This opportunity is hidden in plain sight

The discussion begins with a focus on identifying current opportunities in the market. The hosts reflect on past mistakes, particularly one host's tendency to pursue "last wave" opportunities, such as social media apps, a decade after their prime. This approach, driven by insecurity and a desire for proven success, led to entering markets dominated by winner-take-all dynamics, where established players like Airbnb leave little room for latecomers. During the 2012-2018 period, the real opportunities lay in emerging fields like crypto, machine learning/big data, and new mobile apps. The host admits to having been in the "lazy river" while the "ocean" of opportunity passed by. The conversation then shifts to a specific, unexpected opportunity: Grand Theft Auto 6 (GTA 6). This idea stems from a friend who previously advised early crypto investments, demonstrating a knack for identifying lucrative, albeit initially outlandish, ventures. This friend, a year prior, even contemplated a hostile takeover of Take-Two Interactive, the parent company of GTA. This anecdote highlights the friend's conviction in the value of the GTA franchise. The host elaborates on the incredible asset that is Grand Theft Auto. The previous installment, GTA 5, generated $1 billion in sales within three days, surpassing any movie or video game release at the time. The video game industry itself is three times larger than Hollywood. GTA is described as a highly defensible product, still generating $500 million annually a decade after its release, largely due to its recurring revenue model through GTA Online. Its unique position in the market means there's no direct substitute, akin to Coke having no Pepsi equivalent. With nearly 500 million copies sold and $20 billion in lifetime revenue, GTA is among the top-grossing entertainment franchises across all media, comparable to Pokémon and Harry Potter. The upcoming GTA 6, developed with a budget of over $1 billion, is projected to achieve $3 billion in sales in its first year, with an anticipated $1 billion in pre-orders. While acknowledging that AI, energy, biology, and drug development are larger, more obvious opportunities, the hosts find the "little economy" around GTA 6 more interesting for discussion. This economy includes content creators, modders, tool developers, data scrapers, guides, and in-game item sellers (skins, guns, outfits). The previous GTA 5 release saw the emergence of ventures like NoPixel, a popular modded version of the game that eventually sold back to the company, becoming more popular than the official game on Twitch. This suggests significant opportunities for young, "fun-employed" individuals (ages 13-25) to learn business by building starter businesses within this burgeoning GTA economy, which could be worth hundreds of millions of dollars. The advantage is that since the game isn't out yet, no one has a head start. This leads to a discussion of accessory businesses in gaming. G-Fuel, an energy drink company, is cited as a smart example. They recognized Twitch streamers as undervalued assets, whose deep trust with their audience (watching live for eight hours a day) was disproportionate to their price sheet. G-Fuel implemented a "Nike playbook," partnering with top streamers to develop custom flavors and merchandise, offering them a cut of affiliate revenue. This strategy allowed G-Fuel to achieve $0 to $100 million in sales purely within the gaming bubble, largely unknown to mainstream audiences. Elgato, which sells streaming accessories, is another example of a successful "picks and shovels" business in the industry, benefiting from both streaming and podcasting trends. The hosts delve into the nature of Twitch streaming, noting that while clips are popular, many viewers watch live for extended periods. Use cases range from young people on their phones, to second-screen viewing on TVs, to background audio for those working on computers. The level of trust between streamers and their audience is emphasized, with certain streamers like "Speed" and "Kaisenat" holding significant influence among young people. A major news item discussed is the acquisition of TBPN, a tech live show, by OpenAI for an rumored $100-200 million. The hosts express happiness for the founders, John and Jordy, but question the strategic wisdom of the acquisition for OpenAI. While HubSpot's acquisition of The Hustle made sense for direct customer attribution to their $20,000/year software, OpenAI, with billions of users, seems to gain little in terms of growth or awareness from a media company with 90,000 viewers (or up to a million including clips). The acquisition is seen as potentially being driven by a desire for a "cool" asset rather than a clear business rationale. The hosts speculate on possible motivations for OpenAI. Even if the acquisition cost $100 million, it represents a tiny fraction of OpenAI's valuation. Having a talented media team in-house could provide strategic guidance on communications and branding, especially given the current public perception of AI, which is more unpopular than even figures like Trump. Sam Altman, the face of OpenAI, has faced significant public backlash, including attacks on his home, highlighting a public relations challenge for the company. The public's dissatisfaction stems from fears of job loss, rising energy prices due to data centers, and a general feeling of struggling despite following traditional paths, leading to resentment towards perceived tech billionaires. Despite the skepticism about OpenAI's move, the hosts laud John and Jordy's achievements with TBPN. They commend their innovative approach to media, particularly in inverting the traditional podcast model: the live show's primary purpose was to generate clips, which were the actual product consumed on social media platforms like Twitter. This "farming exercise" focused on creating 20 engaging clips daily, distributed across feeds, rather than solely promoting a long-form show. They also commend John's "great lock-in" – his dedication to the project, even turning down invitations to high-profile events, demonstrating immense focus and commitment in the early, challenging stages. The conversation touches on the alleged "shadowbanning" of TBPN content on X (formerly Twitter) following the OpenAI acquisition, drawing parallels to Elon Musk's previous actions against Substack after an unsuccessful acquisition attempt. This highlights the competitive nature of the tech landscape and the potential for platform owners to influence content visibility. The discussion then pivots to William Randolph Hearst, a historical figure in media, whose life and career offer insights into building long-lasting companies and managing creatives. Hearst, born around 1860, inherited wealth from his mining magnate father. He convinced his father to buy the San Francisco Examiner, initially to promote his father's political career. Hearst's passion for newspapers led him to revolutionize journalism through "yellow journalism" – prioritizing eye-catching headlines, photos, and emotional narratives over factual news to boost circulation. He, along with Joseph Pulitzer, pioneered this style, which famously contributed to the Spanish-American War. Hearst's media empire eventually controlled 20% of America's news consumption. He was known for his lavish spending, sometimes equivalent to $20 million a month, and for building extravagant homes like the Hearst Castle, a 40,000-acre estate with a private zoo, which he later donated to the California government. Despite his immense wealth and power, his company faced receivership multiple times due to his spending habits. The hosts highlight several admirable aspects of Hearst: his charisma and leadership, his land-and-expand newspaper monopoly strategy, his media innovation, and his extravagant taste. However, they also acknowledge his negative aspects, including antisemitism and promoting Hitler as a columnist. Today, Hearst Communications remains a privately owned media conglomerate, generating an estimated $15 billion annually. It owns major magazines (Cosmopolitan, GQ), 20% of ESPN, half of A&E, local news stations, and Fitch Ratings. Its longevity is attributed to a unique trust structure with six family and six non-family members overseeing the company. A key takeaway from Hearst's story is his exceptional talent for "collecting" creatives. He personally recruited and paid top journalists like Mark Twain and Jack London handsomely, offering them creative freedom and protection from controversy. His newsroom was renowned for its talent. The host, currently writing a book on creativity, finds this aspect particularly relevant to managing his own creative teams. He notes that while his current approach involves hard deadlines and rewards, Hearst's model suggests that fostering an environment where creatives feel valued, protected, and free to explore is more effective. The discussion concludes by emphasizing the importance of identifying the "main thing" that will drive a business's success (e.g., compelling media for a newspaper, marketing excellence for e-commerce). Success then hinges on either the founder being world-class at this main thing or being a world-class recruiter of people who are. Hearst exemplified the latter, assembling legions of talented individuals to achieve breakthroughs. The conversation wraps with a humorous anecdote about the challenges of being a social media influencer, particularly the loss of self-respect when needing multiple takes for a video, questioning if it's worth the gain in influence and money.