“If you are aware of that awareness, then you’re always so-called centered and grounded in reality, you don’t get carried away by those ideas or things or whatever happens to you, you’re not worried about it because you’re always focused on the reality of fact that everything changes and that’s what it is.” Amit Rathore is a serial entrepreneur and angel investor based in San Mateo, CA. Since 2003 he has focused on AI, media, commerce, and FinTech verticals. He is the founder of AwakeVC, a private equity holdings company focused on creating 100M jobs by enabling 10M new technology ventures globally.
Watch the episode here:
Listen to the podcast here:
Awakening The Market Within Your Affiliate Business With Amit Rathore
I’m excited about our next guest. He’s on a mission to help D centralize the way that we do commerce and he is an expert when it comes to all things online marketing, the internet, and building systems to help to take back what a lot of the big tech companies have currently. And he’s going to show us how we can have more profits and have our own economy amongst peers. So with that being said, Please welcome Amit Rathore to the show. Hey, Amit, how are you doing?
Thanks, Brett. I’m doing well. wonderful to be here.
Excellent. Thanks for being here. And by the way, you can find Amit at awake.vc and you can also find what we’re talking about here shortly shoptype.com. His newest and best adventure here and that’s S H O P and then type T Y P E .com. So Amit give us a little bit of a background of you and your story and then your current focus.
Sure, I grew up in India, and I grew up in Bangalore, having the Silicon Valley dream in my mind, always wanting to be here and all that. And I spent my whatever, you know, youth and college and you know, 20s maniacally focused on getting to the valley and just, you know, wanting to do the tech thing, tech startup thing. And so I found myself in the US around the age of 22. I was in Chicago for a number of years, and ended up here in the valley in about 2007, 2008, first at Google. And then very quickly, within a few months, with a very small group of people that we launched our first eCommerce AI platform within 2008, which, you know, ended up being used by pretty much everyone that wasn’t Amazon, you know, we were basically telling people, hey, this is, you know, how you’re going to do to sales online, you know, Amazon is a tech company, they’re an AI machine, you know, you gotta like figure this out. And so basically everybody was using us before we sold that company, we were powering eBay, Groupon, staples, you know, a lot of the smaller guys, that little green truck that you might see on eBay, the fast and free, it says, Get this item in one to three days, you know, there’s a little icon that shows up on a number of products on eBay. That algorithm was our algorithm and you know, the first time it came out, it’s pure AI that shows you know because eBay doesn’t ship anything and has no logistics, they have no idea when something is gonna actually get to you. But they’re able to use AI, to promise that for a large number of packages, and that gives them a huge boost in sales. So that’s an example of the kind of stuff we can do, we can read a lot of real-time price changes, you know, like what airline companies do and what hotels do. So we do a lot of the spin techie, you know, optimization of prices and you know, helping people sell more to you, converting you because we know what you’re doing, you know, online purchase intent, all the stuff that you hear about in Netflix’s recent documentary, we have been behind all of those types of things, you know, and it’s not good or bad. It’s just what it is. But, but with awaken, I’ll tell you a little bit more about the more recent journey. It’s very much a question of awakening to the reality of what I’ve built and what we’ve all done together here in the valley. And that, you know, we’re the cause for the inequality and So much of the problems, and I think we can easily fix it with technology. And that’s really what I’ll talk about today. But the journey of mine, yeah, so I went from e-commerce, we sold that to staples, you know, I was there briefly, they wanted to apply the AI to like their entire 30 odd billion dollars, you know, in sales that were there in 2013. It was behind Amazon and eBay, literally, but you know, number three, today, it’s somewhere that’s dying, you know, staples are falling off a cliff because it was bought by private equity, and then they don’t know what to do with it. Just like any other private equity group that buys companies and doesn’t know what to do, because you can, you can only do so much with an Excel sheet, right? But to actually innovate and grow your business takes a different type of mind. It’s not an Excel sheet mind, it’s a different mind. So that’s missing typically in most private equity firms. And so what we’re doing at awake now, okay, so we’re doing it private equity, a very different way, we’re using technology to grow the businesses that we power. And so that’s the value addition that we bring to companies that we work with. And we’ll talk about shock type in a second, it’s the ultimate democratizer, or the level or the profit optimizer, or the income generator, if you will, for anyone, for individuals, for businesses, for big corporations. I mean, it’s like nuclear energy I’ll talk about in a second. But after doing that, Runa, we sold to staples, I left, and I wanted to build this big network, myself, you know, this huge network of cash flows that would, you know, plug everybody in myself, I said, I just do it myself. But you know, as you know, big tech is in the way of that. I want a billion people to connect, I have to pay for that. And I have to pay Facebook and Google and everyone else, and I don’t have the money. Right? So that’s, that’s as simple as that. So I saw, I thought to myself, how do I get access to a billion people? You know, so I started a company called Quinn type, which is really a Shopify, for media companies. That was what I did in 2014, still running, you know, and it’s powering dozens of major newspapers and magazines, like, you know, Bloomberg fortune, and so many others, and in a very end to end digital cloud kind of way. So we power their entire digital operations, you know, content creation, content, distribution, publishing, you know, into Facebook, into Google, and like, just about everywhere, and then into also the monetization, like subscriptions, etc, etc. So it’s like a full-on end to end. So we get access through that to like this huge network of networks. You know, people, all the people that are so over, like, across these networks, now we’ve actually added up over half a billion people. And we’re now beginning to launch the monetization layer or the new layer I mentioned just now, which is shocked if it brings us back to my sort of, you know, beginnings in a way, you know, of shopping and you know, of internet commerce. And, and, and, you know, businesses that need to make money, because that’s what sales and existence are all about, you have to drive your top line, you know, before you can do anything else. So sales and driving that customer and getting them to purchase. That is where everything begins. Right? So awake is a demand-side economics company. We don’t think about it on the supply side, we think about it from the demand side, we talk about where the buyers are, and we are already enabling them. Now whatever they need is going to be brought to them. All the products or services that you need that I need. I’m not getting that information on Amazon anymore. I go there, everything is five stars, 5000 ratings, you know, everything’s from China, you know, and it’s like, okay, I mean, which one should I buy? That, that question of what to buy, it’s far more important than I can get it anywhere. Right? It’s not Amazon anymore. I can get it pretty much anywhere, right? And so the question is, how do I get it? And it’s not just the 5% of retail that Amazon has got covered, but it’s the 95% of things that we buy every day, like health care, like restaurants, like travel, like, what should I watch? And you know, all of this stuff, which is, you know, everything we do, right? What do I wear? You know, why do I get my hair cut? You know, all of these kinds of questions happen every day. This is not on Amazon. This is every single Mainstreet we’re talking about. And it’s digital now. So we’re talking about the future of the internet network of networks. All the people that come together now on Shark type, for example, and simply connect their businesses. It is the ultimate sharing economy if you know how to sell a haircut because you’re very good at it and you can show it on YouTube and whatnot. You can have your followers go to the best salons, and you can get here 20-30% and you know because people don’t click and buy the first time. They actually have a customer journey, there is an attribution model that we can apply, you can actually pay people for exactly the influence that happens in any given sale, even if it’s multiple people across multiple platforms across time and space. This is the future of the Internet that works for everyone. Right? Well, I’ll just stop there. That’s really what it is.
You had the winch once your new New York Times bestseller book comes out, you know, let me get a copy of that because you can write a full, full amazing book on that so much there to unpack, and I want to unpack it here and get some practical steps for entrepreneurs that are listening to this, you know, this episode, business professionals are high net worth individuals, okay? Who, who might be starting a new venture. But before we go there, I want to take one step back, right, because it was really neat. In the very beginning, he talked about when he came over from India, he had a dream, to get to Silicon Valley and to be in the tech world, he knew it at a young age. So I want to take you back to those that time, right. And help us take us back to when you were there. And what I want you to focus on, though, is what we like to call in the show is certain gifts that you were given. And I believe we’ve all been given certain God given gifts, and these gifts are given to us to be able to bless others. So I want you to connect those dots, you know, or connect that maybe get one gift or that two gifts that you believe you were given? And has that helped how you bless others today?
Yeah, I would say that the gift and the curse that I’ve been given is that, you know, I’m extremely rational and abstract, and the most abstract human being in existence, I think, I claim that title. And I say, jokingly, but I think it’s true. And because of that, what I mean is, I think in ways that most people find unemotional because, in abstract thought, there is no emotion, you know, it’s just what it is. It’s very, very rational. So people find it, sometimes difficult to deal with me in many ways. So I’ve had my you know, troubles with that, right. But that’s my gift as well, because I see things very, very, very clearly because I just see it and emotionally, you know, so that helped me in the so-called awakening, which I had, you know, a few years ago, because I grew up in India, and I was maniacally focused on money, let me be very clear, I grew up in a very middle-class family, and I saw my friends who were, you know, richer than me, and, you know, had all these things. And, you know, I wanted to be in America, and you know, all that stuff, right? And it was all about money. It’s about monetary success, and it’s what, you know, what else? Is it? Right? It’s a, it’s purely a class-based world we live in, right? It doesn’t matter what you look like, actually, it’s just how much money you have. And that’s a fact. And unfortunately, it’s a fact. Right. And I but I also saw, I see that now, you know, I didn’t see it, then, of course, then I thought it was like, so important to get them. You know, everybody wants it. I was maniacally focused. I was I, you know, had many, you know, trade-offs along the way, as you can imagine, you know, in relationships, and so many things. And finally, when I got to the point where I wanted to be, you know, we sold the company and this and that. It didn’t do it for me, you know, it’s like, Okay, this is like, really? Now what, and it didn’t give me anything that I really wanted or needed, you know, it just gave me something like a checkbox? And yes, money, but I mean, what are you gonna do? You’re gonna eat all that money? And I’m gonna, like, start, I mean, what are you gonna actually do differently? Yeah, and, and, you know, the people are the same, and everybody else is the same. And, you know, now it’s, like, complicated as well. And now, it was just like, basically, mostly a disaster. You know. And so that rational thought took over there. And I was like, Well, basically, I thought all of this, and it was the wrong model, the wrong understanding of what happens or how it works. You know, so that was also the process of waking up to the truth, which is that, wow, this is just activity, we’re just doing things based on ideas of what should be done and all that. But you know, the satisfaction and joy and happiness comes from an entirely different place, which is accessible as it turns out to everyone. And you can have been happy, extremely happy, and then be successful as well. And that process is in that order. You know, you have to be happy and then you’ll be successful as whatever you want. Right? And that’s the law of attraction, you attract happy people who then make more manifestation happen. This is how the world works, right? And this is the rational realization of how it is and what that waking up processes and who am I, and who we all are, and what is all this going on, and how we should operate in this world and how do we make money and also, like you said, pass on the blessings to others.
So well sediment thank you so much for sharing that it gives me, even more, more insight and, and you’re absolutely right to think in the abstract and to be able to rationally you know, reduce in an unemotional way, what is and what’s not. And then what you can actually do about it to make a difference, especially in this online ever increasing changing technology environment, at a rapid pace. That’s a revolution, like we’ve never seen in the history of the planet that’s affecting so many things, whether it be healthcare, whether it be financed, whether it be jobs, whether it be the gold, globalization, I mean, a currency all at once, it’s like this perfect storm is hitting, and we need minds like yours who can think in the abstract, and who can help make sense of all this. So Wow, by the way, that’s probably your second. Right there. So thank you so much for being on the show. It’s really a pleasure to get to know you a little more here. Okay, so, so have a dream. connected with a lot of it was and yeah, let’s be honest when you’re young and your, your money is in it. I mean, it’s always probably a temptation for people, right? Money and power and influence and it’s always there. But you’re right if you’re so maniacally focused on it, and then you achieve it. What I found that the major reason for setting a goal is not for what you get because what you get is always temporary, right? Money is just temporary, it’s not eternal, it only provides a position and an opportunity to help others, which hopefully, it moves to the eternal stuff, like, you know, happiness, and character and leadership and leaving a legacy-making a difference in people’s lives, right, and helping people help, you know, free people from whatever thing that might be holding them back. But money is just, it’s just, it’s tangible, right? It’s, it’s, it’s here. It’s what you do with it in the legacy you leave. So you shift it from that, and I love that thought of it. So now let’s get really practical on what that looks like and I want to focus on shop type right now. Because I think it’s kind of bringing all these things together and correct me if I’m wrong for where you’re at, and the legacy you’re trying to leave and lead for a lot of folks here. So walkthrough, you know, if I owned a real estate brokerage company, okay. And I’m trying to compete, and I’m trying to do my help, my services with more folks walk through how you might say to me if we’re talking for the first time?
Well, if I’m talking for the first time, it could be a slightly easier conversation, I would, first of all, preface it a little bit, I will try to explain, you know, what is it that we are really addressing? for any business right, before we get to your business, I’m just going to briefly describe the problem that any business has on the internet today. And the internet, as we know, it is a network of networks, the entire network. That’s why it’s called the internet. Okay, it’s a bunch of networks that come together and form the Internet. The Internet with a capital I and it for us means Facebook, and Google and Instagram, and LinkedIn, and YouTube and all these things that we’re all using every day. It’s about 50-60 platforms out there, maybe 100. And the rest of us are, you know, users. And there are a couple of these players that are operating systems like Apple and Google. And to some degree, Facebook is now almost like an OS. You know, for most people, many people around the world feel that they actually don’t have access to the internet. But they use WhatsApp and Facebook. That’s literally how some people are around the world where they get these phones given to them, they don’t really know very much. It’s all they know. And they don’t have the internet, they have Facebook and WhatsApp. So that’s the world we live in. So if you look at how business operates on this internet, it’s how the big tech makes money. The big tech companies make money when you and I that have businesses want to get more customers. We want to scale our business. So we go to these social media platforms and we give them videos about us. For example, let’s say you and I are doing this podcast, right? And we put this out there on Facebook or YouTube. And it goes viral. Let’s say 10 million people see this all entrepreneurs that they all now know how shop type works and how capital gains tax solutions fit into it. And now they’ve got this incredible cash flow engine. I’ll explain what that is. But let’s say these 10 million people see this. And we’re also happy that we went viral. Now we’re going to reach these 10 million people to actually do business with them. If you and I want to reach them we want to pay Google, we gave them the content for free. They said it’s a social network. Social media they call it right. And so we gave it to them. All these people viewed it, everybody’s benefiting, everyone’s happy. But if I want to reach them on the social media platform where I gave them the media for free, which they said would be great, and it’s social, I can’t do it. I have to pay them. And I have to pay them a lot of money. And I have to rent this information from them every day, it’s not like I will get that list. I will be able to show them ads basically anonymized and hope that 1% conversion, you know, makes that happen for me. So this is the extraction that we have plugged into. This is the internetwork that we are talking about. We don’t see it because the businesses are behind the scenes. But the consumers have a free kind of layer on top of all this. Right? But that’s the internet. And how much is this money? If you look at Digital transaction costs fortnight, the game is in the news right now, you know, because there’s, you know, in this battle with Apple about the 30%, they take, and it’s a billion-dollar company, it’s multiple billions that they’re not a small company, so they can afford to go to in a court and all that stuff. For you and me, we got nothing. Right? What are we gonna do? They say 30%? You say yes, sign here. Right? If you’re a restaurant doordash comes and says to you, here’s an order and give us a 30% or whatever it is, they charge 20-30%? What are you gonna say? No, no, you give them their pound of flesh. Right. So this is what is being used out there, the so-called internet is being used, right? To do what so-called connect the people and then extract the money are, basically, we’re talking about transaction costs, plus, let’s say, customer acquisition costs, if you’re a small to medium business, maybe that’s 5,10, 15, 20%. Sometimes, when you’re just starting, it’s a lot more. Right. So all that money is being poured into the internet. Basically, for every single business, there’s 70 million small businesses in the United States. And what is the way to, you know, advertise Facebook? Right. So think about these numbers. I mean, it’s staggering, right, and all this money can and should be paid to the people that we are talking about, either your content or mine are the people that are, you know, consuming the content, or are, you know, sharing it, what is the Facebook software got to do with the trillions of dollars running through it? Right, so this is the issue we’re talking about. So what we address with shark type is a new approach, a new economic model that just snaps on to the existing internetwork of networks, a new network approach, you launch a network, your real estate company launches a network, and all your members, your customers, your real estate agents, your past partners, everyone turns into a member of your company, a core seller with you, you share with them the upside. And they connect on the internet, all their friends and businesses, and networks, LinkedIn, Facebook, Google, whatever else. And when shares happen, and when people actually transact eventually, which is eventually because people bounce around, they don’t buy a house at once they talk to people and bounce around, they ask people, it will take a while. And this value chain. Facebook doesn’t care, it just cares about transactions, and it’ll take one every single time. Whereas you only care about the last one. And you do want the other ones and you would like to not pay Facebook for all this extra money, you would rather pay just those three, four people. That’s it every day. That’s it, you would rather pay them because now the whole universe can become your salesperson. You would like that the internet working for you. And for everyone on the internet, not just for the networks.You attract happy people who then make more manifestation happen. Click To Tweet
So let me see if I gather this. So essentially, you know what Facebook is kind of basically doing, we’re giving them free content of which everyone gets a lot of value. But then you have to pay to play in order to get that you have to pay Facebook, all the you know the money to actually get to potentially a customer, but it’s not the entire list forever. You have to continue to do that over and over and over again. That’s how they make their money. And what we’re saying shop type is we’re going to create kind of our own network, right our own maybe affiliate system is kind of what I’m thinking about on steroids, where we’re connecting, we’re sharing that same content, and we’re, we’re, we’re and we’re going to do business inside of that community, right versus paying all that extra money to Facebook. Is that a fair summary?
Basically and then you can still do all the activity on Facebook and Instagram and blah, blah, blah, but you don’t have to pay Facebook itself. You can still continue to do that. That’s another that exists, the existing way continues, this just snaps on. This is a completely new orthogonal approach that just fits the existing model, nothing changes for anybody except those that want to make money in this new manner. It could be anywhere in the world, it could be in India, telling the best real estates or in you know, a certain and this is why blah, blah, blah, it could be anywhere in the world, it could be in Nigeria, for all it matters. we’re promoting good content, good information that buyers want. And it’s organic, right? It’s all about authentic information, organic information that anybody can do it.
I’m thinking sort of like a credit score, but I’m thinking a bit more like content or value add or trusted credibility score, right here. And if the more people that you help, and the more guests, it’s sort of like the likes, right, they’re getting all the likes over here, which boosts everything here, I’m thinking the more folks that are in your shop type, let’s call it network. Am I on the right track here?
Yeah, basically, you get this reputation score. That is not only based on what people say, but it’s actually based on your sales, actual sales numbers straight-up simple. Right? It’s actually what’s selling. It’s not a not an ad, by the way, what people are not returning. Right? It’s like it’s a full-on end to end CRM system for the universe. Right, and it’s everyone plugs into one single CRM system. And everybody is now you know, why are we here? We’re here for business. I mean, we’re here for the money. Yeah. But we have to connect with each other. We need to know each other, you have relationships with each other. And then, of course, money happens, right? Money is just a byproduct like you said earlier. Right? Right. So the money will appear. And it does appear, right. The ledger itself is the money, I can now issue coins on the ledger, I don’t have to issue crypto, I can issue fear. Think about that. So you can be like a government-issued fiat currency that works in-store. And this store is a universal store. It’s a global network of companies and stores and people that accept this credit. It settles on the ledger in real-time, you can earn regular cash, you can earn crypto, you can you know, fear you cannot because money is not an asset. We are a global asset ledger that shares the economy of the universe with everyone because we’re all part of the universe.
Got it. I’m with you now. So now let’s take step two. So now I’ll go like, oh, gosh, this is the future, I like to give it a shot, I like to join and get it going, what would be the next step for that business to be.
So basically, you go to shopify.com, you sign up for free. If you’re already on Shopify, for example. It’s a one-click integration, you synchronize your entire catalog, you synchronize your entire inventory. And we make it available to our entire global co seller network. You can also do the same thing, you can just tell your friends about it, you can tell your existing agency partners, you can tell our existing media partners and your existing marketing companies about it. And they get a link, you just log in. And they can start to share media, which they’re already doing with the links now that directly track them. And their contributions and their reach. And everything is on the platform. Everybody’s wallet is on the platform. They’re all getting credited for exactly what’s going on. And if they’re doing more of it and doing it well. They start to make a business. So this is a global entrepreneurship platform. Anyone can start to drive money for a global set of businesses, your real estate business, or somebody else’s t-shirt company, people can start driving leads and making money no matter where they are in the universe.
Love it. So next thing would be my mind protection and privacy. Right. So which to me is kind of counterintuitive, because you’re already on Facebook, you’re already out there already doing all that stuff anyway. But for some reason, you know, we trust that that protection and privacy, which is an illusion, right? Because they have everything and you can find everything. But more so not so much for that part. I mean, I’m more thinking just like the actual currency and the transfer of stuff so yeah, like.
Very good question. Yeah. So the way it works is you see the awake system. And I’ll get slightly technical enough. And if you’re, you know, cryptocurrency, you know what I mean? We are a set of protocols. Which means that we transcend even the blockchain. It’s just the protocol. You could be on a blockchain, you could be on something else a graph database doesn’t matter. It’s a protocol. So shop type represents the market protocol, or the market network protocol to be specific. How does the market network emerge? And what is transactionality? is and what are the interfaces a protocol that you have to follow to be a part of that network? The shop type network shop type is the name of the product, it’s a SaaS company, you can use it, but tomorrow anyone can implement this protocol. In other words, eBay could implement it, technically speaking, right? So it’s in that sense, it’s like Bitcoin, right? It’s like a protocol. That’s a global protocol. Right? It’s not a ledger, it says ledger protocol. It’s not a, it doesn’t have a blockchain behind it. So it’s totally, you know, energy-efficient, right? There is no energy use. Okay, so that’s a very important part. Now, this, the first protocol that this is built on is a global identity protocol. Who is it that we are going to give money to, because chalk type is a money giving, we give money out, the buyer buys, we just hand it out to a lot of people, right, so we have to make sure that people who are giving money to our KYC, you know, we have to have KYC on them. And they have to have their bank account connected to our ledger to take the money out. So if you have your PayPal account or your regular bank account, you can take the money out of our ledger, you might accrue it in any currency in the world, or in Bitcoin or any other whatever we are transacting, you can accrue all of those multi-currencies in this ledger. And then you take it out. So the privacy elements and the KYC. And all of that stuff is at the identity level of every single node, every member, every business that connects, we have to have licenses in place, you have to provide that like Uber, like Uber drivers come in, they have their own registration, license car, whatnot. So you just plugin, right, it’s the same model. This is global, almost like a Uber for Ubers. Right? It’s a business of business software. And so that’s, that’s what it is.
Yeah, fantastic. And I am excited to get going myself because part of what we do is we have these affiliate partners, we have the strategic alliances, we have these referral fees that we set up for folks who help us educate and spread the message of the deferred sales trust to help people defer capital gains taxes on the sale of highly appreciated assets. And so to be able to have this in a single location, and be able to track sales, and to see I have it all in real-time if I’m missing anything. But that is fantastic, right? Because part of it is just having to keep track of all that is having to process all the payments, and then see having an easy way for them to also tap into that as well, right? Because sometimes there’s affiliates that want to bring in an affiliate, right? And what we’re saying is, yeah, go ahead and do that. And let’s all connect here on the shop type platforms.
I’ll explain exactly how that works. So we are a profit-sharing network, right is a sharing economy, if you think about what that means we share the economy itself. Whatever the businesses are, we share that and our economy is to make money on all these businesses. So we share that, that’s what we share, right? That’s what shop type is sharing. So when the transactions happen, two kinds of share splits occur. One split occurs where you as a business have come on, but I sell t-shirts, okay, let’s say I sell t-shirts or jewelry or whatever I’m selling, right. And I come on the platform, I integrate it in one click. And I say in my dashboard, I say I’m willing to give 40% in commissions because you know what Walmart takes that and everybody else takes much more. And I don’t have to, you know, drive the sale here. So I get 40%. So I say 40%. Now, on the other side of the global co seller network looks at these products and can blog about them, they can talk about them, they can put them on their magazines, they can you know, whatever you want, if you’re an entrepreneur, you can collect all the best ones, and, you know, sell them. And the actual sales happen from the sellers, which are already on the platform. So people operating in Shopify don’t do any fulfillment, they don’t have any support, they don’t have any, you know, they’re playing in the pure margins. Okay, so it’s pure money at this point, your profits. So we’re just sharing those profits. Now we turn around. So people are coming to us and giving us 40% 30% or 50%. You know, our own brands are putting them on there for 60% private label brands and stuff. So globally, you’ll be able to make money across this huge set of products. And the Commission now will split across mostly say three ways. You know, mostly three ways we’d say we’d pay like a good 10% of the available commissions to a person who makes an introduction to the buyer. So if 50% is available, you get 5% as an intro, just as an intro, you just make intros do nothing else. Nothing else. You just Pinterest stuff, put it on Pinterest, somebody clicks you make an intro, that’s an intro. Alright, that’s a 5% passive income doing absolutely nothing. Okay, now, another says 40% of available commissions are given to somebody who nudges the sale. Which means if somebody sends an email or so you see it on WhatsApp or Twitter or whatever, you know, Snapchat or whatever it is, Instagram, or anywhere, frankly, if it’s within, say, 48 hours. So these are all rules that anyone can set by the way, because this is just the network rule. I’m just launching a network My network I operate this way, I say, you know, 10% of intros, you know, 40% for a nudge, and another remaining 50%. For this for the close, which happens to be within an hour. Nobody needs to know which part of the journey they’re in, they don’t know which nobody knows the other person. This is an independent agent acting in, you know, Univision, on the internet, across the internet, everyone’s just doing one thing, being authentic. Being themselves, being you know, all they can. And as people come through, depending on where they are in the journey, if and depending on how much of an entrepreneur you want to be, you can own the entire 50% or you can just passively let through whatever is happening. Right. So literally, this is a new model to drive the sale, which is the most important thing for any business. And then the second part kicks in right, the second part kicks in, which is referral commerce, you introduced me to the brand, Brett introduced me to this T-shirt company. So because I shopped I’ve made a million dollars, we pay 5% of bread, automatic, it’s in the ledger in real-time, right. So every time a sale occurs, Brett seeing the money in his wallet. This is passive, your passive, this is not an intro, this is the referral link for the business so that when you talk about mlms, this is the reverse MLM because we give up 95% to the other people, and we keep 5% and pass that along. So it’s a reverse multi-level where we’re actually sharing 5% profits with the people who brought the businesses in and, you know, people who are on the levels. And it’s just a small number. But for the person who brings in a lot of people, that’s a lot of money. So and if you’re on the high up in the network, it is a lot of money, it’s just that it’s 5% more like a FinTech at that point, right? yourself, like people, can become fintech, essentially. And then you get this money split as well in return. So both the splits occur in real-time. And we can configure more splits. So like stripe is what they call a payment facilitator, we are creating a new category called we call it commerce facilitator. So we are a compact, we can change the rules, we can do all the stuff, we can even do revenue-based investment. So when investors come in, we take debt and we allocate across the sales, you can actually do senior data, you can do collateral factoring, you can do all kinds of stuff in real-time. Right, so now we will talk about taxes, when you mentioned earlier, you know all the stuff you can do, you can actually real-time this entire thing you can batch it into, you know, transactions that are tax-deferred. For the LPS and for the investors and the referral network side. Real-time you want daily wages you want whatever you want, you can pay the restaurants in real-time pay everybody in real-time. But on this side, you can do all kinds of different stuff, you can put these two companies in opportunity zones when you can do anything you can, I can run a query and say give me all the tax-deferred investments available in opportunity zones in America, which are run by black businesses and are selling certain categories and have an IRR of over $1 million and have a growth rate of I mean I can literally run a query and give you an investment package.
Yeah, my mind’s blown Amit I’m not sure where to go with that. It’s just so abstract, but also practical and amazing. And so the profit-sharing network, the global entrepreneur platform, and the ability in real-time to get paid on just what you already were doing or promoting or talking about, is there I think the best thing is just to dive in and try this thing out you know, I mean give this thing a test drive and run with it that
We’re looking for beta customers. We’d love to work with early guys and people get those and guys but you know, we’re working with them personally. It’s early days so yeah, we’re excited if you want to try it Yeah,
Absolutely. I’m gonna try for sure. We’re running out of time so I want to shift to capital gains tax reform and then we’ll go into the lightning round. So would you share with our listeners because by the way, you sold it you sold a company it sounds like a pretty big company and you sold it to staples. Right? And I’m curious what did you do with the capital gains tax and what did your partners do when you guys sold that?
Yeah, I usually make this joke that you know, we make money as entrepreneurs and losers that lose it as angels you know, so I lost a lot of money in angel investing over the years I’ve invested in a whole bunch of companies of course and you know, made money too. But really, we need a system to your point you know, you need a system you need to have that well thought through and if it’s not thought through then it’s just not done right and it’s not then you lose a lot of money to waste a lot of money.
Yeah, part of what we do just for listening to learning about the capital gains tax solutions are the first sale stressed for the first time is we help high net worth individuals who are selling a highly appreciated business or real estate cryptocurrency public stock, private stock, defer capital gains tax, what’s the capital gains tax? Well, it’s somewhere between 30 and 50% of your gain depending on what state you live in, and how much depreciation recapture you received, when you sell. And what we do is provide only tax deferral, but liquidity, diversification, and the ability to go back into real estate or business, whether it be a startup business, whether it be angel investing, and someone else’s business, all tax-deferred, so you can create and preserve more wealth. And let me just give you a quick deal story. So a recent deal was a $7.6 million sale for gentlemen who sold a highly appreciated apartment complex, and we saved his failed 1031. And he paid off all of his debt. And one of his biggest things was, he wants to defer the tax, he deferred about 1.1 million in tax that would have been gone. Instead, he has this full about 3.1 million sitting in the trust. But part of his thing was to diversify, right. And so he puts some of it to hard money lending, some of its going to go into the stock market. And then some of it’s going to go into actual multifamily investment in real estate, but not of his own with other people who are taking all mid debt. And he’s diversifying with different operators, different sponsors, different syndicators in different parts of the US, and getting cash flow coming from different properties, right. So he took, what before was his only single property, he had all the debt, all of his name, and all of the toilets, trash, and liability, and basically, he’s diversifying it. And he’s also gonna give a chance to retire. So in your shoes Amit, maybe it could be a benefit, where you say, hey, look, alright, so this big company for this big price, and yeah, I want to take a percentage of it, let’s say 33%, and do some angel investing on my own or with others, maybe the other 33%. I’m going into stocks, bonds, mutual funds, maybe the other 33%, I’m going into commercial real estate, but the key is you’re all tax-deferred, right? It wasn’t just, you sold for 10 million, paid 4 million in tax, took an extra four that you would have paid and you diversified. So that’s what we like to call transformational exit planning. Which gives you more. Is that making sense? Yeah.
Could you know, do something like you know, when LLP comes in, and we, you know, basically take a bunch of money in, right, let’s say you put in a million bucks. And then you are juicing these returns from all these businesses that are on the ledger, we batch all the results, I mean, returns and we do a qualifying transaction that can be tax-deferred. Can we do that?
Yes. One caveat, let’s say it’s a million into the trust up to 80% can go into like an outside deal with an outside deal, like a startup company, or a business venture or a real estate development or real estate deal. The other 20% need to stay liquid diversified investment grade security. So it’s got to be in some of the biggest money managers, companies.What I found that the major reason for setting a goal is not for what you get because what you get is always temporary, right? Money is just temporary Click To Tweet
20% has to go into some sort of a managed account. any direction can go into any alternatives.
You got it you got, that’s a good way to put it. Yep.
Okay, that’s fabulous. Because we can actually offer that as an awake service to LPs that want to come in on all the small to medium businesses and large businesses that are there on the network, and you know, get cash flow out of that. But then you can actually create these tax-deferred vehicles that batch these returns into them, right and do like qualifying transactions that are then recycled.
Yes, exactly. Exactly. And I’d have to get into the details with the tax attorney, and the financial advisor, I’m kind of like the nurse, right. And the brain surgeons are the ones that kind of do that. But Rules are rules, the trustee, we’re kind of like the broker and the trustee for the trust, perfect. It’s gotta be a third party and the way we work it out. But yeah, I want to explore it with you offline. But if you’re listening to this, you’re interested in learning more, you can go to awake.vc. You can also go to capital gains tax solutions.com, to learn more about the deferred sales trust. That being said, Amit are you ready for the lightning round?
Let’s go for it.
All right. So knowing what you know, now, you can go if you could go back to your 25 year old self, what’s the one Golden Nugget, you would make sure you would do?
What I would tell him, you mean?
I would basically say that, you know, don’t be scared about you know, anything. I think the fear factor comes from desperately wanting to be a certain something. And that’s a purely imagined idea. And we get scared of it. We get scared of not being that idea. That’s in our head. You know, because all we know, is the idea in the head. We don’t know things we don’t know. So we’re like, oh, my God, everything’s got to be this way that we know, you know, and that knowing that knowledge is the cause of fear. If you didn’t know that, you would just be doing all the things you wanted to do. Right? You just be like, yeah, or you know, so it’s like ignorance is bliss, except that it’s not ignorance. Once you understand it, it’s no longer ignorance. It’s just bliss because you know exactly what it is. Then you can be powerful. You can do whatever you want.
Yes, we’re only limited by the weight, the limits we put onto our minds, right? And so that’s amazing. I love that. What’s the one book you’ve recommended or gifted the most in the past year?
I used to give, you know the power of now to a lot of people, I think that’s a really good book to start when you’re, you know, looking for these sorts of answers and stuff. And more recently, I’ve started giving out The Autobiography of a Yogi, believe it or not, it’s kind of a bizarre gift for most people. They’re just like, what is this? And I just tell them, I say, you know, you have to read this book, and then you have to wake up.
Another resource, I would say that, you know, the local TechCrunch. And you know, these local companies that are reporting on innovations here are very, very important for us to keep an eye on, you know, Silicon Valley actually has a ton of good ideas, not all of them work. But many of them apply to our businesses that we’re in like life, life’s Life Sciences, or whatever, like, you know, life work and play that we’re in, you know, we might be in small businesses around the world, around the country, many of these ideas actually do apply. So I think, you know, these entrepreneurial websites are extraordinarily important. And people should keep an eye on it.
Fantastic. After all, your success Amit and your mission to do everything and all of the folks that you’re helping out. I’m curious, it’s our last question because we’re running out of time here. How do you stay centered in your values? And how do you stay encouraged to reach for new heights?
Yeah, I mean, that’s kind of a, you know, spiritual question, almost as you know, in a way, why I call it awake was that realization in a way that, you know, things are only things and, you know, material, things are material, because they are, they are actually made of matter. And there’s something other than matter here, you know, there’s something that matter appears inside of, and I call it awareness. So everything is happening inside of awareness. And if you are aware of that awareness, then you’re always so-called centered and grounded in reality, you know, you don’t get carried away by those ideas or things or, you know, whatever happens to you, you know, you’re not worried about it, because you’re always focused on the reality of fact that everything changes, and, you know, that’s what it is.
That’s beautiful, and it’s abstract, and beautiful, and clear. And I think only a mind like yours can put it so well. So I mean, I want to just, First of all, thank you for being on the show, I want to thank you for sharing your gifts, your talents with us your part of your story, and so much there with shop type, I’m so excited to dive into that, would you remind our listeners where they can find you give them a call, and then give them one last call to action for moving their businesses forward. And, and then we’ll wrap up the show.
Sure, I run a company called awake, which is an investment company, and we are looking for all kinds of businesses to help grow and they don’t have to be digital, I think everything is going to be digital. So you know, that’s something that we help with and we think big and small, I think small is big, you know. So that’s so they can reach me at awake that we see. And there’s a whole group of people around the world that are building awake companies now in various verticals you know in cannabis and wine and spirits and games and fashion and you know, dozens of verticals food. So it’s really exciting. And they can find all that on awake.vc, and also shoptype.com is the core layer in a way if you’re a Shopify customer or WooCommerce or any of the online beat you know customers or you’re not you know you’re looking to sell more your influence your media company and you’re looking to get more revenue, you can go to shark type.com and sign up for free and you can get started today.
Beautiful. Thank you amid and I want to thank our listeners for listening to another episode of the Capital Gains Tax Solutions Podcast. Hey, as always, we believe most high net worth individuals and those who help them struggle with clarifying their capital gains tax deferral options. Not having a clear plan is the enemy and using a proven tax referral strategy such as the deferred sales trust, or using an amazing new innovative thing like shop type is the best way for you to grow your business and grow your wealth. And with that, I wish everybody well please rate review subscribe to this to this episode and to the podcast. And we so appreciate you go bless some people today with the gifts you’ve been given. Thanks everybody by now.
About Amit Rathore
Amit Rathore is a serial entrepreneur and angel investor based in San Mateo, CA. Since 2003 he has focused on AI, media, commerce, and FinTech verticals. He is the founder of AwakeVC, a private equity holdings company focused on creating 100M jobs by enabling 10M new technology ventures globally.