Valuetainment - July 01, 2020


Episode 482： My Response To Joe Rogan’s $100 Million Deal With Spotify


Episode Stats

Length

11 minutes

Words per Minute

182.39032

Word Count

2,019

Sentence Count

197

Hate Speech Sentences

2


Summary

Joe Rogan is leaving Google and going to Spotify. What does this mean for the marketplace and the future of streaming services? Today we break down the math and see who actually won the deal. Joe Rogan or Spotify?


Transcript

00:00:00.000 30 seconds.
00:00:01.860 Did you ever think you would make it?
00:00:04.500 I feel I'm so close I could take sweet victory.
00:00:07.620 I know this life meant for me.
00:00:10.760 Yeah, why would you bet on Goliath when we got Bet David?
00:00:14.580 Valuetainment, giving value is contagious.
00:00:16.420 This world of entrepreneurs, we get no value to haters.
00:00:19.160 How they run, homie?
00:00:20.140 Look what I become.
00:00:21.400 I'm the one.
00:00:22.460 I'm Patrick Bet David, your host of Valuetainment.
00:00:24.000 Today we're going to talk about Joe Rogan's 100 million dollar deal he just got with Spotify.
00:00:27.440 And we're going to break down the math to find out who actually won.
00:00:30.940 Did Spotify make a decision getting Joe?
00:00:33.220 Or did Joe make a decision going with Spotify?
00:00:35.660 Let's take a look at this.
00:00:37.040 What does this mean to the marketplace?
00:00:39.340 A couple things.
00:00:40.260 Number one, if you guys remember Donald Sterling, a name you haven't heard for a while because
00:00:45.900 Steve Ballber bought the Clippers from Donald Sterling for 2.2 billion dollars.
00:00:50.480 Now here's a story.
00:00:51.300 Donald Sterling bought the San Diego Clippers years ago before they were the LA Clippers.
00:00:58.440 He bought the San Diego Clippers.
00:00:59.900 You know for how much?
00:01:00.560 You ready?
00:01:01.320 Did he buy for 300 million?
00:01:02.980 Maybe 100 million, right?
00:01:04.340 50 million.
00:01:05.240 How about 16 million?
00:01:06.720 How about 12 and a half million dollars?
00:01:08.800 Donald Sterling paid 12 and a half million dollars for the San Diego Clippers.
00:01:12.820 He sold it to Ballmer for 2.2 billion dollars.
00:01:17.080 From 12 and a half to 2.2 billion dollars.
00:01:19.260 Why does this matter to you?
00:01:20.840 The day that, what's the name of the guy that bought the team?
00:01:26.160 The day Ballmer bought the team for 2.2 billion dollars.
00:01:28.700 You know what happened that day?
00:01:29.780 The following day, they said Michael Jordan's a billionaire.
00:01:32.880 Why?
00:01:33.580 Because every team's valuation went up.
00:01:36.460 So what does this mean?
00:01:37.260 What does Donald Sterling and Ballmer and Clippers have to do with Joe Rogan?
00:01:41.760 Everything.
00:01:42.200 It's like living on a lot.
00:01:44.600 You bought a house for $500,000, you know, 4,000 square feet.
00:01:49.480 Two years later, the house next door, same exact size as yours, sold for a million dollars.
00:01:54.240 You just made $500,000.
00:01:56.120 Joe Rogan officially showed the value of content creators worldwide.
00:02:00.420 That means Spotify is willing to pay a guy like him.
00:02:02.900 Now, we've got to know that Joe Rogan's the number one podcast, 150 million downloads per month, 1,500 podcasts.
00:02:09.000 That's all going to be transferred over to Spotify.
00:02:11.700 This guy pulls from UFC.
00:02:13.320 This guy pulls from a marijuana side.
00:02:15.700 This guy pulls from, you know, Hollywood actors, comedians, workout.
00:02:20.580 He's a great fighter himself.
00:02:21.840 He's got a lot of drop, different places that he pulls people from.
00:02:24.780 But still, he got paid $100 million.
00:02:26.020 Now, was that a wise investment on Spotify's side?
00:02:30.520 Now, as far as Rogan goes, he had to make his decision based on what he did.
00:02:33.600 But on Spotify's side, let me show you some numbers here.
00:02:36.740 Let's look at market cap.
00:02:38.320 Let's look at market cap.
00:02:39.420 So, check this out.
00:02:40.620 This was announced yesterday.
00:02:43.160 Yesterday, if you come closer, Mario, Spotify's stock was $161.43, if you look right here.
00:02:50.740 Okay?
00:02:51.480 Today, the stock is what?
00:02:53.660 $189.80.
00:02:54.620 Okay, so look at this increase from May 19th to May 20th.
00:02:58.640 How much has gone up, right?
00:02:59.860 From $161 to $189.
00:03:02.560 Let me do some math for you.
00:03:04.200 They announced Rogan is leaving Google and leaving YouTube and leaving iTunes to go to Spotify, right?
00:03:10.800 Oh, my gosh.
00:03:11.400 Joe Rogan is leaving.
00:03:12.200 Joe, he said it himself.
00:03:13.500 He's not an employee, but he's just going over.
00:03:15.160 He's going to do the same thing.
00:03:16.020 He's got control of his creativity.
00:03:18.560 So, Spotify cannot tell him what to talk about and what to talk and what not to talk about
00:03:22.140 because that's a challenge right now on YouTube.
00:03:23.620 Here's the math.
00:03:25.080 Mario, come around.
00:03:25.660 Let me show the math for you.
00:03:27.340 The stock yesterday, the 19th, was $161.43.
00:03:32.680 Today, $189.80.
00:03:36.000 Okay?
00:03:36.200 It's a plus of $28.37 divided by $161.43.
00:03:43.160 They made 17.57% in 48 hours.
00:03:48.160 And this is what it looks like.
00:03:49.920 Spotify on 518 was worth $30.53 billion.
00:03:55.280 Today, Spotify is worth $35.29 billion.
00:03:59.320 They gave $100 million contract to Rogan.
00:04:03.440 They made $5 billion in 48 hours.
00:04:06.740 Nothing for Spotify.
00:04:09.500 Spotify, good for you to show the marketplace the value of Joe Rogan.
00:04:14.720 Joe Rogan is worth essentially $5 billion.
00:04:17.860 That's what Joe is worth to Spotify because all of those viewers that were going and watching
00:04:25.040 his podcast every day, now they have to go.
00:04:29.280 Still got to be free on Spotify.
00:04:31.160 Now they have to go to Spotify.
00:04:33.120 But what Spotify did is the following.
00:04:35.280 Anytime you go to war, let's just say you go and fight a gang, right?
00:04:39.260 And you don't just go fight.
00:04:40.380 The average guy is going to just fight the regular guys at the bottom.
00:04:43.340 But you go to the main guy and you fight him.
00:04:46.880 You knock the leader out of a gang.
00:04:49.360 You automatically gain the respect of who?
00:04:51.860 Everybody, right?
00:04:53.240 Spotify didn't go after the number 10 podcaster.
00:04:56.460 They didn't go after the number 5 podcaster.
00:04:58.620 They told YouTube, we're going to take your best player away from you.
00:05:03.220 His name is Joe Rogan.
00:05:04.540 And he's going to come to us.
00:05:05.940 And you know what's going to happen?
00:05:07.040 The eyeballs of everybody else open.
00:05:10.080 So guess what?
00:05:10.740 Your content creators, YouTube, are not happy with you.
00:05:13.720 Capitalism is going to do its part.
00:05:15.360 This is why I trust capitalism.
00:05:17.780 So now, content creators are very happy.
00:05:20.500 Oh my gosh, did you see what happened?
00:05:22.840 Did you see what took place?
00:05:24.360 That means maybe I'm worth more money.
00:05:25.940 Yes, all of that stuff is true if you're a talent wanting to create content and that's
00:05:32.380 the direction you're going to be going to, right?
00:05:34.300 Now, Spotify is going to make a decision who they're going to be picking up.
00:05:36.600 But a couple of things I want you to be thinking about behind closed doors.
00:05:39.540 This is one of the things I'm thinking about.
00:05:41.280 So I'm a guy that likes to go and analyze things, right?
00:05:44.260 So watch this.
00:05:45.460 Joe has an agent.
00:05:46.520 He's got a manager that negotiates on his behalf.
00:05:48.580 Now, according to some of the numbers, he's already making $30 million a year.
00:05:52.000 Some say he's making $50 grand an episode he does.
00:05:54.060 Some episodes he makes $150 grand, like Elon Musk maybe makes $200,000, $300 grand that
00:05:59.500 he does.
00:06:00.280 Regardless of what it is, he made $30 million last year.
00:06:02.820 So if they sign a $100 million deal, I would hope it's only a two or three year deal, but
00:06:07.660 maybe it's a four year deal.
00:06:08.880 Let's just say that's what the case is.
00:06:11.440 The question we got to ask is the following.
00:06:13.280 Did Joe Rogan's manager go to YouTube and tell YouTube, Joe's about to sign a deal with Spotify.
00:06:21.720 Do you want to match it, to keep him Apple or iTunes or Google?
00:06:28.340 Do you want to keep him or are you okay losing him?
00:06:31.100 Now, I'm not there to speculate and say what was said.
00:06:34.500 I don't have the data.
00:06:35.500 I don't have the entry.
00:06:36.380 I don't have the script to tell you this is what was said.
00:06:39.760 I have the emails.
00:06:40.600 Not at all.
00:06:41.580 But let's just say that's what happened.
00:06:43.540 And Joe's a pretty astute guy.
00:06:44.820 He's a pretty intuitive guy.
00:06:45.760 He's a pretty smart guy.
00:06:46.480 He's going to tell his manager, hey, go ask YouTube if they're willing to match.
00:06:51.060 Imagine if they did and YouTube said, no, we're not willing to give Joe $200 million to match
00:06:57.280 the deal or maybe $300 million.
00:06:58.940 He's not worth that kind of money.
00:07:00.600 Are you kidding me?
00:07:01.720 Joe worth $200 million?
00:07:03.740 No.
00:07:04.080 No, they're just trying to bluff us.
00:07:05.640 They're trying to play the game.
00:07:07.280 While Spotify made $5 billion.
00:07:10.860 So Spotify, I've never done anything with Spotify, ever.
00:07:15.380 I've never listened to anything on Spotify.
00:07:17.420 I'm telling you fully trans, never.
00:07:19.420 Then the next question becomes, how many people will convert and go follow Joe's content on
00:07:25.420 Spotify?
00:07:26.160 Here's the reality of it.
00:07:28.260 Two ways to look at that.
00:07:29.120 Number one, the true believers of Joe, 100% is going to Spotify.
00:07:33.580 No question.
00:07:35.260 100% is going to Spotify.
00:07:37.600 The, oh my gosh, I got lost and found this video of Joe Rogan, but I'm not a subscriber.
00:07:42.840 What a cool video.
00:07:43.640 I get stuck for two hours and 28 minutes.
00:07:45.960 Maybe not.
00:07:47.020 But the true believers will go.
00:07:48.480 No.
00:07:49.260 Spotify is not dumb.
00:07:50.300 They know exactly what they're doing.
00:07:51.800 Spotify is probably going to spend so much money advertising Joe's short clips on Facebook
00:07:58.820 and YouTube and Google to drive them to Spotify because Spotify is going to spend the money.
00:08:04.080 That's what's going to be taking place.
00:08:05.820 But I have a feeling his followers are going to go there, no problem.
00:08:08.840 And he'll probably end up creating new followers.
00:08:10.700 But this is the direction things are going right now.
00:08:12.580 So it's pretty interesting to see what's going to be taking place in a marketplace because
00:08:16.100 the price has been set.
00:08:18.000 The market value for a content creator like Joe is $100 million.
00:08:22.900 But I want to make a prediction to you right now.
00:08:24.940 Now, I believe in the next five to 10 years, somebody who's a podcaster, somebody who's
00:08:30.900 a content creator is going to sign a $1 billion contract.
00:08:34.360 Let me say this to you one more time.
00:08:36.780 I predict in the next five to 10 years, someone's going to sign a $1 billion contract.
00:08:44.920 $1 billion contract.
00:08:47.340 You know why?
00:08:48.200 Because hopefully, YouTube, Google, some of the executives, Spotify's are going to see
00:08:53.380 this and they're going to say, wait a minute, you mean to tell me I give you $100 and I
00:08:58.800 make $5,000 in 48 hours?
00:09:00.980 I'll bet that.
00:09:01.700 Even roulette is $100 for $3,600.
00:09:05.620 I've never heard anything.
00:09:06.580 I pay $100, I make $5,000, 50X in 48 hours?
00:09:10.180 Spotify says yes, 50X, 48 hours.
00:09:14.420 Time to play ball.
00:09:15.400 The market's been set.
00:09:17.360 Everyone knows what is the value of those creating content.
00:09:19.880 And this pandemic that took place made Spotify $5 billion in 48 hours.
00:09:26.760 And in a way, if they made $5 billion, that means somebody lost $5 billion.
00:09:30.680 Whether that's Google, whether that's Apple, whether that's iTunes, YouTube, somebody lost
00:09:35.600 $5 billion because that market went to another place.
00:09:37.860 So something to think about.
00:09:39.440 By the way, if Joe's watching this and one of Joe's friends sends this over to him, Joe,
00:09:42.800 you mentioned a couple of weeks ago you're thinking about Texas and Austin.
00:09:47.140 And a guy sent me a message and I posted a tweet about your video.
00:09:51.540 You may want to make that move sooner.
00:09:54.040 Because on $100 million, living in the state of California, that's $13.3 million.
00:10:00.300 Just by you moving to the state of Florida, Tennessee, Nevada, or Texas, you'll buy a $13.3
00:10:07.300 million house on the state.
00:10:09.560 Let me say that one more time.
00:10:11.120 Come to Texas, Austin, Dallas, maybe not Houston, but Austin, Dallas, go to Fort Lauderdale,
00:10:17.740 go to Boca, go to any of these places.
00:10:20.500 Look for a $13.3 million house because the state will give it to you for free just for
00:10:25.120 leaving the state of California.
00:10:26.580 That's my take on Joe Rogan's $100 million deal with Spotify.
00:10:32.440 Joe, congratulations to you.
00:10:33.820 I salute you.
00:10:35.000 And Spotify, congratulations to you for landing an absolute stud of a guy.
00:10:39.720 Thanks, everybody, for listening.
00:10:41.160 And by the way, if you haven't already subscribed to Valuetainment on iTunes, please do so.
00:10:45.660 Give us a five-star, write a review if you haven't already.
00:10:48.640 And if you have any questions for me that you may have, you can always find me on Snapchat,
00:10:52.660 Instagram, Facebook, or YouTube.
00:10:54.600 Just search my name, PatrickBitDavid.
00:10:56.500 And I actually do respond back when you snap me or send me a message on Instagram.
00:11:01.160 With that being said, have a great day today.
00:11:03.180 Take care, everybody.
00:11:03.920 Bye-bye.