B (2:01)

But after hearing Lopez's pitch, Suzanne ended up passing on the story.

C (2:06)

I just really didn't buy into what they were doing. It just didn't sound. It sounded a little bit too much like smoke and mirrors and not enough like a real business plan.

B (2:14)

Like it didn't really pass the sniff test for you as a Wall Street Journal reporter?

C (2:18)

It did not pass the sniff test exactly. You know, I'm used to talking to people who have been in this business a long time who kind of know the ins and outs of retailing. And he is. Not that he doesn't have those chops,

B (2:30)

but Lopez's idea did pass the sniff test for some of his online followers. In fact, 660 mostly small investors provided Rev with over $230 million. Lopez told these investors that they were getting in on the ground floor of something really exciting with a promise of big financial returns. But that success would never come. And a few years later, the securities and Exchange Commission filed a lawsuit alleging that Tai Lopez was running a massive Ponzi scheme. You know what my takeaway is?

C (3:07)

What?

B (3:07)

Is that Suzanne Kaeperner has a good nose. Welcome to the Journal, our show about money, business and power. I'm Ryan knudsen. It's Friday, April 17th. Coming up on the show, an influencer's retail empire that never was.

D (3:41)

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B (4:47)

If you've heard of Tai Lopez at all, you probably know him from one particular YouTube video. It's called Here in My Garage.

F (4:55)

Here in my garage just bought this new Lamborghini here. It's fun to drive up here in the Hollywood Hills. But you know what I like a lot more than materialistic things? Knowledge.

C (5:07)

Then the camera pans over to this wall filled with books, bookshelves.

F (5:12)

It's like the billionaire Warren Buffet says, the more you learn, the more you earn.

C (5:17)

He talks about how he reads all these books and there's like a simplicity about it that was just genius.

B (5:25)

Here in My Garage was all over YouTube in the mid-2010s. And it spawned a whole genre of videos that poked fun at Lopez's humblebrag.

G (5:33)

Here in my garage just bought this new Honda Civic here. Had all these bookshelves installed out in my garage like a crazy person so I could show you the Lamborghini and the books at the same time. But you know what I like a lot More than materialistic things. Materialistic things.

B (5:54)

Lopez used his videos to promote his online business courses. One of them is called 67 Steps, where for $67 a month, Lopez promised a step by step guide to the, quote, good life. Lopez also sold in person seminars where he shared his secrets for getting rich. What was the story that he was telling about himself and who he was?

C (6:21)

Well, he is very open about the fact that he's a college dropout and that his father was in prison for selling cocaine. And he was raised in a mobile home by his mom. So humble beginnings.

F (6:32)

Wasn't that long ago that I was in a little town across the country, sleeping on a couch in a mobile home with only $47 in my bank account. I didn't have a college degree. I had no opportunities.

B (6:45)

Lopez said he got his start at an insurance company where he cold called potential clients. He said his breakthrough came when he figured out how to write snappy copy for Google Ads, which generated better leads and eventually solid sales commissions.

C (7:00)

He used that as a launching pad to kind of reframe himself, as you know, this kind of up from the boobstraps businessman. Learn how to get rich quick.

F (7:10)

How can you achieve financial freedom? It's one of the most common questions I get.

B (7:15)

Lopez's videos gave off an air of luxury. They were set in extravagant mansions with pristine pools. They promoted parties, promising encounters with fashion models. And he showed off his connections with prominent businessmen.

F (7:28)

All right, guess who stopped by the house today.

B (7:33)

What's up, Ty?

F (7:34)

Hi, Mr. Mark Cuban.

B (7:36)

one point, Lopez filmed a video with former Shark Tank star Mark Cuban.

C (7:41)

And they're shooting hoops together on his private basketball court. And they're talking about, you know, what it's like to make your first million, first billion.

F (7:49)

People ask me, what do billionaires do in their downtime? We're sitting here sweaty from playing basketball, catching up on email. You always work.

B (7:57)

This isn't work.

E (7:58)

That's what I like to do, what

F (8:00)

he loves to do.

C (8:01)

And I did reach out to Mark Cuban and I said, you know, are you friends with this guy? And he said, look, I'm not friends with him. I filmed this video kind of at the request of a mutual friend. And, you know, I regret having done this.

B (8:14)

Then in 2019, Lopez announced his biggest business idea. Retail E Commerce Ventures, or rev. Lopez partnered with a mechanical engineer named Alex Maier, who had made his fortune after selling a dating app for $255 million.

C (8:33)

Retail e commerce Ventures. The idea was a lot of traditional retailers with household brand names like Radio Shack, Pier one, Dressparn were failing. They were filing for bankruptcy. And Lopez got the idea of buying them on the cheap in bankruptcy and turning them into e commerce companies that you could save a lot of money if you close the brick and mortar stores. You would just, you know, run them as e commerce players.

B (9:00)

This concept though, of like, run them as an online retailer. Like, was it a crazy idea?

C (9:06)

It was not a crazy idea. And in fact, Lord and Taylor is now online only. They closed all their brick and mortar stores. They exist online on the web. Bed, Bath and Beyond, same thing.

B (9:20)

Rev's first notable acquisition was Dressbarn, the decades old women's fashion retailer. Dressbarn had shut down its 544 stores and rev bought its E commerce rights for a mere $5 million. Then Covid hit and more brick and mortar stores went belly up and Rev went on a shopping spree. This morning's Retail E Commerce Ventures is announcing the completed acquisition of distressed sports brand models. This is the third major retailer along with Pier 1. With all of their acquisitions, Rev started to get a lot of attention.

H (9:57)

Joining us for this segment, we have Alex Merz of Retail E Commerce Ventures to discuss e Commerce turning distributors dress brands into e commerce powerhouses, as well as.

B (10:09)

To help finance these acquisitions. Lopez asked his millions of followers if they would consider becoming investors.

F (10:15)

I'm working on buying a massive global brand. If you have at least $10 million, this is a big deal.

B (10:21)

10 million DM me 10m in one pitch deck. Suzanne reviewed. Lopez told people that if invested $1 million, they'd received $200,000 after the first year, a 20% return.

C (10:34)

And, you know, to the average layperson, it makes perfect sense. You know, Radio Shack is a good brand. Let's cut the costs of all the physical stores and just put it online and you can make money that way. I mean, it seems very plausible.

B (10:49)

One of the people who bought in was John Melton and he's talking these

G (10:53)

big percentages and he's talking about it being a billion dollar brand and, you know, building up these companies, then selling them and making 10x20x like he was talking such a big game. When you trust someone and you're getting returns, that's how you get sucked in.

B (11:13)

How it all came crashing down is next.

I (11:30)

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B (12:32)

John Melton lives in Maryland. He and his wife Nadia have two kids. John says he's been an entrepreneur for 25 years and he's something of an influencer himself, posting videos, giving business advice. His Instagram bio says he's, quote, slightly addicted to winning. Sometime around 2020, Jon and his wife came across Tai Lopez's pitch online.

G (12:56)

Tai was promoting how he's starting this company with Alex Mayer. I remember them saying, like, you know, Tai's this online marketing genius. And of course, again, because we were in that space too, like we, we were very familiar with him and they're talking about how he has fu money.

B (13:15)

John started watching more of Lopez's webinars.

G (13:18)

I think his concept made sense and I actually think in the beginning he had good intentions. I really do. I think it was initially like, hey, you can buy these businesses, these brands for pennies on the dollar and, you know, not take on the debt, but you could take on the database. You could, you know, go out there and promote and sell through their email list, through social media, through Twitter, you know, now X, whatever. So the again, the concept made sense.

B (13:45)

John was sold. In the first two years, he and his wife invested around $900,000 into REV. And in the beginning it was great.

G (13:55)

We were getting returns every month. I want to say it was about 17% returns those first couple years.

B (14:03)

Through weekly Zoom webinars, Lopez kept investors updated on Rev's business. During those updates, Lopez also pitched new ideas. One of those ideas was for a new real estate investment.

G (14:15)

He's going to start doing real estate syndications where you buy these apartment buildings, you fix them up, you raise the rent and then you refinance, get your cash back and then you just, you know, you get cash flow from the renters.

B (14:28)

In late October 2022, the day after hearing about the real estate venture, the mountains wired. Lopez $500,000. Less than a month later, John got an email with some unsettling news. Everything was grinding to a halt.

G (14:45)

No more weekly zooms, no more monthly deposits and no explanation. And it's not from Ty. It's from some attorney we've never heard of.

B (14:55)

John started freaking out. By now he'd invested over $1.4 million with Rev and he wanted answers. He started sending Lopez a slew of text messages.

G (15:06)

I follow up with him on the 20. Hey bro, is everything okay with Rev with us recently investing 500k in your new real estate arm? Obviously I'm a little concerned. No response.

B (15:19)

John messaged again on November 30th.

G (15:21)

I said, hey bro, this is not okay and I need to get my 500k back that I wired you asap.

B (15:29)

He showed me the text chain on his iPhone. It's a wall of blue bubbles. A one sided conversation.

G (15:35)

More blue, more blue, more blue.

B (15:38)

Finally, about a month later, John got a one line text that read simply,

G (15:45)

this week we'll have some more updates.

B (15:48)

But then nothing. And the wall of one sided messages continued.

G (15:52)

And then question marks, question marks, question marks. I mean, it's just blue. For the last few years,

B (16:02)

It finally hit John that all of his money was gone. And not just his money. A lot of the people who had invested with Rev were out. One investor said that he lost most of the $175,000 he'd put into Rev, money he'd planned to use to pay for College for his two sons. Another investor is out about $300,000 and now has to delay his retirement.

G (16:25)

It's just, you know what's so frustrating about the whole thing is he never even mentioned one time that business was like any of the companies were in trouble. I mean, everything was just so great.

B (16:40)

In December 2023, a group of Rev's debt holders foreclosed on some of the brands that Rev had acquired. Pier 1 Models and Dressbarn are now operated by a new entity called Omni Retail Enterprises. These brands still exist as online only retailers, just without Lopez and his partners. In the fall of 2025, the securities and Exchange Commission filed a civil lawsuit against Tai Lopez, Alex Maier and Lopez's cousin Maya Birkenrode, who is the company's coo. The SEC accused the trio of quote making Ponzi like payments to investors. According to former employees in the sec, none of the companies Rev owned were profitable.

C (17:22)

The SEC says to keep the businesses going and to buy even more brands, they would raise even more money from new investors, and then they would use that money to pay out to their old investors. So a lot of the money that the original investors received, because some of them did in fact receive money, it was coming from new investors. So, you know, a classic Ponzi scheme.

B (17:43)

Lopez, Birkenrode and their lawyer, Marty Reddy did not respond to requests for comment. The SEC also declined to comment. Court filings indicate that both sides are in active settlement talks. Tai Lopez hasn't admitted to wrongdoing. A spokesman for Mair said he believed in Rev's business model and that he put over $5 million of his own money into the company and suffered substantial losses when the business was hit by what he called, quote, severe post pandemic macroeconomic headwinds, according to people familiar with the matter. The FBI is also investigating. No charges have been filed. So what ultimately happened at Rev, like, what went wrong?

C (18:26)

What went wrong was they raised money and made promises that they couldn't keep. They did not have the skills to turn these businesses into profitable ventures. And even, let's just, you know, put the caveat in there that even if they had done everything perfectly, it was still a long shot. You know, this is still a gambler. I think sometimes people think retailing is an easy business because these are brands we're familiar with. But I think it's a little bit of a misunderstood industry, and it is incredibly difficult. The margins are thin, the competition is fierce, the barrier to entry is low, and it is very difficult to run a successful retailer. You know, anytime someone says, look, this is easy, this is a home run, you should think twice and say, maybe that's not true. You know, sometimes something sounds legitimate, but it can be hard for the average person to really vet that and know for sure.

B (19:26)

As for the Meltons, John says his family will be fine financially, but the whole thing still stings.

G (19:34)

If those businesses would have just gone belly up and he would have been honest about it, we probably would have been like, hey, you chalk it up as a loss. That sucks. Lesson learned that we just paid our stupid tax. There's a thing I heard a long time ago. They said, there's really smart people out there and they're spending all day, every day trying to figure out how to get your stupid money. And that's true. That's what Ty did.

B (20:02)

If you could talk to Tai Lopez, what would you say to him?

G (20:05)

I mean, dude, make it right. Just do the right thing. I mean, that or you're going to go to jail at some point. If it's not jail, it's something else. Like karma's at your door, homie.

B (20:18)

As for Tai Lopez, he's still putting out content. He currently has around 3 million followers on Instagram, so the best way to

F (20:27)

make mega money in the next two years is to copy any corporate non AI product.

B (20:34)

He's been a featured guest on YouTube shows with hundreds of thousands of subscribers.

F (20:39)

I've been teaching people smma, social media marketing agency. I own the trademark for it. I've taught. You know, I launched a generation of entrepreneurs off that one concept.

B (20:48)

By the way, I saw and Lopez has his own podcast. The latest episode of the Tai Lopez show was published in March.

F (20:56)

Book a call free. We can talk. So you got to be doing at least seven, eight figures for everybody else. Follow my free stuff. All right, talk soon.

B (21:12)

That's all for today. Friday, April 17 Additional reporting this episode by Alexander Gladstone the Journal is a co production of Spotify and the Wall Street Journal. The show is made by Laura Benchoff, Catherine Brewer, Pia Gadkari, Max Green, Isabella Japal, Sophie Codner, Matt Kwong, Colin McNulty, Jessica Mendoza, Annie Minnoff, Laura Morris, Enrique Perez de la Rosa, Sarah Platt, Allen Rodriguez Espinosa, Heather Rogers, Pierce Singh, Jeevika Verma, Kathryn Whalen, Tatiana Zamis and me, Ryan Knudsen. Today is Annie Minoff's last day. Thank you so much for your time with us, Annie. We know you'll continue to do amazing things. Our engineers are Griffin Tanner, Nathan Singapak and Peter Leonard. Our theme music is by so Wiley. Additional music this week from Katherine Anderson, Peter Leonard, Bobby Lord, Emma Munger, Griffin Tanner, Nathan Singapak, so Wiley and Blue Dot sessions. Fact checking this week by Mary Mathis and Kate Gallagher. Thanks for listening. See you Monday.

H (22:25)

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