So there's some other ways to make money, but that's the general gist of it.

Which I think is the evolution of all marketplaces. I remember when Etsy first launched, it was 100% the transaction revenue on the take rate. And then over time, I haven't looked in a few years, but I remember when it surpassed 50% revenue on the services, on the things that they were able to upsell to buyers and sellers, became over half of the revenue of the entire company. Interesting. That makes sense. Because you start to realize there are some holes where you could pull in some more money and the stuff people are looking for, frankly. Yeah.

And the financing is huge in this category. In this market. You're not quite in this market, this category. You're not quite at homes yet, but most... It's the second biggest purchase of any household. Right. But in the home industry, the mortgages, everything around that, that is, I think, as much if not a bigger part of where margin dollars are made. We thought financing would be a bigger thing than it is. I think that...

It is a big purchase, but since we're selling mostly enthusiast cars, more people are buying with cash than you might expect, even for higher value cars. I think that a lot of the people who are buying cars like this, it's not like a financing your Ford Explorer as your main family car and you're going to have it five years. It's sort of like enthusiasts who want to screw around with a BMW M3 for a year or six months and then sell it and get something else. And they have 80 grand to play with that they are kind of always, it's going up or down depending on what they bought or sold. And it surprised me how many people are making cash deals.

But it's still a nice chunk of the business and it will continue to be. I mean, I've never bought a car on the internet. Could I go sell my Mazda CX-5 on Cars and Bids? Or is there some, like, we only accept enthusiast cars? Yeah, we only accept enthusiast cars. And in fact, we only accept about 40 to 50% of the cars that are submitted to us.

And actually, if you go and look at our Google reviews, a large chunk of the negative reviews are from people who just, we didn't accept their car. And they're mad because we didn't like... And it's so annoying to us because this person never even had a transaction. They're not even a customer. And they're like, these jerks didn't think my Pontiac Grand Am was cool enough for their site. Well, screw them. And it's like, well, that's not a negative review. Screw them.

But that's like a lot of a lot of our like the few negative. That's so great. Wait, so how did you think about this, though? Because like, on the one hand, I'm like, oh, yeah, of course. It's your enthusiast car website, as you say, so often. However, your audience.

actually is kind of two audiences, right? Like you've got your enthusiast audience, and then you've got your audience that wants to buy the Mazda CX-5 that you do the reviews of. So how and why did you decide to exclude that part, at least for now, from cars and bids? That's an interesting question that no one has ever asked me. That is exactly right. I do have two audiences. I have a performance enthusiast car audience that

And I have audiences for regular cars. And the proof of that is just look at the view numbers on some of the videos I do for regular cars. I always hold up, I've got like a Toyota RAV4 review that has 2 million views. And people are like, oh, YouTube's for kids. You know, sometimes people say that. Nobody's really watching. Well, go look at my RAV4 review. I mean, I don't think a lot of like,

14 year old boys were like jumping on YouTube to watch Doug review a RAV4, right? Like those have influenced the purchase of over a million purchases of a RAV4 of in-market buyers. Right. So that's probably legit or something else. They watched the video and they were like, you know what? I think I'm going to buy a CX-5.

And so I did kind of turn my back on that audience. But I think what I realized was the simple truth is the enthusiasts are always going to be more likely to engage in a space. I think that the people who are in market for new cars who are watching my videos are watching my videos. And then that's kind of all the interaction they do with me. The enthusiasts are watching every video or not the RAV4 videos, but every enthusiast video. And they're like getting excited about me. And I think the real key is engagement.

If you're going to start a business like this, you want to do it with people who are excited about you, which is like the churning groups, which is our investor. It's like their major philosophy is like find people

creators who people are excited to be in your space because then you don't have to spend as much money on like ads to try to get people. You have people who are... Your retention's probably better. Absolutely. Because wouldn't you rather go to a business of someone that you are a fan of than just like some faceless corporation? And so that makes sense. Yeah, and the positive edge to the double-edged sword of the enthusiast market and the relatively less financing in your corner is...

People repeat transactions. They buy a car. They enjoy it. Then they sell it again on Cars and Bids. Then they buy another car on Cars and Bids. It's interesting that you say that. That's very astute. Yes. We've only been around for three years. And so you'd think, well, probably you haven't had a lot of repeat people. You misunderstand the degenerate car enthusiasts that we are. We buy and sell. I've...

I'm constantly buying and selling. I have nine cars right now, and so do all my friends are doing the same thing. And it's always the same. We buy a car we're very excited about. I'm never selling this.

Nine months later, you know, I really think that that other car looks kind of cool. And that repeats itself over and over and over again. And so, yeah, there's more repeat people than you'd think. We've had some cars already sold on the site three times. And some people who have bought five cars. This is a different market, though. Like, you know, if you're buying a CX-5, like that car is going to depreciate. This is my decade car. Right.

But for the cars for this segment, enthusiasts, these are not like consumption per se. These are assets. And so, like, yeah, it's like freaking crazy to own nine cars. But if you own nine CX-5s, you just blew a lot of money. If you own the nine cars you own, you know, you're not going to lose that much money and you might even make money by owning those cars. That's right. That's right. I tell everybody to the detriment of my wife that my cars made more money than my wife did in 2021. Right.

Which is in fact true, but she doesn't like when I say that. But that's right. The enthusiasts kind of know what they're doing a little bit more, or they should. A lot of them don't, but the sophisticated ones do. And so they'll buy cars and they'll get out of them right. They'll sell them after a year and they only lost a couple grand or something, and that's fine. And that allows them to continue the hobby.

Jenny and I were on vacation last week. I texted Ben. I should have texted you too, although I'm sure you get this all the time. An amazing black 356, just like beautiful, parked on the street. It was so pristine. If you had, David, then our entire text thread would just be us texting 356s to Doug. But like, you know, whatever that person paid for that, or maybe they restored it or just like,

They're not going to lose money on that ever. That's right. I mean, that's exactly right. And so enthusiasts who make those decisions, it's actually funny because I hear so many of my enthusiast friends tell me, I

I wanted to buy a whatever, but my wife won't let me. And it's like this same person has bought a new Ford Explorer. And I'm thinking to myself, you're going to lose so much more money in that family approved new Ford Explorer than you would in a Porsche 911. Yeah, it's a lot of money to put into it up front. And yes, you would do better in the market, of course. But like a lot of these cars are just doing fine. And in 2021, a lot of them were going up and everybody thought they were a genius. Not that that will repeat itself, but you get the point. Like sometimes it is a nice place to park money that you can actually enjoy for a little while.

And if it's a new Ford Explorer, then you're in the first year losing, I don't know, $20,000. So you literally lost the value of two Rolexes. It would be difficult to buy some of the cars that we sell on Cars and Bids and lose $20,000. Like it would legitimately be difficult. But it's very easy to do at your local Ford, Toyota, Honda dealership. Just buy a new SUV. You lose it instantly. Yeah.

It's crazy. After we did our Porsche episode, both from learning about the industry through that and then obviously doing it with you and all, I came away and I was like, I should buy...

cars and using it. But then you have the problem, which I'm sure is the obvious one you run into of like, well, a lot of these cars that hold their value, you can't really use them for your family. There's a reason why I have like seven expensive cars in my garage, but my daily driver is a Mercedes-Benz station wagon with a third row and all. They're not feasible. And side airbags and lots of safety features. And a lot of car enthusiasts discount that stuff, but I totally agree.

I want my kid driving around and myself, honestly, on long drives in crowded cities in like a safe car. And I can screw around with the other stuff on the weekends.

Your own life, let's not even make it life because that's too ridiculous, but you having a functioning ankle for the rest of your life if something were to happen in an accident that just crippled your ankle is far more valuable than all nine cars even if you lost the full value of all of them. Also, how are you going to put a car seat in a Carrera GT? They don't have the latch system, I assume. They actually might. Latch is now mandated, but I don't know when it was mandated. But it is funny. I'll get into brand new Ferraris that cost a million dollars and they have latch because they have to by law. But...

But yeah, no, that's exactly right. And so as a result of that, I try not to, first off, I try not to buy really old stuff. And actually, Cars and Bids is geared towards more modern cars. We're 80s and up only enthusiast cars. The modern era. That's kind of the cars that, right, exactly. That's the cars that I'm into anyway. Older cars, I hate to say this because there's a lot of older cars I love, but they are a little bit more scary to drive, to use. And certainly you don't want to take any vintage car like somewhere you need to go because there's never a guarantee that it will work, ever. Right.

I basically like, with the exception of some, I don't know if they're 90s or 2000s, but there's some model of the 911 in the middle that I don't like as much. But with that weird exception, as I go back further in time, I like the design more and I have more of a lust and a desire to own one. What is the oldest safe 911 for me to get? Safe in terms of physical safety or reliable? Oh, um...

It depends how safe you want to be. Safe like you would think of a modern car being safe, I wouldn't go past 2005, which was the 997. That came out in 05. The model before that was safe enough, but not amazing. Before that, I really wouldn't screw around with it. Airbags were a safety feature, but...

car technology has come so far in terms of crumple zones and also in terms of all these other safety features that are so important. A lot of car enthusiasts discount all this stuff. Oh, I don't need a blind spot monitor. I don't need a backup camera. Well, actually the statistics say that you do and they say that they help. And I find that the more safety stuff I can get in my car is the better. So, you know, get a new 911 if you want the safest one. That's the answer. Pay for the library wine colors. So great. Okay.

What is a car these days? I feel like that is... Yeah, there was this whole thing about that. Oh, Tesla, it's an iPhone on wheels. Forget Tesla. That's obviously a driver of this and a big part of it. But in general, it's wild. So we have a Model 3 and we have a 2013 Acura TSX Sportwagon, which is great. It hauls a lot of stuff. We just leave it on the street and I don't care about it. It's fully depreciated. It's fine. But...

These are two different product categories when I drive them. So what's going on here? I mean, it's interesting, right? I think the Model 3 is kind of the preview of where cars are going to go in the future. And I think car enthusiasts will be dragged kicking and screaming into this world. And I'm not just talking about electric. In fact, I'm not talking about electric mostly. Electric is...

obviously coming but maybe kind of slowly what really is coming though with the telsa has really pioneered is the technology in cars i mean there's so much self-driving capabilities well i'm not allowed to say that driver assist capabilities that is the politically correct term there's so much functionality from the screen there's so much etc etc these cars that's really like the new thing and so people say oh iphone on wheels is like a disparaging remark

get used to it. That is the future of our lives. For my job, I think it's great because I point out all these quirks and features in cars and the more bizarre things cars are getting in them, like Tesla has the, like a drawing pad and video games. I'm like, bring it on. I can put these in my videos. It's easy. But from- This is another correct bet that you have. Other car reviewers like are caring deeply about this particular feature of the engine that most drivers will never experience. Whereas you're like, if you push the

this button that does that. That is exactly right. And that was one of my biggest things. I have told so many potential car reviewers when they ask for advice, I tell them to not drive the car. They're like, what? But I actually don't think people care that much about how a car drives. 25 years ago, some

Some cars were really bad. Like, really. Like, late 90s, early 2000s, into the 80s, etc. There were, like, legitimately bad cars. And you had to go out and read a car review to make sure that it wasn't, like, loud or rough or crashy or, like, difficult to hear, whatever.

These days, all cars drive well. All electric cars pretty much drive the same. And so nobody really cares that much about the driving experience. Enthusiasts care about sports cars, and in that case, I kind of talk more about it. But like for electric cars, they're more focused on the tech, the styling, the functionality, the cargo and interior room. Those are the things that is more interesting to people. And so, yeah, exactly. Look what this button does is absolutely

actually more important advice for a lot of new car shoppers than like that's where the differentiation yeah then like then like all these old school car reviewers sitting there being like the the steering angle and the turn in feels like this it's like that nobody nobody cares about that unless you're a real sports car enthusiast what percentage of people who own a car do you think are in that category in the category of enthusiast or in the category yes

I don't know. What do you think? 15, maybe 20, 10, somewhere around there though, for sure. Right. I would guess the low end of that. I think probably 30 or 40% of people would say that they're interested, right. That they're maybe even 60% would say like there, when I make a car decision, I think about stuff like styling and the way it steers and all that. Like they think about that, but they're not like really going to understand some of those driving dynamic concepts in a

complicated car review, right? You know, people buy Jeeps. Oh, I like this. This is cool. That's important to people. But do they really care about all the nitty gritty technical details? No. And that there's a big disparity there, right? The person who cares what they drive is probably most people. The person who really, really gets all this stuff is probably a small sliver of people.

And I think if I went and surveyed Americans, what is the difference between a mid-engine and a rear-engine sports car? I think maybe 3% would know the difference. I once read that some unbelievable percentage of people, like 70% or 65%, were willing to switch the car they were going to buy based solely on color. So if they had gone to a Mazda dealer and the CX-5 was white, but they really wanted a silver one, and the Honda dealer with the CR-V was across the street, they'd be like, done. I'm good. Yeah.

And it's like, wow, that kind of shows you what we're talking about here. Yeah. For this, however big it is, the small segment of enthusiasts, I think probably this does mean that the...

The differentiation on the driving experience is going to matter more and more and more and more to them as it becomes more commoditized for the rest of the market. Like to get a driving experience that actually is different. I mean, I only I've only driven the Model 3, but I fully expect that.

Every other electric car drives exactly the same, pretty much. To get something different, you have to go special. Yeah, that's right. The big differentiation used to be the powertrain, frankly. The engine, the way the engine felt, how smooth it was, how it accelerated. And that's gone now.

I mean, all electric cars accelerate basically the same. Now, some are faster than others, but the feel of it is basically the same. And so, yeah, there's less differentiation. And maybe enthusiasts will have to start to get boxed into a corner of just like steering feel and things like that. I don't know. It'll be interesting to see where car enthusiasm goes in the next 20, 25 years. Or maybe...

the old school stuff just becomes more and more desirable and more valuable. Going back to the car industry. So you mentioned electric is coming slower than, you know, some people want or that we might think. In fact, you have Toyota over there saying like, we literally don't live in a world that could support everybody having an electric car. And our bet is on fuel cell. Like, I think you can maybe only buy it in California because there's only a certain number of

places in Northern California where you could even refuel the fuel cell, however it works. I actually don't know. Is that claim reasonable that we actually don't live in a world that could support that in the next 10, 15 years? I think it depends on who you ask. Whenever I talk to conservatives, they're like, there's no way the grid could possibly... But then I talk to like people, you know, but then I talk to like...

EV adopters who are really excited, they're like, no, we got tons of, I don't know the answer. And I think a lot of people know less than they think. But I will say, to me, the biggest problem is not the grid, the quote unquote all seeing grid. I think the biggest problem is like infrastructure at the end of the day. It's one thing to install a charger at a single family home, which can be quite expensive and difficult.

But it's a whole other thing to install a charger at an apartment complex or on the street. I mean, a lot of people still park on the street. A lot, a lot, a lot of people, even people with garages and single-family homes. And so it's still so infancy. Like, I want to install a charger on the street because I park, like, real cars in the garage, and I don't want to put an electric car in the garage instead. Well, the city of San Diego doesn't have the capability. There's no, like...

regulations about like installing a charger on the sidewalk. Like that's not, they're not there yet. So there's a long way to go. I feel like before there can be like widespread EV adoption. And if you were designing this system from scratch, you could imagine,

Way to do it would just be hot swappable batteries on cars that like well if the issue is we can't have charges everywhere Then we'll just have these like big centralized chargers Just like we have gas stations and then people can easily go and get a new battery that as far as I can tell with The vast majority of manufacturers is not the route that anyone pursued. Well, you know what I've learned first off Yeah, that's a that's a great idea And I remember when Tesla announced they were gonna do that and then it fell by the wayside and I haven't heard anything about that like ten years and

But it was a concept they were going to do. But every time I go to a car launch, an electric car launch, the automakers always trot out the same statistic, which is something like 92% of EV owners charge at home 92% of the time or something, right? And I think the simple truth is that...

Yes, that would probably be the right thing if you were going to do road trips. I drive across the country every summer. It's the main thing that stopped me from getting an electric car. But for most people, they just need to charge it at their house. And they don't really care that much. Like the fact that there's no quick, you know, swappable. And now these electric cars are starting to be able to charge pretty quickly. But you have to find the right charging station, etc., etc. And there are a lot of problems with that stuff. But it will all get solved. It feels like the early days of something that will become a big thing, a common thing in 20 years. Yeah.

Yeah. It's also like just give it the nature of the car industry, the replacement cycles on these things. Again, not for the enthusiast segment, but for family cars are so long that it just feels to me like it's all going to naturally feather in and the solutions will get solved along the way. And the average car ownership lifecycle is 11 years, I think, something like that. So like, you know. Yeah.

Yeah, that's exactly right. The problem will solve itself. It's just it is going a little slower than I expect. You know, you live in California. It's kind of a bubble. There's electric cars everywhere. All my neighbors have Teslas and EV6s and all that. But you come out here. I'm on the East Coast this summer. And there's even here in Massachusetts, there's not as many as I expected or thought. And it's still a thing where your neighbor gets a Tesla and everybody's like, whoa. And I'm like, really? And then middle of the country, forget about it. I mean, they're not there. It'll be a while.

Which is so funny because the Model 3 is like the new Prius. That's how I feel. This notion of like, ooh, you got a Tesla. It's not like, ooh, you got a Porsche. Yeah, I don't feel like I have anything special. Totally. I totally agree with that. But there are still people who are like, oh, every kid I meet at a car show is like 12. It's like, I want a Tesla someday. I'm like, it's like a Honda Accord. Someday. Yeah.

Like the Model Y outsold the Honda Accord last year or the year before. That's insane. Like that is insane. If you had told me 20 years ago when I was a kid that a startup electric car would outsell the Honda Accord, the mainstay of the car business, like that's crazy to think about. But they are everywhere, right? They are very, very, very common, but not in some places. And it's going to be a slow adoption. You get in any new taxi in the last two years and it's a Model 3. I will never forget last year we went to Copenhagen and...

We were taken to the airport. We were in Copenhagen. We had to take a taxi to get to the airport to go on to the next city in a Ford Mustang Mach-E. And we had the baby and all of his stuff, and it was enormously difficult to deal with it all. But I remember getting out of the car and just looking at it for a second before cramming all the stuff into the packages and everything, the luggage, and thinking to myself, I just got driven in Western Europe in an American electric car.

Ford Mustang taxi. Like, what is this world? It's so bizarre. That is the future in some places. And some of those countries have crazy high adoption rates, like most of Denmark. But some places are really far behind. You do have those little, like...

moments of clarity when you're a new parent with the little baby where most of your life you're just like, I literally am like, you know, this is wild. And then you have these moments where you have like an out-of-body experience and you're like, what? Right, right. Here's something that's happened when I wasn't paying attention because I was paying attention to baby.

Oh, okay. So I don't think you've done this because I think I watch your channel pretty religiously or maybe recorded and haven't released it yet. Have you come up to San Francisco and done the cruise and the Waymo here in the city and reviewed those? No, I haven't yet, but that would be interesting for sure. Dude, you totally got to do it. I haven't been in them yet. Ruling just happened. It's now fully commercial all over the city. It's obviously not, but it feels to me like...

you know, 20, 30% of the cars I see driving around on the streets these days are, you know, there's nobody in the driver's seat. I'm very familiar with tech people's take on, on,

autonomous driving. What does the car guys think of all of this? I mean, it's going to be a fight with the enthusiasts. They're not supportive. I love it. I think it's one of the greatest things that's ever happened. You know, I love driving my fun cars. I love it. It's so much fun on the weekends, you know, go on a fun road with my friends or go off roading or whatever. But like when I'm driving up to L.A. on a Thursday and it's, you know, traffic, I'm

I'm happy to let the car handle all that. I think that enthusiasts need to realize that there's a place for both. And I really, really, really strongly believe that. I'm totally cool with the fact that I just want to send emails and browse Instagram while it's driving me up the highway. And then go on the weekends with my Porsche or my Ford GT or whatever and have real fun. There are still enthusiasts who are like, no, it's fun sitting in traffic too. We have to stay in drivered cars. I just find that to be insane and contrarian.

I just have so little use for it in the city personally because I don't commute to an office. But the current product in San Francisco is such a different product than a car. It's not even fully like an Uber Lyft replacement. It's a replacement for like part of that. I think about it to like the scooters than it is, you know, like it's certainly not a car you own. I think that we're further away from like full autonomous vehicles doing a lot of stuff, though, than people think. Yeah.

It works in limited situations very well. It works in good weather.

You know, you heard a lot about autonomous cars like four or five years ago. Like really, the industry is going in that direction. You haven't heard as much in the last year or two, like in terms of big developments. And I think they're kind of getting stuck on some smaller stuff that's actually more difficult to overcome than people think. Weather is a big factor. I mean, moral decisions have been discussed a lot. That's a big thing that they have to figure out. But weather is a bigger factor than people realize. There's a reason they're testing all these things in Phoenix, in L.A., in the Bay. I can drive just fine in dry, sunny weather.

Like, where I really want the autonomous car is when it's, like, sleeting and there's ice on the road. Like, that's where I would like some help, please. Well, and also just the geographical area, too. I mean, that's the thing here in San Francisco, at least, with this, is it only operates in very specific neighborhoods and parts of the city.

It's like geofenced. It can't go out. So that's why it's not even a real replacement for Uber and Lyft. It's like, oh, I want to go to Marin. I need to go to the peninsula. Like, you can't take a Waymo for that. Do they need to go get like, you know, millions of more training hours on those roads? They must be teaching them individual roads, which would eventually work, I guess, but has obviously enormous limitations, including when they start doing road construction and suddenly those roads are different and then they got to do, I mean, it would be like a never-ending thing. But that's what Cadillac is doing. Cadillac's

driver assist technology is called supercruise and it's the best in the business no question but they mapped the highways they like literally individually mapped the freeways in order to get it done and that took a lot of time you know like it's amazing it works incredibly well you can be totally hands-off in a new cadillac you could drive from la to san francisco completely 100 hands-off except when you have to go and refuel but like they had to map the freeways for that to happen and so good luck

You totally should come up here to San Francisco and do both Waymo and Cruise. Just fully review the actual cars. One of them is down in LA, and I see it fairly frequently. I just don't remember which one. They're using Jaguar I-Paces, which is a horrible electric car. Oh, I think that's Waymo. That's what they use here. The only people willing to buy that vehicle. But yeah, they're around. It's just the Buick enclave of driverless cars. More or less, apparently. Yeah.

But yeah, it will be the future someday and I'm ready for it. I'm ready to just sit in traffic and let the car drive me.

Because you drive in a lot of traffic because you're going around to these cars. Yeah. I mean, I end up driving up to L.A. a lot and Orange County a lot. And it's just it's such a slog. It's so difficult to do. The 405 is just the worst thing that's ever existed. And so it's a lot. My last car purchase, I bought a Mercedes station wagon, pretty much brand new. And I based my decision almost entirely on the quality and efficacy of its driver assist technology. And it's really good. By the way, I feel bad for throwing shade on Enclave owners. What I actually mean is the Encore technology.

Neither are good. Just licked it up. Neither are good. The Enclave is better, but the Encore is... There's also one called the Envision, which is made in China. There are not a lot of Chinese-made cars in America, but the Envision is. Oh, this is fun. Okay. What is the worst car on the market right now? Like, what should you absolutely not buy? What is like...

the best for each kind of category of purchase here. Worst car on the market right now. I really, for a long time, would have said that it was the Mercedes-Benz Metris. Mercedes-Benz makes a large van, but I think they took that off the market because no one was buying it. That's a terrible car. A lot of the cheap little stuff is pretty bad. The Mitsubishi Mirage is a horrible car. I can't believe they still make theirs. They might not. They might have just recently stopped.

The thing is, there's not a lot of bad cars anymore. There was the Dodge Journey. That was a horrible vehicle, but I think that's off the market too. Not in Mexico, though. You can still go south of the border and grab one. There's not a lot of really bad cars, though. Most cars are now good. That's just the situation.

Every automaker has realized information is too readily available to people to just make a bad car anymore. People aren't going to stand for that. They just won't buy your vehicle. We can't get away with what we used to get away with. Yeah, truly. Especially the big three, Ford, GM, and Chrysler would just make trash. And a certain subset of people would buy it either because it was domestic or because they didn't know any better. And now, like, there's YouTube. People are –

Doug will save you. Right. I will save you from buying a crappy car. It's actually interesting. I think this is one of the unsaid things about car reviews. I've always made this big holier-than-thou stance that I don't accept anything from the automakers, including plane trips and hotels. If I'm invited to a press event, I pay my own way and stay in a hotel.

At my own cost. And I've always been like, I do this to remain impartial. And it's a nice position to take. And it does go far. But I end up coming to the same conclusion as the people who the automakers paid to bring there. Because the truth is the cars aren't really...

bad anymore. There probably was a day when the automakers would whine and dime these journalists and say, you're going to say nice things, right? But they don't have to do that anymore. Like, cars are actually good now. It was common practice too, right, I believe, especially at the big three, you know, American automakers to...

for models that executives were going to drive and test and reviewers that they would be like, for those specific cars, they would be different than the cars you bought at the dealership. And that still happens. There's no question that still happens. I would say it probably happens across the entire industry. The press department orders cars...

There is an option code that most automakers have but hide from their window stickers called press finish. And there is dispute about what that is. Some automakers, there is absolutely no question that press finish adds power. Absolutely no doubt. Like they've been tested.

Other automakers claim it's just like some, just a little extra attention to detail on the line to make sure that there's no glaring issues or anything like that. And I buy that in some cases, but there is no doubt that the press card. Now you're thinking to yourself, well, I want to buy a former press vehicle then. No, you don't. Because then the, then the journalists get into these cars and abuse the hell out of them because it,

Journalists making $63,000 a year getting into a Ferrari is like, this is amazing. So you don't want those cars. But they definitely get a little extra something something at the factory.

Wow. All right. There's a couple of things about cars and bids I'm very curious about. So you opened talking about this with sort of why it kept you up at night and what the goal of starting a business was in addition to just the media side of the house. And I'm curious after the last, what, four years, has...

Cars and bids become a bigger business for you. And you can talk about whatever numbers make sense that whatever gross margin or net margin or maybe top line revenue compare the media business to the marketplace business. Yes, cars and bids is clearly bigger than the YouTube side. But I think the real crucial thing is even when it wasn't bigger than the marketplace business and we knew this from day one, it had more potential to be.

You can only get a YouTube channel to be a certain size, right? I mean, you can Mr. Beast it and go crazy and whatever, but that's very rare and very lucky. And my channel clearly was not at that trajectory reviewing cars. But the cars and bids clearly has more like upside and growth potential. And so it is bigger. And I suspect that that divide will only continue to grow, grow, grow.

And I have to imagine the margin profile, tell me if I'm wrong on this, on the YouTube channel is basically 100% gross margin, basically 100% net margin. Because for the longest time, it was just you. And so you don't have drones and red cameras. Except for travel. There were a few things. I was paying an editor. My best friend reads my emails, so I pay her. And there was some travel. But the expenses were, yeah, I mean, we were probably 90% net.

It was a great business, honestly. Yeah, we're familiar. Yeah, that's right. Then the other side of the house, you probably have 5% or 6% gross margins on cars and bids because you've got the 4.5% take rate plus a little bit more. So you're starting at, it could be a much bigger...

It's a lot lower, especially now, because we took this huge investment, and so we are kind of investing in growth. And so it's one of those classic situations where we're kind of knowingly giving up net revenue for the next half a decade.

however many months in order to get the tools in place to like grow the business to a place where we need it to be. Oh, I guess what if you just added up all the 5% of all the car sales? No, I mean, it would be much, much higher. Yeah. But there's then the media business much. I mean, you can. Oh, wow. We're selling basically 30 cars a

day or we're auctioning 30 cars a day, we have about an 85% sale rate. And so, and the average transaction value, I don't know, but you could figure it out very easily just from looking at the site. It's somewhere in the $30,000 to $40,000 range. So you can kind of do the math. There's real money being made. It's just that there's a lot of employees. Yeah, the sort of net revenue goes, whatever you could, but then like everything between that and profits, there's a lot more on the cars and bids side. Right, exactly. Exactly.

Yeah, that's fascinating. Two very different businesses that share a top of funnel, but... Right. That's exactly it. They share a top of funnel and other... And they're obviously both in the same field. You could see someone watching videos and then buying or selling cars, but they are very different businesses the way they are run and the way they exist. And it's kind of an interesting thing to be part of both. One topic that I think will be really interesting for our audience, Ben...

Ben, you're probably going to go this way. Before the Turing Group investment, you guys didn't raise any venture capital, right? My partner, my business partner, his company kind of was the one who gave us like our seed money essentially to get started. I didn't put up any of my own cash.

But it wasn't like, you know, if XYZ founders were going to go do this, like this is the type of business that you would go, you would do Y Combinator, you'd raise a seed round, you'd raise a Series A to get to the point where the churning group investment happens. So like pre that, a normal startup would probably be 20 million plus of capital into the business to get there. You guys didn't do that. We did it with a lot less, you know, but the result was...

We kind of had to be scrappy and we sort of had to make it work sort of thing. And we were profitable pretty quickly. I think the car market helped us out a lot. We also stayed lean. We stayed really lean. But I think the drawback of that was we probably didn't grow as fast as we could when the car market was blowing up so much. I think that if we had had more money, we probably would have made some more strategic hiring decisions and that probably would have grown us a little faster. But we did the best we could with what we had. And now we don't have to make those distinctions anymore. Obviously, this is a special case because...

You're Doug DeMiro, you know, and you had the built-in audience and all that. It's just really interesting to me to something I've been observing from many different vantage points over my career is like the amount of money that

startups raise, the correlation between that and success, you know, as best as I can kind of come to, I'm not sure that there's really any correlation. I think most of the time it is negatively correlated, except for the most extreme outlier successful outcomes. It is required. Yeah.

Specifically to get to a point where like when you took this investment at a certain point, yeah, you need capital. Like you took this investment from the turning group. Like if you're going to really, but you need capital. But to get to that point, like whether you raise $0 or you raise $30 million, like Ben, you're right. It might be negatively correlated to raise more. I actually, right now, I kind of think there's no correlation. Ben's point is interesting though. It's negatively correlated.

Unless it becomes essential. So that's the problem with these VCs and PEs, right? They have to make a decision. Is this going to be one of the negative correlation or is this going to be one of the essential? I don't know. It's an interesting point. Yes. I don't know a lot about this world. We've gone through this round, obviously, with the churning group. And of course, during that, I learned a lot about this process. And I'm the type of guy who spends a lot of time learning about this sort of thing when I'm in it. And one thing I have noticed is that a lot of the people who are in these firms are

have only been in them since the last recession and are kind of these young guys who sort of think that they're going to like do it, you know? And frankly, they've probably had a great track record so far because the economy has generally been strong over the last 15 years. And that's where all their investments have happened. And I think in a lot of cases, a lot of these people have thrown a ton of money at stuff and it's worked whether or not the money helped, right? Or was the reason that it worked.

Or that they were just surfing market beta. They didn't even need to look for outperformance. It was just like, oh, I'm in a market. I want to put money in the market. Some of me wonders if maybe things are going to change a little bit. I have a suspicion that our event was well-timed. Not that I don't think we're going to continue to grow, but I do think that for the car market especially, there was some unprecedented growth. But it'll be interesting to see how these things evolve over the next few years.

People could stop and Google it. And can you give us the details on when was the investment? Describe the transaction just so people know what we're talking about. The Turnin Group, which is like a private equity firm in L.A. that primarily specializes in these businesses like ours, which is like a business that creators lead. There's other ones like Meat Eater, which is a hunting YouTube channel that turned into a business. And Barstool Sports is another one they invested in a long time ago. They bought the majority of our business a year ago, basically.

And so they installed a CEO who they installed. I mean, I went through the whole hiring process and it was quite something. I love him. And obviously put money on our balance sheet so that we could grow the business even further, which we have since the investment. So it's gone well for everybody. And what was the total amount of capital there? They threw in like $37 million or something like that. And some of that was secondary. And then there was additional that they kind of threw on our balance sheet to help us grow.

And this is for the combined entity, right? That's right. You merged your channel and cars and bids for this? One interesting aspect of this whole thing is that, yes, the two businesses were merged into one business, which I think was a really good thing for the business. Because in the past, I was kind of serving two masters. The media business was where I was actually getting my paycheck from, right? The marketplace business was the one we thought would grow. But at the same time, if I got a great offer to go review something in the media business, I was gone for a few days and I had to do it because that was...

That was my business. And now they're all under one umbrella. And so the money is made by everybody and everybody's happy. And the growth of the media business means the growth of the marketplace business and presumably vice versa. So it's a good it's a good thing to combine them. And the incentives are aligned. You know, it's this classic thing when you have like a conglomerate and two division presidents that they're like are each trying to, you know, make their own P&L look better. And now everyone's on one P&L. Right. It's interesting, right? Like, Doug, you obviously know this.

Listeners may or may not be familiar with this. Maybe it's more just like our whole sort of quote unquote creator world that Doug, Ben and I are all in. But the hot topic du jour is what Turning Group does and like creators starting these businesses themselves. You know, it's Feastables and Mr. Beast and all that stuff. Everybody wants to do it. And this is a key aspect of it that I think a lot of people don't really think about and understand of like, well, the media business is

Is that part of the other thing or is it separate? Because as you say, once you start building a company, you know, you need employees, you have a separate set of stakeholders, but then you could get a million dollar opportunity in the media business that takes your eye off the ball there.

You, as far as I know, and I don't know the cap tables of certainly many, if not all of these other media creator businesses, but you're the first person I know that I know for sure. You actually merged the businesses. Yeah, but it made sense. I could see no real drawback to it, frankly. And I still feel that way a year after it happened. I still think it was the right thing to do. And...

It is a great investment philosophy. It's an interesting thing. I've said this on some stuff before, but like it's a great investment philosophy in some senses because you're investing in these businesses that are creator led where, like I said earlier, like people love the person. And so they physically want to give you money. Like they want to support you as opposed to like a regular business where you got to advertise and all that. And it's like a faceless corporation. But the drawback and the weird thing about the way the turning group operates, these businesses are thus kind of propped up by individuals who could turn out to be problematic. Right. Right.

Like, that's the thing that I'm always like, really? Are you sure you want to invest in this? What if I go on some Twitter rant and, you know, then I'm canceled, right? Like that, that's a real possibility. But I think their argument would be it's worth the risk because I think they think this is how a lot of businesses will evolve over the next decade.

20 years. You see the Kardashians going out starting businesses. You see Mr. Beast, like, businesses on the back of these followings. That's a real thing. There's, like, real money to be made there and real businesses there. And maybe people are going to gravitate more towards businesses like this as opposed to just...

I think they absolutely are. Well, and this is where the keeping it all under one roof of merging the media business and the operating business, businesses, whatever you want to say, I think makes a lot more sense and can kind of start to solve it because at least the incentives are all aligned. Right. It'll be pretty crazy to imagine a world where like business

big swaths of the economy have a leading player that's a human brand. Like imagine gas stations. Like what if there was a like... John Rockefeller's face was on. Exactly. Well, that's actually where my thought process was. It was like, I don't think in the time period, most consumers knew the name John Rockefeller, but they knew Standard Oil. And so could we eventually get all the way to a world where like, I get my gas from, you know, I don't know if it's Doug's gas station, but that has a

associated with it. I think this is what Mr. Beast wants to do with Feastables. Like, I think he wants Feastables to be like, you know, Procter & Gamble or something like that. Yeah. It's an interesting thing. And I really do think it kind of clearly is becoming sort of the future of

how these things work. When I launched Cars and Bids, I didn't do it intentionally, like knowing that this was a thing that, and honestly, at that time, three and a half years ago, it wasn't as much. It wasn't, no. And I think that the success of that and several other things has kind of shown like, hey, this is like a real thing and let's go do more of these. And I think, and the advice I give to all my creator friends is you need to do something. You need to do something. YouTube is not enough. TikTok is not enough. You need to take your audience and go do something.

Oh, man, I would say starting maybe six months, I would say before you did the churning group transaction, you know, friends and other people in the business who started coming to us and be like, what's your cars and bids? Like, you guys need a cars and bids. And, you know, we've always been like, I think that the dynamics are a little different in podcasting and we're kind of a unique animal. But so we haven't done it for various reasons. But, you know, you pioneered this, like literally, you know, you became a verb of like, what is your cars and bids? Right.

I mean, to an extent. I'm so glad it worked out and I'm so glad I did it. It would have been the worst mistake of my life not doing it. And I'm telling that to creators. And you know, one of the problems that these creators have when I tell them this, I've become sort of the elder forefather of the car YouTube space. Every time I go to...

whatever bizarre town these guys are located in, I have dinner with them and then they're always asking advice. And I always tell them to start their own business. And they always say the same thing, which is how the hell can I start my own business? I'm so consumed with YouTube. Like I'm so busy with doing content.

And the answer is, I don't know, but you better figure it out because there may be a day when you're not as consumed with doing content and when your audience isn't as engaged that you wish you would use that opportunity. I felt this way having a full time job for the last eight years while we were doing Acquired. It's like, is it an enormous sacrifice? And I basically have to give up all my hobbies in order to create a podcast.

thing that people actually care about. Yeah, it is. And at the same time, you have to make trade-offs in life. You do? So I did it sort of the opposite direction. That's exactly right. And you can make a jump or not.

I hate to say this because I don't want to get people discouraged. I never feel like that. And this isn't true for everybody, but I think the earlier in life you can do it, the better. I started YouTube when I was, first off, when I was too young to know any better, which I think is legitimately important. It's funny. Like it's a joke, but like, it's true. If, if I had been 37, I think I would have been like, that's just stupid. But as a 22 year old, I was like, I can do this because 22 year olds think they can do anything.

And also, I just didn't have that many obligations. I just simply didn't have that many obligations. And I think that when you're 22, it's hard to realize how few obligations you have compared to someone who's 35.

I got two mortgages now. I got a kid. I got another kid on the way. I got nine cars, apparently. Congratulations. Thank you. Not on the cars, on the kids. Ten by the time this actually releases. Actually, it's eight right now. It'll be nine when this releases. But anyway, you can't. You just can't as easily do it. And you don't want to. You can't afford to take the risk. It's just too difficult. And so when you were planning cars and bids and working on it, did you already have your kid at that point? We were trying. No, we were trying. In fact, we had a miscarriage the week the site launched, which was like

the most bizarre. Oh, I'm so sorry. I mean, you know, it worked out. We got our little guy and we got another one and it's going to be fine. But it was like, holy crap, what a bittersweet, bizarre situation to be in. But no,

No, we didn't have the kid yet. But the thing is, because I had a partner and because we had employees and we had some money behind it, it wasn't quite as big of like a time suck for me. But that first year was like really, really hard. And honestly, I missed a lot of early stuff with my son. And I'm so happy now that I'm able to like take a little bit of a step back and get some breathing room and like be able to spend like real time with him. Frankly, I like this two-year-old stage a lot better than the infant stage anyway. Yeah.

Agreed. Strong agree. Having a kid about the same age as you. Yeah, definitely. All right, Doug, before we wrap here, knowing the acquired audience, you know, it's people in tech, it's investors, it's CEOs of startup companies, lots of founders. Anything that you want to leave folks with before we head out here?

No, not really. Other than kind of what I just said, which is a more of a message to creators, like go do something with your audience. To people who are starting up and founding and like running businesses like creators are God. Use creators though. Like creators are more useful than you think. And a lot better investment than digital advertising if you could imagine.

partner with creators i think that's like a very very useful way to like run a business and start a business and try to find potentially on the cap table like instead of like media buys like you know what if someone had come to you and said i'll give you a big chunk of my company and you get to be the co-founder and you don't have to do any work except talk i will tell you this though the creators so since we launched we've been trying to do a lot of collabs

since we launched, like since we combined the businesses, we've been trying to do a lot of collabs so that we can get past just my audience. And I've done a bunch with a lot of great people. We've tried to do a lot more. Creators, what a group. What an interesting and bizarre group of people. Like people can't come to meetings that are scheduled on Zoom. Like they do, oh, I forgot. Can we do it tomorrow? And I'm like sitting there. The cap table is a total opportunity to get people. But a

But a lot of creators are less sophisticated than you think and are like difficult to deal with. And so like, I think the goal would be try to find the 7% of creators who can keep a schedule, who understand how Excel works, who can like go on a Zoom call, like...

It's hard. Like it's legitimately hard, but like they're out there somewhere. I mean, I imagine not to disparage anybody else in your category, but I'm just like, I can't imagine anybody else in your category that would be like you. Some are better than you'd think. And honestly, some are much worse. And I've talked to some people and I'm like, I hear their like story and I'm like, I can't believe you've even made it this far. Like it's difficult work to get this far, but like

It's the traditional story. I read a great Vanity Fair piece from years ago about Johnny Depp and his crazy finances and how he's blew all his money. And it gets into this. Like he was spending $300,000 a month on employees. He had 14 homes. It's that kind of thing. Like creators and the creative types like need people to rein them in. And I think where you strike gold is if you can find a creator who's kind of also like me, which is like gets the business side and what you actually have to do in order to be like a reasonable person. And that's harder than it looks, I think. Yeah.

Totally. Okay, one more last thing before we let you go. If anybody in our audience is looking to get into cars as an asset class wants to do something on cars and bids, maybe like what would your advice be for somebody that's interested in? Oh, I might want to buy a 911 from 2005 or, you know, a 350 or, you know, whatever. Yeah.

There are some cars that I think are undervalued. I think the main key that I would say is buy analog gas-powered cars. Cars with manual transmissions, big engines, and...

and old school feel old school look as cars start to become more electric all electric cars sort of have a similar shape because of aerodynamics and fuel range gas powered old school wedge shaped exotic v12s are going to be like the cars that continue to go up and over the last three years a lot of cars have enjoyed a high rise in value and i think there are still cars that have a high rise to continue going as the market starts to get more and more and more dominated

by like EVs and sort of lookalike vehicles. I think there's going to be more and more people who with newfound money are going to want to go back to their childhood of like fun, old school analog cars. Oh, the nostalgia factor is so key. Huge. And that's already happened. I think it's going to happen a lot more, I suspect.

How do I back your intuition here? Like, can you start a fund that I can invest in that's like Doug's appreciating car fund? We need an ETF for Lamborghini Countach. You know what's funny? I actually have started to develop this thing. I got to do a video on it, but I've started to develop this thing about market cap for exotic cars. If you multiply the number they made by the number they're selling for, you're

You can start to see which ones are maybe looking a little undervalued. You know, you've got the total market and maybe which ones are looking a little overvalued. I recently bought a car that plays into that, and I think that people should maybe look at that a little bit more. A lot of cars actually fall right into the same area. Carrera GT, Ford GT, a lot of like very special cars fall into about the same market cap.

And stuff that's wildly high and wildly low, you start to think either there's a reason for it or maybe there isn't. And either it's over or undervalued. That's a thought that I'm having. If you ever make a spreadsheet and want a second set of eyes, set it over. I do have an Excel running. If you want to share some of that alpha, just, you know.

Seriously, this should be part of Cars and Bids. It probably should. You could attract a whole other investor class with this. Part of the problem is for very special exotic cars, there are production numbers printed. For lesser cars like M3s and stuff, it's more difficult to find production numbers. But I have a whole exotic car market cap spreadsheet, and there are some cars on here that I would definitely be putting some money into, and maybe I just did. I'll announce that soon on my channel. Great. I'm Venmoing you right after this call. Subscribe to Doug DeMille on YouTube. Yeah.

For your instant alpha. There you go. Awesome. Listeners, thanks so much. We'll see you next time. We'll see you next time.