SPI 946: A Look at the SPI Sale from a Numbers Perspective with Matt Gartland

SPI 946: A Look at the SPI Sale from a Numbers Perspective with Matt Gartland

Pat Flynn: Fun fact, this is the first time that Matt and I are in person with each other since the sale of SPI.

Matt Gartland: Unbelievable…

Pat Flynn: Congratulations. Hey. Can I shake your hand?

Matt Gartland: Congrats, buddy.

Pat Flynn: We have had a lot of conversations about this now post-sale. If you don’t know what we’re talking about, our company, SPI, uh, the company, the brand that I started, Smart Passive Income, in 2008, had recently sold, and it sold to an amazing person.

I’m sure we’re gonna talk about her, uh, in a little bit, but this is something that started with me. Matt came on board, and we’ll probably dive into the history of it a little bit, but mostly this is just a way for us to capture this moment. We’ve had a lot of good emotional, deep conversations, and we’re like, “Well, let’s just turn the cameras on and capture these things now so we can look back at them, you can learn from them, and all those kinds of things.”

We’ll have likely some lessons and things learned that we can share with you, and we just want this to be hopefully a… I mean, it’s not a send-off. It’s not a goodbye. No, not at all. It’s, it’s w- it’s a celebration.

Matt Gartland: Yeah, a, a celebration and a inflection point, I think- Yeah … for what, you know, this brand has meant to you, to me, and to the entrepreneurs that we’ve touched and then their families and their careers, and it’s christening of the new chapter, right, in a really big way.

It is. So that’s how I’m kind of thinking about it.

Pat Flynn: Definitely, definitely a new chapter. A lot of you might have insight on my new chapter, which is related to Pokemon and those kinds of things. We’re actually here at the DPM Studios, and Matt, this is your first- It is … look at it. What are your initial thoughts on it?

Matt Gartland: Oh, it’s a kid in a candy store sort of feeling. It’s amazing.

Pat Flynn: It’s a dream come true for sure, and this is where we’re going to film things and create things and not just maybe even live only in the Pokemon world, but I’m getting in- inspired now by a lot of YouTubers who are in Hollywood and creating scripts and, and producing films.

I mean, that is what this space can allow for, and I’m excited for that. But new era for Liz, of course, who is the person who purchased SPI, Liz Wilcox, who, you know, we’ll talk maybe a little bit about how that all came to be. Um, but a new era for you as well because you’re no longer CEO, which you once were, and then president, and, and n- now you’re moving on to your own things.

And you have also a family and other, other important things to take care of, so I think people are gonna be very curious about where you and I both go from here. Yeah. But maybe it’s good to go back in time with a little bit, uh, how we actually first- got connected. You wanna start there?

Matt Gartland: Oh, our story.

Pat Flynn: Our story.

Okay. Yeah, a little bit-

Matt Gartland: Oh, gosh …

Pat Flynn: For people who might not know.

Matt Gartland: Yeah. I mean, that goes back to 2012-ish, 2013. Fantasy football was the original touch point of all things.

Pat Flynn: That’s right.

Matt Gartland: Yeah. So-

Pat Flynn: And we’re about to enter the new season.

Matt Gartland: We are coming up on that. Our draft is, you know, getting scheduled right now, which is always a, a fun kickoff to the season.

So that was the first, first connection. Yeah. But then the first project was Let Go, your memoir project.

Pat Flynn: First book.

Matt Gartland: Yeah, that was five years, your five years into SPI, and kind of celebrating that pretty significant milestone, and you telling then the story of certainly your job loss going through the Great Recession, but that becoming a really magnificent moment in the grand schemes.

It led to SPI, among other ventures.

Pat Flynn: Mm-hmm.

Matt Gartland: And, you know, that five-year anniversary for you was a way to, you know, give back to the amazing folks that had kinda come up then in that era, listening to you on the podcast, et cetera, teach from that place. And then we worked with Caleb, sitting behind the camera today.

So it was the three of us, uh, at that time working on that project.

Pat Flynn: Yeah, that’s right. That’s really funny, actually. It’s coming back full, full circle-

Matt Gartland: Mm-hmm …

Pat Flynn: in a way. Yeah, Let Go was my first book, came out 2013. Matt and his team at Winning edits- were helping to really just put that book together. You know, I created the manuscript, uh, for that, but then Matt packaged it and, and, and I didn’t know anything about publishing back then, and you did, and you’ve helped a lot of other clients in that world.

But I had such a great time working with you. I knew we were gonna eventually do something else together. I didn’t know to what extent. I didn’t know that we would both really start to evolve SPI into what it eventually became and the community and all that stuff and the team. I was just a kind of a one-man band for a while that had contractors helping me.

But you really taught me, especially when we started connecting even more, the importance of, you know, building out a team and having SOPs and a lot of the financial-related stuff that, like, I didn’t really care about. I mean, I cared about it, but I didn’t care to spend time on it, and that’s Matt’s zone of genius, those kinds of things.

And so obviously, if we fast-forward to today, none of what we have now in a sold business, none of this would’ve happened without you, Matt, and molding SPI into something that became a sellable asset. Right. There were so many parts of… If you could go back into time and look at how SPI was when you first came on board, what were the things that were missing that if we didn’t address probably wouldn’t have lo- lo- the sale today and-

Matt Gartland: That were missing?

I’d love to even start with, like, what I saw that was present even… And I’ll come back around to, you know, what was missing. But in thinking ahead to, yeah, like an asset, something that had longevity, you know, to it. You know what I mean? You personally had a magic, right? That as I was working with other creators, you know, at that time, that term didn’t even really exist back then-

Pat Flynn: Yeah, Yeah.

Matt Gartland: Uh, the way it does today. Like, there, there was a real special chemistry for how you told stories and how you taught the skills of entrepreneurship. And I could see, especially as we got deeper into our work together, just the very genuine connection that the subscribers, the listeners, the readers had- Mm-hmm

you know, to your material that stood out from others that were attempting similar work, right, in the space. And not only was that, I think, something that was like, oh, there’s, like, value there, I mean, yes, but it really spoke to me also, right, and fostered our friendship also. Yeah. So, so this needed protecting.

Pat Flynn: Mm.

Matt Gartland: So as I think through sort of the story arc of my career and even my life, like, I’m a protector. So it’s like, how do we, how do we very carefully take something that is so special and is working and then build systems, methodologies, financial rigor, et cetera, around this such that this stands the best chance possible to go as far as it can, right, from a longevity standpoint?

So that’s where it started for me.

Pat Flynn: Yeah. Well, I appreciate you calling that out. I mean, that’s something that I always felt was my superpower in the beginning and still is. It’s that connection to the audience. Right. And that’s something that, you know, as somebody who was a brand-new business owner back then, and even five years into it, still kind of scrappily working and scrappily putting things together and, you know, lots of Band-Aids, lots of duct tape on this thing.

That’s where really when you came on, you started to help me put things together in a way that felt more puzzle piece versus duct tape. Right.

Matt Gartland: Yeah.

Pat Flynn: You know, making those connections, hiring my first, you know, people. You, you connected me with, with Jess originally- That’s right … who I still work with today.

You know, the team who helps support the podcast and, you know, I was still working with Matt on a more contractual agency type basis.

Matt Gartland: Yeah, for, for several years.

Pat Flynn: For several years. Yeah. Mm-hmm. Yeah, but, um, then we fast-forward to… What year was it when we, we kind of, like, quote-unquote, “Tied the knot,” as we often call it?

Matt Gartland: Uh, 20- 2018.

Pat Flynn: 2018, where- You know, I was Matt’s kind of top client, most workload, all this kind of stuff. Mm-hmm. And it just made sense, especially with the growing business at the time. I’d just started launching online courses, and that’s, that was, like, really where we saw a huge influx of revenue. I wanted to invest that into the business in a way that was smart.

And thanks to Matt and, and consult from him, it just made sense to almost combine forces. We did what’s called an acqui-hire, essential- essentially, where I bought Winning edits from Matt, and in exchange for some cash and equity- Mm-hmm … um, you know, I got the team and, and you as CEO.

Matt Gartland: Right. That’s right. So we, you know, what’s the nerdy superhero phrase?

We, we did a team-up, right?

Pat Flynn: Yeah.

Matt Gartland: Yeah, so we, we powered up in that way. And it wasn’t just so yes to all of those things, right, in terms of combining of superpowers, but it was in that same era of what is then the vision of SPI? Where is it going? Is it just business as usual? Mm-hmm. And we were, we were doing reasonably well.

Of course, that was still sort of in the golden era of DIY online courses. Right. We could unpack that more maybe if that’s meaningful.

Pat Flynn: Things have changed since then.

Matt Gartland: Things have changed, yeah. So it’s like, okay, let’s, let’s team up for sure. You know, we became very close friends, you know, leading up i- into that moment.

There was a massive amount of trust. But it was also then like, okay, where is the industry going? Mm-hmm. Right? What’s changing? What things are not working in the industry? And we were starting to feel some of that even within the business. So it was kind of all things together, which is let’s, even in that era, Chris, in a bit of a new direction, same name, right, but let’s continue to be leaders in the space.

Let’s try some different things. This was pre-pandemic, so that hadn’t happened yet. Right. But we were already really getting committed to the notion of community- Right … and community-powered learning and community-powered engagement in ways that maybe we weren’t the absolute first to do it, but I, I still to this day believe that we were one of the first to really make the big all-in bet on that.

Pat Flynn: Right. Demonstrated in two ways. One, Superfans.

Matt Gartland: Mm-hmm.

Pat Flynn: The book, which came out in 2019, and that was being written because we knew that this was the direction things were headed. But alongside that was FlynnCon, an event that we hosted in San Diego. You and the team, now that we were all together, we decided that we were gonna put on this event.

Of course, we weren’t the first business event to happen, but we wanted to make it feel a little different. So my family was involved, and we started talking about more things than business, about life and, you know, friendships and those kinds of things. We brought a lot of our amazing friends up on the stage, and we had a lot of built-in time for people to connect with each other.

It wasn’t just back-to-back-to-back talks. It was, you know, an hour and a half of a talk, then three-hour break until the next one, so you could decompress and talk about those things. And we had some of our favorite companies, Circle, Kit, in the hallways kind of-

Matt Gartland: Not Circle yet. That didn’t exist.

Pat Flynn: Oh, yes, you’re right That’s right Teachable Kit was there Teachable Teachable was there, that’s right Yeah But what FlynnCon taught us was that when you get people together in a community, like magic happens

Matt Gartland: Mm-hmm

Pat Flynn: And we were like, “Okay, let’s do it again next year.”

So 2020 rolled around. Uh, I had some meetings with hotels in downtown San Diego ’cause we were planning that, and then COVID hit in March, and everything kind of stalled out. But what didn’t stall out was the feeling I had at FlynnCon, which was how much I really wanted to connect this community that I’ve been growing together.

So that’s when Circle came about.

Matt Gartland: Very fortuitously. Fort-

Pat Flynn: Yeah fortuitously because- Yeah … that became the tool, the software that we used to build our community on. Because we wanted to bring that community feeling that we had in person, ’cause we couldn’t meet in people, uh, in person anymore, we wanted to bring that online, and that’s where Matt really got the note cards running for what this community could look like.

Um, so I mean, that was the beginning of what eventually became the sellable asset, which is this recurring revenue membership community model. So yeah, it was kind of, it’s, it’s interesting to talk about that ’cause it, it did stem from us trying to think forward. Right. It didn’t stem from us focusing on, well, what will always remain true.

It’s, you know, now online courses are, are dead, if you will, uh, in, in the way that they used to run, but community was always gonna be an important part of this.

Matt Gartland: Yeah. We, uh, one of my big themes we’ve talked about at ad nauseam is optionality, right? Trying to, as much as we can, create conditions that allow us some flexibility and control in a, in a world where we don’t have c- total control.

Mm-hmm. Like, you can’t control the internet, we can’t control bigger macro forces. And what we were starting to see, if I even rewind a little bit further, I wanna say it was like in 2017, just i- in our own numbers and projections and things, that, yeah, the, the DIY courses market was starting to drift, right?

And ’cause we were doing multi, multi, you know, millions a year- Yeah … in, in that. And, you know, okay, great. But if we rest on our laurels, right, and we don’t think critically about that and, okay, what, what if this, this, this, this, right? You can end up in a bad spot, so.

Pat Flynn: So the- Well, we’ve seen a lot of our friends who had that as their primary business model-

Matt Gartland: Yeah

Pat Flynn: Who are no longer here.

Matt Gartland: That’s right.

Pat Flynn: ‘Cause they weren’t being thoughtful of the future- Right … or they just kind of were, like you said, resting on their laurels, were just kind of never really trying to innovate. Um- Yeah.

Matt Gartland: And, and a massive, like, wrapper around all of this that was a major fusion of, like, why tie the knot at the end of 2018 together formally is this powerful idea of, you know, longevity and also legacy.

Pat Flynn: Mm-hmm.

Matt Gartland: Right? We wanted to build something that could potentially outlive either of us, right? Yeah. How on earth do we do that in an industry that is dominated by personal brands, right? It’s a really fascinating, like, business, you know, chess game sort of thinking.

Pat Flynn: It is. Especially when SPI was built in a way that was almost synonymous with me.

Matt Gartland: Right.

Pat Flynn: I was SPI. So when we deflect the focus from all things Pat Flynn to all things community, of which I am a part of, but it’s not just about me, it’s about you, it’s about the other creators, it’s about the members and their work and featuring them. We started to make some public-facing changes on, for example, the website.

Matt Gartland: Mm-hmm.

Pat Flynn: It wasn’t my face on the homepage. It was the faces of our community, and it, in a way, it started to be treated like more of a media company versus a personal brand, and that worked, but it also didn’t because I feel like the disconnect showed up of like, “Well, who’s behind this?” And, you know, there is something to ha- to personal brands and how easy it is to connect with people because it is so personal.

So there was this kind of like push and pull, at least from my perspective, on, “Okay, we’re building this media company, but it’s also… It was once synonymous with me, but it’s still important for me to show up.” But how much, and then, like, where does that focus live? I don’t know if you have any… You’ve worked with a lot of brands as well-

Matt Gartland: Yeah

Pat Flynn: And have probably felt similar pushes and pulls.

Matt Gartland: I, I’d say that there’s always a tension. The tension is unavoidable. It’s how you attempt to modulate it. Like, how do you, how do you think about, yeah, the, the creative energy flowing in from someone like you, right? But then being able to systematize some- something to a reasonable degree.

Right. Right? And how do we, yes, enroll other people, most notably our amazing members and our fans, you know, into the brand and be able to showcase their success stories increasingly in connection with, you know, most notably yours.

Pat Flynn: Mm-hmm.

Matt Gartland: Right? But then also other partners. Like, there was an era going back to that, like, 2020 era where a good friend of mine locally in Columbus, where I live, Jay Clouse, I brought him into the company.

We did a small- Yeah … acqui-hire at that time of his then company ’cause I saw his potential, and he was beginning to become a creator in that way. Again, before that term really meant anything. Yeah. So he was on our team for a while. He was actually our community-

Pat Flynn: Shout out to Jay, by the way.

Matt Gartland: Absolutely. Yeah.

Pat Flynn: Like, very important part of the beginnings- Yeah … of our community.

Matt Gartland: Yeah. Uh, we were roughing out what we initially called, based on those early stage note cards, uh, SPI Plus was the first name we had for it. That’s right. Didn’t, didn’t launch as that. Yeah, we were crafting that out in terms of its vision and its model in 2019. That overlaid with FlynnCon.

Pat Flynn: Mm-hmm.

Matt Gartland: And, you know, that serendipitously led to talking with our good friend Ankur, s- founder and CEO of Teachable at the time, where we did almost all of our revenue selling courses. And he was very honest. To this day, I have immense credit to him. Uh, I mean, he’s amazing on every front, but he was honest to say, like, “Look, I’m not gonna be taking Teachable in that direction, you know, as a platform to be able to sell like what I was envisioning to sell.”

Pat Flynn: Yeah.

Matt Gartland: “But hey, you should go talk to a couple of my top guys. They’re leaving the company with my full blessing to go create this new thing, this new startup. You might wanna go talk to them.”

Pat Flynn: Hm. Sid and Andy.

Matt Gartland: So Sid and Andy, and then Rudy is the third, and we went and spoke to them and, uh, his Circle. Yeah.

And I flew to New York. I got you on the phone. You didn’t join, at least not in person, and that was four weeks before the pandemic hit. I was in New York with them talking about Circle. We signed our advisory deal ’cause we became advisors to Circle. That’s crazy. It’s, it just, it’s nuts when you think about what we are attempting to do in terms of create some optionality for ourselves-

Pat Flynn: Mm-hmm

Matt Gartland: Fused into, like, how do we create something of such purpose that could hopefully one day outlive us in terms of a longevity, right? And then there’s obviously some luck involved, too.

Pat Flynn: Yeah. What else were you thinking of, Matt, coming in and thinking about the future in terms of molding the company in a way that was built to sell?

We weren’t really planning on selling it. I don’t, I don’t even know when that became a thought for us. Yeah. I’m cur- I’m curious if we could explore that potentially. Sure. But I think it was important how you came on to actually mold the company so it was sellable, right? Yeah. Sure. Built to sell, very important for business owners to understand so that you know that, you know, you can…

It, it’s not for the purpose of always selling, it’s for the purpose of building systems and operations- Mm-hmm … so that if you wanted to go- Yeah … four weeks on a vacation, you can do that and the company will still run, or if, you know, if you wanted to move f- forward, or God forbid something happened, the business can still continue to run.

That’s right. And those are all things that were important and th- and things that I thought because SPI was, was all I had, and if something happened to me, then… And, and because I’m so tied to the brand, then, like, what’s gonna happen to my family?

Matt Gartland: Oh, absolutely.

Pat Flynn: Yeah. You know, those are, those are other thoughts that came to mind too.

Matt Gartland: A lot of this sort of stuff starts with mindset, and I think it’s a, like, a teachable point even for other entrepreneurs, and it’s very, very… This next point is, like, very, very normal.

Pat Flynn: Mm-hmm.

Matt Gartland: Is when we get into working for ourselves, we’re usually trying to replace another form of income, right? Traditional job, what have you.

So but, like, this mindset shift from just thinking about income generation to thinking about almost, like, wealth building a little bit. So yeah, how do we build then something that can be self-sustaining or at least increasingly self-sustaining and not just, okay, Pat, how much income do you need to be making from this, this company, right?

Into, like, okay, this is a company almost its, its, its own thing, right? It’s not just synonymous with you making income.

Pat Flynn: Right.

Matt Gartland: Right? So then that speaks to, yeah, a certain level of team design, whether it’s in-house or not, but yeah, you know, Dan Martell, Buy Back Your Time is, like, one reference of many.

Pat Flynn: Mm-hmm.

Matt Gartland: Right? How do we think about finance? Obviously, it’s a big thing. We don’t have to get too nerdy on finance unless you want me to. But, but-

Pat Flynn: Do you wanna open that box?

Matt Gartland: We’ll save it for a different day. I- I’m really good at finance.

Pat Flynn: Too good.

Matt Gartland: But, but, but on finance, I, I guess I’ll just simply says, like, how do we- forecast the future better with more confidence so that we know

I mean, cash flow is everything in businesses like ours, right? We’re not venture-backed tech companies. We’re not playing with other people’s money. We’re playing with our money.

Pat Flynn: Right. Right?

Matt Gartland: So, and then that money is family money, too. Mm-hmm. Right? So to your point about family and taking care of the people that, you know, love us, you know, what can we be doing to have more predictability with, with income generation, which would then mean really revenue for the company?

How are we protecting our margins from a profitability standpoint? Can I look into the future with increased clarity on our financial modeling for cash flow- Mm … to make sure that we’re, as we’re making investments over here, like FlynnCon was a big monetary investment to pull that off.

Pat Flynn: Yeah.

Matt Gartland: Right? So-

Pat Flynn: Yeah, we lost money on that, for sure.

Matt Gartland: We lost money on the event, right? But it was an investment into the brand and the relationships that surrounded the brand.

Pat Flynn: Right.

Matt Gartland: But all, like, again, it’s a nerdy thing to say again, but it’s like chess or even multi-dimensions of chess. So you gotta look through some different layers there to kinda build something of resiliency that can withstand even hard moments.

2019 was a hard year, right? And then 2020 was a much better year, ’cause we had enough of the infrastructure, the human infrastructure, the brand partnership infrastructure, the financial infrastructure in place that we weathered kind of a hard year.

Pat Flynn: We did.

Matt Gartland: And then we got to then the other side of that with the launch of SPI Pro is what we ended up calling the first version of the community that we were already building before the pandemic hit.

Mm-hmm. Then the pandemic hit, and when we launched that in July, it just exploded.

Pat Flynn: Yeah, we kinda, we kinda moved forward the launch because there was so much demand for connection.

Matt Gartland: Yeah.

Pat Flynn: There was … You know, remember Clubhouse launched and a number of other- Yep … apps, and it was just like, “Well, now would be the time to launch this community, so let’s MVP it and put it out there,” and you got Jay on board, and it just like, it was magic.

I mean- Yeah … we had hundreds of people come in immediately as a result, which really Was significant- Yeah … obviously for not just revenue and recurring revenue, but for just- Yeah … the signal that this was the direction to go.

Matt Gartland: Yeah. And, and maybe a good point to kinda pull on or pull out of that is we didn’t yet bet the farm on it, right?

Like, we didn’t turn off DIY core sales. We al- we were still running that in parallel.

Pat Flynn: Correct.

Matt Gartland: Right? So you could call this, like, a really big experiment, right? And, you know, you’re known famously and, and rightfully for a lot of experimentation and learning from that. This one just worked like gangbusters.

So when it did, it’s like, okay, that proved the thesis, if you will. Yeah. Right? It’s like, okay, let’s keep going. Let’s move in that direction, right? And we ended up rebuilding… This wasn’t just, like, a new product launch. At least it did start there, but at least how I think about it and was thinking about it is like, if this works, we rebuild the company.

Yeah. We’re- We basically re- It’s a whole, it’s a whole- …

Pat Flynn: Rebuild the company- … business change- … in this direction. Yeah …

Matt Gartland: Altogether. Yeah, and then we built our business on Circle, right? Again, with great credit to them, being able to provide us that infrastructure.

Pat Flynn: Right. Well, what was interesting, and I’m sure you’ve caught wind of this, Matt, but, um, m- maybe me more so because people were reaching out to me directly, but there were some businesses and mostly venture capital that was now interested in what we had.

Matt Gartland: Mm-hmm.

Pat Flynn: I mean, I think, yeah, you, you and I were even in one of those calls together with one of those-

Matt Gartland: I mean, there were a couple during our tenure.

Pat Flynn: Yeah, where we had gotten offers for SPI already. And I wasn’t in the mindset of selling the business. It was just, that was maybe the first moment I was like Oh, we have something sellable-

Matt Gartland: Mm-hmm

Pat Flynn: and of value to somebody out there who has more money, they wanna invest in it. But, I mean, those were, we had a couple of those calls. It was very easy for me to say no to those because we knew, we knew what they were gonna do the, to the business. They would just rip it apart.

Matt Gartland: Yeah.

Pat Flynn: Yeah, that- Um, either that or we would work for them and it would just be hell, and that’s not what we wanted either.

Matt Gartland: Exactly. To, yeah, in every way endorse that thinking, right? They would’ve used it, yes, for parts, or it would’ve been like a squeeze play, right? They would’ve s- tried to squeeze the audience, right? D- we’re just another cog in some bigger- Oh, that would’ve felt so bad … much larger machine. And yeah, it does come back to, like, okay, what are we building, that idea of legacy, what’s meaningful to try to pass on should a s- situation ever present where it felt right, and those did not feel right.

Mm-hmm. I mean, the numbers got a little bit interesting, but not interesting enough to ever sacrifice on our values.

Pat Flynn: Right. I mean, they were interesting. One of them even presented the idea that if we reach a certain benchmark in our recurring revenue, then that unlocks a much, much bigger multiple.

Matt Gartland: Oh, absolutely, yeah.

Pat Flynn: That’s- That, that would be, you know, mid eight-figure-type thing, and it was just like, whoa, okay. I don’t know if that’s gonna even happen, but.

Matt Gartland: Yeah, a lot of that gets a little bit dreamy coming in from, like, the VC- Right … bigger side of things, but- Right … anyway.

Pat Flynn: So I mean, that, that was the first time I was like, oh, we do have something sellable, and hey, even though it was once synonymous with me, with me, it’s no longer too synonymous with me.

Like, I still was, okay, the owner of SPI and the h- the sort of head of the company visually or at least front-facingly. Mm-hmm. But now this was something that because of the recurring revenue and because of the membership and the community model, it felt like, oh, well, I guess we could one day, but it never was anything we were, like, shopping for.

Matt Gartland: No, n- in no way actively. Again, optionality. So we allowed for the possibility of something awesome to happen. Right. Right? And eventually, and we can catch up on the story to then what has happened, but yeah, we weren’t… That was not like, “Oh my God,” like, “We need to sell this thing in 18 months or else.” No.

Right? Or anything like that. Never. Yeah. One thing I… And it’s very dry, I admit this going into it.

Pat Flynn: Warning.

Matt Gartland: Uh, warning. Nerd alert, is, like, entity structure. You know, the, the foundations of a business on paper.

Pat Flynn: Sure.

Matt Gartland: Right? So, like, when we tied the knot and went in together, we spun out SPI- SPI

Pat Flynn: Media …

Matt Gartland: from your parent company.

You have a parent company. Mm-hmm. I have a parent company that I own wholly. Your parent company you own wholly, right? And we co-founded a new company called SPI Media, right? Mm-hmm. That name really never got out there that much. It was never intended to be, you know, the brand itself.

Pat Flynn: It was just for the books really.

Matt Gartland: Right, but it was a dedicated legal entity that had different safeguards around it, that had really clean paper trails. The financials on paper were crisp. So these are the certain things that then when you play the game forward, and you think about, okay, should a scenario present where then we’re gonna be scrutinized, and you go through due diligence, and things are being reviewed as they were very meticulously, then this adds up, right?

And it does genuinely and seriously appear to be not just like a legit business, but a profitable one- Mm-hmm … one of value, one that has other forms of assets, like IP-oriented assets, et cetera. So- I mean, it just made the process a lot easier … we laid the foundation from the jump when we did that.

Pat Flynn: Yeah. I mean, that’s, that’s you, Matt.

That’s all you. I just wanna give you credit for that. I would’ve not thought to do that. But that makes sense. Looking back it’s like, okay, we have a separate entity now, and it has its own financials, and it has its own IP, like you said. So therefore, if, if we ever ended up wanting to sell it or do something with it-

Matt Gartland: Mm-hmm

Pat Flynn: it’s much easier to hand off. That’s right. And, and it has made it that much easier.

Liz and I have been on several podcasts together. Many people watching this maybe have already heard or seen those. And so, I mean, we can lightly relive how this all happened. I think it’s kind of serendipitous how everything happened because it was Liz’s sister, Patricia, who we hired to help us with Card Party, which is my Pokemon event, who came in to offer assistance, who saw me at that event stressing out because I was doing both SPI work and Card Party and Pokemon stuff at the same time.

I was trying to get that last email written or something like that, and she was, um, very aware that I was kind of straddling two ladders at the same time, essentially. And so she went back to Liz and just had left, uh, her a comment of like, “Oh, Pat was trying to do two things at once. Like, would you ever buy this from Pat to make his life easier ’cause he’s having all this fun in the, in the Pokemon space?”

And she was like– Liz was like, “Oh, yeah, maybe. Like, that kind of would fit. Let’s talk.” And that’s kinda how it all began. Mm-hmm. It was just– I mean, thank you, Patricia, Liz’s sister, and, and for saying that. And, you know, I don’t think it’s anything that was on either of our minds Until, until then it was, and then we just kind of explored that.

And the one thing Liz and I always say when we’re on our podcast together talking about the story is, like, the negotiations, although yes, were about numbers a little bit, were mostly about is this right for both of us and, and the audience?

Matt Gartland: Mm-hmm.

Pat Flynn: And it just seemed to check all the boxes. Yes, it helps me because then I can really dive into this new calling that I have and the momentum I have there and, and, and the joy and experiences that I’m having there now.

It feels like the early days of SPI, but now on the Pokémon side of things. But I think this is the right thing to do for the audience as well ’cause my f- mind wasn’t fully there anymore, and she’s all in on them, and we’ve already seen so much success from her just coming on board. Even early on before the announcement, the stuff that she’s done to really bring new life to the community has been only something that I think she could have done.

Matt Gartland: I think so, truly. And the magic of the universe, again, we didn’t force it. We didn’t try to rush it into existence. It was very organic- Mm. Very natural, very sincere, right? And- Praise be … usually if by some miracle, right, that can kinda appear in your life and there’s some sense of being able to detect that, right, then that sometimes is the best form of an opportunity.

Pat Flynn: Yeah. I mean, I have talked about this acquisition with a lot of people, and most people who are understanding of how this world works and business and acquisitions and stuff say this is a very rare occurrence.

Matt Gartland: I, I think increasingly in our industry where-

Pat Flynn: With personal brands especially …

Matt Gartland: Well, it’s personal brands and then everything that’s transformed now with AI content generation and things are much more fragmented, and I think genuine degrees of concern, not to drift too far here, but just, like, like, what is real, you know, in terms of what’s being put out there, you know, what is helpful.

Right. And just more deluge of information upon AI-generated-oriented slop info- like, blah, blah, blah, right? So to have something of such genuineness that we have created, right, and your stewardship and leadership just of the depths of that teaching, right, and how it’s been imbued through community-based programming, our accelerator programs, I mean, and really everything.

Yeah, it’s I think increasingly rare to have what we have built carefully now in this era.

Pat Flynn: Somehow it happened, and it worked out. I mean, a part of what happens in my head, and I’ve spoken about this on podcast too, is just like I care so much about that audience, the SPI audience. That is who got me here.

Mm. That is who has enabled me to step into something even bigger than anything I ever thought I would do, and I’m so grateful for that, and my big worry is disappointing people. Maybe people came because of me, and they’re like, “Now that I’m not there, it’s like it’s not the same.” But I feel like, again, to best serve that audience, I have to move forward and give the baton to somebody who is literally all in on them.

And it may take some people time to understand that or feel that, but already a lot of, a lot of people have felt that already. I’ve gotten a lot of DMs from people in the community saying, “Wow, ever since Liz came on, like this is a completely different community and I love it Even before the announcement.

Maybe the announcement will still kind of surprise some people if they haven’t heard al- already, but I definitely think especially for long-term, this is, this is the best of all worlds.

Matt Gartland: Yeah. Liz is the future. Like, she… Like, her spirit, and kinda going back to your story of, like, every successive conversation we had with her, even before numbers were discussed, was, like, her energy, her thinking about the beginners that we have classically served so very well.

Pat Flynn: Mm-hmm.

Matt Gartland: And what’s the future of entrepreneurship now in this era? Like, it was so fluid. Like, it was so smooth.

Pat Flynn: Yeah.

Matt Gartland: Right? So, you know, you and I would debrief after one of those conversations, and it’s like, “Okay, I guess we’re taking the next step- Yeah … with her.” And it’s like, okay.

Pat Flynn: Every time it was like, “Green light, green light, green light.”

Matt Gartland: Let’s prepare for the next conversation. It kinda ratchets it up a bit. We get into that conversation, it goes really well. Well, I guess we’re taking the next step, right? It was just, yeah, it was green light after green light.

Pat Flynn: After the first conversation, how confident were you that this was gonna go all the way through?

Matt Gartland: Not that confident. Just after the first one?

Pat Flynn: Because-

Matt Gartland: Well, numbers is always the lit- the litmus test, ultimately. Energetically, yes, green light big. Absolutely with her, but we hadn’t talked numbers and aga- nor should we have in that first one. But for me, as I think about, okay, trying to do a deal, and I’ve been a part of several, this is my fourth exit, it’s like, okay, are we really gonna see value the same way when numbers enter the conversation?

Pat Flynn: Hmm.

Matt Gartland: Right? And that, not to drift it backwards too far, but it’s like, okay, have we done, have we done it right in terms of the business infrastructure stuff, right, and the numbers, and being able to share the numbers and then tell a very credible and authentic story around the numbers, right, and what these numbers mean, right?

Pat Flynn: Right, right.

Matt Gartland: And then we had that first conversation, it was, like, the third or the fourth in that sequence, and I think that was in the fall. We were together for that conversation, actually, in person.

Pat Flynn: Yeah. Were you at all worried, like, ooh, we might scare her away, or maybe we’re- Um … underselling ourselves, you know?

Matt Gartland: Like- I, I wouldn’t say it was a fear of, like, scaring her away ’cause I felt in every way, like, 100% conviction in our numbers and what ultimately then was our asking price.

Pat Flynn: Yeah.

Matt Gartland: Right? But certainly, like, an, an uncertainty on whether or not she would see it the same way, and… Well, maybe I s- I wouldn’t say that there was zero fear.

It was like, man, I really do feel like she’s the one, right? Energetically, story, ambition. So there was a hope. There was a hope that she would be the one, and maybe a sense of… Ah, again, I don’t think it was fear, but I was like, man, I just hope it doesn’t decay. Like, I, I hope it, this doesn’t become- Yeah

complicated or too complicated. I, I hope that she sees it the same way.

Pat Flynn: And when we shared those numbers, it was very clear that she was like, “Okay, this is kind of in line of what, what I thought.” And I think that’s credit to you in terms of telling that story and leading up to that and sharing a lot of data around how we came to those calculations.

Matt Gartland: Oh, yeah.

Pat Flynn: I mean, it’s a- It wasn’t just a made-up number.

Matt Gartland: Oh, no. There’s spreadsheets upon spreadsheets.

Pat Flynn: Matt’s good in the sheets.

Matt Gartland: I am.

Pat Flynn: Sorry. We’ll leave that in. Uh, but yeah, I mean, it’s been nothing but celebration between the three of us, and, and this is, again, the first time Matt and I are together- Mm … in person after the sale.

So it’s been really great. We’re gonna get a nice dinner tonight and, you know, toast to it, and, um, you know, toast to our futures. So I think a lot of you know where I wanna go. I mean, I haven’t gotten too specific, ’cause some of it is still in the works or even secret in terms of my work with Pokémon and the storytelling we’re doing there with the YouTube channels and other things that are happening, Card Party.

But I know people are curious to know what you’re up to, Matt, and what your future entails now that, you know, you are moving forward from SPI.

Matt Gartland: Well, come back to me. I appreciate that. I wanna talk a little bit about you, though, first.

Pat Flynn: Okay.

Matt Gartland: For, for gosh sakes.

Pat Flynn: Deflection. Fine.

Matt Gartland: Yeah, yeah. Uh, it’s truly impressive what now you’ve been able to do and help so many other people.

You know, it’s not just cards. It’s the story and the lives and the meaningfulness around, again, gathering, connection, Card Party, people, community together. So I actually really wanna kinda-

Pat Flynn: Thank you …

Matt Gartland: Spotlight that for you.

Pat Flynn: It has become much more than I thought it was. When I got into it, it was- Yeah, about the cards and just- Mm-hmm … let me have fun on YouTube, and it’s something my kids and I can do together. But it is actually feeling very similar to how when SPI started. I started to get letters in the mail from people saying, like, this is affecting their lives. I’ve had stories from people who have said that the content has helped them with the bullying that they’ve gotten, um, and helped them find their people, find their community.

I’ve gotten messages from parents who say this is the only family-friendly content that they could find on the internet that they are comfortable allowing their kids to watch, and they have been watching together. The families who now collect together, and they’re bonding with each other when they hadn’t had any connection or, or, or commonality before to…

I got a few messages from moms within the past couple months who have had kids with ADHD who were mute, who are now talking because of- Wow … the videos that they’ve watched. And even it’s gotten to a point where I’ve gotten messages from people saying that they are now today still alive because of the content.

This is much more deep than just cards. Yeah. I mean, it’s kind of prophetic that it’s Deep Pocket Monster ’cause it goes deeper than just the cards. And I’ve shared this a couple times before, but you know, a few people with the size of the brand have s- have called me like the MrBeast of Pokémon. And although I do appreciate MrBeast and while he’s grown huge, like I don’t wanna be in that category with him.

He lives in his studio, and he is a workhorse and, you know, doesn’t have a family, not… Again, respect to him. But there’s a different person I’d rather be associated with, and that is Mr. Rogers. Like, I wanna be the next Mr. Rogers. Like, I can’t ever be him, and I can’t replace him ever, but the lessons that I learned from him and the lessons that he teaches moving forward, especially to kids- I have now a platform that I’m able to do that.

And I don’t know if you remember, Matt, but way back in the mid-2010s, I had once expressed that I wanted to do something that I knew would help kids.

Matt Gartland: I vaguely remember that. A book project, if I’m not mistaken. Yeah.

Pat Flynn: There was a book project. There was me getting involved in motorcycle drove by really quickly.

There was me getting involved in districts and schools and understanding more about the dynamic of how that works. I wanted to inject entrepreneurship into school curriculum. And I soon and quickly learned how messy all that is, from the politics to the red tape to all the things that make it very difficult to make any change in that world.

But then fast forward to today, and I’m able to directly make an impact on kids through the content that I’m creating. I don’t have to go through all those hoops. I don’t have to worry about giving up control on how I should do that because I can do that in my own way. And it’s been working. And to see these families and these kids and to hear from them and to talk to them at Card Party or to get emails and DMs from the parents, it’s been so energetic for me to move into this now new era of my life.

And again, I don’t wanna discount how important SPI was and everybody there and you and, and the team and especially the audience and the community members and the students. You all have a role now in where I am today and the impact that we are making as a result of that, so thank you so much. Just thank you.

But yeah, it’s been pretty cool to see what’s been made possible, and I only feel like we’re just scratching the surface with where this can go. Because the, the truth is, I don’t need it to generate a crap load of money, right? I don’t need it to make me world-famous. That’s not what this is about. I feel like if I were to end everything I’ve…

I’m doing right now, I would be comfortable and happy. I have a calling, and that’s what this is about.

Matt Gartland: Yeah. Absolutely. I think all of our interconnected lives, certainly yours and mine, but yes, the audience is, like, we try to unlock greater potential in each other. And I think that’s just truly, like, one of the most amazing things, especially about a business partnership.

At least, I kinda have a romantic idea of that notion.

Pat Flynn: Mm-hmm.

Matt Gartland: Right? Is that, you know, if you can find the right pairing, it can be a one plus one equals three equation.

Pat Flynn: Yeah, absolutely.

Matt Gartland: Right? And I mean, our friendship and partnership has w- been one of the most meaningful things to me in my life, let alone in my career, genuinely.

Pat Flynn: Yeah.

Matt Gartland: And to see you be able to flourish in this way is awesome. I have some level of, of opinion or belief that, like, that may not have been possible if you had remained solo your entire time, not just with me, but, like, the team or other people- No, guaranteed … in different ways.

Pat Flynn: Guaranteed.

Matt Gartland: Right? Which again, I, I guess now zooming out to kind of the industry, we’ve been talking about personal brands, other people, like, being solo is hard.

Being solo is lonely, right? Solopreneur And at least I continue to think that while there’s still abundance of opportunity and a lot of hope and, and amazing potential, you know, out there, it feels like it is getting harder, like the landscape. You know, not as easy to build an audience as it once was when you got started, right?

Pat Flynn: Mm-hmm.

Matt Gartland: So I see, like, business partnership and different forms of partnership being one of the most powerful positive forces possible, right? And, you know, look what it’s done for SPI. Look what it’s done for you, and then others, you know, that we know and, and good friends of ours that have partnership in their lives in some way, right?

Yeah, yeah. So that’s how I even think to maybe reflect on me and kinda like what’s next or, or whatnot is that’s my calling. I think that’s always been my calling, at least as I’ve endeavored into entrepreneurship, and I wanna keep doing that. So I know you know this phrase. You know, we’ve talked about it.

I kinda fancy myself as like a fractional business partner now.

Pat Flynn: Mm-hmm.

Matt Gartland: ‘Cause I know a lot of people that have done really well, multi, multi six-figure, even seven-figure businesses, but they’re on their own. Things are hard. They have built maybe a good business, but on some level it’s just a good job, right?

‘Cause they have- Yeah … income.

Pat Flynn: Yeah.

Matt Gartland: But then they get trapped in that. They don’t know the next chess move to make, um, maybe just ’cause that’s not their superpower, right? In terms of thinking about the things that we’ve been able to do together and looking at the board, and how do you play that game and bring other things into the picture.

So yeah, I’m excited ’cause of our work together, the amazing people that I’ve been able to meet through SPI and my network and, and whatnot that’s been flourished from that, is to be able to now serve in that capacity. So that’s kind of a big part of my future, is this notion of fractional business partnership and supporting just other amazing, talented entrepreneurs that really are looking to…

Like, they’ve kinda outgrown their current business in a way.

Pat Flynn: Mm-hmm.

Matt Gartland: Uh, or they’re trapped in it, right? And we need to, like, re-architect their business for its next major chapter. Uh, that’s very fulfilling to me- Yeah … ’cause I know what it can do. Right, I mean- And, and look, look where we are now.

Pat Flynn: I was… That’s what I was gonna say.

This is the outcome of-

Matt Gartland: Yeah …

Pat Flynn: all the things that you’ve brought to SPI and to my life, and so thank you, Matt. Um-

Matt Gartland: Thank you …

Pat Flynn: I wouldn’t have gotten here without you.

Matt Gartland: Likewise.

Pat Flynn: So yeah, I mean, we’re not done working together. No. We have other things that we work on together, but this is definitely the end of a chapter- It is and, and the start of a new for both of us. And, and, you know, it’s exciting. I mean, there are so many great things that have come, uh, about from this, you know. Caleb has also moved on from SPI to come work with me here in the studio, and not just manage the new space, but also we’re gonna do some amazing things in the world of livestreaming that tap into his talents, and the things that I feel like as CEO of SPI maybe just wasn’t, we weren’t getting out of that, of, of, of him, uh, um, and have been, like, waiting to come out.

So I’m excited for that, and I’m excited for our continued work together as advisors on certain, certain projects. Oh, yeah. You know, we advise Circle and a number of other different companies together.

Matt Gartland: Tech companies.

Pat Flynn: Tech companies, yes. And, um, I really enjoy doing that work, especially because we’re not in the day-to-day of it.

We can meet once or twice a month and offer some advice based on our history and based on our expertise, and still make an effect and ha- have change or see change happen in these companies for the better for them- Yeah … which ultimately helps out everybody involved. And, and, you know, we’ll still continue to do that together.

Matt Gartland: Yeah, absolutely. And then continue to be a big fan and proponent of SPI and its future with Liz.

Pat Flynn: Amen, yes.

Matt Gartland: Right? I mean, we’re still a part of the community. We still love the people inside and out of the company and the brand and everything. So, you know, we’re not gone from that either. No, no, no. We just enter a different relationship to it.

Pat Flynn: For sure. And, and I’ll definitely be back on SPI to be a recurring guest, and not just because I was formerly once the person behind it, but because I want to continue to showcase everything I’m doing and where I’m going and how it’s working and what’s not working, and all that kind of stuff. I, I al- always am available as a case study.

I mean, Deep Pocket Monster is the perfect case study for- Building a community and, and for everything I’ve written in Superfans, and I love that we’ve been able to work out something such that Superfans is still living on. In fact- In a big way … it is a major part of the community in terms of how it’s structured because, like I wrote about that in 2018 and then published in 2019, it’s, it’s the future of business is not information, it’s connection.

And so I’m excited that that continues to live on and a piece of me is still there to help serve people even though I’m not owner of the company anymore. I very much, just like Matt said, support it and want it to succeed. I want Liz to thrive and for the community to thrive even better than when, when I was in it.

Matt Gartland: Yeah. Yeah. That’s perfect. So to the future, right?

Pat Flynn: To the future, and to all your futures. Thank you so much for- Absolutely … for watching this, and I hope it provides some inspiration and even some insight into how, yes, a personal brand could get to this point, but also how thinking big picture, uh, you know, sometimes, you know, we don’t know exactly what’s gonna happen tomorrow, but I feel like we’ve always had these things based on our values and based on our mission, and that’s what guides us.

So all the best to you. Thank you, and give it up for Matt, everybody.

Matt Gartland: Stop. Thanks, everybody.

Pat Flynn: Thank you.