Non-fungible tokens (NFTs) appear to have popped up over night. What exactly are they and what might they mean for investors? Simon Erickson has a breakdown of this emerging technology and some of the exciting ways it’s already being used. In addition, Roblox had filed for a direct listing bringing the much discussed company public and Matt Cochrane will have all the details.

Samantha Bailey  0:12

Welcome to 7investing Now, a show that teaches you how to take a long term view on investing by better understanding what’s happening in the market now.

Dan Kline  0:23

Good afternoon 7investors and welcome to the Wednesday edition of 7investing Now my name of course is Daniel Brooks Kline. I’m being joined today by Simon Erickson all the way from Texas. Simon, everything’s normal in Texas, you’re back to wearing spurs, the big hats and, and power and all that stuff is there.

Simon Erickson  0:39

Thank goodness this person the hats are back then we’re back to normal again.

Dan Kline  0:43

A few people know this, but Simon actually rides a horse to and from the grocery store. So that is true. That is not true. Simon lives of course in Houston, Texas, which is a which is a city, Matt Cochrane, you are here with me in Florida. You’re having some technical issues today. So if Matt disappears, it’s not because he doesn’t like you. It is because he is having some internet problems. And, gee, what a surprise Matt’s internet provider is Comcast. Matt, welcome to the program.

Simon Erickson  1:09

Why do you have any experience with Comcast and acting up? Like I think I heard about that. But yeah, like, hopefully I’ll be here the whole show.

Dan Kline  1:17

Here’s the thing, if Comcast had a policy that their technician had to spit spit in your face and punch you before they could fix something, it wouldn’t be any less customer friendly than their actual policies. But I don’t want to get any more any more private messages from Comcast and I, I will say, Simon, if I disappear someday, it’s Comcast or it’s Walmart. Those are the two companies that most don’t like to be criticized. And I can actually say I’m generally a big fan of Walmart, they just have some customer service issues and some delivery issues that have have not gone well.

But that’s not what we’re going to talk about today. Now, later in the show, the last segment of the show, we’re going to take your questions, we have some we’re going to take some more we understand the markets have been fun, volatile and bad volatile the past two days have been in a while rocket to the moon, the couple of days before that where the sky is falling. I will point out that if the markets go down 500 points on Monday and up 250 points Tuesday and Wednesday. The markets really didn’t do anything like there is a lot of churn.

There’s a lot of sentiment based moving. That being said, if you have questions, if you’re worried, we’re here for you. That’s what we do at seven investing we focus on the long term. I’ll say it before I’ve said I’ll say it again, I’ve said it before, nothing changed about Apple yesterday, like nothing changed about Disney or Costco. But with that, we’re going a totally different direction. We’re going to talk about non fungible tokens. That is a term Simon Erickson. I had not heard until I don’t know, roughly three weeks ago, and now it’s absolutely everywhere. Simon, what is a non-fungible token?

Simon Erickson  2:52

Yeah, sure. Yeah. So let’s start with some terminology that the first part of that non fungible means it’s uniquely identifiable. And it’s not just mutually transferable. So in English, that means we, each of these is unique, and they’re not all exactly the same, right? So Dan, if you and I go out and we buy Starbucks stock, that is a fungible good share of Starbucks that you buy is pretty much exactly the same as the share that I would buy.

A non-fungible good would be as if you and I go to the Eagles concert, we would say, hey, which ticket did you get? Are we in the front row, are we in the back row, because those are uniquely different on the perspective that we have in our stage. And so a non fungible just means you can track it uniquely. And it’s not exactly the same as if it’s transferred elsewhere. And then the second part, a token is a digital asset that can be tracked for transactions over time. So not only the upfront sale can be tracked, and then it goes to the abyss of the secondary market, you can actually track every single time that a token is tracked is bought or sold on the same ledger of a blockchain. So the combination of those two is making for a very interesting dynamic within FTS.

Dan Kline  3:56

So let me give an example here. These are one of a kind are unique, but they’re not necessarily one of a kind. These can be like sort of like prints where there can be multiple copies so maybe I go out and shoot a video of me doing a monster duck few people would think that at five foot eight, I can dunk and I can’t but let’s pretend I could so I shoot this video, fans of 7investing want to see this we could make it one of 100 and the contract would essentially be we are only going to produce 100 We can never produce any more so you end up with something that is a collectible or an asset. Am I understanding that correctly?

Simon Erickson  4:29

That is correct. And it could be anything that you want it to be digital like you said you doing a slam dunk? That’s awesome. I would pay money to see that one dance.

The idea is that these are these are offered on a blockchain and typically they’ve been the Ethereum blockchain token standards that they’ve been created. You have to mint them and when you do that, it allows you to not only track them the entire way but also kind of cuts back on counterfeit, right? Because you can follow the ledger to where they were originally minted. It keeps people from Creating a fake Dan video of dunking a basketball or a fake Rolex that you see on the side of wall of Manhattan or something like that. I mean, you can follow these digitally all the way back to the source. And the ledger itself is what makes NF T’s really unique because you can actually capture value for each one of those transactions that takes place.

Dan Kline  5:20

So Simon, let’s say I want to buy and sell NF T’s obviously, some of them have real perceived value. Some of them have just sort of sentimental or collectibles value. So be careful. What I’d say is this is a lot like the collectibles market where Barry Bonds his record, homerun ball might have been worth a million dollars at one point. And then Barry Bonds fell out of favor and maybe it’s only worth 100 grand now. So there is some risk. But many NFT’s are more like buying you know, a baseball card of your favorite player, you’re not buying it to resell it, you’re buying it to like mount on the wall or having your man cave. But Simon if I wanted to buy or sell NF T’s because I’ve got some ideas here. How would I go about doing that?

Simon Erickson  6:01

So the the similar comparison is to eBay and I’ll start the example by saying the say that say that Matt is really into kitty cat Beanie Babies, right? And Matt goes on. I mean, I was just assuming man, I didn’t know for sure. But it was

So Matt goes out and he buys a crypto or he buys I’m sorry, he buys a kitty cat Beanie Baby, he sells it on eBay for $10,000. Right? eBay takes a small cut of that say it takes $500 5% of whatever the transaction detail is. And then whoever buys it said that you bought it, Dan, you go off and you sell it. And eBay really is out of the picture at this point. That takes us $500 he gives us $500 to eBay takes us $10,000 for his being for his Beanie Baby. And that’s gone. But now Matt decides to create an NFT, which is a digitally created kitty cat Beanie Baby, it is now a digital asset, not a physical asset. And he sells it on an NFT gateway.

And we do have those already, we’re starting to see NFT gateways starting to show up that are allowed to do this. Now Matt sells that upfront for $10,000. The Gateway itself, which is the eBay symbol similar to eBay, like we in the previous example, takes 5%. But then Matt captures 10% as the seller of the good, right, so he captures his his $1,000 he sells it to you for $10,000 dan. And then five years later, you sell mats digital kitty Beanie Baby for $100,000. Now, eBay is, still taking 5%. And you’re still getting a cut for making that sell.

But Matt is the original content creator of that digital kitty cat gets another 10% of that $100,000 that then follows the ledger back to the original person who created it. So you can see this really encourages people that are content creators to monetize over time, because now we have a way of tracking every one of those transactions in the future.

Dan Kline  7:53

So let me point out a couple of important things. First, we’re not mostly ignoring Matt and just using him as examples. We essentially start the show with a top story today, we decided that that Simon’s pick for what we’re watching our second segment really was the top story of the day. So we’re starting with Simon story. And we’re going to move to Matt story, which is Roblox, which is filed for a direct listing. So we’re going to get a lot of that later in the so second, our very own Maxx Chatsko,

I believe, or maybe it was a it was Maxx Lucas, it was one of our friends out there did not know what Beanie Babies were. So let me explain this for the younger crowd. Beanie Babies are theoretically collectible, small stuffed animals that for a brief period in time because they were in somewhat short supply. Some of them had very, very high collectible value, the floor fell out of that market. So I have an aunt who had tons of these. And in fact, people on both sides of my family that had tons of these with the idea that they had value.

And then when they became no longer scarce, and people became less interested, the value went away. So there was a limited quantity. But they didn’t have that ability for the company that makes them that’s tie to every time one was sold, they did not get a piece of this. So this is going to be really good for artists and creators. We’re going to get to that in a second. So Simon, what creates the value for an NFT it’s kind of supply and demand. Right?

Simon Erickson  9:15

It is and I think that a lot of the flack that NFT’s are getting right now is because these are more collectible items, right? We’re seeing digital basketball cards, we’re seeing digital comics, things like this that we’ve kind of traditionally thought of as, as collectibles. And eBay has played a role in facilitating those transactions.

I think you hit the nail on the head. Dan, when you say that this is going to fundamentally change the music industry and the art industry, which as Napster and other technology has kind of devolved those industries where the people that were actually creating the songs were getting less and less money every year because it was all interchangeable goods, right, everything was exactly the same. Now they have a way to make exclusive content. provide that to people who are willing to pay for that exclusive content and get paid continuous. You can actually build a career out of this again, as a musician, something that It’s kind of been harder and harder to do for the last 10 or 15 years. Yeah,

Dan Kline  10:02

and I spent a bunch of time in the music industry at least covering the music industry, I worked at Guitar World Magazine, I ran Long Island’s biggest arts and entertainment. In the old days, an artist would sell an album and get a cut of the money from that album, it often wasn’t a great deal. But there are ways to make money if you sold a lot of albums. What happened in the streaming music, even take it beyond Napster, the legal streaming music is artists get a cut from Spotify, Apple Music, whatever. And it’s a very, very small cut.

Because there’s multiple management’s taking a piece, the artist gets a piece Spotify needs a piece, and you’re only paying $9.99 a month, that is essentially made the physical album, a souvenir. So someone like Taylor Swift, who has a devout following might still sell a million physical albums, when in the old days, she might have sold 10 or 12 million, the average smaller band that’s still very successful, essentially sells no albums. So what this allows them to do is say, okay, there’s no reason for you to buy my music, you know, you can get it on your streaming service.

But I bet you would like a copy of the album with a message from me and a bonus track that’s never going to be released to streaming music, or access to the front of the line for tickets or who knows what it is. This is a really important way in my opinion. And Simon Feel free to explain it more for artists to monetize something that people want, if they have a fan base.

Simon Erickson  11:27

Yeah, absolutely. Kings of Leon just put out their first album on an NFT non-fungible token digital album. And they’ve given away golden tickets, they’ve only mentioned a few golden tickets out there that you can pay for an exchange with anybody else who wants to buy them from you. But in addition to getting access to the album, which everybody else will have with a CD, you also now get to front row tickets to any concert at any venue that they have in the future. You have exclusive backstage access, and they’re going to release even more benefits for the people that hold those golden tickets over time. Right? This is not a one time sale anymore. This is a this is a gift that keeps on giving. What will the market bear for something like that? That’s exclusive. That’s up for the market to decide. It’s pretty exciting for Kings of Leon, though. Yeah. And

Dan Kline  12:07

This sort of builds on something you’ve seen a lot of artists do Simon we’ve talked about I like a lot of bands that would be considered obscure, and, and my favorite band had their heyday in the 80s and 90s band called buffalo Tom out of Boston, their last album, they fundraised for it using pledge music, which I’m pretty sure no longer exists, it’s a crowdfunding platform. So you could go and I’ll call this an early version of this NFT model without some of the recurring revenue, you could go and say, hey, I want my name in the liner notes. That’s $25. Hey, I just want digital access to it. And to support the band that’s $10. I want them to play in my backyard when the album comes out, that’s $7,000. This is a way to do that in sort of a recurring revenue where they may only have 20,000 fans nationally. But those 20,000 fans are fairly passionate. So that’s a way for much smaller artists, not just music, to sort of monetize and make a living. I think it actually like kind of changes the art and collectible world.

Simon Erickson  13:05

Yes, you’re walking down the demand line, right? It’s not everybody’s just buying the album and paying the same amount for it. It’s if people want more, you can give your most devout fans more access for a higher value.

Dan Kline  13:16

We would love your questions and comments that can be about NFT’s we’ll take the one that’s in there about NFT’s a little later towards the end of the segment. That can be about anything you’d like to talk about. And certainly if you have Roblox questions, we’re going to be talking about that in the next section. But Simon there are risks here, what are the risks in buying an NF? t? The one that pops to my mind is it works like like any cryptocurrency, right? Where if I lose my wallet, I no longer have

Simon Erickson  13:42

the asset. And there is a little bit of friction getting set up. I mean, you still these are still you know, you have to pay for them with with things that are in cryptocurrencies on blockchains typically aetherium I’m not as concerned about the traditional things we’ve had about counterfeit or you know, losing your money on investment. All of that’s kind of tracked by the blockchain itself, I think it’s more or less comes down to you know, what you’re getting into. If something seems like you’re just trying to get in and out and make 100 times your money in a week. That’s not the way to typically think about these. The Gartner hype cycle kind of walks us through how new technologies like NFT’s tend to go through a really high level of expectations where everybody’s trying to make a ton of money really quickly on it.

And then we saw the same thing with Bitcoin, right? Bitcoin shot up to $17,000 a Bitcoin when everyone in the ground was buying it. And then it kind of went through that same trial disillusionment, right, I lost a lot of money. Everyone was very frustrated as Oh, I bought Bitcoin and lost 50% but now you start seeing people embracing blockchains and cryptocurrencies, especially enterprise. I think we’re gonna go through the same thing with NFT’s think about its long term, how it’s disrupting industries as an investment, rather than trying to get in and out on something that is a hot collectible that you want to make some money in a week on. Yeah, I

Dan Kline  14:52

I would argue that collectibles are not an investment. You know, when I ran the toy store, we sold baseball cards and people were always angry at us on the value We would pay them based on what they thought they were worth. We also sold some very, very high end trains. And some of those would be $10,000, you know, engines. And if you put one on eBay a month it would sell if you put two only one would sell, because that was how limited the market is. So when you’re buying a collectible for resale value, there has to be someone on the other end of that transaction that is important to remember.

So that brings up we’re going to go to some questions. Now we’ve got one from a friend of the family, Alan Soclof from from cruising altitude, he’s actually going to be on seven investing now on Friday show the last segment talking about millennial investors. But we had talked about how the NBA has been using NFT’s with highlights and he says, How does paying $200,000 for an NBA highlight make any sense? It’s a good question. Are people really paying that much? I mean, I guess if you have exclusive access to it, there could be some, some opportunity there.

Simon Erickson  15:52

I mean, it comes back, I think, to their previous count, we just made Dan if you know, what are you investing in in NFTs fpr, it seems ridiculous to you don’t buy the NFT, that’s $100,000. Right? If you are an artist, that you’re trying to figure out how you’re gonna make a living off of selling art or music, and this is a way to accomplish that, then it makes a lot of sense. So buyer beware, I think is the guidance that I would give, I don’t want us to go out there and say every NFT is the best deal possible for you out there. I just see the potential for innovation, a lot of industries, and this is solving for,

Dan Kline  16:23

I view it a lot like you know, if I wanted to own an animation cell from the Simpsons, or a Star Wars lightsaber, or my thought isn’t, you know, hey, those things could become valuable in the future. But that wouldn’t be your goal. There has to be some joy of ownership. If I am a fan of Kings of Leon, and I can buy something exclusive that that’s just me supporting the band, and it’s $30 or $50, or even $100. That might be worth it for me as a fan. Simon, we have a couple of questions here, one from Max Lucas, one from Chris Morley, you can you’re sitting close to your computer than I am. So I will let you take them and read them. Sam, if you want to bring up the max Lucas question first. Simon, go ahead.

Simon Erickson  17:00

I think the value of an NFT, here we go. There we go. I think Thank you, Max. I think the value of an NF T will come down to how it is taxed. Art is an investable asset for many high net worth people because the possible tax exempt tax exemptions on the capital appreciation. Yes, of course there’s tax consequences a good point Maxx, I can’t disagree nor argue with any point of that comments. A good Good point.

Dan Kline  17:20

It’s it’s also I hate to say going to be as our cryptocurrencies a haven for tax cheats, because well, the IRS has wagged its finger and said, You have to report all your transaction. There are plenty of track notes. I’m not giving any, any criminal advice matches just Just so you know, I’m just saying that there is not as much transparency, buying some of these things, especially as they’re there are emerging markets for them as their necessarily is when you’re buying like stocks through TD Ameritrade. And they’re not only correctly issuing you paperwork, they’re sending that paperwork to the government as well. So this might be a gray area, as the government doesn’t catch up to technology, all that quickly.

Simon Erickson  18:00

It’s far behind the IRS is gonna be way behind this curve. They’re gonna figure out how they’re supposed to tax these things. Keep in mind, NFT’s isn’t just selling digital, Beanie Babies and basketball cards either. I mean, this could incorporate a lot of things, we could be talking about digital real estate, in an augmented reality worlds that are being created right now. And is that a real estate transaction? if you’re if you’re buying something just like you’re buying land in the physical world today,

Dan Kline  18:24

I mean, things like that, technically, would be an NFT for a transaction. There’s going to be a lot of different tax codes that apply to this. And Simon, before we get to Chris morleys question, I just sort of want to bring this back to the original concept is that basically, anything can be an NFT. And the ridiculous example I gave is I hire Mr. T. And I get him to do other celebrities catchphrases. So you’ve got Mr. T doing you know, dynamite. And Fonzie is a and all the other. And he signs a contract that says he’ll never do this again. And I’m selling 10 copies of each one. That is a unique asset. There might be a market for it. But Simon, you could after the show create an NF T of us talking right?

Simon Erickson  19:04

Yeah, let’s let’s put it up on video, Dan. I mean, it’s not mutual interchangeable, we’re only going to create three of them. You know, maybe only our parents will buy them who knows but but if we put it up on the marketplace, no nifty gateway as a way you can create NFT’s right now and sell them what the market will bear. Now this is creativity opening Pandora’s box of what people want to create out there.

Matt Cochrane  19:28

I mean, can I ask question? So I get why creators are incentivized to, to put to release NFT’s. But the reason why people pay the eBay fees is because that’s where the customers are right? Is there a chance we’re gonna see a lot of supply for NFT’s but maybe not the demand because let’s face it, again, people pay the the 5% eBay fees or Shopify fees or wherever they’re selling, they pay those fees because that’s, that’s, you know, the marketplace economics. They bring the customer to the seller too. So is there a chance like we’re not going to see the demand side of this materialize?

Simon Erickson  20:06

I mean, absolutely, the platforms are going to have to get larger and larger because of those network effects. Man, that’s why you just saw jack Dorsey and square, buy a majority stake in title right with Jay Z, because he thinks he’s got a large enough user base that if he starts pushing this, the demand will will naturally come in place. If you get in front of enough people. If you are a plan, if you are a marketplace that’s doing NFT’s and only 10 people are visiting a year, that’s not going to work. That’s not going to make it there’s no demand for what everybody is selling there. Naturally, you’re going to want to sell in the market places that have the greatest the strongest network effects. Absolutely. Absolutely.

Dan Kline  20:41

And there’s absolutely a glut of regular collectibles out there like so for when we were selling baseball cards, we literally had 10s of 1000s of cards, we couldn’t even process we had a stamp section. And there were probably stamps in our collection that were worth thousands dollars. But the manpower it takes to go through those stamps is massive, and it doesn’t necessarily So the cool thing about these being electronic is your ability to search them your ability to track them is going to be really strong. But Simon there’s a question there from Chris Morley, that sort of speaks to this about whether this could be a declining asset for technology reasons.

Simon Erickson  21:17

I’d say Yeah. Okay. Great question, Chris. I’d be very concerned about NFT purchases, becoming orphaned as the tech evolves over time, some of the buying video games that are impossible play five years later. Yeah, I remember those Nintendo cartridges, or anything else. And anymore the consoles that are there. I mean, Chris Chris’s are blockchains that are that are public blockchains available everywhere on the world that has the internet connection, right? So these are not physical consoles, like a PlayStation like a Nintendo, like a cartridge that would only apply for those kinds of things. I think the bigger question is, what what is the fundamental blockchain that is that is tracking the transactions.

You don’t want to maybe buy and sell NFT’s if they’re built on the token standards of a very, very small token or a cryptocurrency that nobody’s using? You want to use the ones that are on aetherium that have smart contracts, and are going to be around 10 years from now. But I don’t I don’t I don’t I’m not sure it’s exactly the same as as the console gaming industry. And the other thing that I’d like to point out since we’re talking about this, another great point that I think you’ve got me going on a bit of a tangent for here. Apologies, Dan. But the gaming industry itself has transitioned as well. Right? Take Two Interactive makes the NBA franchise, right, so this is where you can play games that used to be played on consoles now on the internet, or at least consoles that are connected to the internet. And Matt, do you know what percentage of Take wo’s revenue is from in game transactions? Now?

Matt Cochrane  22:40

I don’t off the top of my head, I’m sure it’s a growing amount of their total revenues, that it’s about

Simon Erickson  22:46

40% now is from those transactions of you know, customizing the player giving them abilities that make you better than your opponents out there. I mean, that’s, that’s very different than just selling the cartridge up front. And so things like that this exclusivity, this personalization customization in ft is just kind of is the next evolution of what the gaming industry picked up on 10 years ago.

Dan Kline  23:08

We’re gonna absolutely get back to talking about this on many other shows, there’s a ton of great questions in the queue. There’s also some great questions in our doc that I feel we already kind of hit on. But everyone who asked us questions we appreciate I promise. And another couple weeks, we will take a look again at the NFT market because I think it’s really exciting.

There’s going to be winners here. There’s going to be losers here. If you have good content, this is going to be another revenue source. Is that going to be as big as say like when DVDs were you know, absolutely game changing to the movie business for a number of years and that sort of fell away? Or is it going to be a novelty? I don’t think we know all those answers yet. And Simon as we close this segment out before we move to talking to Roblox, I’ll give you the last word you can take a question you can you can share anything you want to share.

Simon Erickson  23:53

Yeah, I mean, I think this is just one of those other fundamental innovations, right? Like we talked about the hype cycle just a second ago. It’s kind of at first when you see things like Bitcoin, the initial reaction if you’re an investor is Oh, no, completely staying away. Now that’s gonna be a fad. Oh, it’s too high. No, I can’t believe the bitcoins, this dollar amount per per Bitcoin. I think it’s the same thing with NFT’s

I don’t want us to spend too much time putting under the microscope of individual transactions, or, you know, how did this basketball player or Dan Kline dunking a basketball be worth this much money? I think that the bigger impact is going to be really big. And I think that as an investor, you know, we try to zoom out and say, Okay, well, what is that going to mean for square? What is that going to mean for the platforms in the marketplace? What are going to mean for the content creators, if you’re with IP, like Disney, you know, you’ve still got to have rights, and the IP for anything that’s branded and companies that create that content, own those rights to it. I think that at the end of the day, this is going to be a bigger deal than just a fad that blows away in the wind. I’m really intrigued by where NF T goes. NfT’s go over the next couple of years.

Dan Kline  24:56

As a creator. I think that’s the exciting part of it. This sort of speaks to what Andrew Connell He was asking, but basically, so I wrote a couple of books. And every now and then I get an email from someone, hey, I picked up a copy of your book used. And I would go great, I don’t get any money on that, because it’s used you didn’t buy it from the publisher. That’s us kind of silly example, cuz you don’t make any money publishing books anyway. But that being said, if I put out a book as an NFT, which in theory would be possible that you I would get every time that was sold, I would get some royalty, some piece of that transaction.

So as a creator, that makes you this a very viable platform to say like, yep, I’m going to put something out in the world, it’s going to be at a fair price. But every time it changes hands, I’m going to get paid my 2%, my 5%, whatever that is, as someone who you know, has been creative in the past. That is really exciting. For me, I love seeing that some of our members, some of our friends and fans are actually answering each other’s questions in the questions and comments. That is absolutely awesome. But Simon, we will get back to this I promise not on the show later on. But Matt, Roblox This is a company I’d never heard of, but my kid is maybe a little outside the age for Roblox Never heard of it until you brought it up a few months ago. But they’re going a direct listing route to go public. Can you set the table a little bit about what that means? And what Roblox is?

Matt Cochrane  26:17

Yeah, absolutely. So like, if the last time we talked about it, I think they were getting ready to like, have an IPO and that was late last year. And after seeing some valuations or some other IPOs, late last year, they decided to switch to a direct listing. Um, and they’re going public today. So what is Roblox? I think it’s, it’s best to find like, Is it a game? Is it an app? Is it a platform, and it’s almost like best to think about it as it’s kind of YouTube centric, meaning like, there’s a lot of like, there’s 8 million developers that make games on his platform. And there’s 36.2 million daily active users that log onto Roblox every day. And it’s best thing about this user generated immersive, 3d digital world where friends meet to explore and play.

And this is from so how do they define it, this is from their s one, they say, we call this emerging category, human co experience, which we consider to be the new form of social interaction we envisioned back in 2004. Our platform is powered by user generated content, and draws inspiration from gaming, entertainment, social media, and even toys. So there’s a few, like very unique characteristics or key characteristics for Roblox, that to like, understand it, like you should understand these things. So first of all, every user has their own unique identity with their like own form of avatars that allows them to express themselves like as whoever or whatever they want to be. And so you can always accessorize with this.

And users can create accessories and different costumes for avatars that people can buy. And those people have created accessories, they get 30%, the developers of games, they get 70% of the take for the for the amount of money they spend on those games that users spend on those games. It’s friends, it’s extremely social, it’s all about, like, three of my four kids play this very often there, there is a three of those 36 point 2 million daily, active users are my children. And it’s all about what game is my brain playing right now. Like, like, you know, like one of the most popular games that my kids play, I don’t know how popular it is, but that they always play. It’s like this like building. And it’s this giant hide and go seek game. And the person that did is wearing a giant banana costume, and he’s chasing around all the other avatars. And they like, you know, they just, they just love playing that it’s immersive.

So Roblox says they want their experiences to, quote, become increasingly engaging and indistinguishable from the real world, anywhere. Like if you could play on any kind of platform, PC, mobile console, even VR platforms like the Oculus, and it’s very low friction. So it’s really simple to set up an account on Roblox. It’s free to sign up for users to play and enjoy experiences on the platform. And it’s very easy to like converse with your friends on the platform.

And it’s also very easy for developers to build experiences and they call this the Roblox studio. And it’s very like it’s either very low code to build like a game or no code with robots drew studio and then publish them to the robots cloud. And then it’s access six accessible to all users across the platform, and the variety of content and this is key. So Roblox is like this fast, expanding universe, a developer and creator built content. As of September 30 2020, there were over 18 million experiences on Roblox and in the 12 months ended September 30 2020. Over 12 million of those were experienced by the community. There are also millions To create or build virtual items with which users can personalize their avatars, and the city economy. So Roblox has this vibrant economy.

Dan Kline  30:08

Let me let me jump in here. So I just want I want to set it back to the real world. So let’s say Simon and I decide we’re going to join Roblox we want to build the seven investing to the moon stock market game were

Simon Erickson  30:22

already in the works right now.

Dan Kline  30:24

How do we make money on that? Once you are we charging for that experience inside Roblox? Or is it all buying add on stuff? how we’ll talk about their financials in a second? But how do we make money with our very, very good idea for a game here?

Matt Cochrane  30:39

So that’s why I was gonna get to it like it’s this economy, right? So Roblox has this vibrant economy built on a currency that they called Robucks. And it’s this virtual currency that you can only use within the robot platform. And you can choose to spit like customers, like when users will buy Robucks, like I have spent, I have paid out allowances to my kids in Robucks before. And if, if, if, if they, if it was up to them, I would spend a lot more allowances in Robucks.

Um, and basically, they can go spend it on experiences or items for the avatar however they want. And so developers and creators can earn Robucks by building experiences and items that users want to purchase. So we could set up like there’s some virtual worlds, we could set up on seven investing store and people could come in, and you know, for like, 17 bucks a month, they could get like seven stock picks or something like that. And then, you know, it robots enables developers and creators to convert the Robucks back into real world currency.

Dan Kline  31:41

So Matt, this isn’t because I always pictured this as being sort of like one game kind of like Minecraft that has all sorts of spin offs, but it’s really not. It’s really a platform where I could use the robots engine to build a racing game, or a battling game or a stock market game like so

Matt Cochrane  31:57

imagine if Minecraft is it’s the best. In my head. It is kind of like Minecraft, but it’s also kind of like YouTube. So it’s all about like, Dan, if you me and Simon, we’re going to go into Roblox. It’s like maybe I make a game. And then all three of us and all seven of our lead advisors go. And we play that game together. Like it’s so it’s very social. And it’s all it’s very, like, user generated content. So there’s almost infinite content, like YouTube, like where you say, like YouTube is just like, there’s an almost infinite content on YouTube.

Because to try to quantify it is, is basically impossible, right? I mean, like, how many hours of video are uploaded onto YouTube every minute. I mean, it’s like, it’s basically infinite because it’s user generated. So there’s you never run out of content, or get bored of a single game on Roblox because there’s always another game to play.

Dan Kline  32:52

So So Matt, that sort of answers Chris Morley’s question about it sort of being Farmville. It’s not a sort of one time experience. Like if you get bored with what you’re doing, you can pick lots of other things in the Roblox universe. But Matt, their numbers are absolutely incredible. I’m shocked by their margins, they almost seem like made up. But why don’t you go through how well they’ve done? Well, yeah.

Simon Erickson  33:14

So I mean, like they in 2020 revenue, they made $924 milllion and $524 million of that was operating cash. $329 million was paid to developers. So Roblox has almost tripled payouts to developers in last year. So while revenue didn’t quite double, as the company aims to get top creators to spend more of their time building for the app, they’re just paying more than developers, more than 1,250 developers paid at least $10,000 last year to virtual sales in the Roblox game. So it’s really all about like incentivizing these top creators to make more compelling content.

Dan Kline  33:52

Is it all games matte? Or could we go in and create? You know, there’s obviously a lot of young people here, so there’d be a lot of opportunity to say, educate on personal finance or the stock market? Could we gamify that and sort of, you know, build out the next generation of  7investors.

Simon Erickson  34:07

So a lot of it is more if you’re familiar with Sims, it’s almost more like that kind of content. So it seems a game. Yes. But it’s also more like an online Hangout. Yes. Like, there’s some games where it’s like, I think this is literally, uh, you work at a fast food place. And then you hang out in the parking lot afterwards, with your co workers from the fast food place. That’s, quote, unquote, a game. So I mean, some of it is more gamey and some of it is just, it’s more social. It’s like a social experience. You know, like, so in the last year when the pandemic hit.

Like, if the pandemic had hit like 10 or 20 years ago, I think the kids at that time would have been much more effective. But in the last year, like, um, my kids, they obviously felt the lack of social social interactions in the real world, but because of like things like Roblox or other types of games like this is up A lot of how like kids socialize now, you know, playing fortnight with your friends. You know, Roblox is a part of that. It’s very, it’s very social gaming. So even almost all the games are built around playing with your friends.

Dan Kline  35:15

This is why my kid talks like he’s text messaging, lack of human interaction. As an investor here, the numbers are great, the profit margins are high. But what are the risks?

Simon Erickson  35:26

Alright, so the cost of revenue is mostly App Store fees, which goes down like iOS or Android. and and that is increasing as more robots revenue comes from mobile. So as more users access robots via mobile devices, App Store fees are only going to go up, meaning this cost of revenue is only going to scale as robots, it’s harder. And the second one is, is that trust.

And safety is extremely important for this platform, over 50% of robots as user base is under the age of 13. And everything is social and user generated. So the company has to invest heavily in moderation. And this gets to like one of robots, his biggest challenges, right? Because so many other users are younger, if they want to expand their audience to like over 18, how are they going to expand that user base, bringing older demographics, but still, but still have the the necessary trust and safety that they have now.

So I think that’s one of the biggest challenges where to go forward to expand that user base and to get 18 plus users onto the platform, or even just even keeping the users they have now as they age above that, like 18 years of age mark, but still be able to moderate the content. And that’s expensive, one to moderate. And two, it’s going to be tricky to navigate that to like keep users on the platform as they get over the age of 18. And that’s probably the biggest long term challenge Roblox faces.

Dan Kline  36:54

So eventually, Simon and I can meet up at A Roblox whiskey tasting virtually Simon, you want to ask Matt, a question before we move into the homestretch here.

Simon Erickson  37:03

I just think that the margins on this business earnings are insane. It’s amazing that you know, what it was at $924 million of revenue said last year 56% of that is falling the operating cash flow. And that’s even after they’re paying out the developers a third of that. I mean, most enterprise companies are putting it right back into r&d, or at least sales and marketing. I mean, Matt, do you have any idea how they should or could be spending their money? That’s an insane profit margin for a company this early on?

Matt Cochrane  37:32

Well, right now, I think one of their biggest expenses, like I said, was that that that moderation, like and I think that’s going to be like a difficulty for going forward. And they have to invest a lot. And I think in moderation, and like they, one of their, like, key points of success, it’s like to parents, like me have three or four children, like they have a lot of trust with me. And there’s still things that have fallen through the cracks, where it’s not where there’s content has been found on there. And of course, it’s routed out. But that’s not age appropriate. And I think just like, as they get more developers, and as this, like, you know, more and more games are developed, it’s almost like, you know, the think of YouTube and how much alphabet has to spend constantly on looking for videos with inappropriate content. Now, think about that, if you have a platform for users that are almost all exclusively under the age of 18. And there’s just millions of games being developed at a time, the cost, the moderation cost, to go through that content is is going to increase with time. So that you know that that’s really like, one of their biggest costs.

Dan Kline  38:38

And age appropriate is something my wife and I don’t agree on. So like they’re oftentimes we’re all think something’s fine for my son, she will, you know, video games for a long time. They’re like games, I’d buy it, I’d be like, yeah, don’t play that one around your mom. Like, you know, Resident Evil being a good example of one that I found is a cartoonish game, nobody’s gonna, you know, that to me is very different than say like a Grand Theft Auto, which is real people committing real ish crimes. But that is a very squishy standard.

So it’s not all going to be easy sailing. I’ll give a little piece of advice I always talk about now, we know a fair amount of wrote about Roblox compared to the average direct listing or SPAC or even IPO. But if it’s a really great company, you’ll know a lot more after a couple of quarters of them reporting earnings and having to meet sec filing standards. You’ll see what their CEO is like when he gives a presentation or their CFO depending who leads the presentation. I am generally a big fan of not investing in new stock listings right away. It’s not a hard and fast rule. But if you bought Amazon two quarters in or Apple or whatever it was, that does not change anything except rounding errors. Matt, last word on Roblox before we move into the homestretch here

Simon Erickson  39:48

Yeah, so I mean like, look like Simon said its margins are great. It has some long term challenges with paying the the app stores as it goes more mobile and with like content moderation. versus like, you know, weighing that versus like growing their user base to over, you know, to users over 18. You know, so they have some challenges, it’s going public at about a $30 billion valuation, which puts that prices sales over 30.

Matt Cochrane  40:14

So, you know, it’s expensive, but you know, it has captured a key market. And if it finds a way to grow with that market and keep users as they get over eight as a age over 18, you know, the platform itself is could be, could be huge. And you know, already has some network key network effects. So there’s a lot of like, there’s a lot of key concerns and risks to full disclosure like my my children, they get $2,000 contribution to their, their Coverdell ESA accounts for college one day. And so they pick two stocks every year that they can invest in, and one of their stocks was was Roblox this year. So when it goes public, that will give me getting a weekend cheer the Roblox in their esa accounts, but I’m so so we will, my family will will own the stock as it goes public.

Dan Kline  41:06

You’re watching  7investing now. I’m Dan Kline. And this is the free public facing part of what we do at seven investing. This is for everybody. The idea is on this show, to take the news of the day and give you the long term investing perspective. But that’s not the main thing we do. Simon, if you’re a member of seven investing, we’ll talk about how easy it is to join. What are some of the things people get for their $49 a month or $170? a year? Yeah,

Simon Erickson  41:33

thanks. Thanks very much, Dan. You know, we always do these shows, because we try to be three things, right? We want to be innovative, we want to be credible, we want to be helpful. And we say there’s a front because, you know, we think that the back and forth of a live stream is so much more helpful than just you publishing recommendation reports, which we also do.

And then we also follow up on those recommendation reports with subscriber calls, which is another interactive, we do it as a Zoom call where people can ask a specific questions about the recommendations we have and all this this bubbles up to our mission, which is to empower people to invest in their future. How do you how do you empower people, we want it to have an educational aspect to we want to have a back and forth component to it. I’m really proud of everything we’re doing. I think we’re looking at some really innovative things. Our track record is always transparently reported for the credibility piece of that  7investing.com/recommendations if you want to see at any given time how we’re doing.

And I think we’re looking at some really neat things. I mean, we talked about some really fun things on this show. But look at our recommendations this past month, Dan, I mean we were looking at some stuff that is completely off the radar for a lot of investors out there recommendations we think are the best ideas in the stock market that are not making headlines. And so combined together is seven investing membership seven investing, comm slash subscribe, it’s just $49 a month, $399 a year, we’ve got a bigger picture, bigger picture mission that we’re dead set on achieving out there.

Dan Kline  42:55

And that’s gonna bring us into the homestretch. The next section of the show, we’re going to take we have some of your questions. If there’s some other questions on the market you want to get in, we will try to get them we don’t have a ton of time. But the reason we do that the reason we make seven picks a month that our members pay for is because we want you to pick and choose and invest for the long term.

I think one of the most important things we’ve done and we’ve all done it on Twitter is saying okay, stocks are very volatile right now. Look at the stocks you own and look at the stocks you bought, what is changed about them some of the stocks we pick, say like a biotech pick from from Maxx or Manisha might go up 20% down 30%. And you’re like, wait a minute, like nothing changed about their drug pipeline. Maybe it’s a retail pick from me and someone say, well, their numbers are good, but their next quarter might not be as good because of, you know, people doing different things. That might be true, but it doesn’t change our core underlying analysis of the market. But we’re going to get to some of your questions. Martin Triggs asked what the heck is going on? This is during the they asked this question when yesterday the market was whip sign up and down. Why the speed and fury? Is this the new normal? How much is this a robin hood, read at Wall Street bets effective panic newbies. Thanks. Looking forward to listening. I don’t actually think it’s any of that. I think it I don’t think there the whole market is moved by those markets as much as they are by big institutional investors. Simon, your thoughts here?

Simon Erickson  44:16

Yeah, I’ll go back to something you said earlier in this program, Dan, which is that Apple hasn’t really changed in the last week, even with the market going up and down. The return for investors is pretty much a combination of one of three things if not more than one of these things, which is fundamental growth, you know, the business reports higher earnings over time, the markets valuation multiple that it gives as a multiple of those earnings or whatever fundamental increases over time or it pays a dividend, right. And so the fundamentals have been just fine, at least from the earnings reports that I’ve looked at recently. Dividends haven’t hugely been changed up or down by most companies out there. So this is a revaluation of the multiple that institutional investors are getting a little scared and shaken out of a volatile market. Is that an opportunity for long term investors? Absolutely it is because we do not have the same restrictions as hedge funds or institutional investors do. And so I, I stand to the to the the idea that market sell offs are your best friend and opportunity if you’re a long term investor.

Dan Kline  45:16

Alex Wolk says what should someone who got a little overzealous buying tech racks in the last six months, and are essentially back to square one do but doesn’t have much dry powder left? either. Matt, I’ll let you take this one, I’ll just say, if you bought any of our tech racks in the last six months, none of our thinking has changed. We weren’t making those recommendations based on what they were going to do in six months. we’re basing basing it on what they’re going to do over years. And there’s added volatility right now. Because there’s a lot of back and forth on is the economy going to open? What’s that’s gonna look like our behavior is going to change. A lot of that is just pure noise, Matt Cochrane, you can bring some noise as well.

Simon Erickson  45:55

Yeah, absolutely. I mean, it all depends why you bought those companies, right. So like at seven investing, like, we recommend companies that we want to hold for the long term and like, you will see volatility, and you will, like they’re starting out, it’s the most difficult time to be an investor. Remember that, because like, you don’t have much of a base, you, you might not have a lot of games. And when a market for market dips, when you’re first starting out, it can be painful because your your your account balances are lower than the amount you’ve put it. And that that is by far the most difficult time to be an investor. If the thesis for the road, why you bought that company has not changed, then then don’t sell you want to hold. First you want to buy great companies. And hopefully at seven investing, we recommend great companies for the long term. But if you buy great companies and not the reason why you bought those companies has not change, you want to hold through the downturns.

Matt Cochrane  46:50

If you have dry powder, that’s great, add more, hopefully, you can start adding a little every month to your portfolio and take advantage of like the dips, like of the companies that are down the most, if not add money when you can, but you want to keep adding money when you can, and you want to hold through through good time to bat through thick and thin right. Um, and you know, as long as the thesis has not changed, you know, as far as we’re concerned at  7investing, we want to invest for the long term. And you know, volatility or short term movements is not a reason to sell.

Dan Kline  47:23

Joyce Hein who is a member calls our service a great value, Joyce, it is a great value. So I was actually talking about joining 7investing a little bit after I did on a family zoom to both of my aunts, my aunt Susan and my aunt Judy. And they’re both investors. And when I told them the price, they told me That’s crazy. Like, why wouldn’t you charge 10 times more for what you’re giving. And the reason for that assignment. If I’m getting this wrong, you can, you can tell me because you created the company. The reason for that is we want everyone to invest, we want a price point where someone who’s new to this, it’s you know what a magazine, what a cost back in the old days, you know, it’s not something that’s gonna scare you.

It’s also not something that if you’re only investing a couple $1,000 or less a year, the price of your subscription is going to put you into the red, we also do something awesome is that if you’re a member, you get a referral code, you can use that referral code, put it out there to your friends and family. For every person who signs up. Not only did they get a deal on the subscription, you get a month for free. There’s people that are going to have me working well longer than I necessarily intended to work, because they already have you know, eight, nine, whatever it is years worth of subscription. Simon, did I get that correct?

Simon Erickson  48:32

elda dan 100% spot on, you’re hired.

Dan Kline  48:36

I want to go quickly through a few more questions. Chris Morley asks, he’s watching the show. Curious about everyone’s thoughts on risk profile and having a substantial part of one’s net worth in a single security. I personally don’t do that. But I if so let’s say I bought something and it 10 times and it became 30% of my portfolio. I wouldn’t put new money into that. But I probably wouldn’t sell it. Now. If it got over 50%. I might then examine how much risk I had. It would also depend what the stock was if if that stock was a biotech waiting on approval for something or if I had owned GameStop because I believed it as a retailer. And it’s all of a sudden 10,000% higher. That to me, it depends out Simon then Matt, let’s be let’s try to keep it to about 30 seconds if we can hear Yeah, perfect.

Simon Erickson  49:26

It’s a personal question. And everybody’s everybody’s role is different. So take everything we say with a grain of salt. My personal opinion on this is I think you compound your gains and you shouldn’t sell your winners. I have a position that’s 25% of my taxable portfolio right now. It is a seven investing recommendation from last year. I won’t reveal which one it is but I’m comfortable with with an outsize position Absolutely.

Dan Kline  49:49

Matt Cochrane, your thoughts? I was gonna say it’s AMC, but it is neither of those bad.

Simon Erickson  49:57

No, it really depends on your own. your risk tolerance, there’s so many variables when it comes to that, you know, I would hate to give any kind of personal advice. Like what I would say like what I do, I have about 30 positions. Um, you know, I very Look, I’m not gonna say I never sell, I sell my, I might sell about one position a year, actually, it’s probably what it averages out to be. And that’s, you know, usually to add a new position or so my number of positions does tend to grow over time, and then I try to pare it back. But um, it really depends on the risk tolerance, which so many things go into that the income of your job, your age, I mean, there’s, there’s so many factors that go into that, there’s no way you can answer it for every person.

Dan Kline  50:44

It also, in my opinion, depends a lot on what the stock is, if you know, if it’s Walmart or Target or something that’s just you know, the bottom doesn’t look that dangerous, then you’re not it’s not as much risk as if it’s like a high flying tech company, that in theory could not be the next big thing or, or even an apple when you look at how much of Apple’s revenue, you know, over 50% traditionally comes from the iPhone, there might be more risk with Apple than there is with Microsoft, if you really get in and look at it. It is all personal. It depends on your age. Chris, we are the same age.

So I tend to want to be spread out with nothing more than 15% of my portfolio. But if something climbs because it’s exceeding, I’ll keep an eye on it, but I generally won’t sell it. Two more questions before we end the show. And I will share one comment at the end because the nice comment So Sam, you know which one I’m talking about there. Rael, regular viewer, friend of the family here says, uh, what happens when you buy the dip? But the dip keeps on dipping? All I would say is if it’s good company, stay the course.

Matt Cochrane  51:46

Simon. I agree.

Dan Kline  51:49

That was a quick answer, which is necessary because we are running out of time. That last question, it’s a totally other direction. But we we often talk about not investing money that you need for the next three years. And our our mutual good friend on and our former colleague shared something like this on Twitter, and a ton of retail investors were like, That’s crazy. Like how much money you missing out on, I stand by the idea that I don’t care how safe a stock is, you do not want money invested over that you’re gonna need within three years for college tuition down payment for a house now if the reason you need it is you want to take a silly vacation or buy a car you don’t really need that might be different. But this this goes to Huck Whalers question, where’s the best place to save your down payment for a house you plan to buy in three years, in my opinion is definitely not the stock market? Simon denmat.

Simon Erickson  52:43

Yeah, I would agree. I mean, you never know what’s going to happen. It’s going to you know, maybe the market sells off the week that you’re needing that money, and then all of a sudden, you don’t have it available for something you were counting on your lifestyle. I mean, stocks are great ways to build long term wealth. We don’t say never sell. I mean, it’s totally fine to take profits off the table. But don’t don’t get yourself in a pinch when you need the money the most.

Dan Kline  53:05

Yeah, man, I’ll give you the last word on this question here.

Simon Erickson  53:07

No, I have nothing to add, I mean, really three years, you don’t want to be keeping that money in the stock market for any timeframe, less than three years, ideally, five years or more, no doubt that three to five years is that gray area for me, like depending on how conservative or progressive you are maybe not like, it’s a totally binary choice where maybe you can keep someone in the market, but most of it out of the market. But once you get to three years and under, yeah, keep getting out of the market. And there are lots of credible sites out there, look for the big names, don’t look for some of the pop ups, that will give you the best rates on a bank account, the best rates in the CD, those are going to be very, very minimal returns.

Dan Kline  53:45

But if you are keeping $50-100,000 on the sideline, you know for two to three years, you probably it’s important to get 1.2% rather than point oh 5%. And those things can be five think, you know bank rate or go banking rates there. There’s lots of sites that would that can give you that information. Just realize that those sites make money if you go through them and get one of those accounts. So while they do have great editorial price processes, the places I mentioned, be careful that not everyone does with that one last kind comment from from Deepak Patel, if you want to share that Sam, love hearing from you folks appreciate the transparency to your live chats and recommendation.

Yeah, we’re transparent if you’re a member, you know, everything we do. I know I wrote something that’s actually going to be public facing that I wrote today for our advisor updates and I talked about how I owned some of the stocks in there that I’m kind of saying have a lot of risk involved and I explained a little bit why on them and what my 10 year horizon is for them, but that’s not something I’d make a pic because it’s not my highest conviction pic. It’s something I’ve taken a very small flyer on. So there are a lot of things that you get as a  7investing member or even it’s just a fan. is reading our public facing stuff where you’re like, oh, like Matt really likes that company doesn’t mean it’s a pic doesn’t mean that it has this highest conviction.

But with that Sam Bailey let’s hit our finisher. I wonder if we’ve changed some minds after this show but which investment are you most excited about 31.7% of cryptocurrency only 6.1% said non fungible tokens 18.6% Real Estate 43.6% said none of the above.

Simon as someone who’s about to is trying to sell his condo so he can buy an investment piece of real estate. I would argue that for me, it’s real estate, with the exception of I consider part of the value that I’ll be using the property I don’t really believe in real estate as an investment, where your goal is to make returns on it. I think that’s very active. It’s very difficult. In this case, if I break even on the cost, and I get to use it 10 weeks a year. That to me was an investment payoff, but I am excited about NF T’s Do you think we change the minds on this show?

Simon Erickson  55:59

I’m excited about NFT’s too. I would vote a personally the end because I think that that is kind of the foundation for NFT’s is the cryptocurrency blockchains themselves, Real Estate’s great to virtual real estate built off of blockchains as well, I’d have to go with a in this poll personally.

Dan Kline  56:13

So Matt Cochrane, I know you’re a big philatelist huge stamp collection in your house. So aside from stamps, now, Matt does not collect stamps, as far as I know, aside, aside from not collecting stamps, which of these most interests you

Simon Erickson  56:27

Well, obviously, the vast majority of all my investment money is in the stock market. However, the one that most interests me is real is real estate. I think that’s a, you know, look, if you want to put like small percentage of your portfolio towards riskier assets, like cryptocurrency or fps, that’s fine. Go for it. I think that’s absolutely like something that could really pay off big however, like, like, maybe I’m just more a little more conservative in nature, I like to take my risk in the stock market, or I think I might have an advantage. I don’t know any advantage that I have right now in cryptocurrency or in a piece. So I like to stick to the stock market and the real estate seems like a more conservative, conservative investment.

Dan Kline  57:08

Two quick comments here. We have one advantage and cryptocurrencies that is our partnership with crypto EQ. If you want more about that there is where is that in our website, Simon, I was about to say, I don’t know where that is on our website.

Simon Erickson  57:19

Like you we have him on the live stream every now and then then we have on the on the site itself, you know, crypto iq.io, if you want to check out their site, we don’t pretend to know everything about Bitcoin and cryptocurrencies. So we brought in a partner that does a lot more analytical time looking into those.

Dan Kline  57:34

And I will say, Thursday, I’m doing a podcast with a data scientist from clever real estate, to talk a little bit about millennials in the real estate market. And we don’t know when we’re gonna release that will probably part of it will air on this show. And what I’ll say is your house is a bank account, it’s not an investment. So in theory, if you buy a house, you get the advantage of living there. And as you pay down your mortgage, assuming you have a mortgage, you’re creating some value. What you don’t know is well the market goes up. A lot of people bought in New York and right now the values are down because of the pandemic. I don’t think that’s long term. My values here in Florida, though I have had not been able to sell my condo should be extremely high because people are moving here. But I look at it as sort of a secondary benefit. I didn’t buy my house because I thought it was going to go up in value. I bought my house because I wanted to live there and it seemed like a good value and it was a good value that hopefully now was worth more if you’re looking for a condo in West Palm Beach. You know, hit me up on Twitter.

That’s it for this issue edition not an issue we’re not a magazine, we were television show this edition of seven investing now. If you want to get in touch with us, it’s really easy to do that is info@7investing calm. That’s for questions about our service questions about how things work. You know, not really like, Hey, what about this stock? If you want to talk to us about stocks or things that would be great ideas, potentially for this livestream or for our podcasts. Hit us up on Twitter @7investing. That is the number seven investing. We are very, very active on Twitter.

We throw polls out there all the time. We were talking to you yesterday I asked people for some of the biggest mistakes they’ve made in the market. I find it’s really important to even for those of us who do this for a living. I admitted that I was a big fan of JC Penney, not recent JC Penney, I mean post Ron Johnson, Marvin Ellison, JC Penney, and I’ve talked about this before, I really thought they had the keys to a turnaround. I was ridiculously wrong about that, obviously. So is my track record great. Most of the time, yes, it is. But even the best, you know, this is baseball, you know, nobody, nobody hits every ball for a homerun. So it’s fun to having so many of you share that. I’m sure we’ll use that content on a future show but for Matt Cochrane for Simon Erickson for Sam Bailey behind the glass, we will see you Friday.