We all know when a stock is hot. When that happens it is usually too late to make big winds. In this episode Jack explains how to invest early in the right companies. (Hint: They are probably companies you already enjoy).
About Indestructible Wealth: I’m Jack Gibson. I’m your wealth strategist and I’m here to help you make some money. The Indestructible Wealth Podcast is for young entrepreneurs who want to make, keep and grow wealth to enjoy now, and for years to come.
Episode #14 – Investing in Experience: the Next Best Thing to Top Golf
Podcast Episode Transcripts:
Disclaimer: Transcripts were generated automatically and may contain inaccuracies and errors.
Welcome to the Indestructible Wealth Podcast. This is the place where we help young entrepreneurs to make, keep, and grow wealth that you can enjoy now, and for years to come. I’m your host Jack Gibson, a serial entrepreneur, founder of multiple seven and eight figure businesses, and wealth building strategists. Each week I’m going to share my tips, resources and secrets, to help you create a plan and build the life you’ve dreamed of.
All right. Welcome back to indestructible wealth. I’m your host Jack Gibson and I’m your wealth coach, financial coach I am the guy that’s going to help you guys get to where you want to be faster and more efficiently than what it took me to get here without the pains while, well it’s going to be painful I’m not going to lie. You’re definitely going to have ups and downs, you’re definitely going to have challenges creating wealth is not easy. So I don’t ever want to make it sound like I’m going to cut out the pain and ups and downs as you’re going to experience because that’s simply not anything that I’m capable of doing.
However I can take the last 24 years since I started investing and I can take all the good, the bad, the ugly, compress it down into the philosophies and the mindsets and the thoughts and the strategies and the tactics and I can get you 24 years’ worth of pain and suffering and not all has been painful.
I can’t say that but I’m going to compress that for you into a much shorter period of time so that my goal is for you to become a sophisticated investor in about 5 years versus the 24 years that it took me. My goal is to get you financially literate so that you’re not just going off the whims of the markets and the doing what everybody else is doing. We want to move against the grain, we want to move against what everybody else is doing and that’s the secret to success in so many different areas of life including building wealth.
So I have a question. Have you ever been to Top Golf? They’re starting to pop up and I don’t know if you’ve ever heard of it before but probably if you haven’t heard of it you’re probably saying, well I’m not into golf and I’m not interested in learning how to golf.
And that’s great. Okay But hear me out on this one because I’m going to tie this in like everything I do to make money. Okay and building wealth. So just calm down all right if you don’t fucking like golf calm down. I think you’re like Top Golf though what’s unique about Top Golf is that it makes golf fun for those that really suck at it and it’s also a lot of fun for good golfers too because they can finally play golf with their good friends and family. most of the time if I want to, if I got a friend who sucks at golf, first of all he’s probably not interested in coming with me or if he is I simply can’t stand the thought of watching them hack away and slowing the game down.
So that’s why I can’t take both of my boys at the same time. Tyler my youngest is a hacker he’s like, he’s the aggressive he loves baseball, football, basketball I wish he loved basketball the most, but still number 3 or 4 on his list but he doesn’t really like golf that much because he just hacks away like he swings as hard as he possibly can. he’s a hacker. So I don’t really enjoy taking them because he’s not good. He slows us down and throws tantrums. Right so my oldest son John he’s much more reserved, much more focused and takes his time like golf is for him.
So I enjoy taking John sometimes, like if he’s really not focused and he’s off his games like a 13 year old. Then it kind of sucks cause he slows me down. But Top Golf is something I can do with both of them. We can do it as a family. See Top Golf has a wide array of different games for all skill levels and what’s cool is that every ball you hit as a tracking device in it so that when you hit the various targets out there in the range it adds to your score and they set these targets up like some of them super close like if you just completely totally suck at golf never played before and you take like a little half swing chop at it you can hit these targets in front of you and score points.
And on top of that what probably really sets Top Golf apart it has a huge bar and food delivered right to your bay. I mean every bay has a waitress that is going to bring you food and drinks and if you don’t want to wait you just go up to the big bar and you order your drink. So even if you really don’t even want to swing the club you can still have some fun going to Top Golf, making fun of your friends and having a few cocktails.
A couple of weeks ago I took a trip down to Indianapolis for spring break. This is our got to get out of the house moment and do something with the kids. So we took a 3 day trip and the biggest reason we wanted to go was for Top Golf. Our kids had one of them who had done it. One of them had it and so it’s just something cool we could do as a family. We had to reserve our bay a week in advance and that was just for a Friday morning at 11, so my boys had a blast and we ended up adding on an additional hour of time in the bay because we were having so much fun. So when we drove by it the next day we happened to go by the Top Golf location again. This was a Saturday, there was literally a line out the front door.
So what that told me is that demand for Top Golf is strong and this is a business that cranks out cash and profits because they’re making money. They’re making money on the golf renting the bays but they’re making tons of cash profits on the alcohol because alcohol is always one of the most profitable things that any venue can sell because they can mark it up 3, 4, 500%. I probably don’t even know what the margin is but it’s really high.
So it cranks out cash and profits and I don’t see any signs of it slowing down as the economy continues to open up from COVID, I can see more people coming out and looking for a fun activity to do like Top Golf. Now things are starting to open up but I can’t say as of right now we have a fully open economy where people aren’t scared to go out we don’t, we’re definitely not there yet.
So I see this pinup demand that’s going to start unleashing itself and it’s going to be anxious to get out and do these types of activities and have experiences. Top golf is an experience. It’s something that you can do like I said whether you like golf or not. So from what I can see investing into Top Golf would be a company that I would be proud to be an owner of. I would love to own a piece of this company. However there’s one big problem. I cannot. It’s still a private company.
So if I wanted to open a Top Golf franchise well that’s about $18,000,000 I’ll need to raise. That would be if I did that, that would be risking my current lifestyle or that would be risking my current lifestyle for a better one. And that’s something I would never do. So how do I get a piece of this action? I want to tell you about drive shack. Drive shack is a $300,000,000 golfing company which used to operate a bunch of traditional golf courses around the country.
And they’d been selling these courses and using the proceeds to build multipurpose entertainment facilities, think Top Golf. Maybe with a couple of minor variations in terms of like the golf set up these radar tracking on the balls instead of chips in the balls they don’t have like they have different targets. but it’s in all intents and purposes I mean, it’s very very similar to Top Golf.
It’s mostly been set up so far in the Southeast. So in all likelihood you haven’t heard of them but it intends to open up dozens more across the country over the next few years. At the same time, drive shack is pioneering and even a newer alternative social entertainment concept called puttery. Now this is an adult mini golf with a bar, food and social hangout spaces. Let’s say you don’t like it, you don’t want to swing a golf club and you don’t want to go to Top Golf. Everybody loves putt putt, who doesn’t like putt putt. I mean if you don’t like putt putt just unsubscribe right now I’m not dealing with you. I’m kidding I mean don’t unsubscribe you’re valuable but, This is something that I think everybody would like to do: mini golf with a bar and food, sign me up for a competition, something that could be done with friends, with my family. The first puttery is going to open in Texas in the summer of this year, 2021.
So between Drive Shack and the puttery expansions this company is in a great position to grow at Light speed over the next few years. Even without the pent up demand, millions of people who can’t wait to get the fuck out of their houses and have some fun. So here’s the good news. You can’t buy Top Golf, but you can buy into drive shack.
Drive shack is a publicly listed and traded company. So here’s what I also love about the drive shack. It’s just a $300,000,000 company. Now, when I say just I don’t mean to diminish, I mean that’s bigger, much bigger than any company I have to build by multiples but yet that means that it has a huge potential upside.
When you have a company that you like, let’s think about Apple, like a $1,000,000,000,000 company, right. Facebook, Google huge, huge trillion. Multi-billion almost trillion dollar evaluations. How much more can those really go up? How much more is there upside now that they can still grow for sure they can still go up but their time of parabolic high-speed growth is probably in their past. Now if you had invested in those big companies 20 years ago like 10 years ago with Facebook you’d certainly be up quite a bit. If you would’ve just bought and held, you would have gone through some massive ups and downs. Like most technology companies do they have their big ups and they can have some equally big downs but you would have done really well.
So what I like about small cap companies. Small cap companies or companies that are usually in the under a billion. So these have parabolic opportunities they can still crank sales to, to huge levels. And that means share prices are going to go up big too. So analysts see sales rising to $400,000,000 by 2022 and then $500,000,000 by 2023 and I think these are conservative numbers. I think drive shack In my humble opinion can grow bigger and faster than these numbers. This is a bet I like because I love the experience that it will provide. I understand their model because I’ve been to Top Golf so I get what they’re doing. I see the demand. I see the people on the waitlist to get in. I see the amount of people that are waiting outside on a Saturday to get into Top Golf. And so being a smaller company gives it the room to grow at that fast pace then these larger established companies. now you don’t need to buy shares in this just because I like it and I’d be proud to be an owner. I just want you to start thinking about buying into companies that you know and understand and that makes sense to you.
Not only in terms of where it currently stands in the market but where you think it can go in the future. I’m still kicking myself because I’ve been using zoom for over 5 years now. In my direct sales company, we were some of the early adopters of zoom and I loved the product. I loved the zoom platform. It was so much better to me than anything else video conferencing that was out there, hands down. I mean like everything’s about us is about Zoom.
So why didn’t I buy into zoom 5 years ago? I wasn’t thinking this way. I was one of the first early adopters of the Tesla. I mean I had my first one. I want to say it was about 5 years ago. I mean I would say the earliest adopter by any stretch but earlier adopters. I love technology. I love the car. I’ve been driving one ever since. it makes driving fun. I love it. I look forward to driving somewhere just because of the experience that it gives me. So why didn’t I buy into Tesla 5 years ago? Well, Company wasn’t profitable at that time. So I kind of was nervous about buying into a company that wasn’t profitable but where’s it going in the future? I mean, I knew that I had a pretty strong inclination that Tesla was going to base on how I love the product other people talked about. That kind of reverence that the Tesla name had. Why didn’t I buy it? Because I wasn’t thinking this way now. It’s in my opinion it’s too late to buy Tesla. Everybody’s already like its mainstream and too many people have bought into it and the price, the valuation of the company is off the charts. I mean that stock would have to drop significantly for me to be interested in buying it.
But you want to start thinking about how these guys start thinking about products, start thinking about places you’ve gone and experiences that you have and think about like, did I like this? Did I, would I be with my friends and family like this, like is this catching hour, people talking about it? And then start thinking why, is this a company that hasn’t yet hit the mainstream? I want to get in things early. I want to get them things before they get adopted by the masses. That’s where you create the money.
That’s where wealth is created. It’s being first to market the early stage market that’s where you’re going to make your money in any business in any investment opportunities. So I want you to start thinking this way and start looking at just simply looking around. You have what you like, what are things that you like, man that’s a cool product.
I really liked that product. I could see this catching on. I could see this becoming big, start looking them up to see if they’re publicly traded and start and then you’ll start learning like valuations. What price to earnings ratios make sense? Like that’s the stuff that we’re going to start teaching you on this platform. So you can start, you can take a company or a product or a service and a company that you really like and then you can say, where do I think this is going in the future? What’s its current price to earnings ratio? Is it off the charts? Is it way too high? Does it not make sense? does this get adopted by the masses?
Adopted by the masses everybody’s using it, talking about it, buying the stock. now I’m not interested I want early stage companies. Hope this helps. Let’s create some indestructible wealth, and there’s still plenty of upside in the stock market. I know it’s at an all-time high but I believe with the amount of technology and disruption and the way things are going to be happening with technology companies. I think the opportunity for high growth stocks is still very much alive. It’s going to be an exciting decade for you guys with technology and a lot of these companies and things that are coming out. The only way you’re going to be able to invest in them is through buying them in the stock market.
So here we go.
That’s a wrap for this episode on the Indestructible wealth podcast. Before we part ways, I want to help you to take advantage of 2 incredible tax saving strategies that could help you save a lot of money. All you have to do is leave me a 5 star review – if I’ve earned it – and comment on iTunes, Stitcher, Spotify, or wherever you tune in. After you’ve done that simple step, just email me a screenshot to [email protected] and I’ll send you everything you need to save money on your taxes for years to come. If you’d like to dive deeper into your own wealth building strategy, check us out at myindestructiblewealth.com and follow along on social media. Also, please share this podcast with anyone who’s looking for guidance on their own wealth building journey. Until next time, remember our mission here is to help you make, keep, and grow wealth you can enjoy now, and for years to come.