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This website makes 2 million bucks a day, and they don't sell you anything. It's called NerdWallet, and it's actually a case study in getting just a few things right early to build a crazy good business. It has nothing to do with money or connections or even knowing very much. In fact, some of the stuff NerdWallet did was counterintuitive and also dangerously effective because it worked. I'm gonna tell you how it started, why it works, and the big business lessons we can all take from it. My name's John Davids, and if you find this stuff valuable, like, and subscribe. So I know to keep making more of it, let's do it. You're listening to Making it with John Davids. So this story starts in 2009. This guy, Tim Chen is working in finance, and his sister asks him a question. What credit card should I get? Tim wants to help, so he starts Googling. But the results are kind of garbage. The rankings are biased and pretty spammy. Websites are coming up. So he starts digging deeper into the data himself. And he whips up this spreadsheet, comparing every single credit card. No fluff, just the numbers, just the facts. And then he shoots it over to his sister, and she loves it. She finds it super valuable. And Tim realizes something. He figures other people might be wondering about credit cards too. They might have the exact same questions. And his spreadsheet could really help. It's a whole lot more effective than what's out there right now. So he teams up with an engineer buddy of his named Jacob Gibson. Tim's the finance guy, and Jacob's the guy who knows how to build websites. So our boys buy a cheap domain called nerdwallet.com and they throw up a site of their own. Next, they paste the credit card comparison spreadsheet that Tim made up on the site, and they hit publish. Nerdwallet is officially online. And then something kind of crazy happens. Every day, a few people are clicking onto the website, and every day it's a few more and a few more. And they're hanging around for like 5 minutes, 10 minutes, 20 minutes, which is a very long time for people to spend on a website that they just found. But they're flipping through the pages, learning about credit cards, obviously getting tons of value. So it makes sense. Of course, they're going to linger for a long time. And this starts a virtuous cycle. People are coming, spending a bunch of time on the site, getting value, and Google starts pushing it higher and higher and higher on the search Engine result page, NerdWallet.com is moving up every day and traffic keeps going up. So nerdwallet.com might be 12th on the result page when you search for what credit card should I get? And then the next week, it's number eight on the result page, and then it's number two on the result page. And this happens over a pretty fast period, just a few months. Pretty soon, this is the number one result on Google for a really high value category, finance. And the guys still aren't making any money off of it just yet. It's a free website, but that's about to change. In 2010, just one year later, they add affiliate links to the website. Basically paid links from American Express, Visa, MasterCard. So now when people browse NerdWallet.com and find a credit card they want, they can click a link directly to it. And then Tim and Jacob get paid a few bucks. They're still not telling you which credit card to get. That's totally up to you. But whichever one you choose, depending on the guys are getting paid that year. In 2010, these links rake in $65,000. Now, I don't know what the revenue was in 2011 or 2012 or 2013, but by 2014, NerdWallet is making a reported $44 million. That's over 67,000% growth over four years. Not too bad. It's a whole lot of clicks. Now, I'm going to go deep into the strategies in a minute because there's a lot going on that we can learn from. But the big picture is that NerdWallet stumbled into search engine arbitrage before that was a thing making content on the Internet at a very low cost or basically no cost, and then getting it to rank highly on Google, which is incredibly valuable and would be very expensive if you wanted to pay for that. And. And then, of course, making money off the millions of people who were clicking the links on the site. That's the arbitrage. And they did it in the most boring category possible, credit card comparison shopping. But that's why it worked. Every click to Visa or Capital One is worth so much money today. NerdWallet has expanded into mortgages, insurance, investing, and a whole lot more, offering advice on the best stuff you can get. And, of course, sprinkling in their affiliate links so they can make a few bucks off every single Referral. And in 2024, they racked up $687 million in sales. This episode is brought to you by my Social Media Selling challenge available now@johndavids.com challenge Imagine waking up to new customers flooding in, all coming directly from Instagram, TikTok, LinkedIn, Facebook, YouTube. No more chasing likes or worrying about how many followers you have. Well, a lot of businesses are actually doing this right now, and I can show you exactly how it's done in just 20 minutes a day. Once you have the system in place, you'll wonder why you waited so long. Spots are limited, so join now. Visit johndavids.comchallenge all right, guys, I've got a real soft spot for this story because of how it started. It's actually very similar to how I started, which I'll tell you about a little later. But let's rewind back to 2009. NerdWallet begins with a spreadsheet uploaded to a webpage. It was raw and ugly. No slick branding, no fancy user experience. Just pure value. And that's exactly why it took off so fast. Think about the context of this back in 2009. Most credit card sites back then and today too, are basically credit card ads, cosplaying as guides. The website doesn't accurately compare one credit card to the other. It's just promoting the credit card of whichever bank is behind that website. And then NerdWallet shows up with legit data. Here are the cards, here are the rates, here are the fees. You decide. We don't care. This is clearly written by someone with no horse in the race because they literally don't care what this thing looks like. It's just a spreadsheet. Take it or leave it. And this is where so many business builders mess up, especially in the early days. But even later on, when you're a mature company, they have a great idea or a great product or a great piece of technology, and they sacrifice execution in pursuit of perfection. They always fall back on those four deadly words. It's just not ready, my friends. If you're not a little bit embarrassed by version one of your thing, it probably means you waited too long or you're trying to accomplish too much at once. Your scope is too wide. There's really only ever two reasons to wait to get something to look perfect before launching. The first reason is if you're already super established and whatever you do is scrutinized. So yes, if you're Apple, if you're Coca Cola, if you're Netflix, you don't have the luxury of moving as fast as everyone else. And frankly, if you're really well known in your category, I get it you probably have more to lose than you have to gain with any single new thing. So you've got to be more cautious. And by the way, I still don't always agree with doing that. That's how a lot of companies die. But at least I understand the logic behind moving sl. The second reason is if your competitive advantage is making things look pretty. So if the success of your product depends on it looking beautiful, then I get it. But be honest with yourself on this one. Don't use it as a crutch, as an excuse. Now, if you don't fit into either of those two buckets, then what are you waiting for? Just move, just launch. Execution over perfection. That's one of our core tenants at influicity. But there's something else to this also. Launching fast, like NerdWallet did with a gritty looking website wasn't just a good idea because it was fast. It was also counter positioning. Every other bank website looks corporate, it looks clean, it looks polished, and NerdWallet looked raw. And that signaled something different. The only positioning for a new entrant into a market is counter positioning. If the big guy is clean, you're dirty. If the big guy is suit and tie, you're a hoodie and kicks. If the big guy is black coffee, you're a triple oat milk latte, half sweet, extra foam with a sprinkle of cinnamon on top. Counter positioning, my friends, is the only positioning. If you're not already established, it's how you stand out in the marketplace. NerdWallet moved fast and had strong counter positioning because it was just a spreadsheet on a website and it worked. And something else I love about the NerdWallet story, and this was a total fluke, by the way, but how awesome is it that they chose this category? Of all the comparison charts and lists that Tim could have picked, he chose credit cards. Not headphones, not workout gear, not standing desks, credit cards. Are you kidding me? Once he made that decision, this business basically couldn't fail. Credit cards are one of the most high value decisions a customer can make for any business. If someone signs up for a card, that bank is going to be making money off that person for 10 years, 20 years, 30 years, probably their whole life. Annual fees, interest, late fees, balance transfers, merchant fees. The lifetime value of that customer can be massive. And that's why, as a market opportunity, NerdWallet was set up for success early. Think about it this way, even a mildly successful version of NerdWallet would be way better. Than a really successful version of, say, a sneaker comparison website. Not because people don't compare sneakers, but because a sneaker retailer might be willing to pay, say 10 or 20 bucks for a customer referral, but a credit card company will literally pay you 10 to 20 times that, which is pure profit for Nerdwall. Same amount of work, more profit. All juice, no pulp. And this is the part that matters for anyone watching or listening who's building something right now. You need to have focus. But focus means two things. First, it's about doing fewer, more important things, obviously. But second, it's about picking the most high value things to do. Because once you're in a high value category serving high value customers, I a lot of business problems just disappear. They don't even cross your desk. I talk to entrepreneurs all the time who have problems with customer acquisition or pricing or profitability or customer churn or whatever. And these are real problems that most companies will encounter at one point or another. But picking the right market to serve can delete like 80% of those problems. They just melt away. Even if your execution is just so so even if you don't have tons of scale, I'll give you an example. If you tell me that you have an independent coffee shop, you've got one location, you make a mean cup of coffee, I'm sure you can do well, and let's say you do amazingly well. Here are some of the problems you would still probably have. You'll have pretty tight pricing pressure because people are only going to spend so much for a cup of coffee. You'll have pretty high fixed costs and overhead because you got to pay rent in an area with heavy foot traffic. You'll have to deal with labor issues and high turnover because that's the nature of a quick service restaurant. This means you'll probably tap out at about 15% net margins and that's if you're super dialed in, you'll keep 15 cents off every dollar. It's a best case scenario. Now on the other hand, if an average entrepreneur says to me, I'm going to offer funeral services in my city, I'd say, well, you're probably gonna do very, very well. Because a funeral business is a non discretionary, high margin, quick sales cycle business that requires almost no marketing with plenty of upsells built into it and it's 100% recession proof. Yeah, all things being equal, that's a better vehicle than an indie coffee shop. And yes, you could look at Gregory Zamfotis, friend of the podcast, founder of Gregory's coffee. I think he's at like 50 locations and his coffee is doing great. And yes, he does very well. But I can also tell you there are a few funeral companies in my town and I know how much money they make and it is an insane amount of money. That's why they don't talk very much about it. There's a reason funeral directors are wearing Richard Mille. I'm not saying you should be in the funeral business. It's very depressing, I'm sure. And I'm not saying you should open a coffee shop. The takeaway is just to be very intentional about the opportunities you choose. NerdWallet might have lucked into it, but you shouldn't rely on luck. Think long and hard about what category you choose to play in. This is 100% up to you. You cannot pass the buck to somebody else. And saying yes to one thing means saying no to every other thing, every other market, every other business opportunity. Time is your most valuable asset, my friends. So be very intentional with it. This episode is brought to you by Influicity's new tool, the AI Ads Generator, available now at johndavids.com ads Great ads aren't about luck. They're about leverage. The brands that win are the ones who can launch faster, test smarter, and outspend everyone else without wasting a dollar. That's exactly what the AI Ads Generator gives you. Instant ad copy that speaks to every customer and feeds the algorithm high performing variations your competitors can't keep up with. It's like strapping a jet engine onto your marketing. And right now it's free. Yes, it's free. Go to JohnDavids.com ads that's JohnDavids.com ads. All right, so let me round out my NerdWallet nerd out with some serious, serious value. So NerdWallet pops up in 2009 and they managed to win audience and traffic because of Google. Back then, you didn't have a million companies running complicated SEO strategies to climb the credit card rankings. And our buddies Tim and Jacob used the search algorithm to effectively win over the audience that mattered most for free. No money spent. A beautiful arbitrage, beautifully executed. And catching these arbitrage opportunities is so important. In fact, I would argue that these moments where there's a shakeup which leads to underpriced attention, where crowds are bubbling up and most companies don't notice, those are the best opportunities for business builders to strike. I actually can't think of any better time to do it. So let's look at Zynga. Zynga was this company built on Facebook traffic arbitrage. They did social Gaming back in 2007, and they exploited cheap viral distribution inside the Facebook news feed. They got tens of millions of people to play their free games and, and inside those free games, you could buy virtual goods, which is how they made lots and lots of money. By 2011, four years after launching, they passed a billion dollars in annual sales. And they were valued at their peak at $12 billion after they went public. Another one is Groupon. They were built on email traffic arbitrage. Another good one. In 2008, email open rates were insanely high, Inbox competition was really low, and local merchants had no other way really to reach mass demand this quickly. So Groupon bought attention really cheap through email, and they took a share of the revenue from all the local businesses they were promoting. They passed a billion dollars in annual sales by 2011, and they were worth $16 billion in the public markets at their peak. Uber is probably my favorite example from the last decade because it was a three pronged arbitrage. These guys were savages. They launch right when the smartphone, the GPS and mobile payments click at the same time. In 2009, App Store distribution was cheap. Push notifications were new. They had it all. Very few competitors understood mobile UX as well as Uber, and cities hadn't caught on with the regulation change. These guys had a perfect storm. Today, Uber is valued at $170 billion, and they're on pace to do something like $50 billion in revenue in 2026. By the way, Uber is still doing very well, of course. Zynga and Groupon, not so much. The lesson here, of course, is that you start with an arbitrage, but you can't rely on that arbitrage forever. You gotta pivot away from a dependency and build a real moat around your business, which Zynga and Groupon never did. So I'm just talking about the initial arbitrage here. I'm not saying you should copy everything they did after that. I'll give you guys my own example. On a smaller scale, my first business was a complete arbitrage. I built a blog back in 2004 and it was a decent blog. I had a bunch of writers and we put out good content, mostly on women's lifestyle, because that was the cheapest to make relationships, health, beauty, that sort of thing. And then I partnered with MSN and Yahoo.com, the two biggest websites in the world at the time, providing them with Content for free because they needed lots of it for their homepages. And in return I negotiated to get related links back to my website, basically free ads on their sites. And then I made money by selling ad space on my site. And I made huge amounts of money in college with this arbitrage cause I had tons of traffic coming in for free. So when you have these moments of transformation, especially with audience being able to reach lots of people at once for cheap or for free, you need to pay attention my friends. These opportunities are few and far between, but they are game changing when they happen. Generational wealth can be built in almost no time. So where are the arbitrage opportunities in 2026? Well, I'm seeing a few right now. First, Facebook. Yes, Facebook.com, the old school social network that is absolutely crushing it for high quality, quality organic content today. Now I'm not talking about paid ads on Facebook, although you absolutely need to do that too if you want to get lots of customers. But high quality organic content on Facebook is super valuable. My content team, Team JD is doing several posts a day on my feed and we're growing at like 2 to 3,000 followers a week. And the content is getting millions and millions of views. High quality audience. It's amazing. Do not sleep on Facebook. Second, Live shopping. This is definitely more category specific, I would say. So if you're in E commerce like a lot of our clients at Influicity, you need to be looking at TikTok shops, you need to be looking at whatnot. It's been happening in China for a long time, this live shopping experience. And this is an east moves west phenomenon. So if that matters to you, pay attention to live shopping. And number three, of course, AI search, sometimes called generative AI engine optimization or geo. All the SEO that you've been doing for the last 20 years, obviously that still matters. Keep doing that. But seriously, move on AI search. Right now, it's so important. Giants will be built in the next 12 to 24 months. On ChatGPT, on Claude, on Gemini. We have Playbooks and blogs to help you do it. We'll link to that down in the YouTube show notes so you can grab those too. Those are three arbitrages to look at in 2026. Facebook Live shopping, AI search. Come on guys. How cool is it that a guy could make a spreadsheet and turn that into a legitimate multi million dollar business that's still around today, valued at over a billion dollars? God, I love capitalism. Get my best stuff to your inbox@johndavids.com. Quick break so I can tell you about influicity. That's the little marketing agency I started in my apartment about 10 years ago. Well, fast forward. It is not so little anymore. Influicity works with some of the biggest brands in the world, building customer communities that drive revenue. We do this through influencers, podcasts, paid media, social media content, AI, and so much more. You can learn more@influicity.com and hey, while you're there, check out our case studies. We have a lot of them. That's influicity.com.