Yong-Soo Chung [00:00:00]
Tim Stoddart has lived a rather... difficult life.
Tim Stoddart [00:00:03]
it was really hard. Like I went through it. I went through the wringer, man. Um, couldn't stay out of jail. Like couldn't stop getting jumped on the subway. It's like, I don't even know. I just get my ass kicked all the time.
Yong-Soo Chung [00:00:19]
Thankfully, he saw the light very early on...
Tim Stoddart [00:00:22]
I got sober when I was 23 and I grew up in Philadelphia and I traveled a little bit but I've never really spent any time out of the city and I had a cousin who lived in South Florida who basically took me in and kind of saved my life.
Yong-Soo Chung [00:00:37]
Tim grabbed this second chance at life with BOTH hands…
Tim Stoddart [00:00:40]
Man, so I'm glad I learned that lesson. I learned it when I did. And so I'm grateful for it. But I just I would have saved myself. Even talking about I'm not like too much of an emotional person, but it gets me like welted behind the eyes...
Yong-Soo Chung [00:00:55]
…and the results are plain for anyone to see.
Tim Stoddart [00:00:58]
So in total, I think we'll do like, I think all in all, there's, there's partners involved in all of that stuff, but all in all, it'll probably be five, five or 6 million bucks a year, something like that. I think by the way, this is back of the napkin math.
Yong-Soo Chung [00:01:11]
I know exactly what you are thinking.
Just how did Tim Stoddard go from living with his cousin in South Florida to making '5 or 6 million bucks a year'?
Well, the answers to this question lie in Tim's fascinating journey as an entrepreneur over the years... A journey that began with Tim first getting sober and then starting his first entrepreneurial venture - SoberNation.
Tim Stoddart [00:01:34]
That's how it happened, man. And even saying it back to you out loud, it's, it's just wild. This like sequence of events that just always seemed to be like the perfect time for me to to learn this lesson when I needed to learn it. And it all started from this idea of just writing online, sharing my experience, sharing what I learned to that day basically. And it's turned into what it is.
Yong-Soo Chung [00:01:55]
A journey that we will retrace on this episode, with Tim himself as our COPILOT.
Tim Stoddart [00:01:59]
Hi, I'm Tim Stoddard. I'm the CEO of Stodzy Internet Marketing and the owner of Copyblogger Media.
Yong-Soo Chung [00:02:06]
And along the way, Tim will tell us how he built SoberNation from a simple blog, how that led to him launching Stodzy Internet Marketing, how he leveraged that into buying CopyBlogger, and why all his entrepreneurship ventures are part of the same, identical pattern.
So jetsetters, buckle up, put your phones on airplane mode and get ready for take-off!
The next generation of successful founders in this digital age of entrepreneurship will leverage their audience to launch, build, and scale their brands. First Class Founders explores this golden intersection of audience-building & company-building with proven strategies to grow both your audience, which is your distribution, and your brand, which is your product.
Because those who can master both will create a category of one.
Hi, my name is Yong-Soo Chung and I'm a serial entrepreneur who bootstrapped 3 successful businesses from $0 to $20 million over 8 years.
On this podcast, you'll learn timeless lessons from world-class content creators, startup founders, and CEOs. You'll also hear tactical tips & strategies from ME, Yong-Soo Chung!
Are you ready? Then, let’s begin!
Before we begin, we teamed up with HyperPods to bring to you a quick 3-min hyper-visual summary of this episode with Tim about how he thinks about building his personal HoldCo.
Grab the hyper-visual summary for this week’s episode absolutely free at firstclassfounders.com/hypervisuals.
Despite being the owner of multiple businesses that make him several million dollars a year combined, Tim regards himself as a writer at heart.
Tim Stoddart [00:04:03]
I write and I delegate. I write because I think being a good writer is the most valuable skill that you could ever really have. And I delegate because I've learned that as you grow a company, it's the most foundational thing you could ever do.
Yong-Soo Chung [00:04:24]
That's because Tim's first entrepreneurial venture, SoberNation, began as a humble blog on blogspot.
Tim Stoddart [00:04:31]
I was just writing every day, whatever came to mind. At the same time, I met a friend and this friend who, he was going through a similar journey that I was going through.
Yong-Soo Chung [00:04:41]
The friend in question also happened to be working as a sales executive selling ads in magazines.
Tim Stoddart [00:04:46]
And he approached me because he knew I was getting into this blogging thing. And he said, 'Hey, I know that you're writing online. I've had this idea of like building a directory. I found this directory of country clubs and it seems like it's a really cool business. Do you want to partner together?' And I said, sure. I didn't really think of it much more than that.
Yong-Soo Chung [00:05:08]
And that was how SoberNation started.
Tim Stoddart [00:05:10]
So what is Sober Nation? Basically, it's a media company that provides content, resources, personal stories to other people that are struggling with addiction. And it's not much more complicated than that really. It's a way for people to connect with each other and for people to share their own experience and strength and some hope with each other so that they can like get help and they can relate to each other.
Yong-Soo Chung [00:05:35]
Now, SoberNation was essentially a personal project. But Tim happened to come across a website that, shall we say, made it so much more...
Tim Stoddart [00:05:44]
I found this website called copy blogger and I was learning how to write online by reading this website called copy blogger. And Copyblogger was one of the, I don't know, let's just call it like first practitioners of this idea of using your content to build an audience. And then through that audience, you could sell them products or services.
Yong-Soo Chung [00:06:10]
It seems like common knowledge today but...
Tim Stoddart [00:06:12]
But 20 years ago, this was not a thing that people really commonly understood.
Yong-Soo Chung [00:06:17]
Tim began to put CopyBlogger's suggestions and recommendations into practice on SoberNation.
Tim Stoddart [00:06:22]
And just simple things like the value of bullet points and where to put quote blocks and things that we don't even really think are that important. But when people read on the internet, it's a much different experience. And that's really how I got good. I got good at writing online.
Yong-Soo Chung [00:06:34]
And they worked! The SoberNation blog began to take off...
Tim Stoddart [00:06:38]
And before I knew it, there was a whole community of people that saw me as like this authority. And, you know, meanwhile, I'm not even a year sober at this point. I'm still completely clueless in my own life, but I had been building an audience and the power of an audience is a real thing.
Yong-Soo Chung [00:06:55]
Add to that, SoberNation happened to be in a niche that didn't have many practitioners.
Tim Stoddart [00:07:01]
behavioral healthcare centers, treatment centers, it's an industry that typically didn't have a lot of digital awareness around it.
Yong-Soo Chung [00:07:08]
The upshot of the whole thing was when Tim began getting requests to replicate SoberNation's success for *their* blogs and *their* niches.
Tim Stoddart [00:07:16]
I was just, I was getting phone calls. People that I didn't even know how they found my number. And saying like, how did you build this community? You know, can you do this for me?
Yong-Soo Chung [00:07:24]
Around the same time, Tim stumbled upon a pretty fascinating article by a guy named Mike Ramsey...
Tim Stoddart [00:07:30]
And this guy wrote this like 30 page article about local SEO. And in the article, he talked about how he was explaining to one of his mentors that he wanted to start an agency. Mike's mentor said there's like tens of thousands of agencies in the country. Like, what are you going to do? That's going to be different. And Mike said it was in that moment he realized like, I'm going to start a local agency that specializes in local businesses.
Yong-Soo Chung [00:07:56]
That little idea immediately resonated with Tim.
Tim Stoddart [00:07:58]
and so finally, when I read that article, I was like, 'You know what? Screw it. I'm going to go for it.' And I started a company, I named it Stodzy for no other reason than that was my nickname when I was a kid. I was like a skater kid and all my friends called me Stodzy.
Yong-Soo Chung [00:08:13]
And, by Tim's own admission, Stodzy has been pretty successful over the years.
Tim Stoddart [00:08:18]
The Stodzy business is certainly the most revenue generating. You know, we'll do a few million bucks this year for sure.
Yong-Soo Chung [00:08:30]
As heartwarming and inspiring as that story is, there is an incredible entrepreneurial lesson in this journey.
Stodzy was actually a PRODUCT that was simply a result of the AUDIENCE that Tim had built through SoberNation. In fact, one can even argue that Stodzy's success was guaranteed BECAUSE SoberNation had already built a ready audience.
Tim Stoddarts [00:08:50]
That's exactly right. It's so cool that you picked up on that.
Yong-Soo Chung [00:08:53]
This, by the way, is an excellent example of the M.A.P.S. framework in action. And if you don't know what the M.A.P.S. framework is, you should queue up episode 41 of this podcast, which is titled "Unlocking the Power of the MAPS Framework: Mindset ➜ Audience ➜ Product ➜ Scaling"
Essentially, the M.A.P.S. framework says that you need to build your audience before you can launch your product. Which, you will notice, is exactly what Tim did with Sober Nation and Stodzy.
And, in case you were thinking it could have been a one-off thing, well, he replicated the success a few years later with Copyblogger and Digital Commerce.
Tim Stoddart [00:09:27]
It's the same thing, you know, Sobernation was this media entity that generated traffic to Stodzy, which was my agency. CopyBlogger was this media entity that generated traffic, generated awareness to digital commerce, which was my agency.
Yong-Soo Chung [00:09:42]
By the way, the CopyBlogger that Tim is talking about here is the same CopyBlogger that he used to passionately follow in his early days of writing posts on SoberNation!
Tim Stoddart [00:09:51]
And I was like, I wonder what they would say if I said, Hey, could I buy into this company and like really be a part of it? And they said yes.
Yong-Soo Chung [00:10:01]
Yeah, Tim ended up *buying* CopyBlogger!
Tim Stoddart [00:10:04]
It was a huge deal. Like it was a huge deal emotionally for me. I won't give you like all the details, like things happened, you know, it didn't happen all at once. It's not like I wrote a check and I was a hundred percent owner of Copyblogger.>
Yong-Soo Chung [00:10:16]
But Tim *did* eventually become the "hundred percent owner" of CopyBlogger.
And, if you are a premium member of First Class Founders, you can hear the whole story of how that happened in the raw interview that I publish as a bonus episode every week.
Premium members also enjoy a ton of other perks - such as access to a private feed and AD-FREE episodes that are released a WEEK early! To become a premium member of First-Class Founders, go to firstclassfounders.com/join. Look for a link in the show notes!
As a premium member of this podcast, you can listen to Tim narrate the whole story in the BONUS raw interview, available to you in the private feed! Do listen to the whole thing - it's quite fascinating AND inspiring!
Anyway, getting back to Tim's journey, in buying CopyBlogger, Tim actually bought a total of THREE websites.
Tim Stoddart [00:10:50]
There's copyblogger.com, there's rainmaker.fm, which is like an old podcast network, which I'm still trying to figure out what to do with. And there was digitalcommerce.com. And digital commerce was the website that they housed all of their courses on. So they would use Copyblogger to basically sell their courses and the courses were on digitalcommerce.com.
Yong-Soo Chung [00:11:09]
Tim partnered with a guy named Jon Nastor, who specialized in SEO and re-created Digital Commerce as an internet marketing and SEO agency.
Tim Stoddart [00:11:18]
And that was the first revenue streams for copyblogger was digital commerce. It didn't start with the fancy web page that we have now. It was just a one page landing page. And I would put CTAs on the blog posts and I would try to generate leads and we did. You know, they came few and far between and I had to earn every deal. And I had to earn every lead. But within 12 months, you know, we were doing, I don't know, 100 grand a month or so.
Yong-Soo Chung [00:11:44]
When you think about it, Tim was simply following the same pattern that he knew had worked with SoberNation and Stodzy.
Tim Stoddart [00:11:51]
It's the same thing recycled. The only difference is it's just more operators that I have to work with.
Yong-Soo Chung [00:11:58]
And then, Tim repeated the SoberNation model with THREE other websites - DetoxLocal, YourFirstStep, and MedicallyAssisted.
Tim Stoddart [00:12:06]
All four of those sites is what internally we call Recovery Local.
Yong-Soo Chung [00:12:10]
RecoveryLocal is set up to feed leads into Stodzy.com - Tim's Internet Marketing agency - in pretty much the same way as SoberNation. I'll tell you all the details in just a bit but first, I want to give a shoutout to my wonderful sponsor, Riverside!
All right, listen up creators. You know that I'm super picky about which sponsors I work with. Well, I'm super happy to have Riverside as our sponsor for this episode. Why? Because I love using Riverside to record all my guest interviews on this show. Yup, that's right. My producer and I use Riverside as part of our podcast production process.
My favorite part about Riverside is how seamless the recording process is whenever I record an episode with a guest. Riverside records everything locally so the audio quality is the best that it can be. Plus, it even records backup audio just in case something happens, which has come in pretty handy in the past.
But hold on. We don't just use Riverside for recording. We use it to analyze transcripts within the video recordings to pull out the best parts of my conversations with guests. They even added AI to make it even easier for you to create even more high quality content.
Riverside is completely free to sign-up and get started for your first 2 hours. Then, use code "FIRSTCLASS" to get 20% off any paid plan. Trust me, you'll love using Riverside as much as I do. Just look for the link in the show notes and don't forget to use code "FIRSTCLASS" to save some extra cash.
Huge thanks to Riverside for sponsoring this episode!
And now, let's get back to our episode with Tim Stoddard.
Before the break, we heard Tim's story of how he built a powerful distribution channel through his blog SoberNation and leveraged that into starting his own agency Stodzy.com. We also heard Tim describe how he replicated this success by acquiring CopyBlogger and using its distribution to build and grow another agency called Digital Commerce.
As it turned out, SoberNation was actually a great template in other ways too.
Tim Stoddart [00:14:34]
what we learned from sober nation was how to structure directories as such that they generate traffic for local search queries. And so what do I mean by that? Well, if you go to drug rehab center in, I don't know, Bowling Green, Kentucky. You'll find the city page that lists all of the local treatment centers in Bowling Green, Kentucky on Sober Nation.
Yong-Soo Chung [00:15:00]
And any drug rehab centers wanting to appear in these search results, would then be serviced by Stodzy Internet Marketing - a simple but brilliantly effective pipeline to capture leads.
Soon, Tim realized that it was trivial to replicate this in other, slightly similar contexts.
Tim Stoddart [00:15:17]
we replicated it to a site called Detox Local, which is very similar except instead of drug rehab keywords, it's drug detox keywords. We did that again for a site called Your First Step, which is also very similar, but instead of drug rehab keywords, it's addiction treatment keywords. And then there's a fourth one that we built, which is for a medically assisted treatment center. So basically when people like have a really hard time getting off opiates and stuff, they can take medication, which will help them with like the withdrawal effects.
Yong-Soo Chung [00:15:50]
Since all four of these sites practically serve the same or similar audience, Tim categorizes them under a single umbrella called RecoveryLocal.
Tim Stoddart [00:16:00]
All four of those sites is what internally we call Recovery Local. So Recovery Local is like the media side of our company. And then there's Stodzy, which is like the service side of our company. So in a way, those two things are kind of one thing because they feed each other. You know, we'll use the recovery local stuff to generate leads for Stodzy. And then if we close a deal for Stodzy, we'll like promote them through the media companies just to help them gain some exposure.
Yong-Soo Chung [00:16:25]
Did you catch that amazing flywheel?
Tim uses RecoveryLocal to generate leads for his agency Stodzy Internet Marketing. And Stodzy uses RecoveryLocal to promote them once they graduate from leads to clients.
Brilliant, isn't it?
The success of this model is clearly visible in the revenues Tim's making from each of his entrepreneurial ventures.
Tim Stoddart [00:16:47]
Recovery local sites are the most profitable, but that's just because they take hardly any work. So we sell directory listings on them and we sell lead generation, but there's just the three of us. It's just my three best friends, my three friends that I got sober with. Like we've been doing this, you know, it's just us. And I don't know, it does probably like 90 grand a month between the four of them.
Yong-Soo Chung [00:17:11]
And the service arm of this flywheel isn't doing too bad either!
Tim Stoddart [00:17:14]
The Stodzy business is certainly the most revenue generating. You know, we'll do a few million bucks this year for sure.
Yong-Soo Chung [00:17:25]
As for CopyBlogger, it doesn't earn as much as either RecoveryLocal or Stodzy but it still pulls in a cool five-figures every month.
Tim Stoddart [00:17:33]
I'm part of the ConvertKit sponsorship network. I send out a newsletter every Friday. And just because I get so many damn emails every day from Copyblogger, that newsletter has done really, really well. The newsletter does about 10 to 11 grand a month. Um, and that's one email every Friday. So that's pretty sweet. And copy blogger Academy, we're just under 10 grand a month.
Yong-Soo Chung [00:17:54]
And when you total all of that up...
Tim Stoddart [00:17:56]
I think all in all, there's, there's partners involved in all of that stuff, but all in all, it'll probably be five, five or 6 million bucks a year, something like that. I think by the way, this is back of the napkin math.
Yong-Soo Chung [00:18:11]
Five to six million per year is pretty cool, no matter which way you look at it!
But, that's not all, by the way. Here's the icing on the cake... the part that truly impressed me…
Once Tim hit upon this formula, he went ahead and applied it to his PERSONAL brand!
Tim Stoddart [00:18:25]
...which is TimStodz.com. That's like my personal blog. I'm the only one who ever writes on that. And I'm the only person who ever will write on that. It's like a rule I've made to myself.
Yong-Soo Chung [00:18:34]
The reason that bit is important is because it has ensured that Tim's brand remains undiluted. And, in doing so, Tim has created a media brand for himself.
Now, the way Tim uses this media brand is pretty interesting.
Of course, the email list serves as a pretty powerful distribution channel. And, that has allowed Tim to leverage it to generate leads for his services the same way he leveraged SoberNation and CopyBlogger to generate leads for Stodzy and Digital Commerce, respectively.
Except, Tim did something incredibly smart with this audience he built...
Tim Stoddart [00:19:07]
...through getting my name out there and through building an email list of my own media company, that's how I've been able to generate leads for me to sometimes buy equity, sometimes earn equity in, in companies, sometimes just straight up ask for it because like, I know how to grow this business and sometimes people don't.
Yong-Soo Chung [00:19:27]
Tim used the distribution channel he had built with all the stuff he published on TimStodz.com to generate leads in terms of (pause) potential businesses to invest in! That is, people now approach Tim requesting his help to grow their business and, instead of charging them a consultation, Tim simply asks them for equity in their business!
Is that genius or what?!
Think about it... Tim could simply charge a consultation fee for any leads generated via TimStodz.com and increase his revenue. But he doesn't really need to do that... Because he doesn't really need the money... Because his other businesses are chugging along smoothly...
Tim Stoddart [00:20:05]
and it's, it's turned out to be the case where like the recovery local side and the Stodzy side and, and copyblogger and digital commerce, all of those like generate the cash that I need.
Yong-Soo Chung [00:20:15]
So, instead, he parlays these leads that come in (pause) into EQUITY in those businesses!
It's the same model as SoberNation and CopyBlogger but with a slightly different end result.
Now, here's the kicker: if this *end-result* is sounding vaguely familiar to you, it's because it is following the same philosophy as that of a Personal Holding Company!
I've previously outlined this philosophy in episode 53 of this podcast. The episode is titled, "The Rise of Personal Holding Companies: Exploring the Future of Entrepreneurship" - queue it up to play next in your podcast player, if you want to know more.
The gist of the concept - and the gist of what Tim is doing - is this.
Instead of selling his SERVICES at a higher and higher premium, Tim is now acquiring EQUITY in businesses that approach him for his advice.
Tim Stoddart [00:21:02]
...like the Hormozi-thing, 'You don't get paid for what you do. You get paid for what you own.'
Yong-Soo Chung [00:21:06]
"You don't get paid for what you do. You get paid for what you own."
One of our previous guests on the show, Jay Abraham, also voiced very similar thoughts when he spoke about his strategy for wealth creation.
EPISODE 68:
"Wealth creation doesn't come from ordinary income. It comes from creating an asset, building it up, making it very desirable, either for its pure profit or for its strategic value to somebody larger who needs it and will pay you four, five, 10, 20 times what you make in a year.”
Speaking of selling, Tim told me that, although he was OPEN to selling a business, he wasn't LOOKING to sell any of his businesses yet.
Tim Stoddart [00:21:45]
Here's where my head goes. I'm not bored at all. And there's a part of me that thinks you want to get out before you get bored. Right. Because then like you have leverage that you don't need to sell. Like I never want to get in a position where I need to sell something.
Yong-Soo Chung [00:22:01]
Tim's philosophy of wanting to stay invested in his businesses over the long-term sounds very familiar, doesn't it? Well, that's because it is. It actually comes from a very popular and famous source.
Tim Stoddart [00:22:12]
the only person I've found so far who has set the right path on how to increase the probability of success in the future is Warren Buffett. And Warren Buffett tells me that you don't in that you don't day trade, you invest and what does investing mean? It means like you trade money now for a potential upside in the future. And, and Warren Buffett's philosophy has just, it's really dumbed it down for me to where I don't have to try to think of what the right thing to do is. I can just look at the circumstances and just be like, okay, these circumstances dictate that this is the move. So I don't have to be smart.
Yong-Soo Chung [00:22:51]
And this same philosophy also drives Tim's investment decisions. That is, in choosing the businesses he wants to make a part of his personal holding company.
Tim Stoddart [00:23:00]
I only have three criteria really for when it comes to businesses I wanna be involved in.
Yong-Soo Chung [00:23:06]
And all his businesses and investments so far have followed these three criteria pretty rigorously.
Tim Stoddart [00:23:11]
And so through those criteria, there's nothing I see that says, you need to get out of this. Everything is telling me, stay in here, keep generating that cashflow, keep reinvesting the profits into other opportunities.
Yong-Soo Chung [00:23:26]
Curious what these three criteria are? I'll tell you all about them in a moment but first, I want to introduce you to the most adorable sponsor we have had on the show - my wonderful French bulldog Humphrey.
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Yong-Soo Chung [00:17:31]
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Alright, let's get back to our conversation with Tim Stoddard on how to replicate models to build and scale businesses for your PHC portfolio.
Before the break, we heard Tim mention that he has three criteria for choosing businesses he wants to be involved in.
Tim Stoddart [00:25:05]
One, like is it profitable? Like I only invest in cash-flowing companies. I'm not an angel investor. I have no interest in doing debt. It doesn't have to be a lot of cash. So it doesn't have to be a big company. It's just, you know, like I said, it's, it's Warren Buffett, Charlie Munger, like does the business work regardless of what the numbers are? Like is the business working?
Yong-Soo Chung [00:25:27]
Tim's FIRST of three criteria: Is the business profitable?
Tim Stoddart [00:25:31]
Two, Is it evergreen? Like I, I'm an owner in an AI, in an AI company. Um, really that's something that, traditionally I would have stayed away from just because it could be a flash in the pan. Who knows? That's why things like healthcare really stick out to me. That's why, um, things like content and personal branding and like the creator economy really stick out to me. Online education doesn't have to be courses about courses. You know, people are making courses about anything now, like who knows woodworking, landscaping, um, knitting, accounting, right? Like I just, I think the whole education system is completely changing over the next 10 years. And so I look at industries that are evergreen.
Yong-Soo Chung [00:26:11]
Tim's SECOND of three criteria: Is it evergreen?
Tim Stoddart [00:26:15]
And then I look at industries that I feel good about, you know, like I don't, I wouldn't feel good being an oil exec. And so I'm not going to do that even though it meets those first two criteria. Right. It's definitely cashflow positive. It's definitely evergreen. We're not going to stop burning oil anytime soon, but I wouldn't feel good about it. So I don't do it.
Yong-Soo Chung [00:26:32]
Tim's THIRD of three criteria: Does he feel good about it?
And, every single business that Tim is a part of - as an owner, or investor, or equity-holder - every single one of these businesses is rigorously filtered through these three criteria.
Tim Stoddart [00:26:46]
With what I have going on right now. They're all cashflow positive. They're all evergreen. And I like doing all of them.
Yong-Soo Chung [00:26:54]
Additionally, because these businesses fulfill these three criteria, it also gives Tim a reason to stay invested in them...
Tim Stoddart [00:27:01]
there's nothing I see that says, you need to get out of this. Everything is telling me, stay in here, keep generating that cashflow, keep reinvesting the profits into other opportunities, or just put the money in the bank, you know, put it in a freaking S&P 500, which is the best thing to do anyway. I have seen nothing right now that convinces me that now is, is a time to sell. Like Warren Buffett would look at what I got and he'd say, hold onto this forever. And so that's probably what I'm going to do.
Yong-Soo Chung [00:27:36]
Before wrapping up my conversation with Tim, I asked him what advice he'd give himself if he could travel back in time and talk to his younger self.
He began by recounting some of the difficult circumstances he lived through in his younger days.
Tim Stoddart [00:27:48]
it was really hard. Like I went through it. I went through the wringer, man. Um, couldn't stay out of jail. Like couldn't stop getting jumped on the subway. It's like, I don't even know. I just get my ass kicked all the time.
Yong-Soo Chung [00:28:04]
Over time, Tim has managed to identify a crucial element that caused him all this pain.
Tim Stoddart [00:28:09]
...I think a lot of that pain that I went through was really a disconnect between like myself and control... because why does anybody hold on really tight to something? They do it because they think it gives them control. And it's a really hard ego shattering thing to know that the only thing that you ever have control of in your life is like your reactions. That's it. Like you can only control how you react to things. You don't have control of your parents or of what other people do, or if your girlfriend cheats on you, you don't have the control over any of it. And it's just this like weird, cruel joke that the universe plays where the harder you try to grab on to control the worse it feels.
Yong-Soo Chung [00:28:56]
The trick, Tim realized, is to not try to control things but to control your reactions instead.
Tim Stoddart [00:29:02]
Man, so I'm glad I learned that lesson. I learned it when I did. And so I'm grateful for it. But I just I would have saved myself. Even talking about I'm not like too much of an emotional person, but it gets me like welted behind the eyes just to think of how much pain I could have saved myself by just not trying to control things. And that's it. I would have done that differently.
Yong-Soo Chung [00:29:26]
You can connect with Tim through his website.
Tim Stoddart [00:29:28]
Timstodz.com, T-I-M-S-T-O-D-Z.com. I send a newsletter out every Tuesday. Um, it's great. I work hard on it. And every time I send out an email, I get a couple of dozen replies back, um, from people that seem to be thankful for my writing. And so if you want them to sign up for that, that'd be great. I hope you love it.
Yong-Soo Chung [00:29:46]
If you enjoyed this conversation with Tim about how he built his businesses over the years and consolidated them all into his personal holding company, you should definitely listen to episode 41, titled "The Rise of Personal Holding Companies: Exploring the Future of Entrepreneurship". The episode goes into a fair bit of detail about what a personal holding company is and how you should go about creating one for yourself.
Queue it up next in your podcast player!
And do let me know what you thought of the episode on X or your favorite social platform. I'm on X as @yongsoochung and my DMs are always open!
That's it for this episode, I'm your host Yong-Soo Chung and I'll see you next time on First Class Founders!
Tim Stoddart [00:30:33]
I've had like three heroes, well, four, I guess in my life. Tony Hawk, my dad, and then like Brian Clark slash Seth Godin. Those two people taught me how to like write online. And yeah, it's still freaks me out. And it's kind of funny too, because Clark will rag on me because he's my friend now. And, you know, every once in a while we'll just do like a webinar together. And I have to really check myself to not be like hero worship-y, you know, where it's like, yeah, but you've really founded this whole thing. And I have to remember that that's so personal to me. Um, it's just an inside joke that, that we kind of have, but I'm only sharing with you because that, that has not gone away yet. And I hope it never does. I mean, really, I hope it never does.
Tim Stoddart has lived a rather... difficult life.
Tim Stoddart [00:00:03]
it was really hard. Like I went through it. I went through the wringer, man. Um, couldn't stay out of jail. Like couldn't stop getting jumped on the subway. It's like, I don't even know. I just get my ass kicked all the time.
Yong-Soo Chung [00:00:19]
Thankfully, he saw the light very early on...
Tim Stoddart [00:00:22]
I got sober when I was 23 and I grew up in Philadelphia and I traveled a little bit but I've never really spent any time out of the city and I had a cousin who lived in South Florida who basically took me in and kind of saved my life.
Yong-Soo Chung [00:00:37]
Tim grabbed this second chance at life with BOTH hands…
Tim Stoddart [00:00:40]
Man, so I'm glad I learned that lesson. I learned it when I did. And so I'm grateful for it. But I just I would have saved myself. Even talking about I'm not like too much of an emotional person, but it gets me like welted behind the eyes...
Yong-Soo Chung [00:00:55]
…and the results are plain for anyone to see.
Tim Stoddart [00:00:58]
So in total, I think we'll do like, I think all in all, there's, there's partners involved in all of that stuff, but all in all, it'll probably be five, five or 6 million bucks a year, something like that. I think by the way, this is back of the napkin math.
Yong-Soo Chung [00:01:11]
I know exactly what you are thinking.
Just how did Tim Stoddard go from living with his cousin in South Florida to making '5 or 6 million bucks a year'?
Well, the answers to this question lie in Tim's fascinating journey as an entrepreneur over the years... A journey that began with Tim first getting sober and then starting his first entrepreneurial venture - SoberNation.
Tim Stoddart [00:01:34]
That's how it happened, man. And even saying it back to you out loud, it's, it's just wild. This like sequence of events that just always seemed to be like the perfect time for me to to learn this lesson when I needed to learn it. And it all started from this idea of just writing online, sharing my experience, sharing what I learned to that day basically. And it's turned into what it is.
Yong-Soo Chung [00:01:55]
A journey that we will retrace on this episode, with Tim himself as our COPILOT.
Tim Stoddart [00:01:59]
Hi, I'm Tim Stoddard. I'm the CEO of Stodzy Internet Marketing and the owner of Copyblogger Media.
Yong-Soo Chung [00:02:06]
And along the way, Tim will tell us how he built SoberNation from a simple blog, how that led to him launching Stodzy Internet Marketing, how he leveraged that into buying CopyBlogger, and why all his entrepreneurship ventures are part of the same, identical pattern.
So jetsetters, buckle up, put your phones on airplane mode and get ready for take-off!
The next generation of successful founders in this digital age of entrepreneurship will leverage their audience to launch, build, and scale their brands. First Class Founders explores this golden intersection of audience-building & company-building with proven strategies to grow both your audience, which is your distribution, and your brand, which is your product.
Because those who can master both will create a category of one.
Hi, my name is Yong-Soo Chung and I'm a serial entrepreneur who bootstrapped 3 successful businesses from $0 to $20 million over 8 years.
On this podcast, you'll learn timeless lessons from world-class content creators, startup founders, and CEOs. You'll also hear tactical tips & strategies from ME, Yong-Soo Chung!
Are you ready? Then, let’s begin!
Before we begin, we teamed up with HyperPods to bring to you a quick 3-min hyper-visual summary of this episode with Tim about how he thinks about building his personal HoldCo.
Grab the hyper-visual summary for this week’s episode absolutely free at firstclassfounders.com/hypervisuals.
Despite being the owner of multiple businesses that make him several million dollars a year combined, Tim regards himself as a writer at heart.
Tim Stoddart [00:04:03]
I write and I delegate. I write because I think being a good writer is the most valuable skill that you could ever really have. And I delegate because I've learned that as you grow a company, it's the most foundational thing you could ever do.
Yong-Soo Chung [00:04:24]
That's because Tim's first entrepreneurial venture, SoberNation, began as a humble blog on blogspot.
Tim Stoddart [00:04:31]
I was just writing every day, whatever came to mind. At the same time, I met a friend and this friend who, he was going through a similar journey that I was going through.
Yong-Soo Chung [00:04:41]
The friend in question also happened to be working as a sales executive selling ads in magazines.
Tim Stoddart [00:04:46]
And he approached me because he knew I was getting into this blogging thing. And he said, 'Hey, I know that you're writing online. I've had this idea of like building a directory. I found this directory of country clubs and it seems like it's a really cool business. Do you want to partner together?' And I said, sure. I didn't really think of it much more than that.
Yong-Soo Chung [00:05:08]
And that was how SoberNation started.
Tim Stoddart [00:05:10]
So what is Sober Nation? Basically, it's a media company that provides content, resources, personal stories to other people that are struggling with addiction. And it's not much more complicated than that really. It's a way for people to connect with each other and for people to share their own experience and strength and some hope with each other so that they can like get help and they can relate to each other.
Yong-Soo Chung [00:05:35]
Now, SoberNation was essentially a personal project. But Tim happened to come across a website that, shall we say, made it so much more...
Tim Stoddart [00:05:44]
I found this website called copy blogger and I was learning how to write online by reading this website called copy blogger. And Copyblogger was one of the, I don't know, let's just call it like first practitioners of this idea of using your content to build an audience. And then through that audience, you could sell them products or services.
Yong-Soo Chung [00:06:10]
It seems like common knowledge today but...
Tim Stoddart [00:06:12]
But 20 years ago, this was not a thing that people really commonly understood.
Yong-Soo Chung [00:06:17]
Tim began to put CopyBlogger's suggestions and recommendations into practice on SoberNation.
Tim Stoddart [00:06:22]
And just simple things like the value of bullet points and where to put quote blocks and things that we don't even really think are that important. But when people read on the internet, it's a much different experience. And that's really how I got good. I got good at writing online.
Yong-Soo Chung [00:06:34]
And they worked! The SoberNation blog began to take off...
Tim Stoddart [00:06:38]
And before I knew it, there was a whole community of people that saw me as like this authority. And, you know, meanwhile, I'm not even a year sober at this point. I'm still completely clueless in my own life, but I had been building an audience and the power of an audience is a real thing.
Yong-Soo Chung [00:06:55]
Add to that, SoberNation happened to be in a niche that didn't have many practitioners.
Tim Stoddart [00:07:01]
behavioral healthcare centers, treatment centers, it's an industry that typically didn't have a lot of digital awareness around it.
Yong-Soo Chung [00:07:08]
The upshot of the whole thing was when Tim began getting requests to replicate SoberNation's success for *their* blogs and *their* niches.
Tim Stoddart [00:07:16]
I was just, I was getting phone calls. People that I didn't even know how they found my number. And saying like, how did you build this community? You know, can you do this for me?
Yong-Soo Chung [00:07:24]
Around the same time, Tim stumbled upon a pretty fascinating article by a guy named Mike Ramsey...
Tim Stoddart [00:07:30]
And this guy wrote this like 30 page article about local SEO. And in the article, he talked about how he was explaining to one of his mentors that he wanted to start an agency. Mike's mentor said there's like tens of thousands of agencies in the country. Like, what are you going to do? That's going to be different. And Mike said it was in that moment he realized like, I'm going to start a local agency that specializes in local businesses.
Yong-Soo Chung [00:07:56]
That little idea immediately resonated with Tim.
Tim Stoddart [00:07:58]
and so finally, when I read that article, I was like, 'You know what? Screw it. I'm going to go for it.' And I started a company, I named it Stodzy for no other reason than that was my nickname when I was a kid. I was like a skater kid and all my friends called me Stodzy.
Yong-Soo Chung [00:08:13]
And, by Tim's own admission, Stodzy has been pretty successful over the years.
Tim Stoddart [00:08:18]
The Stodzy business is certainly the most revenue generating. You know, we'll do a few million bucks this year for sure.
Yong-Soo Chung [00:08:30]
As heartwarming and inspiring as that story is, there is an incredible entrepreneurial lesson in this journey.
Stodzy was actually a PRODUCT that was simply a result of the AUDIENCE that Tim had built through SoberNation. In fact, one can even argue that Stodzy's success was guaranteed BECAUSE SoberNation had already built a ready audience.
Tim Stoddarts [00:08:50]
That's exactly right. It's so cool that you picked up on that.
Yong-Soo Chung [00:08:53]
This, by the way, is an excellent example of the M.A.P.S. framework in action. And if you don't know what the M.A.P.S. framework is, you should queue up episode 41 of this podcast, which is titled "Unlocking the Power of the MAPS Framework: Mindset ➜ Audience ➜ Product ➜ Scaling"
Essentially, the M.A.P.S. framework says that you need to build your audience before you can launch your product. Which, you will notice, is exactly what Tim did with Sober Nation and Stodzy.
And, in case you were thinking it could have been a one-off thing, well, he replicated the success a few years later with Copyblogger and Digital Commerce.
Tim Stoddart [00:09:27]
It's the same thing, you know, Sobernation was this media entity that generated traffic to Stodzy, which was my agency. CopyBlogger was this media entity that generated traffic, generated awareness to digital commerce, which was my agency.
Yong-Soo Chung [00:09:42]
By the way, the CopyBlogger that Tim is talking about here is the same CopyBlogger that he used to passionately follow in his early days of writing posts on SoberNation!
Tim Stoddart [00:09:51]
And I was like, I wonder what they would say if I said, Hey, could I buy into this company and like really be a part of it? And they said yes.
Yong-Soo Chung [00:10:01]
Yeah, Tim ended up *buying* CopyBlogger!
Tim Stoddart [00:10:04]
It was a huge deal. Like it was a huge deal emotionally for me. I won't give you like all the details, like things happened, you know, it didn't happen all at once. It's not like I wrote a check and I was a hundred percent owner of Copyblogger.>
Yong-Soo Chung [00:10:16]
But Tim *did* eventually become the "hundred percent owner" of CopyBlogger.
And, if you are a premium member of First Class Founders, you can hear the whole story of how that happened in the raw interview that I publish as a bonus episode every week.
Premium members also enjoy a ton of other perks - such as access to a private feed and AD-FREE episodes that are released a WEEK early! To become a premium member of First-Class Founders, go to firstclassfounders.com/join. Look for a link in the show notes!
As a premium member of this podcast, you can listen to Tim narrate the whole story in the BONUS raw interview, available to you in the private feed! Do listen to the whole thing - it's quite fascinating AND inspiring!
Anyway, getting back to Tim's journey, in buying CopyBlogger, Tim actually bought a total of THREE websites.
Tim Stoddart [00:10:50]
There's copyblogger.com, there's rainmaker.fm, which is like an old podcast network, which I'm still trying to figure out what to do with. And there was digitalcommerce.com. And digital commerce was the website that they housed all of their courses on. So they would use Copyblogger to basically sell their courses and the courses were on digitalcommerce.com.
Yong-Soo Chung [00:11:09]
Tim partnered with a guy named Jon Nastor, who specialized in SEO and re-created Digital Commerce as an internet marketing and SEO agency.
Tim Stoddart [00:11:18]
And that was the first revenue streams for copyblogger was digital commerce. It didn't start with the fancy web page that we have now. It was just a one page landing page. And I would put CTAs on the blog posts and I would try to generate leads and we did. You know, they came few and far between and I had to earn every deal. And I had to earn every lead. But within 12 months, you know, we were doing, I don't know, 100 grand a month or so.
Yong-Soo Chung [00:11:44]
When you think about it, Tim was simply following the same pattern that he knew had worked with SoberNation and Stodzy.
Tim Stoddart [00:11:51]
It's the same thing recycled. The only difference is it's just more operators that I have to work with.
Yong-Soo Chung [00:11:58]
And then, Tim repeated the SoberNation model with THREE other websites - DetoxLocal, YourFirstStep, and MedicallyAssisted.
Tim Stoddart [00:12:06]
All four of those sites is what internally we call Recovery Local.
Yong-Soo Chung [00:12:10]
RecoveryLocal is set up to feed leads into Stodzy.com - Tim's Internet Marketing agency - in pretty much the same way as SoberNation. I'll tell you all the details in just a bit but first, I want to give a shoutout to my wonderful sponsor, Riverside!
All right, listen up creators. You know that I'm super picky about which sponsors I work with. Well, I'm super happy to have Riverside as our sponsor for this episode. Why? Because I love using Riverside to record all my guest interviews on this show. Yup, that's right. My producer and I use Riverside as part of our podcast production process.
My favorite part about Riverside is how seamless the recording process is whenever I record an episode with a guest. Riverside records everything locally so the audio quality is the best that it can be. Plus, it even records backup audio just in case something happens, which has come in pretty handy in the past.
But hold on. We don't just use Riverside for recording. We use it to analyze transcripts within the video recordings to pull out the best parts of my conversations with guests. They even added AI to make it even easier for you to create even more high quality content.
Riverside is completely free to sign-up and get started for your first 2 hours. Then, use code "FIRSTCLASS" to get 20% off any paid plan. Trust me, you'll love using Riverside as much as I do. Just look for the link in the show notes and don't forget to use code "FIRSTCLASS" to save some extra cash.
Huge thanks to Riverside for sponsoring this episode!
And now, let's get back to our episode with Tim Stoddard.
Before the break, we heard Tim's story of how he built a powerful distribution channel through his blog SoberNation and leveraged that into starting his own agency Stodzy.com. We also heard Tim describe how he replicated this success by acquiring CopyBlogger and using its distribution to build and grow another agency called Digital Commerce.
As it turned out, SoberNation was actually a great template in other ways too.
Tim Stoddart [00:14:34]
what we learned from sober nation was how to structure directories as such that they generate traffic for local search queries. And so what do I mean by that? Well, if you go to drug rehab center in, I don't know, Bowling Green, Kentucky. You'll find the city page that lists all of the local treatment centers in Bowling Green, Kentucky on Sober Nation.
Yong-Soo Chung [00:15:00]
And any drug rehab centers wanting to appear in these search results, would then be serviced by Stodzy Internet Marketing - a simple but brilliantly effective pipeline to capture leads.
Soon, Tim realized that it was trivial to replicate this in other, slightly similar contexts.
Tim Stoddart [00:15:17]
we replicated it to a site called Detox Local, which is very similar except instead of drug rehab keywords, it's drug detox keywords. We did that again for a site called Your First Step, which is also very similar, but instead of drug rehab keywords, it's addiction treatment keywords. And then there's a fourth one that we built, which is for a medically assisted treatment center. So basically when people like have a really hard time getting off opiates and stuff, they can take medication, which will help them with like the withdrawal effects.
Yong-Soo Chung [00:15:50]
Since all four of these sites practically serve the same or similar audience, Tim categorizes them under a single umbrella called RecoveryLocal.
Tim Stoddart [00:16:00]
All four of those sites is what internally we call Recovery Local. So Recovery Local is like the media side of our company. And then there's Stodzy, which is like the service side of our company. So in a way, those two things are kind of one thing because they feed each other. You know, we'll use the recovery local stuff to generate leads for Stodzy. And then if we close a deal for Stodzy, we'll like promote them through the media companies just to help them gain some exposure.
Yong-Soo Chung [00:16:25]
Did you catch that amazing flywheel?
Tim uses RecoveryLocal to generate leads for his agency Stodzy Internet Marketing. And Stodzy uses RecoveryLocal to promote them once they graduate from leads to clients.
Brilliant, isn't it?
The success of this model is clearly visible in the revenues Tim's making from each of his entrepreneurial ventures.
Tim Stoddart [00:16:47]
Recovery local sites are the most profitable, but that's just because they take hardly any work. So we sell directory listings on them and we sell lead generation, but there's just the three of us. It's just my three best friends, my three friends that I got sober with. Like we've been doing this, you know, it's just us. And I don't know, it does probably like 90 grand a month between the four of them.
Yong-Soo Chung [00:17:11]
And the service arm of this flywheel isn't doing too bad either!
Tim Stoddart [00:17:14]
The Stodzy business is certainly the most revenue generating. You know, we'll do a few million bucks this year for sure.
Yong-Soo Chung [00:17:25]
As for CopyBlogger, it doesn't earn as much as either RecoveryLocal or Stodzy but it still pulls in a cool five-figures every month.
Tim Stoddart [00:17:33]
I'm part of the ConvertKit sponsorship network. I send out a newsletter every Friday. And just because I get so many damn emails every day from Copyblogger, that newsletter has done really, really well. The newsletter does about 10 to 11 grand a month. Um, and that's one email every Friday. So that's pretty sweet. And copy blogger Academy, we're just under 10 grand a month.
Yong-Soo Chung [00:17:54]
And when you total all of that up...
Tim Stoddart [00:17:56]
I think all in all, there's, there's partners involved in all of that stuff, but all in all, it'll probably be five, five or 6 million bucks a year, something like that. I think by the way, this is back of the napkin math.
Yong-Soo Chung [00:18:11]
Five to six million per year is pretty cool, no matter which way you look at it!
But, that's not all, by the way. Here's the icing on the cake... the part that truly impressed me…
Once Tim hit upon this formula, he went ahead and applied it to his PERSONAL brand!
Tim Stoddart [00:18:25]
...which is TimStodz.com. That's like my personal blog. I'm the only one who ever writes on that. And I'm the only person who ever will write on that. It's like a rule I've made to myself.
Yong-Soo Chung [00:18:34]
The reason that bit is important is because it has ensured that Tim's brand remains undiluted. And, in doing so, Tim has created a media brand for himself.
Now, the way Tim uses this media brand is pretty interesting.
Of course, the email list serves as a pretty powerful distribution channel. And, that has allowed Tim to leverage it to generate leads for his services the same way he leveraged SoberNation and CopyBlogger to generate leads for Stodzy and Digital Commerce, respectively.
Except, Tim did something incredibly smart with this audience he built...
Tim Stoddart [00:19:07]
...through getting my name out there and through building an email list of my own media company, that's how I've been able to generate leads for me to sometimes buy equity, sometimes earn equity in, in companies, sometimes just straight up ask for it because like, I know how to grow this business and sometimes people don't.
Yong-Soo Chung [00:19:27]
Tim used the distribution channel he had built with all the stuff he published on TimStodz.com to generate leads in terms of (pause) potential businesses to invest in! That is, people now approach Tim requesting his help to grow their business and, instead of charging them a consultation, Tim simply asks them for equity in their business!
Is that genius or what?!
Think about it... Tim could simply charge a consultation fee for any leads generated via TimStodz.com and increase his revenue. But he doesn't really need to do that... Because he doesn't really need the money... Because his other businesses are chugging along smoothly...
Tim Stoddart [00:20:05]
and it's, it's turned out to be the case where like the recovery local side and the Stodzy side and, and copyblogger and digital commerce, all of those like generate the cash that I need.
Yong-Soo Chung [00:20:15]
So, instead, he parlays these leads that come in (pause) into EQUITY in those businesses!
It's the same model as SoberNation and CopyBlogger but with a slightly different end result.
Now, here's the kicker: if this *end-result* is sounding vaguely familiar to you, it's because it is following the same philosophy as that of a Personal Holding Company!
I've previously outlined this philosophy in episode 53 of this podcast. The episode is titled, "The Rise of Personal Holding Companies: Exploring the Future of Entrepreneurship" - queue it up to play next in your podcast player, if you want to know more.
The gist of the concept - and the gist of what Tim is doing - is this.
Instead of selling his SERVICES at a higher and higher premium, Tim is now acquiring EQUITY in businesses that approach him for his advice.
Tim Stoddart [00:21:02]
...like the Hormozi-thing, 'You don't get paid for what you do. You get paid for what you own.'
Yong-Soo Chung [00:21:06]
"You don't get paid for what you do. You get paid for what you own."
One of our previous guests on the show, Jay Abraham, also voiced very similar thoughts when he spoke about his strategy for wealth creation.
EPISODE 68:
"Wealth creation doesn't come from ordinary income. It comes from creating an asset, building it up, making it very desirable, either for its pure profit or for its strategic value to somebody larger who needs it and will pay you four, five, 10, 20 times what you make in a year.”
Speaking of selling, Tim told me that, although he was OPEN to selling a business, he wasn't LOOKING to sell any of his businesses yet.
Tim Stoddart [00:21:45]
Here's where my head goes. I'm not bored at all. And there's a part of me that thinks you want to get out before you get bored. Right. Because then like you have leverage that you don't need to sell. Like I never want to get in a position where I need to sell something.
Yong-Soo Chung [00:22:01]
Tim's philosophy of wanting to stay invested in his businesses over the long-term sounds very familiar, doesn't it? Well, that's because it is. It actually comes from a very popular and famous source.
Tim Stoddart [00:22:12]
the only person I've found so far who has set the right path on how to increase the probability of success in the future is Warren Buffett. And Warren Buffett tells me that you don't in that you don't day trade, you invest and what does investing mean? It means like you trade money now for a potential upside in the future. And, and Warren Buffett's philosophy has just, it's really dumbed it down for me to where I don't have to try to think of what the right thing to do is. I can just look at the circumstances and just be like, okay, these circumstances dictate that this is the move. So I don't have to be smart.
Yong-Soo Chung [00:22:51]
And this same philosophy also drives Tim's investment decisions. That is, in choosing the businesses he wants to make a part of his personal holding company.
Tim Stoddart [00:23:00]
I only have three criteria really for when it comes to businesses I wanna be involved in.
Yong-Soo Chung [00:23:06]
And all his businesses and investments so far have followed these three criteria pretty rigorously.
Tim Stoddart [00:23:11]
And so through those criteria, there's nothing I see that says, you need to get out of this. Everything is telling me, stay in here, keep generating that cashflow, keep reinvesting the profits into other opportunities.
Yong-Soo Chung [00:23:26]
Curious what these three criteria are? I'll tell you all about them in a moment but first, I want to introduce you to the most adorable sponsor we have had on the show - my wonderful French bulldog Humphrey.
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Yong-Soo Chung [00:17:31]
Humphrey is an adorable French bulldog. And guess what? He has quite a following on social media. Over a 150,000 followers if you're counting across Instagram and TikTok @spotted byhumphrey.
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Alright, let's get back to our conversation with Tim Stoddard on how to replicate models to build and scale businesses for your PHC portfolio.
Before the break, we heard Tim mention that he has three criteria for choosing businesses he wants to be involved in.
Tim Stoddart [00:25:05]
One, like is it profitable? Like I only invest in cash-flowing companies. I'm not an angel investor. I have no interest in doing debt. It doesn't have to be a lot of cash. So it doesn't have to be a big company. It's just, you know, like I said, it's, it's Warren Buffett, Charlie Munger, like does the business work regardless of what the numbers are? Like is the business working?
Yong-Soo Chung [00:25:27]
Tim's FIRST of three criteria: Is the business profitable?
Tim Stoddart [00:25:31]
Two, Is it evergreen? Like I, I'm an owner in an AI, in an AI company. Um, really that's something that, traditionally I would have stayed away from just because it could be a flash in the pan. Who knows? That's why things like healthcare really stick out to me. That's why, um, things like content and personal branding and like the creator economy really stick out to me. Online education doesn't have to be courses about courses. You know, people are making courses about anything now, like who knows woodworking, landscaping, um, knitting, accounting, right? Like I just, I think the whole education system is completely changing over the next 10 years. And so I look at industries that are evergreen.
Yong-Soo Chung [00:26:11]
Tim's SECOND of three criteria: Is it evergreen?
Tim Stoddart [00:26:15]
And then I look at industries that I feel good about, you know, like I don't, I wouldn't feel good being an oil exec. And so I'm not going to do that even though it meets those first two criteria. Right. It's definitely cashflow positive. It's definitely evergreen. We're not going to stop burning oil anytime soon, but I wouldn't feel good about it. So I don't do it.
Yong-Soo Chung [00:26:32]
Tim's THIRD of three criteria: Does he feel good about it?
And, every single business that Tim is a part of - as an owner, or investor, or equity-holder - every single one of these businesses is rigorously filtered through these three criteria.
Tim Stoddart [00:26:46]
With what I have going on right now. They're all cashflow positive. They're all evergreen. And I like doing all of them.
Yong-Soo Chung [00:26:54]
Additionally, because these businesses fulfill these three criteria, it also gives Tim a reason to stay invested in them...
Tim Stoddart [00:27:01]
there's nothing I see that says, you need to get out of this. Everything is telling me, stay in here, keep generating that cashflow, keep reinvesting the profits into other opportunities, or just put the money in the bank, you know, put it in a freaking S&P 500, which is the best thing to do anyway. I have seen nothing right now that convinces me that now is, is a time to sell. Like Warren Buffett would look at what I got and he'd say, hold onto this forever. And so that's probably what I'm going to do.
Yong-Soo Chung [00:27:36]
Before wrapping up my conversation with Tim, I asked him what advice he'd give himself if he could travel back in time and talk to his younger self.
He began by recounting some of the difficult circumstances he lived through in his younger days.
Tim Stoddart [00:27:48]
it was really hard. Like I went through it. I went through the wringer, man. Um, couldn't stay out of jail. Like couldn't stop getting jumped on the subway. It's like, I don't even know. I just get my ass kicked all the time.
Yong-Soo Chung [00:28:04]
Over time, Tim has managed to identify a crucial element that caused him all this pain.
Tim Stoddart [00:28:09]
...I think a lot of that pain that I went through was really a disconnect between like myself and control... because why does anybody hold on really tight to something? They do it because they think it gives them control. And it's a really hard ego shattering thing to know that the only thing that you ever have control of in your life is like your reactions. That's it. Like you can only control how you react to things. You don't have control of your parents or of what other people do, or if your girlfriend cheats on you, you don't have the control over any of it. And it's just this like weird, cruel joke that the universe plays where the harder you try to grab on to control the worse it feels.
Yong-Soo Chung [00:28:56]
The trick, Tim realized, is to not try to control things but to control your reactions instead.
Tim Stoddart [00:29:02]
Man, so I'm glad I learned that lesson. I learned it when I did. And so I'm grateful for it. But I just I would have saved myself. Even talking about I'm not like too much of an emotional person, but it gets me like welted behind the eyes just to think of how much pain I could have saved myself by just not trying to control things. And that's it. I would have done that differently.
Yong-Soo Chung [00:29:26]
You can connect with Tim through his website.
Tim Stoddart [00:29:28]
Timstodz.com, T-I-M-S-T-O-D-Z.com. I send a newsletter out every Tuesday. Um, it's great. I work hard on it. And every time I send out an email, I get a couple of dozen replies back, um, from people that seem to be thankful for my writing. And so if you want them to sign up for that, that'd be great. I hope you love it.
Yong-Soo Chung [00:29:46]
If you enjoyed this conversation with Tim about how he built his businesses over the years and consolidated them all into his personal holding company, you should definitely listen to episode 41, titled "The Rise of Personal Holding Companies: Exploring the Future of Entrepreneurship". The episode goes into a fair bit of detail about what a personal holding company is and how you should go about creating one for yourself.
Queue it up next in your podcast player!
And do let me know what you thought of the episode on X or your favorite social platform. I'm on X as @yongsoochung and my DMs are always open!
That's it for this episode, I'm your host Yong-Soo Chung and I'll see you next time on First Class Founders!
Tim Stoddart [00:30:33]
I've had like three heroes, well, four, I guess in my life. Tony Hawk, my dad, and then like Brian Clark slash Seth Godin. Those two people taught me how to like write online. And yeah, it's still freaks me out. And it's kind of funny too, because Clark will rag on me because he's my friend now. And, you know, every once in a while we'll just do like a webinar together. And I have to really check myself to not be like hero worship-y, you know, where it's like, yeah, but you've really founded this whole thing. And I have to remember that that's so personal to me. Um, it's just an inside joke that, that we kind of have, but I'm only sharing with you because that, that has not gone away yet. And I hope it never does. I mean, really, I hope it never does.
