The Exchanges

Q And then investing in what kind of stuff? Just a curiosity. Cause we have a lot of people listening that are 18, six,

A Yeah, sure. So I was doing mostly tech companies initially. Um, and you know, this was before the recession. So the first thing I bought was Apple. And then, um, I bought a couple of different tech companies. Some of them got acquired. And then, uh, you know, during the recession, I bought a whole bunch of different stuff. I got Baidu during the recession, which was really awesome. Um, got, uh, you know, a bunch of the different financial companies, Goldman, Morgan Stanley, um, and also just other companies that were kind of like leaders in industry. That's what I always looked For is kind of who's the best in this industry. Um, because that's typically the company that's going to outperform everyone else.

AI assessment note: “I was doing mostly tech companies initially. Um, and you know, this was before the recession.”

Q Okay. Got it. Okay. Very cool. And then, um, who's your target market for this kind of thing? Like describe them to me.

A Yeah, it's interesting. So it's a bit broader than we, uh, initially expected in terms of age. Um, you know, we were kind of thinking that this was for, uh, a 25 to 35 year old, uh, urban professional, typically high income, go getter, going out and doing these things. Um, what we found is it's more like 25 to 45. Um, definitely still high income, definitely that urban professional. Uh, the other thing that's been interesting is we're seeing a whole range of industries. Um, you know, there's definitely, Definitely heavy concentrations in finance and entrepreneurship. Um, but, uh, you see everything from entertainment to, um, you know, to, to media, to, uh, arts and culture. It's really, you see people from all walks of life, um, coming in and applying. So it's been a really interesting and diverse, uh, group compared to what we thought.

AI assessment note: “it's more like 25 to 45. Um, definitely still high income”

Q if, if Amex is processing twenty billion a month, uh, and they can say, go to Four Seasons and say, give our, if they use an Amex card at Four Seasons, give us a discount. You know, Amex can argue they're gonna drive more GMV through Four Seasons, Four Seasons does a deal. You're not as big as Amex. So what leverage point are you using to get these deals?

A Great question. And, and really for us, it comes down to brand, um, the demographic we have and sort of our history in delivering for clients, right? So, so I'll give you an example. Um, and Four Seasons is a great one. They're, they're a partner as well. Um, but I'll give you an example from the dining space. Um, you know, of the top grossing restaurants in the country, we have four of the top 10. Um, those Venues do not need extra business. They are tables are always full. They don't need new people. The reason they like to work with us is that we tend to bring that younger, more affluent millennial. And then in addition, like our check sizes, even with the benefit included, tend to be higher than the average of the venue. Um, so that's why venues like Tao and those kinds of places love working with us as we're bringing sort of this younger, fresher, hipper customer demographic that's really focused on experience, really focused on Um, you know, being social and going out and doing these things. And then also who tends to spend more than their average customer.

AI assessment note: “it comes down to brand, um, the demographic we have”

Q Why'd you do that? You seem like you've had a lot of success. Why'd you feel like you needed them?

A Yeah, it's an interesting question. Um, so I think it never hurts to have, uh, a big network like that on your side. Um, and to, you know, it basically just sped everything up for us. Now we were, we're in an interesting situation cause things kind of took off for us right after we had, we had decided to go into the accelerator program. So it was kind of a whirlwind. Um, but I'm still really glad we did it cause the, the network is tremendous. The partners, Particularly with ERA are unbelievably helpful. Um, I don't know what it's like with most accelerators, but from what I've heard, um, it's not the same level of attention that you get at ERA. The partners are there, 10:12 hours a day. Um, they'll introduce you to anyone that they can help with anything they can. And that continues after the program. Um, you know, I was actually talking to one of them at like midnight last night. Um, cause we've got some stuff going on. So, um, so the group there is, is really, really amazing. So I'm definitely glad we did it. I would say We probably didn't need it, but it certainly didn't hurt.

AI assessment note: “it never hurts to have, uh, a big network like that on your side.”

Q Who are like when they launched their own company and they're going, why does he think that we're going to spend more money? I'm fricking broke putting on my money in my startup. I'm not going to spend extra on drinks. Like what, it doesn't make sense. And you hear them like millennials, they like are bad at saving money. Like why do they actually spend more out of towel?

A So, so it depends on, you know, of course, who, who the person is, how they like to experience things, right? There's going to be a degree of variance, but, um, typically what happens is when you're getting some sort of incentive that elevates your experience, you end up like investing further and elevating that experience. So like, you know, if you're saving 30% on a dinner, let's say, You tend to order an extra round of drinks or get an extra appetizer or maybe do things that you wouldn't normally would. And what's cool about it is like, it makes your experience at that place so much better. It becomes like much more of a night out, much more memorable. Um, and I would say that's actually even more amplified with hotels. So, so for example, like I've booked, well, obviously I book all my hotels through us, but, uh, but before our hotel program was as good as it was today, I actually didn't do that. Um, I used to use whoever had the best rates, but, but now, Um, you know, saving over a thousand dollars on a, like it'd be hard if you're, if you're staying somewhere for more than three nights, not to save over a thousand dollars. And it's typically in the range of like, you know, Any, well, the average savings is 31%, but you can be as high as 70. I tend to save like 40 to 50%, but what's cool is it completely changes the caliber of the place you can stay. You know, like we're s…

AI assessment note: “when you're getting some sort of incentive that elevates your experience, you end up”

Q So, okay, so tell us about Select. What year did you start it in?

A So we started working on it, uh, about three and a half years ago. So it was right around, um, like, 2013, I would say, uh, is when we were starting to, like, test the concept, talk to partners. Um, you know, basically we wanted to see, uh, you know, see if the, the partners would buy into it, um, see, you know, what the, how the customers would take to it. Um, and the idea there is, it's twofold. Um, so on the merchant side, we wanted to work with the premier brands, these places that people actually want to And we wanted to get them to provide our members with something on an ongoing basis. Um, but you know, it's something that's typically profitable for them, sustainable for them, and it gets the right customer to come, not just to come through the door, but to come back again and again and again. So it's, it really makes sense for the businesses. Um, you know, the businesses have been really, really happy with it. And then on the customer side, we basically positioned it sort of against, uh, the premier, uh, Credit cards. Um, you know, so I saw that space too. And you're, you're looking at, um, you know, these annual fees kind of ranging from a hundred to up to 2500 for first century on plus initiation fees and stuff, um, for benefits that have really been, you know, basically points you might, may or may not be able to use towards travel and then a bunch of crap that you'r…

AI assessment note: “So it was right around, um, like, 2013”