- Duration: 31 min
- Platform: zoom
- Source: Read.ai 01JH5WR28TR0BE42P95KQMX438 (https://app.read.ai/analytics/meetings/01JH5WR28TR0BE42P95KQMX438)
Transcript
[Michael Houck]: Sanket, what’s up, man? [Sanket Bhasin]: How you doing? Living the dream, man. Good to see you. [Michael Houck]: Good to see you, man. How are you? [Sanket Bhasin]: Good, good. Just grinding away, man. You know how it is. [Michael Houck]: How’s things with you? What about you? I’m in Mendoza, Argentina right now, trying to convince myself that I like Malbecs. [Sanket Bhasin]: But it’s good. [Michael Houck]: It’s a nice and hot summery down here, so I can’t complain. Mate, I’m actually envious of your life. [Sanket Bhasin]: I feel that you gave a little I just don’t know where you are at all times. It’s good. [Michael Houck]: I mean, I was in New York for a while, but now back to traveling around. We’ll see how long that lasts, but it’s fun, man. Where are you at? [Sanket Bhasin]: Jersey City, specifically. So just moved out, Manhattan. Nice. [Michael Houck]: I was in Williamsburg for a few years. It was my main hub. So kind of outside of Manhattan, but close enough to sort of you know, go in and go to the restaurants and all that stuff. [Sanket Bhasin]: Yeah, same here. Why’d you leave? Just the traveling mode? [Michael Houck]: No, I divorced my wife. Oh, shit. I didn’t hear that. I’m like, sorry, congrats. I don’t know. [Sanket Bhasin]: Either way. [Michael Houck]: It was, you know, it was a hard decision, but it was the right decision. I won’t bore you too much with the details, but basically, originally we wanted to have kids. Then she changed her mind. I still want them. So I was like, well, I got to work towards the long-term. So I made the decision. [Sanket Bhasin]: Oh my God. To actually be honest, I’m actually in the opposite seat right now. I’m at the other end of like, I can’t say too much right now. I hear you. [Michael Houck]: I hear you, man. Well, congrats early. I’ll give you an early congrats on that. Hopefully just going to the headphones. [Sanket Bhasin]: Well, congrats on it. I’m trying to figure that out myself, but I’m saying I’m at the other end of the stick. Yeah, yeah. I see what you mean. [Michael Houck]: Yeah, no, it’s tricky. Sorry, I was a bit scripted. [Sanket Bhasin]: I can’t say too much right now. [Michael Houck]: No worries. Well, look, let’s chat newsletters. Sorry it took us a bit to connect on this, but I can tell you what we’re doing. We’d love to learn about also where you’re at and the plan for 2025. So maybe we just start there, giving some context on where you’re at with it. [Sanket Bhasin]: Yeah, cool. I don’t know if you know too much about what I’m doing. I think I’ve just sent you an email before about this local search fund I’ve started. But essentially, I close around the end of November. So we’ve kicked off the search now, which is fun. One thing I’m really trying to do is just get some deal flow avenues. The specific companies I’m looking for are software companies, specifically in vertical software. And they’re serving energy or healthcare sectors. So I’m just trying to get a little bit, I think creative’s the wrong word. I feel that everyone does this whole, it’s like a standard playbook. But I’m just trying to get some deal flow in. And I think the challenge that I have is, and this is where I’m a little bit on the fence with the newsletter kind of thing. Absolutely is a long-term game. I’ve seen it work really well, but I haven’t seen you do really, really well on it as well. But I feel for me, I’ve literally got 24, well, 21 to two months now to find a company. So find it, do the deal, and start operating, right? And it seems like it’s a lot of time, but it’s actually not. I’m going to have to just churn through just a lot of calls. I’m cold calling cold emailing. I’m just like grinding away just to get in front of these software guys. But I’m kind of just thinking, right, it’s absolutely going to be easier if there’s a little bit more trust built before I hit them up. Yep. So I completely know that. It’s just that, dude, do I have the time and do I have the resources to do that? He’s like, that’s what I’m trying to figure it out right now. [Michael Houck]: Yeah, that makes total sense. We see people using newsletters a lot for just staying top of mind and building trust, especially with, if you do like long form, if you’re just curating like news articles and things like that, you know, you can build, you can build trust that way, but the stronger way to do it is through, through long form content where they see your thought process and, and you kind of walk them through things. Um, so yeah, it totally makes sense to me. Um, I guess, so the, the target for a newsletter, if you, if you do do it would be, um, the folks who you guys could eventually, go after, right? [Sanket Bhasin]: Yeah, well, this is like a kind of a, again, this is something I’m brainstorming right now. I do feel like the ICP is a vertical software owner serving energy or healthcare sectors, and then sort of goes down there, okay, like, you know, a minimum of $1 to $20 million in ARR. And I could even go like super deep and granular on that too, if I need. But I think the thing I’m thinking of right now is like, do I just stay, you know, from a Experiences that I’ve had software people just know software people. That’s just how it rolls And so is it just worth just go a little bit higher and just go? Hey, we’re just like if you’re building a vertical software company or just a software company in general Do this the stuff that we could potentially be talking about? It’s it’s the same stuff for example in book I’m writing a article right now for like, you know how to optimize cloud right the very very in-depth article That I’m doing like a full analysis on all the cloud providers and just going really deep into like, okay, how can these people save money? Because every single one of my mates is having trouble trying to control this cost. It’s insane. So that could be applicable to any software company really. But then I think the question of mind is just like, all right, well, you know, am I going to do better if it’s like a bit like niched down, right? Yeah. [Michael Houck]: We’re, we’re definitely at the point, you know, when you look back, Substack has been around for quite a few years, actually, at this point, more than, more than I would have thought. And then Beehive- Just not a fan? Oh, no, no. I didn’t mean it like that. I’m not a fan, but I didn’t mean it like that. But no, just like these, these newer, this new wave of newsletter, platforms has been around for longer than you’d think. You know, I still feel like I’m in 2020 sometimes, you know, like 2020 was yesterday. So, um, but fucking COVID. [Sanket Bhasin]: Yeah, I know. [Michael Houck]: But no, um, so, so, so yeah, so my, my point is that at this point, a lot of people have gone really broad and the newsletters that I see doing the best starting now are the ones that do go sort of that one or even two levels deep. The guy for this very specific thing. It ends up that thing has a bigger market than people thought. So if you’re saying, I want to acquire companies in the energy sector, in this sector, target as specifically as you can for that. And maybe the content is more broadly applicable and they’ll share it around. But I would say the more specific, the better for sure. [Sanket Bhasin]: Yeah, cool. And so the thing is right now, we are going to be targeting healthcare. From energy sectors, just because my background’s in there too. So it’s almost just like, I understand these spaces a lot. I can speak to these owners too when I’m on the phone with them versus like going in, just being super generic. But then it’s just like, all right, well, how do you create like a publication? Can you do both? Should you do two? [Michael Houck]: If it’s two, that’s just a lot of work. That’s just like a lot of lift. Yeah, yeah, yeah. Between healthcare and energy. Yeah. You wouldn’t want to, I mean, two would be a lot of work for sure. [Sanket Bhasin]: I can’t even do one right now. [Michael Houck]: Yeah, I mean, so do you have a strong inclination that you want one or the other? [Sanket Bhasin]: Man, it’s so, I’ve just been chatting to a lot of, so like I’ve just got a lot of mates who are building software at the Energy right now. And I was chatting to one of my mates just the other day, he was actually at Google X, leading that, then he went to Shell, then Exxon, Now he’s just building his own thing, which is really cool. And he just knows his whole life, like he spent 20 years in this space. And so him and just a couple of other people, and he just really boiled it down to three things, which that is sort of leading me towards to go, okay, it’s probably gonna have to be like sector specific. Let me just get the notes from that. But it was just a really way of saying, hey, dude, man, this is what would be super helpful. Like, if you can get me this, I’ll be keen to just read it all the time. And a lot of other people said that, too. This is the one time I can’t find this note. But it was something along the lines of, like, hey, just like, I just want to know. [Michael Houck]: Uh, how my competitors are making money. [Sanket Bhasin]: So like, what’s, what’s sort of happening in this space? Like B what’s the pain points, my customers, um, and C like, what’s this new technology that’s sort of coming through that I can potentially apply to my tech. Right. Yeah. So like, if you think about it that way, there is some generic stuff within that, but then really, really applied to an energy entrepreneur. Building software kind of thing, right? And from that, it’s going to be like a sort of mix of sort of like market data specifically for that, and also just sort of like macro stuff that’s happening in tech. [Michael Houck]: One angle that I think could work could be if you sort of position it for software founders, right? Software startups, software guys. But the actual content, the exam you’re using are in the sectors that are most relevant to you. That way, if the content gets shared or if you put out something and there’s those like, hey, by the way, we’re looking to acquire businesses in healthcare and energy, there will be that sort of social proof that you know what you’re talking about in that space right away. And you’ll have built up that trust there. But to your point about, well, software guys, no software guys, you also are casting a wide enough net where, you know, if they’re not already subscribed to the newsletter, they probably know somebody who is, who could be the connector there. So I could see it working if you specifically focus on software, but use examples and data and things like that from the sectors that are most interesting to you as well. [UNKNOWN_SPEAKER]: Hmm, okay. [Michael Houck]: Yeah, good job. Yeah, okay. I guess I would just at least focusing like there’s three levels here, right? There’s founders, there’s software founders, and then there’s like energy and healthcare software founders, right? So I think if we’re in that middle tier, I think that that’s niched down enough where the content will still stand out and be interesting and keep people engaged and reading the newsletter from week to week. Okay, cool. [Sanket Bhasin]: And then I think this other question that I always have was like, should it come from a personal brand or would you go coming from like a you know, like a brand for the news. For example, you guys have done Founder Journey, which is a brand. It used to be you, I think it was Hoax Newsletter at one point. And that was, was that like a strategy that you used to like potentially just get the ball rolling, just get your name out there, and then you moved later, or was it just happened? [Michael Houck]: Yeah, sort of in between both. I mean, initially, you know, we were just leveraging my audience. So branding it around my name just made the most sense, made it more recognizable to them. And then once we got it to a certain size, you know, it’s sort of become its own business. You know, I have employees who work specifically on Founding Journey. And so branding it as Howick’s Newsletter, when we thought long-term about it, it just didn’t make as much sense because it was going to become more than a newsletter. You know, we have the podcast right now, and we’re going to have more things soon. And also if we ever did want to sell it, which, you know, we don’t want to right now, but if we ever did, we couldn’t sell it if it was Howick’s newsletter. [Sanket Bhasin]: So yeah. Yeah. Okay. Gotcha. And look, are you seeing like in terms of, um, engagement rates, people, um, you know, people are signing up, but you’ve seen a change from when it’s like your personal to a brand or not really? [Michael Houck]: No, I would say though, that given your specific reason for wanting the newsletter, it’s going to be really important to build that trust. And so branding it around yourself, at least initially, probably is a call. But in terms of engagement, no, we executed the rebrand pretty well. We gave people sort of a heads up that it was coming and still use the old email addresses. So our deliverability wasn’t impacted and all that stuff for a while. So no, we didn’t see any impact. [Sanket Bhasin]: That’s just great. And in terms of the branding side of things. Right. So like, I know that actually I, I don’t even think you were ever on Substack. I think it was just always on Beehive or something, but, uh, yeah, I have a Substack. [Michael Houck]: We use it because our email list is so big. Substacks network effects of like recommending our newsletter to other people. It actually pushes it because we have like a large amount of subscribers. If we had a small amount, it wouldn’t push it at all. So it wouldn’t make sense. But what we actually do is we publish through Beehive and then My assistant, every time we publish, reposts it on Substack, not sending an email out, but just posting it on the page. And so therefore, it gets recommended on their platform to people. We import those subscribers back into Behav. [Sanket Bhasin]: It’s rather convoluted, but she handles it. If it works, it works. It’s still good. That’s awesome. And my question related to that, then, is in terms of branding, You know, have you seen like design, like good design added to a newsletter perform sort of better versus like a really minimalistic straight out or is it just content is just key? Not quite either. [Michael Houck]: So I would say content is definitely king, but there’s two ways to think about newsletter design. There’s like aesthetically, like how cool does it look? How unique does it look, right? And then there’s just like, is it readable, right? Font that the colors is all easily readable on people’s phones. Yeah. It’s really the second one that matters. How stylistic it is, how much it stands out. Yeah. People might talk about it a little bit, but the main thing is, is the content good and can they read it easily and quickly? So, um, design matters mostly only in terms of how readable it is. [Sanket Bhasin]: Yeah. Gotcha. Okay. And then, um, you know, In terms of, now you’ve sort of got an idea of where I am, what I’m trying to achieve here, the goals here. What’s a recommendation for you? Be honest here. I’ve aggressively got to find a company and buy it. I’m on a very, very short timeline. This is going to take up a lot of time. I’ve got literally, dude, if you see my day, man, it is full on. I’m trying to manage it right now. It is intense. But, like, the things are working, right? Like, these, like, cold calls, these cold emails I’m doing, you know, things like that, it is actually working. I’m actually getting a really, really good response, right? Especially because my background is really related to that. So, it’s almost just like, you know, for example, sort of the energy entrepreneurs, like, I used to work for Shell within their software development, sort of leading the venture arm for that. So, as soon as I say to an energy entrepreneur, I used to work for Shell, straight away, they’re like, let’s chat, you know? [Michael Houck]: Let’s at least chat. Yeah, let’s talk. Exactly. [Sanket Bhasin]: Yeah, yeah, yeah. So, it is actually working pretty well. But again, it’s always better to build that layer of trust to go into something a little bit warmer than I’m going in. I’m going in super cold, pushing myself a little bit. Again, it’s still working. A newsletter could be a nice tab, but what do you think? Is it something that I should be thinking about pursuing? [UNKNOWN_SPEAKER]: Yeah. [Michael Houck]: I mean, look, in general, I think a newsletter is a good thing for anyone to have right now. I think owning an audience is a good thing for anyone to have right now. So that’s the high level. For your specific situation, I would say that what’s going to lead to a better outcome for you? Is it cold email? A bunch of people get on a call with the 5% or so that replied to cold email. And hope that one of those pans out, or is it to take those people you were going to cold email instead, put them on a newsletter list. So they get an email from you every week, every week. And they get reminded, Hey, that you’re interested in this. You have some banner in there that says like, by the way, I’m currently looking to buy one of these businesses. Um, the answer is probably a mix. It probably makes sense to cold email people, but it also makes sense to hold onto those emails and stay top of mind for them. Cause the moment you send that email, they’re not always going to have with to comb through their network and find someone to connect you with or themselves to get on a call. So it gives you more shots on goal. That’s how I would frame it. That’s how I would frame it. What’s the best practice here? [Sanket Bhasin]: So if you look, I’ve got lists on lists on lists, dude. I’ve got so many lists, which is great. But what’s the best practice of like, putting that list into a beehive and start to go like, do I need like a sort of an opt-in or can I just go? [Michael Houck]: This is a very common misconception about newsletters. And actually this has sort of been part of the emphasis for what we’ve been doing for growth for our newsletter and also the service that we’re offering to some people now. Basically, you don’t need opt-in to email somebody. You don’t. You can email anyone you want as long you have an address in the email and a link for them to not receive any more email or some way for them to not receive any more emails from you, right? So technically, if you email somebody from a Beehive account, as long as you put your business address in your Beehive account, it’s at the bottom, it’s in the footer of every email, so it’s an unsubscribed link. So technically you can cold email through newsletter software, people just don’t think about it that way. And so what we’ve started doing is with my newsletter, We’ve set up sort of a separate group segment within the newsletter where import a bunch of people. We’ll send them like the greatest hits from my newsletter so far. And if they make it to the end of that and they engage with a certain amount of those emails, then they automatically get funneled into the main newsletter and the ones that don’t get unsubscribed automatically or intentionally, if they click the link and they never hear from again, we found that when you have really, really good targeting with the people you’re uploading with that, the metrics are actually better than you’d be able to get through like Facebook ads or other channels like Spark Loop, like other newsletter growth channels, because you know they’re interested in your topic and they’ve sort of gone through this vetting process for the newsletter. So we built a data set of 200 million emails tagged by what they talk about on social media, who they follow and what’s in their bio. It’s sort of like you’d get targeting through meta ads, but right in people’s inboxes. And so that’s what we’ve been doing. It’s been working really well for mine and the few clients that we’ve done a sort of a beta with over the last two months. [Sanket Bhasin]: That’s great. And what’s the process you sort of went through? So you started off by just pulling all the emails and data first and And now you’re just like, kind of like pushing up like 50,000, like a week or something like that. And then essentially if they unsubscribe or, and then there’s essentially like an automation that’s like going through, seeing what they’re doing. If they don’t react or like do something, click on anything automatically hits the unsubscribe, but then it’s still that same, like you still got the 200 million. So it’s almost just like, it just keeps updating that 200 million. Right. [Michael Houck]: And no, the 200 million aren’t all relevant for my newsletter. It’s a very broad sort of data set. We have a newsletter for, you know, MLS soccer news in the US. We have one for soap operas, right? Like there’s a wide variety of things people can be targeted for. But yeah, basically we have an automatic upload every week. And then they go through some process. They either meet the engagement criteria or not. If they do, they sort of graduate to the main newsletter. Yeah, that’s how it works. [Sanket Bhasin]: So how do you, so like, is there any instance that you’ve uploaded a person twice? Or how do you manage that? You can’t really do that. [Michael Houck]: So I think SubSec has the same thing, but Beehive I know. If you upload a CSV with an email that’s already been subscribed to your newsletter, nothing happens. They just stay inactive on your newsletter and it skips them on the CSV. [Sanket Bhasin]: Oh, that’s awesome. That was like the one thing that was always in the back of my mind. It’s like, dude, I don’t want to piss people off. [Michael Houck]: How do I do this? You’d have to go into their page, their subscriber page on your Beehive and manually turn their subscription active again for that to happen. [UNKNOWN_SPEAKER]: Okay. [Sanket Bhasin]: And then if they, and I’m assuming if they, for example, like they unsubscribe, but then two months later, it’s like irrelevant. So they actually went to your website and subscribed again, that would automatically they’d just update that. Yeah. [Michael Houck]: It would update the status. Yeah. Yeah. Okay. [Sanket Bhasin]: That, that’s, it was like, that was just really on the back of my mind too. Like if I went through that route, I’m sorry, I don’t want to fucking piss these people off, man. [Michael Houck]: How do we do this thing? No, they can be, they can be on every single one of your lists. They’ll only get, they’ll only get imported once. Don’t worry about it. [Sanket Bhasin]: Yeah. Okay, cool. Um, all right. So this just gives me like a time to think about, look, let me just like stick with it. Um, I’ve just got the next couple of weeks. I’m just kind of Ramping up essentially the processor systems, you know, cause see our rooms and stuff I’ve got fucking six interns starting tomorrow gonna be grinding away with Yeah, yes I think this Last thing I’d say to is, you know I’ve come with like a foundation Like I’ve been building and scaling my own companies for like 17, 18 years. Yeah. And so this is, this is the first time that I’m kind of going into like some what of a fucking investor role and dude, it fucking sucks. Like, oh no, it’s the fucking worst. Like I’m speaking to these like founders and it’s, and it’s almost just like, it’s like already like they’re putting like a kind of like a, um, you know, like a face up, like a fence up. Yeah. [Michael Houck]: They’ve got the translucent but firm barrier between you guys. It’s so true. [Sanket Bhasin]: And I’m like, what’s your problem, man? But then I’m like, holy shit. Remember when I was speaking to investors, I used to fucking hate those people. They’re fucking so annoying. I don’t know shit about my stuff. What the hell? [Michael Houck]: All of a sudden, you’re not a fellow founder. You’re like this guy who’s trying to buy their company. [Sanket Bhasin]: Fucking mistake. I was like, dude, let me just find this company, buy it so I could just fucking become an operator again. Oh, my God. You have no idea. [Michael Houck]: Once it happens, once you find the right deal and you go through with it, you know, it’ll be it’ll be just as good. Yeah. Well, that’s definitely what I’m going to be hitting you up. [Sanket Bhasin]: I’m going to start to work and to get absolutely I’m going to have a ton of cash flow then. And so we’re definitely one hundred and fifty percent going to be doing there at this moment. Let me try to figure out what my time spent. Let me try and figure out what I’m going to be working on. But that’s when I really need your hand there, Mike. When I buy this company, I need to fucking grow it aggressively. And so that’s where I’m definitely hitting you up. [Michael Houck]: And we’re going to be doing something massive at that point. Yeah, dude, let’s do it. I’m here for whatever. If it’s just jamming, if it’s newsletter stuff, whatever you need, just let me know. And I’ll keep my ear to the ground, too. I already am. Do another pass with some people to see if they know of anybody. The specific sectors are not sectors I have a huge network in, but I know a couple of people in healthcare, so I’ll hit them up and then see what we can do. [Sanket Bhasin]: Yeah, I swear. I’ll send you a one-page that I’ll put together as well. That might give you a little bit more info. Again, I fucking just really want to work with you, dude. You’re such a good dude. Oh, no. I just feel like what you’ve done is really, really impressive. It’s something that I’ve always wanted to do. And I just know it just takes a lot of time, effort, and energy. And I feel that you’ve got the playbooks to do it, which is awesome. So I’d love to work with you on that. [Michael Houck]: Yeah, I would love to help out in any way. I think what you’re doing is super interesting, too. I feel like I spend so much time with the software guys that seeing the others… I had my venture fund before. Um, so I’ve been on that side of things, but it’s, it’s just like a muscle. I don’t get to flex as much right now. And so it’s, uh, it’s fun for me too. [Sanket Bhasin]: Um, and if you need any, like, uh, like I’m just booting out, like a lot of stuff at the interns and stuff to you, like templates, like dinos and stuff too. So if you need, I don’t know if you want to want to get back into things, especially analyzing like the PE type deal and stuff, please hit me up. [Michael Houck]: I probably will take you up on that. We’re pretty bullish on the newsletter. Growth and data play for the first half of this year. But especially by then, seeing where you guys get to with this, we should jam and see what makes sense to add to the portfolio for second half of the year and beyond. [Sanket Bhasin]: Yeah, perfect, man. Again, I’m literally just templates, and templates, and templates for these interns, right? And so if that’s going to be helpful for you, absolutely. [Michael Houck]: You got to do it Hunger Games style, man. When I hired 9v8, that was my project plan. Like, all right, I’m going to hire like two or three. [Sanket Bhasin]: Let’s see how it goes. This is this is exactly what I’m doing. And it’s actually so funny. I’m like, oh, shit, I think I just got too many. Dude, I put this I put the job app out and Handshake. Oh, sure. Get a handshake. Yeah. I put it at five dollars. Days, I got a hundred applicants in, dude, 80 of them were solid. I’m talking like, dude, I looked at them and I’m like, I feel like I haven’t done shit in my life compared to these kids. And dude, undergrads, proscript, dude, I had this chick apply yesterday from like, so Booth is different, right? I went to business school there. So I’m really, really into like the careers department there. ex-FBI agent that’s potentially coming on board. [Michael Houck]: Be careful with that, man. Be careful with that. I know. I know. I know. [Sanket Bhasin]: It’s very, very careful. But the Handshake, the undergrads, dude, what they’ve achieved, it’s just incredible. Plus, they’re really, really high IQ. Still a little bit debatable. They’re young. They’re young. Yeah, sure. Yeah. But the IQ, man, in these kids and the horsepower on them, That’s like all I need, right? Like if I give him what to do, I just need him to churn through it. And man, it was like, I had trouble to get down to like 50. That was very, very challenging. And I could only interview like 50, like how much time I got, right? [Michael Houck]: I might hit you up about that because we’re going to need a lot of horsepower type folks probably going into Q2. So I’ll hit you up with what, I’d love to know what works on Handshake and what doesn’t, because that’d be a great, great option for us. [Sanket Bhasin]: Yeah, I mean, I’ve kind of got like a little bit of the playbook written out, the process and stuff in Miro drawn out too. So absolutely happy to share it, dude. [Michael Houck]: Appreciate it, man. Look, I’ll let you go, but let me know where you land on everything. And we can touch base in a week or two and see where you’re at. [Sanket Bhasin]: Perfect. All right, mate. [UNKNOWN_SPEAKER]: Cheers. [Michael Houck]: See you, man. [Sanket Bhasin]: Bye.