Exploring the Future of Smartphones and Income Generation with Dan Novaes

Summary

Podcast Summary: "Exploring the Future of Smartphones and Income Generation with Dan Novaes"

Podcast Information:

• Title: Escaping the Drift with John Gafford
• Host: John Gafford
• Episode: Exploring the Future of Smartphones and Income Generation with Dan Novaes
• Release Date: June 3, 2025

---

Introduction

In this episode of "Escaping the Drift," host John Gafford engages in a deep and insightful conversation with Dan Novaes, a seasoned entrepreneur and the CEO of Mode Mobile. The discussion centers around Dan's entrepreneurial journey, the evolution of his businesses, particularly Mode Mobile, and his vision for the future of smartphones and income generation.

---

Early Entrepreneurship

Dan Novaes opens up about his early ventures into entrepreneurship, which began during his high school years. He shares how his upbringing in both Southern Indiana and São Paulo, Brazil, exposed him to diverse economic environments, sparking his interest in bridging income disparities.

Dan Novaes [02:11]: "I've been doing businesses ever since I was in high school. It's just kind of in the DNA."

Dan explains how witnessing the high costs of goods in Brazil compared to the U.S. led him to his first business idea: arbitraging electronics between the two countries. This venture quickly scaled, generating significant revenue during his high school years.

Dan Novaes [04:00]: "I bought three on an emergency credit card, and by the next day, I had sold all three. I made more money in that day than I had made the entire month working at Polo."

---

Transition to Software and App Development

After initial success in electronics, Dan pivoted to software development. He recounts a pivotal moment when a warehouse robbery wiped out a substantial portion of his earnings, pushing him to explore more resilient business models.

Dan Novaes [09:12]: "I just wiped out like 70% of everything I've ever worked for at the time. I'm now living in Chicago. I'm 22 years old. I just graduated."

Determined to find a sustainable path, Dan ventured into app development. He describes creating a simple app that unexpectedly garnered significant revenue shortly after its launch.

Dan Novaes [10:35]: "Six weeks later, we're Skype friends. I made $10k in three days. This was an insane return on investment."

This early success led to the formation of a partnership with a young developer from the UK, culminating in the creation of multiple apps and the foundational experiences that would shape his future endeavors.

---

Mode Mobile’s Business Model

Mode Mobile emerged from Dan's extensive experience in app development and his desire to address income disparities. The company focuses on transforming smartphones into tools that generate income for users, thereby reducing the wage gap.

Dan Novaes [21:33]: "Each time someone performs an action on their phone, advertisers pay us. We share that value back with the user."

Dan elaborates on Mode Mobile’s innovative approach, where users are rewarded for their engagement across various smartphone activities—be it gaming, shopping, or streaming music. This model aligns the interests of advertisers and users, creating a symbiotic ecosystem.

---

Scaling the Business

Scaling Mode Mobile involved strategic acquisitions and a robust understanding of different international markets. Dan shares insights into how Mode Mobile expanded its user base to over 45 million globally by leveraging both organic growth and strategic partnerships.

Dan Novaes [24:04]: "We're acquiring other assets and companies because we're in the business of sending users to new apps, capturing lifetime value along the way."

He discusses the challenges faced, including revenue concentration risks, and the lessons learned in diversifying income streams to build a resilient business model.

---

Building a Remote Company Culture

Operating remotely has been pivotal to Mode Mobile’s success. Dan emphasizes the importance of transparency, strong core values, and effective communication in fostering a cohesive and motivated remote team.

Dan Novaes [43:03]: "We have crazy transparency within our business. We have weekly ACT meetings where everyone knows exactly how the business is performing."

He highlights the implementation of Objectives and Key Results (OKRs) as a framework to ensure alignment and accountability across all departments, which has been instrumental in maintaining efficiency and growth.

---

Navigating the Impact of AI

Addressing the rapid advancements in AI, Dan discusses how Mode Mobile integrates AI tools to enhance engineering productivity without threatening job security.

Dan Novaes [48:38]: "Every engineer should be using tools like GitHub Copilot because it can significantly boost their efficiency."

He reassures that while AI automates certain tasks, it also opens up opportunities for innovation and higher-value work, aligning with Mode Mobile's mission to empower users financially.

---

Future Outlook and Plans

Looking ahead, Dan shares his ambitious vision for Mode Mobile, aiming to revolutionize the smartphone ecosystem by making phones free and monetizing user engagement sustainably. He envisions a future where Mode Mobile licenses its software to global phone manufacturers, similar to Roku’s strategy in the smart TV market.

Dan Novaes [52:09]: "We believe the phone will be free. This creates a trillion-dollar opportunity by capturing the immense amount of time people spend on their devices."

He also touches on recent crowdfunding efforts, strategic acquisitions, and the goal of taking Mode Mobile public, underscoring the company's commitment to continuous growth and innovation.

---

Conclusion

The conversation concludes with John Gafford praising Dan’s innovative approach and resilience. Dan reiterates the importance of capturing and leveraging user engagement to build a multifaceted, profitable ecosystem. The episode encapsulates Dan Novaes's journey from a young entrepreneur to the visionary leader of Mode Mobile, providing listeners with valuable insights into building and scaling a tech-driven, socially impactful business.

John Gafford [53:48]: "If you want to be incredibly valuable, capture an audience and be able to move them around to different ecosystems. There's a lot of value in that."

---

Key Takeaways:

• Entrepreneurial Spirit: Early exposure and diverse experiences can ignite a lifelong passion for entrepreneurship.
• Pivot and Resilience: Adapting to setbacks and exploring new business models are crucial for sustained success.
• Innovative Business Models: Aligning user incentives with advertiser goals can create mutually beneficial ecosystems.
• Scaling Strategically: Diversifying income streams and making informed acquisitions are essential for growth.
• Remote Culture: Transparency, strong values, and effective communication are vital for managing remote teams.
• AI Integration: Leveraging AI to enhance productivity without compromising job roles can drive innovation.
• Visionary Leadership: A clear, ambitious vision fuels long-term opportunities and industry transformation.

For more insights and to follow Mode Mobile’s journey, visit invest.mobile.com or download their app to become part of their growing community.

Transcript

[Lowe's Advertiser]

Now more than ever, Lowes knows you don't just want a low price, you want the lowest price. And with our lowest price guarantee, you can count on us for competitive prices on all your home improvement projects. If you find a qualifying lower price somewhere else on the same item, we'll match it. Lowes. We help you save price match applies the same item current price at qualifying retailers. Exclusions and terms apply. Learn how we'll match price@lowe's.com lowest price guarantee.

[Dan Nova]

In that sense.

[John Gafford]

Because at some point they're like, wait, you're buying all of this stuff from us?

[Guest Speaker]

How many uncles do you have?

[Dan Nova]

How many jackets do you have? And why do they need so many.

[Guest Speaker]

Leather jackets in Brazil?

[John Gafford]

And now, Escaping the Drift, the show designed to get you from where you are to where you want to be. I'm John Gafford and I have a knack for getting extraordinary achievers to drop their secrets to help you on a path to greatness. So stop drifting along, Escape the Drift, and it's time to start right now. Back again for another. So the podcast of, like it says in the opening man, gets you from where you are to where you want to be. And today, people beamed through the interwebs live into the studio. I got a cat that has invented something pretty cool. It is a. And no, it's not going to be an infomercial. If you're thinking that is not what we do. We do not take paid placement on this show. It's not how this works. I just generally thought this was pretty cool. And I want to talk to the guy but about it. So he is the CEO of a company called Mode Mobile, where he has created a way, his goal in life, what he's trying to do is stop the income disparity, the wage gap, by allowing you to take your cell phone and turn it into a tool that makes money. So let's talk to him. Let's see, let's see. Let's get the ins and outs of that business and learn all about them. Ladies and gentlemen, welcome to the program. This is Dan Nova. Stan, how are you?

[Guest Speaker]

I'm good. Thank you for having me, John. I appreciate it.

[John Gafford]

You're good. Welcome, man. So, dude, you, entrepreneurship is not something that is new for you. It's not something you just started. This is something you. You've been doing your whole life, right?

[Guest Speaker]

I've been, yeah. Doing businesses ever since I was in high school. So it's. It's just kind of like in the DNA and even before I knew the word Entrepreneurship was, you know, have these little tricks that I would do, I guess, as a kid, you know, to try and make a couple extra bucks, I guess.

[John Gafford]

What did your parents do that would cause you to be born an entrepreneur? Tell me about you growing up.

[Dan Nova]

Yeah, so I mean, I grew up. My parents weren't necessarily entrepreneurs.

[Guest Speaker]

They were like parents though that did allow me to have, I think a lot of freedom relative to my friends. Like, I never had a curfew, I never had those type of kind of like rule sets. It was very like, you know, independence driven. So I think that was helpful.

[Dan Nova]

I think actually where the entrepreneurship really.

[Guest Speaker]

Came was, you know, I grew up to, through two very different environments my whole life. I grew up in Southern Indiana and Sao Paulo, Brazil, where I was from originally. My family's from Brazil and the very different places. And I think the areas that I really started to really notice that difference as I was like in my early teen years or going into sixth, seventh, eighth grade was that things in Brazil were actually way more expensive.

[Dan Nova]

Like things that I cared about at.

[Guest Speaker]

Least like an Xbox or a car or whatever because of this insane import tax. And every time I'd go back to, you know, Brazil, my family be like.

[Dan Nova]

Oh, can you bring like all of these electronics?

[John Gafford]

Sure.

[Guest Speaker]

Like why?

[Dan Nova]

And so, you know, you realize that.

[Guest Speaker]

And you're like, wow, like these are.

[Dan Nova]

Two places that as a kid you.

[Guest Speaker]

Realize are, you know, to me they're.

[Dan Nova]

They'Re different, but they're also the same. It's like just people that I'm dealing with. But then I thought, wow, there's like, I could sell this stuff here, make.

[Guest Speaker]

A profit, vice versa. I could take stuff here and sell it there.

[Dan Nova]

And that's how my first business has started.

[Guest Speaker]

And you know, by the time I was a senior in or in high school, I was doing a couple million dollars a year in revenue, you know.

[John Gafford]

From one of those businesses just simply arbitraging electronics from here to Brazil.

[Dan Nova]

That's where it started in Brazil. So basically, you know, the thesis was like I was like a ebay at.

[Guest Speaker]

The time, a Titanium power seller, which you know, for me is like a big title, you know, back in the day. And where it all started was, you know, I had a part time job that I was working at Polo at the time. I had just gotten a car and my dad was like, listen, I'm not going to pay for all these extra things that you want in your car.

[Dan Nova]

You want a sound system, all that.

[Guest Speaker]

Stuff, you need to get a job.

[Dan Nova]

And so I went Got a job at Polo Polo.

[Guest Speaker]

Worked for a week, got like a $70 paycheck. And I had this, like, aha moment when this, like, tour bus of, you know, foreigners came from, you know, they were coming from Japan, I believe, because there's a Toyota factory by my town. And they spent $40,000 on that day at that store. And it was just me and one other kid that was there.

[Dan Nova]

I'm thinking, I'm going to get this.

[Guest Speaker]

Great reward for, like, you know, dealing with all this on a random Sunday. And I got a $5, like, Arby's gift card. That was, like, my reward, you know, And I was super pumped.

[Dan Nova]

And then I got back and I was, like, really upset, you know, but at the time, I had this 40 discount at the store, and I was like, man, if I just gave them.

[Guest Speaker]

20%, I could have made AK, you.

[Dan Nova]

Know, and then, you know, not that that would have worked exactly like that.

[Guest Speaker]

Where I sold my discount to them.

[Dan Nova]

But that's where I had an aha moment. I was like, oh, what do I. Why don't I just buy some of these items and then I'll sell them on ebay? And so I walked around the entire store.

[Guest Speaker]

I had a Palm trio at the time, and it was like the smartphone of the time.

[Dan Nova]

And I was like, taking picture of.

[Guest Speaker]

In the palm tree of 600p.

[Dan Nova]

And so I would, like, take the pictures, get the serial numbers, and then I cross reference, found this jacket. And this one Jack leather jacket was.

[Guest Speaker]

Like, selling there at the store for 180 bucks.

[Dan Nova]

At this factory and outlet and online.

[Guest Speaker]

It was like 380.

[Dan Nova]

I bought three on emergency credit card.

[Guest Speaker]

Kept the receipt on my dad's emergency card, and by the next day, I had sold all three. And I made 680 bucks or something. And I was like, what the hell just happened? I just made more money in this day than I had made the entire month of me working here times five.

[Dan Nova]

And so I think that that's where that started thinking. And then I was like, oh, well.

[Guest Speaker]

Why don't I sell these items in Brazil? It's worth even more there.

[Dan Nova]

And so over the course of the.

[Guest Speaker]

Next five months, I made like 30.

[Dan Nova]

Grand in profit just by reselling Polo stuff. Eventually had to leave that job, right? It's unsustainable model in that sense, because.

[John Gafford]

At some point they're like, wait, you're buying all of this stuff from us?

[Dan Nova]

How many uncles do you have? How many uncles do you have? And why do they need so many.

[Guest Speaker]

Leather jackets in Brazil?

[Dan Nova]

And So it was excessive, but it was like the initial, I think, starting capital to get started and then. And where I started really noticing why I moved into electronics, it was like at the time is like when Apple.

[Guest Speaker]

Ipod was getting really big and all this stuff. And you know, internationally, this isn't as much of a supply chain issue now.

[Dan Nova]

But back then, this is like almost.

[Guest Speaker]

20 years ago, or probably 20 years ago. Typically electronics would come out in America.

[Dan Nova]

First and then everywhere else it was.

[Guest Speaker]

Like three to six months later.

[Dan Nova]

So in addition to that arbitrage that.

[Guest Speaker]

Already occurs based on currency arbitrage, there was also the delay.

[Dan Nova]

And so I could be the first person selling something and then basically sell.

[Guest Speaker]

It to the wealthiest people of that country.

[Dan Nova]

And then I saw that that would be true in the UK and Australia. You could buy electronics and then like, you know, unlock the phones, like smartphones.

[Guest Speaker]

You could buy like bricked phones if people didn't pay their bills on Verizon and AT&T, BlackBerry or, sorry, Verizon and Sprint at the time here, and you.

[Dan Nova]

Can make a couple hundred bucks. So that's kind of like how the business started. And I literally, you know, set up a warehouse in the uk Then I moved to Australia.

[Guest Speaker]

I did the same thing.

[Dan Nova]

And I was like hiring like my.

[Guest Speaker]

Taxi cab driver, you know, that I like. I lived in Australia for six months in college, and I literally hired a cab driver that was just like a guy, good guy I met. We interviewed him, and then, you know, that's how I was setting this stuff up.

[Dan Nova]

So, you know, that's where it all started. But then, you know, got into software.

[Guest Speaker]

After that, and there was a whole long story of how we did that. But I think that's where the foundation of entrepreneurship went. And kind of what was going through my head at the time was, you know, that this was like, for me, you know, I didn't know I didn't want to work a regular job, you know, And I really came to that realization probably like my sophomore, junior year of college, where it confirmed after like two internships that it just wasn't made for me, I guess.

[John Gafford]

Well, I like to say that all great entrepreneurs are chronically unemployable. So that's not a surprising part of that story whatsoever. To be great at this, you just can't be able to work for somebody else. It's part of how it works. So you said you were doing this and then. And then you branched into software, you said. It's a long story. Good news is we got time. So how did you make the. So that was the first pivot was into software.

[Dan Nova]

Honestly, dude, the way that happened, it.

[Guest Speaker]

Was like, I don't know. Oftentimes the worst things in your life are usually the best things for you, I guess. So at the time, you know, I had.

[Dan Nova]

I did a bunch of different businesses.

[Guest Speaker]

In college while running this company. You know, I had a screen printing business. I had started a college music website before Spotify, and we were getting about a million people a month listening to my music playlist.

[Dan Nova]

It wasn't making a ton of money, though. But right around this time.

[Guest Speaker]

I remember sleep. I was sleeping fine, you know, my warehouse, okay. I get an email from, like, you know, our worker there, and the warehouse was robbed, you know, like, completely. I didn't have any insurance on it or anything. And, you know, this is.

[Dan Nova]

I didn't have credit or anything.

[Guest Speaker]

So this is all my money.

[Dan Nova]

I mean, it wasn't all my money, but I'm saying It's probably like 70 of my money.

[Guest Speaker]

And apparently, like, there was a FedEx guy that then, you know, and then this warehouse got robbed in the uk. And he was so apologetic, but really there was no recourse, right?

[Dan Nova]

And I remember thinking to myself, man.

[Guest Speaker]

I just like, wiped out, like, 70% of everything I've ever worked for at the time. I'm now living in Chicago. I'm 22 years old. I just had graduated. I, um. And I was like, how do I prevent this from happening? I was like, what a hassle. Cause, like, you know, the thing with.

[Dan Nova]

Electronics is you might do a lot.

[Guest Speaker]

Of revenue, but your margins, like, maybe 10%, you know, 10, 15%, you're not making a lot of money on the stuff.

[Dan Nova]

And so that was a huge hit to me. And so I was like, well, if.

[Guest Speaker]

I do software, not thinking about hackers, right? But I was just like, if I do software, that would not be possible, right?

[Dan Nova]

And so at the time, it was.

[Guest Speaker]

Kind of like the iPhone was starting to get really big. App Store was getting really big. A lot of the traffic that we were having on their site was on desktop.

[Dan Nova]

So I was like, oh, I should.

[Guest Speaker]

Make an iPhone app. And I actually went on Fiverr. If you, you know, if you know, the website where you get anything for five bucks.

[John Gafford]

Sure.

[Guest Speaker]

Found someone that had posted a listing that was like, hey, I'll make an app for five bucks. So it sounds very promising, you know, definitely.

[Dan Nova]

But hit him up and was like, hey, this is what I want.

[Guest Speaker]

Then he was like, you know, I can't make that for five bucks. But I'll make it for 85 bucks. I'm like, you know what, that's a great deal. Let's do it.

[Dan Nova]

Was like, you know, didn't really have.

[Guest Speaker]

Any expectation for it.

[Dan Nova]

Six weeks later, you know, we're Skype friends at this point in time.

[Guest Speaker]

I get an app and the app actually works. Not the best app I've ever seen. I posted on the App Store and we sent it out to the audience and I made like 10 grand right in like three days. And I was like, this is an insane turn on investment. There's people.

[John Gafford]

What was the functionality? What was the functionality? What did it do?

[Dan Nova]

So initially it was supposed to play.

[Guest Speaker]

Music as like a music streaming app, but he didn't know how to do that. So what it did is it preloaded 10 songs and then it was like.

[Dan Nova]

You know that game that you would.

[Guest Speaker]

Play on, you know, you're kind of like Microsoft where it's like, it's like a little puzzle and you got to clean up the puzzle. So it's like a picture that's all broken, right? It was like early PC days.

[Dan Nova]

Anyways, that's all it did. And it had like, you know, 20 of the favorite song of the songs that people liked and they were just.

[Guest Speaker]

Kind of like, you know, kind of.

[Dan Nova]

Like a stupid game that was in.

[Guest Speaker]

There that was kind of like a hybrid of a music and game.

[Dan Nova]

Very simple. But honestly had made that 10k very quickly and was every day making a couple hundred bucks.

[Guest Speaker]

I'm like, dude, I'm making more money on this. And I did this with a guy from Fiverr who I turns out is my co founder still to this day. It turns out it was a 17 year old kid in high school that was about to graduate high school in the uk. And he was on Fiverr because it was his first ever project. He had just learned a code, didn't really, you know, believe in his skills and just wanted to work on a project. And then I was like, hey listen, like I just graduated. You're about to go to college, you know, why don't you take a gap year, come move to Chicago. I was living in Chicago at the time and I had this idea, we're going to create apps without coding for people. And he's, he did it, like took a gap year and like came his parents allowed him and we then started this company. We proceeded to struggle for a year, did not. It's not like that story of like, oh, and then everything happened and it was great but you know, we started making A little bit of money towards the end. But at the end he was like, oh, you know, I, I can't take another gap year and we're not making enough for me to be sustainable. So I'm willing to work on this part time, but I gotta go back to college, right? So after that year, that's what happened.

[John Gafford]

Dude, you know what's funny about. I'll tell you something funny about that particular story you just told, which is one of my best friends is the founder of a company called Vshred, which you've probably seen all of your social media. And his partner in that business is an English kid that he met exactly the same way on Fiverr. I don't know if it's Fiverr, but no, he just, he just met this kid in England that was.

[Guest Speaker]

Kid.

[John Gafford]

No, he just met this kid that was gifted, that was gifted with ad buying. And he was a kid and he was just like, why don't you move to America? Let's take a shot at this. There you go. And here we are. Now they have a billion dollar company. So, yeah, pretty impressive, but just literally the exact same story. So I guess if you're listening to this, if you a great business, you got to find a high school kid in England because this second time I've heard this story. It's literally the second time I've heard this. Okay, there we go. All right, keep going. Sorry.

[Dan Nova]

Yeah, no, so. So it was, it was a crazy time.

[Guest Speaker]

You know, we became friends and then he like goes back to have his freshman year, you know, you know, like freshman week. Like, it's like super fun, whatever. And he's like, but I'm, I'm down this one week to kind of build this app. And I was like, listen, I have this other idea for an app. I think we can knock it out in one week. Let's try it out. He's like, okay, I'm down. So we launched this app and it.

[Dan Nova]

Was basically Instagram had, I think had.

[Guest Speaker]

Just gotten acquired by Facebook, right? It was like that billion dollar acquisition at the time, but it was still relatively small compared to what it is today.

[Dan Nova]

This app was the first ever app.

[Guest Speaker]

That basically created Instagram as like an exchange system, meaning you could upload your photo and you could like someone's photo or you can follow them and you get a certain amount of coins for those actions, or you can just buy.

[Dan Nova]

Coins at the time.

[Guest Speaker]

The way the algorithm worked on Instagram is the most likes, most follows gets to the popular page. Once you get to the Popular page. You get a ton of organic reach. It doesn't work like that anymore.

[Dan Nova]

This app basically was the first time.

[Guest Speaker]

That you could do that without, like, bots, right? And this app went out, and the first day it came out, There was like four hours left in the day. And, you know, every 24 hours, the clock resets. And it made like 700 bucks.

[Dan Nova]

I thought it was a glitch.

[Guest Speaker]

I was like, someone came in here and probably went and saying, you know, bought that. The next day I see it rising through the charts. Like, you know, we're at, like, number.

[Dan Nova]

Four, you know, in the paid charts.

[Guest Speaker]

And the next day it made like 12 grand, right? And then the next day it made 20 grand, right?

[Dan Nova]

And it was just organically growing, you.

[Guest Speaker]

Know, had this really nice viral loop. And then we were the 65th highest grossing app in the entire App Store.

[Dan Nova]

And so every day we're making, like, $20,000 profit, you know, on this product. And it got to a point that I was like, look, I think you.

[Guest Speaker]

Should drop out of school.

[Dan Nova]

We should.

[Guest Speaker]

We should, like, keep building other apps. And he's like, listen, I can't get a visa because I don't have a college degree. And so he's like, if we raise an investment round, we can get a special visa called 01A visa. It's like people of extraordinary ability.

[Dan Nova]

And so then I went out to.

[Guest Speaker]

Go try and raise money, and we were able to raise a million and a half dollars. We got Mark Cuban to become an advisor in the business as well at the time, and he dropped out of school. And then we started this company.

[Dan Nova]

Three or four months into that app.

[Guest Speaker]

Facebook tried to sue us. They were like, they sent us a cease and desist. They didn't actually sue us because we were using their private API. They didn't like what we were doing. And so we kind of adjusted the way that worked. But ultimately, that's how we got started in software and then kind of ran a lot of different apps through the years. And that kind of led to what we do now with Mode is kind of all that learning, all those different businesses. And we sold a lot of. A lot of the app studio and apps to, you know, other people along the way. But that's kind of like the story of those, you know, early 20s and. And, you know, the pivots along the way.

[John Gafford]

All right, just so. So for those folks that are listening, right, how many dogs did you have? I mean, did you guys just literally go on a streak of winners or did you. Were there A couple just dogs.

[Guest Speaker]

I mean, the app builder was a dog. The entire thesis of that business. It's not that I was like that business.

[Dan Nova]

Some people made it work.

[Guest Speaker]

Like, I, I just like wasn't built.

[Dan Nova]

To be a founder. I think like that because I was.

[Guest Speaker]

Like, I've always been a mass consumer founder.

[Dan Nova]

I would say like every business I've.

[Guest Speaker]

Ever operated has been like a B2C business focused on getting consumers in the door. That's like what I'm good at. That's what I like to do. And so, so that didn't work. And like the, and then you have this consumer app and that did. And that prevented the capital.

[Dan Nova]

Then we were like, oh, okay, let's.

[Guest Speaker]

Make all these other apps. And we did these like celebrity apps. We were like the first ones to use. Like we were going like vine kids. You know, at the time, vine was big.

[Dan Nova]

So we were really ahead of a lot of trends and some of them.

[Guest Speaker]

Made that money, but not to the scale of that first installer app. And that was actually a big life.

[Dan Nova]

Lesson, I would say, because, you know, if we just would have focused on.

[Guest Speaker]

Like some of the core value props that we were doing instead of like wanting to like aim for a billion dollar outcome instead of like a several million or a figure. But I was like so enamored with.

[Dan Nova]

Billionaire outcome, billion dollar outcomes.

[Guest Speaker]

Um, and I just couldn't make it happen. And so eventually though, it did lead to what became this business. So I would say probably like 20. Dude. Like, honestly, this company has almost failed 20 different times.

[Dan Nova]

And even, even as early as a.

[Guest Speaker]

Few years ago, like you're still dealing with those ups and downs because it's anything but easy, you know, and then.

[Dan Nova]

Just when you think something's going great.

[Guest Speaker]

You know, in 2021, 2022, we had like an insane, even with no in our current business, like an insane growth rate.

[Dan Nova]

And everything's going because at the time.

[Guest Speaker]

We were making a ton of revenue off of like, you know, crypto companies and financial like neo banks that were super high valued and money's cheap, so.

[Dan Nova]

Everyone wants to go public, so they're.

[Guest Speaker]

Spending a ton of money on marketing. And that's how we make money is, you know, brands paying us effectively for marketing.

[Dan Nova]

And in 2022, FTX happens, all this other stuff happens. Voyager goes bankrupt.

[Guest Speaker]

That was one of our biggest clients.

[Dan Nova]

They owed us millions of dollars and.

[Guest Speaker]

Suddenly my revenue goes away and my business almost like, you know, tanks. So that idea wasn't a dog, but.

[Dan Nova]

It was also like the concept of.

[Guest Speaker]

What we was doing was working, but the market landscape changed and you know, the errors that I made was like revenue concentration.

[Dan Nova]

Like, oh, if 70% of your revenue.

[Guest Speaker]

Is coming from like, you know, six or seven different people and then they're all in the same industry, something happens, it can probably take you down 100%. And so you learn these things along the way of diversification and how to build a business so that you don't fail. And I think every year that you don't die effectively, the likelihood of your success like infinitely scales because you just get so much wiser, you know what I mean? Of how you operate.

[John Gafford]

Yeah. So what was the idea? Who came up with the idea for the current company, the current iteration of what you guys are doing?

[Dan Nova]

Yeah, with mode. So this is how essentially it started. We had created a concept.

[Guest Speaker]

So obviously we were in the app builder space.

[Dan Nova]

We kind of went from the start.

[Guest Speaker]

Of the app kind of like boom. Which was everyone wants an app to everyone's like, we don't need any more apps. Like honestly, if the, if the house, if the restaurant down the street gets an app, like I'm going to have to freak out, you know what I mean? I don't want to download that app.

[Dan Nova]

And so then I was like, oh, okay, well we should build a kind.

[Guest Speaker]

Of a super app that kind of brings all these services in one place. And then we focus specifically on media at the time. And so what our specifically did was like we aggregated all the music services into one place. SoundCloud, Spotify, YouTube, all that stuff.

[Dan Nova]

And it was this idea of like multimedia, all the super apps, all those.

[Guest Speaker]

Apps within it ultimately didn't work like.

[Dan Nova]

It like people, there was only one type of user using it.

[Guest Speaker]

And that's, this is actually how the idea started is that we asked these people, why are you using this product? And they all had one thing in common.

[Dan Nova]

They didn't pay for subscriptions.

[Guest Speaker]

So they liked that it was free and that you can stream unlimited music. And at the time the APIs of these services, so how we integrated, they didn't show ads in them.

[Dan Nova]

So it was like a weird hack to have an ad free app experience with a huge library. And obviously they could change that at any minute.

[Guest Speaker]

It was just like unfortunate for us at the time.

[Dan Nova]

And then we asked them like, you know, why don't you pay?

[Guest Speaker]

It's like, oh, because you know, budget conscious or whatever it might be. And they tend to have more time than they had money.

[Dan Nova]

So we're like, oh, well what if.

[Guest Speaker]

We Paid you to listen to music. Like, would you be interested in that? And then everyone was like, yes, very interested in that.

[Dan Nova]

So we just put up a landing page. I don't know if you used to.

[Guest Speaker]

Use Robinhood when it first came out, but they had this, like, referral mechanism that, you know, you could jump the line into it, and they get, like, literally millions of installs on that.

[Dan Nova]

So we just put up a landing page.

[Guest Speaker]

I was like, hey, we'll pay you to listen to music. And we have, like, 250,000 people sign up in a matter of, like, you know, weeks. And so we're like, okay, there's something here for sure.

[Dan Nova]

And so we focused the entire business.

[Guest Speaker]

On paying you to listen to music. Problem is that music is, like, a horrible business, and it's really hard to make money doing that.

[Dan Nova]

So then that's how we moved into.

[Guest Speaker]

Like, gaming, and then we moved into.

[Dan Nova]

Other types of activities that you would do on the phone. And before we knew it, we're like, really? What we're building is, like, an operating system on the phone focused on everything.

[Guest Speaker]

You do that rewards you. Right. And then we're earning money to play games, to shop, to stream music, read.

[Dan Nova]

The news, charge your phone. And so then that's how the whole.

[Guest Speaker]

Concept was formed around earnphone and, you know, rewarding you for everything you do on this device. And the 40 hours that you spend on average on your smartphone, that's only going up.

[John Gafford]

So when you say that, you. When you say you get paid for everything. So who's writing the check for this? Like, who's actually paying? Obviously, it's advertising. Obviously. But is it the. Is it individual advertisers or the people that actually own the services that are being used? Because then they're making money on advertising.

[Dan Nova]

Yeah. So the way to kind of think about it is, like, there are direct advertisers that will work with us. I mean, every.

[Guest Speaker]

When you advertise, there's always a goal, right. For your podcast, it might be you want people to download your podcast, you want to wear it, so you're willing to spend money on that. For brands, the same thing. Right. So if it's a game like. Like a Candy Crush or something like that, they want you to play their game and basically create a habit playing that game. And over time, you'll either see a lot of ads and they'll monetize that way, or you'll buy stuff in the game.

[Dan Nova]

And so, you know, they'll pay us.

[Guest Speaker]

A certain percentage, just like they would Facebook the Only difference is that we reward the user per minute. They play Candy Crush for a period of like a week or something like that.

[Dan Nova]

Vice versa.

[Guest Speaker]

If it's like Robinhood is like the client, which we work, their goal is for you to deposit $5 into a trading account. And with, with that they're willing to pay like 100 bucks, say.

[Dan Nova]

And so we'll take that 100 bucks and we'll say, hey user, if you deposit $5 into a brokerage account, we'll give you an extra 50. Robinhood will give you $50 in free stock as well. So you get 100 bucks for opening up your account here. So that's how you align value, because we're taking a little bit of that, you're sharing a little bit with the.

[Guest Speaker]

User and then you're aligning the value with the advertiser.

[Dan Nova]

What's kind of how the model works?

[John Gafford]

Yeah, it's kind of a digital affiliate program is essentially what it is.

[Dan Nova]

Yeah, yeah. I mean, and I think like what you'll see is like, you know, reward models are becoming way more like in the know now. I'd say. I think they were like, when we started this business, these kind of like.

[Guest Speaker]

Make money products or reward products were kind of like, you know, gimmicky I think.

[Dan Nova]

And you know, there's still like advancements.

[Guest Speaker]

That are kind of happening.

[Dan Nova]

But if you just think about the.

[Guest Speaker]

Amount of time that people are spending on these devices, I mean, your attention and data is effectively, you know, being utilized to make trillion dollar businesses. And so we're just kind of sharing that value back with the user and, and just doing every facet of your life that you could possibly think of.

[John Gafford]

So I mean, you guys currently have, you have like 45 million users or something crazy right now.

[Dan Nova]

Yeah, we've had over 45 million people.

[Guest Speaker]

Download and use our products from around the world. I mean, a good portion of that is also international, which is, you know, we still kind of count as like a beta kind of program because it just shows the interest right at the end of the day. Because in order for us to be really successful at what we're doing, you need to have the advertisers, because the advertisers are essentially the ones that are kind of filling bill for those users. But most of that is organic in that sense. But we've had over 45 million people install, use this product and now the business is starting to acquire other assets and companies because we're essentially in the business of sending you to use like the new TikTok app or the new game or whatever and now we see an opportunity of being like, well you know There are the TikToks out there, but there's like a ton of these like utility apps that are like a little game or some photo filter app or you know, whatever. And we could buy those apps, send users into those products and then now we capture all of that lifetime value along the way. So it's almost like the PE like roll up model as well. That's kind of been very profitable. And then you know we're finding good cash flowing businesses and you know we bring them into the mode umbrella.

[John Gafford]

I have an interesting question based on what's going on in the world right now because this, this could be, it could be part of the equation which is this and you would kind of know are your international users worth the same to your investors as us? Do they value them more or less international users versus your US based users?

[Dan Nova]

US users are, I mean it's in the value of, of kind of like lifetime value.

[Guest Speaker]

US is the highest. And the reason being is just because fundamentally the ad markets here are just the most advanced. The income per capita is the highest in the United States and so you generally see it correlate to each country. Now here's the thing that's really interesting though.

[Dan Nova]

In the US right now our focus.

[Guest Speaker]

Is on Android because generally that's more of a budget conscious population. But in the US the ratio is like 50, 50. Right.

[Dan Nova]

Whereas if you go to a country.

[Guest Speaker]

Like Brazil or India or South Africa, whatever, you're going to get like 99% penetration for Android. So we just have a lot more people in those countries, you know, in worldwide I think if you look it's like 1.2 billion devices or so or iPhones and there's like 6 billion of everything else. Right. And so it's just like a lot more people are using Android devices and.

[Dan Nova]

So you know there's nice arbitrage is.

[Guest Speaker]

To be made because some markets are more efficient than others.

[John Gafford]

Well the reason I asked that was because you know, I've sat on this program since the, the tariff war started that you know, the US consumer is the best commodity on earth. If you look at big business, it's worth more than anything else on earth. Yes, because the value that I was just curious if in your model with your advertisers they said like okay, if it's us we'll pay more for it because the long term value of that is higher or if it's international we're Going to give you a little less because we know we're probably going to get a little less on that.

[Guest Speaker]

Yeah, it's for sure like that. And you know, even countries like Canada, UK, Australia, it's still like 80% of what you get in the US generally. You know, it follows that pattern, you know, essentially.

[John Gafford]

So you've gotten some, you've gotten some joint partnerships or some deals done with some big box brands. I mean some big companies, I mean Best Buy and Walmart and those things. How did you get those deals done.

[Guest Speaker]

Man? Honestly, it was every which way I think is the right answer here. Because it was not something I had, I guess take a step back. The thesis behind this was we started out as a software company and we're still a software company. I think one of the misconceptions that we're a hardware company, I think the main idea behind the phone was literally that when I came to that conclusion that what we're doing is effectively an Erno bus. And what I wanted to test out is kind of like if someone bought a phone, that's value proposition was that hey, you're going to get paid to use your phone, would that change the earning habit of someone? Right. And also the time you first open up a device, there's all these new apps that you install, right.

[Dan Nova]

And each time that that happens, advertisers.

[Guest Speaker]

Have to pay for that. Right. So as opposed to when someone downloads our app and you already have Facebook on there, there's no way I can monetize that action. Right.

[Dan Nova]

And so that was like the thesis.

[Guest Speaker]

Behind why we launched earthbone.

[Dan Nova]

And you know, we launched the first one, I literally we only made 5,000.

[Guest Speaker]

Devices and we just launched them to our own users and we sold out of it. We didn't have it in any stores and no nothing.

[Dan Nova]

And it's not like, you know, we, we just try to do it in.

[Guest Speaker]

The most scrappy way possible.

[Dan Nova]

We then did the second device. I was like, okay, this one we.

[Guest Speaker]

Want to get into stores. And the main reason why we wanted to do that is just to also show that the model is possible. Because our vision as a business is actually not to be, it's more to be like Roku. If you're familiar with Roku, the service, what Roku was able to do in 2015 they had seven attempts to go public and it failed every time. And then in 2015 they really hit it and what they did differently and now they're 10 billion plus billion dollar business is effectively they license their software to TV makers like TCL, Panasonic, etc. And they get access to that distribution.

[Dan Nova]

So let the people that are great at manufacturing distribution and then they do.

[Guest Speaker]

A rev share on your streaming habits and things of that nature.

[Dan Nova]

And so that's what we wanted to do. The problem is that anytime I went.

[Guest Speaker]

To a big carrier or phone banker.

[Dan Nova]

It was just such an out of.

[Guest Speaker]

The, like, like out of box model that people just didn't believe it was possible. And when they see it's an app, they're just going, I don't really want to do that.

[John Gafford]

Just put this.

[Dan Nova]

Yeah, yeah, yeah, yeah. And then they were just like, it just didn't have any credibility. So we're like, oh, we're going to launch it.

[Guest Speaker]

And the stores like Walmart, Best Buy.

[Dan Nova]

Show the data, show it's possible. And that was the whole thesis. It wasn't to get a ton of distribution because you know, of those 45 million, we're talking about tens of thousands of devices, we're talking about tens of.

[Guest Speaker]

Millions of installs, right?

[Dan Nova]

And so the play there was just.

[Guest Speaker]

To show, hey look, this cohort a user. This is what happens when you have an earned phone. This is what happens even with like our device, which is definitely not as good as like a Samsung device from our device because I haven't been in manufacturing for like 30 years, you know what I mean?

[Dan Nova]

But you can show that people are.

[Guest Speaker]

Interested in it and that's really the future of Mode. You know, it's really kind of this idea where we're going to see things like an ATT earned phone or a Samsung earned phone or a Motorola earned phone or in other countries where, you know, there's, there's phone makers that you've never even heard of here in America, like Oppo or Vivo, that are literally like insanely like tens of billions of dollars business. But they're the market leaders in India or they're the market leaders in Africa. And so that allows us to license that to those people.

[Dan Nova]

They then launch earned phones in their own country.

[Guest Speaker]

And that allows us to really kind of take over that model and be basically the creators of that earned phone idea. Just very similar to how Roku did for smart tv.

[John Gafford]

What prohibits Apple from slitting your throat?

[Dan Nova]

Well, I mean Apple is, you know, they're not really, it's kind of a different core market, I guess because, you know, people that have iPhones, like they're not as budget consistent. I mean if you're spending your entire month's rent like a flagship device right now, it's like two GS, right? It's like, it's like, okay, cool. You use this product for the entire.

[Guest Speaker]

Year, you'll be able to pay for your iPhone and that stuff.

[Dan Nova]

And obviously it's a good market. Don't get me wrong, we have solutions.

[Guest Speaker]

That we're thinking about actually of what we want to launch for iPhone, that category, but it just wasn't our focus area. And even on the Android side, I think that the general idea is to.

[Dan Nova]

Build this business and to do it.

[Guest Speaker]

In the way that we've done it. It's very complex. It's not an easy business model to actually operate in because you're effectively creating money out of thin air. But the way that we also went about it was like, I don't see other reward products or survey apps or whatever as like competitors. My goal as a business is like, how do I apps create the most value for you? Through earnings and savings and value.

[Dan Nova]

And because those people want our users.

[Guest Speaker]

They'Re going to pay money to us that allows us to increase rewards.

[Dan Nova]

And if you can earn from their.

[Guest Speaker]

Product, great, you should definitely do that.

[Dan Nova]

And so that's kind of like how.

[Guest Speaker]

The thesis of the business operates and why we kind of see that, you know, other companies want to work with us as opposed to like compete.

[Dan Nova]

You know, many people have tried to do this model.

[Guest Speaker]

It's just not very easy to make actually work.

[John Gafford]

Well, speaking of which, I mean, speaking, dude, you, you've run up a giant business. Let's go back a little bit and talk about how you scaled. Let's talk about operationally scaling. How, how many people do you have now? How many employees do you have now?

[Dan Nova]

Yeah, team members. We have a little over like 60.

[Guest Speaker]

65 or so employees. We have a lot, a lot of more part time people as well. Like, you know, we very, we're fully remote model. So you know, after Covid, we decided to fully operate in that way. And so, you know, we, we operate super lean, you know what I mean? I think that that's the, that's the one thing that you learn, you know, from those hardships along the way is how to make like some of our okrs. Internally is like revenue per team member, you know what I mean? So we have goals, you know, like what is the revenue per team member? And then if it starts getting out of whack, then, you know, you have to, you know, either create more revenue or be like, hey look, are we being as efficient as we possibly need to be? But yeah, I mean, those Are, you know, kind of how we think about it.

[John Gafford]

What's more important in your business model is I, I always call it offense and defense. Right. Because you need like offensive money would be generating new relationships and generating new revenue channels. And then defense would be the developers that are making sure your, your clients get a great experience, are constantly improving. What is your mix on offense to defense on your spend?

[Dan Nova]

Yeah, I mean, people spend.

[Guest Speaker]

My highest cost is engineering and product. Because fundamentally we have certain business models.

[Dan Nova]

That are the way to kind of think about moat is like we actually.

[Guest Speaker]

Have three different divisions in our business. We kind of have like a media division, a mobile division, which is our core business. And then we have like down this like money division, which is kind of like some of the stuff we're doing within like the financial services space. But. And some of those divisions are way.

[Dan Nova]

More profitable than others because they're almost.

[Guest Speaker]

Like, you know, be able to use the resources. Like, I'll give you an example. Like when we were trying to find new revenue outlets and after that whole thing debacle in 2022 that we had that we had to kind of really pivot the business and find new revenues.

[Dan Nova]

We realized, hey, you know, we have.

[Guest Speaker]

Like 45 million emails that people, you know, came into our service and what.

[Dan Nova]

Do we know about this view? If you like to earn and save.

[Guest Speaker]

Okay, let's create some newsletters to do.

[Dan Nova]

To basically tell them about earnings and savings. And now that's a mid seven figure.

[Guest Speaker]

A year business for us with extremely high gross margin.

[Dan Nova]

Because all we're doing is doing something that like literally would just be an.

[Guest Speaker]

Afterthought as a business person. Like, I wasn't even monetizing emails, you know, at that time. And then it's turned into something.

[Dan Nova]

So, you know, that's kind of like obviously that business line, maybe they're way.

[Guest Speaker]

More offensive on like sales and you know, kind of getting new advertisers in.

[Dan Nova]

But the core business you have to.

[Guest Speaker]

Invest in like research and development. You know, you're like, if I wanted to operate just for pure profits only profits, like we wouldn't need the amount of engineering and kind of product team that you have.

[Dan Nova]

But you.

[Guest Speaker]

But now we're very disciplined on like, okay, how do we spend and where do we want to make those investments and how long are we willing to wait before an investment comes in return on a specific product area?

[Dan Nova]

And I think the other thing too is like, you know, 2022, the way.

[Guest Speaker]

You operate your company. 2021, 2022, with like the soft banks of the world kind of putting in.

[Dan Nova]

You know, $200 million rounds was like cost. Yeah, growth, all costs, IPO, whatever. And then all the growth investors were basically underwater.

[John Gafford]

Whatever you do, don't turn a profit. Just don't make money. Whatever you do, don't make any money.

[Dan Nova]

Yeah, yeah, yeah. It'll mess your valuation up. And now it's like the opposite. Yeah, now it's the opposite. And I don't know, we had to.

[Guest Speaker]

Change a lot of our, like even the payback cycle, like we used to wait like six to nine months before we even got break even and now it's like 45 days or less, you know, that we wait to basically, you know, turn a profit on the acquisition cost of a user versus, you know, zero months.

[John Gafford]

Well, I was going to say because you've got to be at a place now where you're being approached at people that want to be part of what you're doing. From an advertiser standpoint, like, you guys have got to be big enough now where, I mean, the inbound calls are probably greater than the outbound calls, I'm guessing.

[Dan Nova]

Yeah, I mean, it's both. I mean, you're getting inbound calls for sure, but I think anytime that you're setting up a new business line, you.

[Guest Speaker]

Still have to go. I mean, dude, it's like, attention, attention. There's like so much happening at all times and I think that, you know.

[Dan Nova]

You need to be able to pierce.

[Guest Speaker]

Those new channels and also it creates competition too, you know, and in that sense.

[Dan Nova]

So I think like, for us, like, we are getting approached a lot of.

[Guest Speaker]

Like, you know, partnerships and inbound, but we're also looking at, you know, what are other ways that we can grow our business. And again, going back to this, that concept I mentioned to you, like that's something that wasn't even my brain like a couple years ago, which is like this idea of like, you know, I'm in the business of like the moment that that action occurs, our revenue kind of ends. Right. And, and that's fine, you know, but if you could capture the lifetime value of someone through a product that you built that people like, so that could be a game, that could be a utility app, whatever, and that business in itself already has good cash flow, then you're basically creating like this insane kind of roll up strategy and you're kind of, you know, sending your consumers into a new product. You're getting those consumers and you're creating a really strong network effect. And I think that's what you saw with Facebook and acquiring Instagram or acquiring WhatsApp.

[Dan Nova]

And not every acquisition needs to be.

[Guest Speaker]

A multi billion dollar acquisition. You know, where we've seen a lot of opportunity has been like, you know, there's just these random teams, man. Like we bought this product earlier here in January, had 150 million installs, you know, about 2 million daily active users and you know, like 9 or so million.

[Dan Nova]

Monthlies.

[Guest Speaker]

And the app was like doing like $4 million, almost $4 million in EBITDA a year, right?

[Dan Nova]

Team of four, team of four people.

[Guest Speaker]

Right in overseas, total cost 15k a month.

[Dan Nova]

And I was like, how is this possible?

[Guest Speaker]

You know, and then we vetted it.

[Dan Nova]

Like we went through the diligence, vetted it, we came up to a deal term, it was under 3x EBITDA like the purchase. And you know, there's these opportunities out there, right? You just got to find them. And then now we're growing that product, we double its revenues.

[Guest Speaker]

You know, we kind of took all of our insights and now we're creating that network effect.

[Dan Nova]

And so it's basically kind of you.

[John Gafford]

Can introduce your users to that and.

[Dan Nova]

Their users to us. And, and then also then you have.

[Guest Speaker]

More spaces for advertisers to kind of like, you know, do that. Then you take your know how of like, you know, data, data analytics, user acquisition, all the things that we know how to do.

[Dan Nova]

Because the founders that are building these.

[Guest Speaker]

Businesses, I mean, they've crushed it in some way. Like they found product market fit, but.

[Dan Nova]

They may not be the most sophisticated.

[Guest Speaker]

In all these other areas. Right.

[Dan Nova]

Just because you hit like, you know.

[Guest Speaker]

Gold once doesn't mean that it's going to come again. It's kind of like, you know, even.

[Dan Nova]

Think of my story when I was 20, 22, right? 23, with my co founder, we built some app that was literally spitting out.

[Guest Speaker]

5,600K a month and free cash flow. I got lucky. You know, it just, it just hit it like, you know, at that time. And so, and so I think that like that's a really interesting opportunity. If you look, there's a company called actually, you should check out this guy. Because I think like, you know, you're a curious guy if you haven't heard of it, but there's Constellation Software and this, it's like the billionaire that no one's heard of. He's had. He looks like Gandalf. His name's Mark Landor. He has this like huge Gandalf beard.

[Dan Nova]

And there's only like two interviews of.

[Guest Speaker]

His on the Internet, like. Right. And I, I tried to find all the content that this guy says, but basically he, he has built a $70 billion business. He raised $20 million once. That's all he's raised. And then built a $70 billion business. It's publicly traded in Canada. Right. And that's what's the most insane about it. But they acquire like a thousand companies a year and their business model is on VMS software, which essentially is a. Called vertical market software.

[Dan Nova]

It's like they make super neat. They acquire companies that make super niche software.

[Guest Speaker]

It's like, you know the, you make.

[Dan Nova]

It for like tennis courts or tennis.

[Guest Speaker]

Clubs in like Florida.

[Dan Nova]

And so there's not a ton of clients, but they're super profitable.

[Guest Speaker]

But it's like 1 to 4 million do business. These guys go and acquire thousands of those a year. And they have been able to do that for the last 20 years and have built a machine that just spits out so much cash and it operates in a very decentralized fashion.

[Dan Nova]

And so that's the type of stuff.

[Guest Speaker]

That'S really kind of inspiring. Where I see the future of mode going into, which is really like we have this great ecosystem of opportunity where we have users, they're incentivized to go try out new products. You have on the other hand a bunch of these small little apps that, you know, this is a great radio app, this great photo filter app. This is a great little game.

[John Gafford]

Yeah.

[Dan Nova]

And they're cash flow positive.

[Guest Speaker]

You bring those things together and then essentially create the network effect and then you could create this monster, monster opportunity across multiple different verticals.

[John Gafford]

But can't see. Like one of the things I always talk about too. One of my favorite things to do is when we are going to get in a new vertical, I simply find the best people that I can find in that vertical and then I direct all of our existing. All of our existing client base to that vertical. And then when I can become more than 50% of revenue, we become their partner is what we do. So you can now do the same thing and acquire like, you can say, hey, we'll push our people at your little product and then if it's working, we can roll. You can roll them up.

[Dan Nova]

Yeah. I mean that's essentially the, I mean, that's a. Yeah. Publisher model. I mean, we're still experimenting with this.

[Guest Speaker]

And what this looks like for us.

[Dan Nova]

But you know, I think like a.

[Guest Speaker]

Lot of anytime you have a channel, like a medium of like the ability to bring people in, you know, that's what creates that network effect opportunity, you know.

[Dan Nova]

And you look at guys like Tony.

[Guest Speaker]

Robbins for example, you know, and I've done a lot of his stuff. It's like, you know, you can kind.

[Dan Nova]

Of see that he's selling you in some capacity. But I almost don't mind the way he's selling it to me. But it's like, and if you do the core, it's like you see like.

[Guest Speaker]

All these different areas and then he taps into all aspects of life and.

[Dan Nova]

Each one of those was through a.

[Guest Speaker]

Partnership and then he potentially acquires them. But that's how you know, you have one guy who created one brand that then built a multi billion dollar kind of empire through all of these facets of kind of like, you know, what it takes to have a whole life, which is whole thing. I mean I'm not saying that we're doing exactly his, but you can see that in many different place being played.

[John Gafford]

Out and that's, I think you're seeing that all over the place because it's like what Grant Cardone just did with Gary bruckco with the 10x thing. Little messy. Apparently that's now working out. But it's the same idea, it's the same concept. So let me ask you this, let's change because you got your people all over the place. You're remote. Obviously you guys have a high standard for what you expect out of your people. How do you, how do you hold that standard and create a company culture when everybody is scattered? How do you do, how do you manage that?

[Guest Speaker]

Yeah, I think that's a, that's a great question.

[Dan Nova]

I mean, I think like, you know, we have.

[Guest Speaker]

I mean we've been doing it for like five years in a full remote. Right. First I think like, you know, one thing to not say is like I had a much easier time running a.

[Dan Nova]

A fully remote company than a hybrid company.

[Guest Speaker]

I think it's actually really difficult to run a hybrid company because some people have that in office culture and kind of those that rapport and whatever. And other people then don't because they're fully remote.

[Dan Nova]

And so when we decided to be.

[Guest Speaker]

Fully remote, it was to really to embrace that and then create the best company we possibly could. Fully remote the things that we do.

[Dan Nova]

Specifically around doing that.

[Guest Speaker]

You know, we brought in a chief people officer really early on. Like we had like 25 people. And then someone, that person's like, like one of her main jobs is literally to almost create like an NPS internally. So we have anonymous kind of Reviews of how the company's doing. And then you have like really strong core values around that. You've listened to the people's feedback.

[Dan Nova]

But also, you know, we have crazy.

[Guest Speaker]

Transparency within our business. So even when things were going awry in our business or going well, you know, we have like a weekly, you know, ACT meeting, which is actually the acronym for all of our core values.

[Dan Nova]

And that's basically a 20, 30 minute meeting.

[Guest Speaker]

So people know exactly how the business is going in the various departments. And then we have an all hands meeting. And it shows everything down to the financials and whether we're losing money, how much money you have in the bank.

[Dan Nova]

And so even in those difficult times.

[Guest Speaker]

That we had, you know, during those periods of like 20, 22, 23, when things are kind of coming up again, we only lost one team member, right of.

[Dan Nova]

And we had to, we had to.

[Guest Speaker]

Have a layoff that was like, you know, we had 100 and something numbers at one time. We had to cut down to like 50. Right. And that was difficult. We did two rounds of cuts. And typically in those times you see a lot of like your best people leave.

[Dan Nova]

And fortunately we only lost like one.

[Guest Speaker]

Or so team member, you know, that we didn't, you know, make that decision to go.

[Dan Nova]

And the reason is like, I think.

[Guest Speaker]

Of that kind of like transparent culture and then just, you know, being able to, you know, listen to people, see that they're in their voice matters and also being able to just kind of see your, you know, internal, like how the, how the, you know, the saying goes like the. I don't know how the pudding's made or something. I don't know, forgetting like the saying, you know what I'm talking about though, right now.

[Dan Nova]

But anyways, like, so I think that.

[Guest Speaker]

That'S kind of like how. Has been really helpful.

[Dan Nova]

But I think also just on more.

[Guest Speaker]

The operational time or operational side of things, we've been very focused on OKRs. And I was really, I'm not the most organized person because I'm much more of a visionary kind of thinker.

[John Gafford]

We have integrator. Yeah.

[Dan Nova]

That are way more operational than me, I guess in that sense. But I think like one thing I.

[Guest Speaker]

Really forced on myself to have the discipline in is to operate with an okr like framework of how we operate our business. So you know, departmental OKRs ensuring that, you know, everyone's really aligned on what they're supposed to work on and then being able to kind of track those okrs so that people know exactly what their goals are, ensuring that the managers get comped based on that. It's like, you know, everything aligns to that. And it literally took us like four years to do it. And it's so painful to do, to be honest, if you're not wired in that way.

[Dan Nova]

But I think that that's been.

[E]

High interest debt is one of the toughest opponents you'll face unless you power up with a SOFI personal loan. A Sofi personal loan could repackage your bad debt into one low fixed rate monthly payment. It's even got super speed since you could get the funds as soon as the same day you sign. Visit SOFI to learn more. That's s o f I.com P-O-W-E-R loans originated by SoFi Bank NA member FDIC terms and conditions apply.

[Guest Speaker]

NMLS 696-891 one of the most impactful, important things, along with these other things that we've learned to create a good remote culture that allows for like, you know, you know, we have like a 90, 80 to 90% satisfaction rate and the average company is like 65% or something like that.

[John Gafford]

Yeah, it's awesome.

[Guest Speaker]

Based on a little tool that we use. And I think that those are all things that add up to be able to build a great remote company. I mean, I would love to run a 1,000 person kind of remote company one day that fully operates autonomously in more of a decentralized fashion. And that's what I'm trying to move more and more towards as we think about our business.

[John Gafford]

Well, I run a 600 person in person company, so yeah, that's definitely. It would be what to do for sure. I have a question though. What is. And this has got to be tough, man. As a founder that's making good business decisions. What is the temperature within your engineering departments with AI moving as fast as it is? Is there a little bit of fear? Because there should. I don't know if you saw it. There was a post that was going around Facebook yesterday and damn it, I just forgot who wrote it. But it was a. It's a CEO of a major corporation and he sent a letter out to all of his, all of his people.

[Dan Nova]

It was a CEO of fiber.

[John Gafford]

You saw fiber. You saw it where he's like, AI is coming for our job. It's coming for your job.

[Dan Nova]

Yeah, yeah. Well, I think even for that, I.

[Guest Speaker]

Mean, honestly, I sent it to my co founder.

[John Gafford]

Yeah, yeah, I posted immediately and I.

[Guest Speaker]

Was like, wise words from the CEO of. I know, it's like special place for us, I mean, I think that, I.

[Dan Nova]

Mean their business in particular, if you.

[Guest Speaker]

Think about like, and he wrote it in a bit, in a really good way, it was something along the lines of like, you know, easy task, like.

[Dan Nova]

What used to be easy tasks or.

[Guest Speaker]

Like brainless tasks now whatever used to be hard tasks.

[John Gafford]

That goes away.

[Dan Nova]

Hard is the new easy. What used to be impossible is the new card.

[Guest Speaker]

Right.

[John Gafford]

It's too hard.

[Dan Nova]

And I thought it was really well said, you know, But I think if.

[Guest Speaker]

You think about their business, right, like, what does that business thrive from? It's been like literally like stupid graphic design or not stupid, but like, you know, make a logo. You know what I mean?

[John Gafford]

Easy stuff.

[Dan Nova]

Yeah, like, like dude, you can do.

[Guest Speaker]

That with, you know, chat, you know what I mean? So I think like.

[Dan Nova]

It doesn't impact.

[Guest Speaker]

My business as much as I would say theirs because that's like kind of their core thing. The way that we've been thinking about AI internally is like we need, I've been really adamant about like every. All of our engineers should be using things like GitHub, Copilot or whatever because it basically makes like a 1x engineer, like a 1.4x engineer. And in some cases if you're like a 3x engineer, it could potentially make you a 9x engineer.

[Dan Nova]

It just depends how well you know.

[Guest Speaker]

How to use it and how much you care about it. And so that's all about efficiency.

[Dan Nova]

The other component of it is how.

[Guest Speaker]

To basically make sure your business is smarter. You know, we're starting to invest a lot more on that internally with our own tools and internal sets.

[Dan Nova]

And the way that we also think.

[Guest Speaker]

About like our broader core mission is around this concept, around universal basic income. And it's not that we're in favor of necessarily the government paying for that. It's like almost privatized, you know, so.

[Dan Nova]

That'S kind of like what are tools.

[Guest Speaker]

That we can also provide to our consumers over time to allow them to earn additional income.

[Dan Nova]

Because now with AI, you could potentially.

[Guest Speaker]

Create like, you know, royalty free music, for example, that other people can listen to and you could earn streaming on.

[Dan Nova]

Or you know, products or whatever. And so how do we use this.

[Guest Speaker]

Technology to enable earning and saving for our consumers in some capacity? That's how we're thinking about it into the future.

[John Gafford]

Yeah, a buddy of mine, it's funny you talk about music. A buddy of mine just developed a brilliant AI platform. And essentially what it is is the AI, a bunch of, he got together with a bunch of the top songwriters In Nashville because he's one of them. And they all have AI bots of. Of them. And you can go in the studio with them and write a song. And the cool thing about it is, is then that song can be used for anything licensed. But the songwriter gets.

[Guest Speaker]

Doesn't have to be a part of it.

[John Gafford]

No. Gets credit for it. Gets. So gets. Gets royalties for it. So, yeah, as a producer. So like, literally, my buddy, they launched it up. He, you know, I talked to him, next day, he's like, I wrote 800 songs yesterday, and who knows? And yeah, it's really. It's really smart because he's like, yeah, my AI that knows my tones and how I like things and how I would mix things and how things would go. I. I wrote 800 songs.

[Dan Nova]

That's really interesting. It kind of reminds me actually of.

[Guest Speaker]

What'S that number?

[Dan Nova]

There's a service that masterclass, so Master.

[Guest Speaker]

Class has like an AI that's like, you know, it's like part of their.

[Dan Nova]

Service now is like, hey, you get.

[Guest Speaker]

Basically the Mark Cuban bot or the, you know, insert like professional Gordon Ramsay bot, whatever. And then now you kind of like get a fed from their brain, I guess. I think it's like, super interesting.

[John Gafford]

I have kids tell me my cooking is shit. I don't need Gordon Ramsay bot to give me.

[Guest Speaker]

Yeah, yeah.

[Dan Nova]

Well, I mean, they might get, like, it might probably have to be.

[Guest Speaker]

Also hate them, to be honest. In his case, yes.

[John Gafford]

Haze my children. That's what I need you to do. Haze my children. So what's the future, man? Where do you see this going? What's on the horizon?

[Dan Nova]

Yeah, I mean, I think like, we.

[Guest Speaker]

Are, you know, we're scaling, we're going.

[Dan Nova]

I mean, this early part of this.

[Guest Speaker]

Model has really been of those last two years, really has been around kind of diversification of revenue and, you know, expanding our services and reach. And I think, like, you know, we did a super successful, like, reg A plus offering, which is kind of like a, you know, retail offering. Allows investors to any retail investor to go through and invest in the business. And we got qualified by the SE to do that. We brought in over 50,000 shareholders so far, and so have been able to raise nearly, you know, over actually $50 million, you know, just through crowdfunding over the last couple years.

[Dan Nova]

And so, you know, we consumer is really interested in.

[Guest Speaker]

And many of these people are not our target market. They're much more wealthy individuals. But they see, they believe in the vision.

[Dan Nova]

So I think where the future is, you know, we eventually Want to take this business public. That's our North Star north focus. But where we're going as a business.

[Guest Speaker]

You know, we believe that the phone will be free. We're the closest company to make the phone free. It's not an easy thing to do. So, you know, we're still, still a long way to kind of fully delivering on that vision. But I think that whoever can unlock that, that creates a trillion dollar opportunity because that is the one thing that we do the most. I mean, there's 168 hours in a week. If you're sleeping eight hours, there's 112 left. And then if you check your phone and your screen time, people are spending anywhere from 40 to 50 hours a week. So one third to one half of your life is being spent on this device every single week, which is insane. And so I think that if you think about that, what's possible, it's a really, really big opportunity. And, you know, I think that we're just scratching the surface of where our story will be here in the next few years to come.

[John Gafford]

Yeah. All right, well, if you want, if you want to, if they want, you want them to take a look at your reg D or get your app or do you have a centralized place where they can find you?

[Dan Nova]

Yeah, I mean, the best way to find information on the company is invest.mobile.com.

[Guest Speaker]

You know, you can also download our app and you can claim actually free shares. We're actually the first ever.

[Dan Nova]

I think we're actually the first ever.

[Guest Speaker]

Company that's ever been qualified to allow people to use their points to invest in the company if they wish. And so our goal is to be the first ever company with a million shareholders prior to going public into the markets. And so the idea is to kind of build that ambassadorship. And we're taking basically users, turning them into earners and earners now turning them to owners.

[Dan Nova]

So those are two great places to go.

[Guest Speaker]

You can download our product, get shares for free, no cost, or you can check out our [e-mail] and learn more, watch the content, you know. Yeah. And be a part of the community.

[John Gafford]

Well, dude, I love, I love it, man. And thanks for joining us. If you're ever in Vegas, you let me know, man. I got you. I got you. I got you covered. Whatever you need, I'll hit you up.

[Dan Nova]

Yeah, I'll be there soon.

[John Gafford]

I'll take you somewhere where you can lose some of that money you've got. Well, guys, wrapping up today, man. The one thing that I would say you should have taken out of that is if you want to be incredibly valuable, not just to yourself, but to other businesses, to what you're doing, capture an audience and be able to move them around to different ecosystems. There's a lot of value in that, whether you're promoting a party in a nightclub or bringing a million users from one app to another. Because if you do it enough times and you do it right, apparently you'll have enough money to walk around with a Gandalf beard. So that's it. We'll see you next week. What's up everybody? Thanks for joining us for another episode of Escaping the Drift. Hope you got a bunch out of it, or at least as much as I did I of it. Anyway, if you want to learn more about the show, you can always go over to escaping the drift.com you can join our mailing list. But do me a favor, if you wouldn't mind, throw up that five star review. Give us a share. Do something man. We're here for you. Hopefully you'll be here for us. But anyway, in the meantime, we will.

[Lowe's Advertiser]

See you at the next episode.

[F]

Today we'll attempt a feat once thought impossible. Overcoming high interest credit card debt. It requires merely one thing. A SoFi personal loan. With it, you could save big on interest charges by consolidating into one low fixed rate monthly payment. Defy high interest debt with a SOFI personal loan. Visit sofi.com stunt to learn more. Loans originated by Sofi Bank NA member FDIC terms and conditions apply. NMLS 696891.