#118. Rally Road democratizes investments in collector cars, turning them into stocks that anyone can purchase through an app. We talk with co-founder Rob Petrozzo about how he’s merging the worlds of finance, consumer goods and pop culture to create returns for a new generation of investors. The Loose Threads Podcast features in-depth discussions with leaders across the rapidly changing consumer economy.

Check out the full transcript below.

Rob: [00:00:01] The auction market in the place where you can buy a lot of these really high value assets — so, the classic car market — is not a comfortable place to be. It’s very velvet rope, it’s very have and have-nots. And we didn’t want to treat people like that or treat the business like that. 

Richie: [00:00:15] That’s Rob Petrozzo, co-founder of Rally Road, a platform that democratizes investments in collector cars by turning them into assets that anyone can purchase through an app. The company aims to unlock a range of asset classes that were previously only available to extremely wealthy and/or accredited investors, starting with desirable and culturally relevant cars. 

Richie: [00:00:33] I’m Richie Siegel, the founder of Loose Threads, which analyzes and advises next-generation consumer companies, and FaceLift by Loose Threads, a retail incubator and accelerator for leading brands and retailers. For our latest analysis and insights, check out our free weekly newsletter at LooseThreads.com. We also just announced Loose Threads Live—our invite-only and entirely off-the-record gathering for founders, executives and investors—on October 3rd in New York City. Learn more at LooseThreads.com/Live. 

Richie: [00:01:00] I started the Loose Threads Podcast to spark engaging discussions with leaders across the consumer economy. That’s why I was excited to talk with Rob about how he’s merging the worlds of finance, consumer goods and pop culture to create returns for a new generation of investors. Here’s how it all began. 

Rob: [00:01:22] Starting in 2012, 2013 I’ve been sort of working either freelance or for a bunch of different startups, and trying to find my way in terms of design and where I would end up personally, but I was doing that by keeping a network around me of people that I really trusted, that were smart, that had experience in the space, and one of those people was my co-founder now, Chris Bruno and our CEO, who I had gone to high school with. He was always kinda like the smart kid in the group, and he was somebody that had done it at a really high level for a long time in tech and in media. 

Rob: [00:01:49] We were throwing ideas around for a way to work together, and he had this idea where he said these cars have been going up in value for a really long time. This feels like something we can really turn into something meaningful and give it to everybody—people that really want to be a part of it, but are on the sidelines right now. So we kind of just started working on it. Literally, you know, in a coffee shop on 35th Street, sketching everything out. And, all of a sudden, it was like a year and a half later, and we were in the room with lawyers and we were talking about, you know, incorporation papers. And we were—we had a demo of what will become the first version of Rally Road, and it becomes real really quickly. 

Rob: [00:02:20] I think it’s one of those things where you have a demo done, you’re showing a few people, and they start to get excited about it. You talk to your lawyers and they’re saying, you know, this is something that we probably could make work, let’s do a bit of research on it. Two and a half, three years later, now you‘re in a room with 35 people who are doing a bunch of stuff you thought you could do yourself, and you realize that it’s a real company. 

Richie: [00:02:36] So when you say, you know, it started with, “Can you get a piece of this,” how did that transform into trading, basically, or an offering? Like, did you know that “a piece of this” meant that, or were there other iterations or so forth that could’ve turned into… 

Rob: [00:02:50] Yeah. There were a ton of iterations. I think, when we first started Rally Road, we were thinking about it in terms of like, this could be a stock market of everything. Wall Street has the equity markets, and it has institutional investing, and it has all these elements that, they’re interesting to a big group of people, but [if] I own a share of Apple, I’m not allowed to go into the boardroom and make decisions. I’m not allowed to be a part of that conversation, I’m not part of the product development cycle. We wanted to make a world where you put a little bit of money in, it’s like putting your money where your mouth is. It’s the equivalent of seeing a band in the year 2000, and saying like, I saw them first, when they’re the Foo Fighters in 2015, 2016, you know what I mean? So we wanted to make it something where, if I know a little bit about something I can come into an app like ours, I can learn a little bit more. And then if I feel like this is a great investment, I can put a little bit of money in and see where it goes. 

Rob: [00:03:33] So it was always looked at as kind of like an equity investment. We always looked at it as, this could be, you know, the other stock market. And the name itself, Rally Road, it’s got these connotations that go towards cars, but the real idea was that it’s the opposite of Wall Street a little bit. It’s not in the middle of New York, it’s somewhere in the Midwest, and it’s something where you and a bunch of friends have this idea, and we can collectively get together, rally together, and put some money into something that could potentially make us some money. But at the same time, we have skin in the game now, it’s not just watching from the sidelines. 

Richie: [00:03:59] Why did you decide to start with cars? 

Rob: [00:04:00] Cars, to us, was something that we looked at as, A, it was logistically, probably the hardest one. It’s something where you have this big dirty piece of metal, and it’s got to get move from point A to point B, it’s 2,500 pounds. It’s something that lives in a place with antiques and collectibles but lives in its own lane. It’s something that has this really huge enthusiast community around it. It’s something that, you know, we were raising money the first time around, we’re talking to all like, TV networks and the auction companies that were really heavy into the space, and it’s this really fast growing segment of all these media properties, and it’s something that has a huge, huge fan base. But the haves and have nots are separated by some really specific dynamics. And it’s not just coming with a check, it’s being in the know and having respect in the space, and having a long track record of being a part of this space. And that was something that, it was hard to break into, even for us in the beginning. 

Rob: [00:04:45] You know, we had one or two friends in the space that made a lot of really qualified intros for us and got us in the right rooms but, even then, they were super-skeptical of these like, what they looked at as like, these three young kids trying to come at us and buy cars without having to pay for them, and put them on this app, and the whole thing was very, very abstract. So that was a huge, huge differentiator between this and something like baseball cards or some of the more esoteric collectibles, whether [they] be coins or any of the stuff that money could potentially buy you in. With cars, money doesn’t just get you in; you’re behind a velvet rope. Even the big auction houses—when they run their big auctions throughout the course of a year, if they have 50,000 to 60,000 eyeballs on that auction, there’s really only about a hundred people who are able to place a bid and be part of that conversation in a real way. 

Rob: [00:05:26] So that was the dynamic that we wanted to break down. So cars had the built-in audience, it had this huge fan base. It also had the dynamics that were really separating the 1% from everybody else. We felt like, if we get it done right with cars—just logistically, the storage and insurance and all the stuff that goes with it—we can get it right with a bunch of other asset classes that don’t have that same dynamic, that the path of least resistance and the barriers to entry are a little bit lower. 

Richie: [00:05:48] What were some of the responses to people in that community when you started to tell them what you wanted to do?

Rob: [00:05:51] I mean, a lot of them hated us. But it wasn’t—they didn’t hate that we were trying to change the model. They look at it as this old man’s game, and I don’t mean that in terms of age, but more in terms of—

Richie: [00:05:59] The way it was done. 

Rob: [00:06:00] Yeah. It’s something that like, the way it’s been done has been done that way forever. And you’re talking about people that look at it like, anybody that comes in now, if you’re a purist and you look at a platform like Rally Road, you’re saying they’re taking something that we care about and turning it purely into a financial instrument. And that was never the way we wanted to approach it. So we spent the first 18 months before we had an app—before we had any users, anybody investing in the app—just trying to sort of make inroads and explain to people that what we were doing was trying to treat it with the utmost possible respect, that we think about that with every asset class we go into. 

Rob: [00:06:29] So we’re not just trying to go in and buy up all the good stuff and put it on this app and sell it off. We really do want to take this art form—and it really is, it’s not just a hobby, it’s something that people dedicate their lives to—and make sure that in 100 years it still does exist. And in my mind the only way to do that is to bring a younger crowd in. That younger crowd typically follows the money a little bit. They’ll see the headlines about a car that goes to auction and sells for a hundred million dollars. If we can get that person in with that headline and then make them understand what that really means, then you create this value chain that lasts way longer than just one generation which, right now, has access to all the good stuff. The older generation. 

Richie: [00:07:03] So in that 18 months, when did you start to figure it out? And what was being figured out where you kind of had the steps—where it was like, okay, if we get this done then we go here, to the point of being at the end of it, I guess?

Rob: [00:07:13] Yeah. That’s one of those things where it’s like, go wherever you can affect the change. It’s something where you had this never ending to-do list. And like, you know, my to-do list on a day to day, at this point, it’s nine hundred or a thousand things, and I’m trying to pick off the three or four things I can actually get done. But really it’s about whatever’s in front of you, it’s jumping into that as quick as possible. And in our case a lot of that early [work] was creating a platform that was going to have all the check marks with the powers that be to make sure that we weren’t in a position that we were doing anything, like, that even was considered nefarious in any way shape or form, or that was considered predatory. Because this was 2016, 2017. It was the rise of like, the ICO craze and crypto, and a lot of boom and bust that came along with the last run out of the recession from ’08, ’09, where all the prices for housing, everything, was at a peak in 2016, 2017. 

Rob: [00:07:59] So, for us, doing something brand new, trying to turn a car into a company that can be invested in by non-accredited investors, and do all these things that were looked at as, let’s wait and see where this goes by the SEC We had to do things a little bit slower than we probably wanted to, but a lot of that was the path of least resistance to get this done. It’s setting the groundwork for six or seven months with our lawyers, with the SEC to get them comfortable with what we were doing, submitting all of our paperwork in the best possible way, not marketing the platform—which, for me, as a product designer and somebody who wants to get the word out, was being handcuffed to not be able to talk about it. And understanding that everything that we were doing, day by day by day, was this aggregate that was gonna lead to, A, a trustworthy platform, B, in the eyes of the SEC, and the people who regulate these type of products, we weren’t gonna be in a situation where they thought we were trying to skip the line, then being able to sort of layer the product on top of that. 

Rob: [00:08:48] After all that was said and done with legal and regulatory, it became make the best possible app and the best possible consumer experience, and do something that didn’t look and feel like a stock app or like a stock market, do something that really felt like I was reading a magazine, and once I’m done reading that magazine I get the option to invest and put my money where my mouth is. And that, to us, was the day by day, building out features, creating some marketing relationships, then going out raising some money—which was, you know, a whole beast in itself. But wherever we could affect the change where we want to go first, that’s what we’ve been doing for the last two and a half years. 

Richie: [00:09:18] Why do you think they said yes? And “they” being the SEC.

Rob: [00:09:21] I think it was something that was interesting, we were doing it the right way. So, our third co-founder—Max Niederste-Ostholt, who’s our CFO—he was at Barclays for ten years doing private placement deals. He’s from Germany, he understands car culture from that perspective. We weren’t coming at it in a way that it was like three hedge fund bros trying to throw money at something and make it work. It was something where we had roots in the space. Myself, from product design, Max in the finance world, but in a way that he understood what the product was, and Chris from the sort of media and entrepreneurially world. 

Rob: [00:09:47] We went into this thinking, if we explain what we’re doing as articulately as possible and show rather than tell, and really explain what this is gonna be, long-term, that we can get to a point that everybody trusts us, and that we could pass that trust onto our users as well. So we did what could have been, you know, three or four months of work, we stretched into probably nine months of work, and making sure that we responded to every inquiry in the best possible way with the most possible information. Do it in a way where we didn’t just release 400 different cars to invest in first day, we did it one by one. 

Rob: [00:10:16] Even to this day, we’ve done probably 40 initial offerings to this point, on cars ranging in value from a $25,000, really rare Mazda Miata, which isn’t looked at necessarily as like, a great, sort of unique supercar, all the way up to the million-dollar cars. The Lamborghini that we have in our space right now, which is one of two, Lamborghini Countach. And we do it in a way where we do them one by one to make sure everyone understands what it’s gonna be, gets all the information, gets educated on what this actually means, the provenance and the history of every vehicle. 

Rob: [00:10:43] So, the way we set it up with the SEC and with our legal team was the same way, where it’s like, here’s every piece of information that we’re working with, here’s what we intend to do. Ourselves, too, we have skin in the game, where we put up to 10% of our money in each investment, so if we have a hundred thousand dollar car, anywhere between two thousand and ten thousand dollars of it is us on the investment side, at the exact same price, and we can’t sell until the vehicle sells. So, sort of aligning our interests, doing all that along the way, and slowing it down a little bit. Whereas, you know, the move-fast-and-break-things Facebook mantra, it makes sense, probably for social media, for a social network, but for us—

Richie: [00:11:16] Maybe not anymore. but… 

Rob: [00:11:17] Yeah, not anymore now. I mean, that’s come to a head over the last, like, call it three or four months, but we were thinking that the whole way, where it’s like, move deliberately and try to do things the right way as fast as you can without creating any issues for yourself down the line. And we’ve been really successful doing that at this point. 

Richie: [00:11:31] Yeah. Did you think you’d spend so much on legal, as you did? 

Rob: [00:11:32] Nah. I mean, we have that conversation all the time. We talk about like, the first $500,000 on legal went really, really quickly. We never thought we were gonna be raising money as quickly as we did. We got super lucky. And the rounds that we’ve done to this point, in terms of—whether it’s private equity or the typical family or friends round in the beginning, which we did with like, the one degree of separation—we never thought we’d need to raise money or have to raise money the way we did, it was very much inbound.

Rob: [00:11:53] So, every time we had like, a massive bill, we had somebody who was really interested in what we did that came, had a conversation with us about being a part of the company, and we got super lucky in terms of timing and preparation with that. But the legal bills, as much as they suck, there is no way around it, especially in any type of regulated industry. If you have the wrong lawyer, or the wrong accountant, or the wrong opinion on one piece of paper from two years ago, they’re gonna find it and it’s gonna be an issue for you. 

Richie: [00:12:17] And it’s gonna cost a lot more. 

Rob: [00:12:18] It’s that sort of, pennywise-pound-foolish thing, too. Like, cutting costs and cutting corners in the beginning when it comes to legal and setting up the business is like the cardinal sin. It’s the biggest mistake you could possibly make. Because everything’s going great, and like, for us now, we have six digits in users, and we have this great growth, and we have awesome people watching what we’re doing and paying attention, and some of the biggest names in tech and finance are paying attention to what we’re doing, and they’re asking us to be a part of it. At any moment if we did anything wrong, two and a half or three years ago? That’s all gone. 

Richie: [00:12:45] So talk a bit about just like, the car market, in terms of hold period appreciation. I’m just curious to kind of paint that picture a bit. I don’t know if there are certain asset classes you would kind of compare it to. And then we can move into the launch and so forth. 

Rob: [00:12:57] My lawyers would kill me if I don’t say that the forward-facing statements are not in any way part of this conversation, and past returns are not indicative in any way shape or form of the future. But, that being said, the market overall is a very robust market. It’s got a lot of uncorrelated returns that happen over time, not just with the asset class as a whole of collector cars, but even as individual cars inside of that collector space. So what you see is that a lot of times it’s a little bit cyclical, it happens in waves, but it’s something that’s driven by a mix of emotion, by what the manufacturer is doing with their new vehicles, by the auction circuit insurance values, by even just the cultural influence and the things that happen socially with the car. 

Rob: [00:13:31] So, to give you an example, one case study that we did really early was with Lamborghini Countachs, which is this design and this really unique vehicle that’s always gotten attention, it’s always been relevant. It’s something that, you know, every year there’s either a big photo shoot, or there’s like an album that comes out, or there’s a clothing line or something that references this particular car. So what happened was that car came out, it was super hard to drive, but it was the first big Lamborghini supercar that was getting attention from like, the finance guys and anybody that had money in the 80s. If you had new money, you wanted to get that car. That’s something that, it’s been slowly creeping up over time, ever since it came out—call it the late 70s, early 80s. When “Wolf of Wall Street” came out, really good examples of this Lamborghini Countach were valued around, call it $150, $160, $170, in that range, $175,000. After that movie came out, everything shot to $350,000. And that’s just from like, this iconic Leonardo DiCaprio scene, of him getting out of that car on Quaaludes. 

Rob: [00:14:24] It’s this weird set of cultural influence that impacts the value of these vehicles in a way, where a lot of times it’s meaningful, it’s handmade, it’s something that’ll never exist the way it does then, it’ll never exist like that now, ever again. And they’re treated like art, but only by a small group. So once it’s opened up to the bigger group, a lot of people start to recognize that same value that comes along with fine art, and they start to wanna put their money into it. And that’s when you see these prices inflate and start to rise a little bit. That’s when you see collectors coming out of the woodwork that have had these cars for 20 and 30 years, and they’ve kind of been on ice, and now it’s time to liquidate a little bit. And they realize like, you know, they’re sitting on something really special. And sometimes it takes something like a movie, or like something to be found in a barn before that value can get realized.

 Rob: [00:15:02] So what we do at Rally, what we’re trying to do with this platform is make sure that the buyers and the sellers have the best opportunity. So if you’re somebody who’s got a garage full of cars and you’ve made a lot of money on paper on those vehicles, you want to be in a position to sort of take some money off the table, then we can provide that lane for you without going the auction route. For a buyer on the same side, if I wanna diversify from a financial standpoint I could do that, but if I want to sort of, you know, own a Ferrari but have a piece of a Lamborghini, you can do that our platform, too, and that’s kind of where we want the setup. 

Richie: [00:15:28] In terms of, I guess, like, liquidity, I assume the auction houses take a huge set of fees that—

Rob: [00:15:33] Yeah. I mean, the auction houses, in any given auction there’ll be, you know, anywhere between 15 and 25% will get taken off the top on the buyer or the seller side or individually. That marketplace will always exist. That’s not one that we’re like, looking to displace, and we have great relations with a lot of the auction companies—you know, that market will always exist, that buyer will always exist—but open that up in a way where on our side we’re not taking fees and we’re not doing something where there’s a management fee or a commission along the way. The trading is free. So, you know, our mission is scale, a little bit. Our mission is to open up this asset class, and open up all the asset classes we go into, to a new type of buyer, a new type of investor who isn’t part of that auction circuit right now. 

Rob: [00:16:08] So it’s not tapping into an existing market, it’s taking a market that’s kind of been under the surface for a long time. People that maybe have money in a 401k, it’s not really doing much, or maybe they want to rotate out of equities and find something new. And those are the people, those are our members, those are the people that find their way to our platform. They’re not the people from the auction houses, they’re not the people who are buying whole cars. They’re, you know, a 28-year-old who understands there’s value here, sees it as art. They’re way more financially savvy than I was when I was in my early 20s, and they want to sort of put a little bit of money in and see what happens. That’s what we’re seeing happen on the app right now. 

Richie: [00:16:37] So, talk about, I guess, coming up to the launch, what was the first one you picked? How did it go, what were the expectations, etc?

Rob: [00:16:44] When we launched the platform we had like, a little bit of data set. We knew what was meaningful to us, what was the poster on the wall, the cars that we wanted to acquire and put on the platform. And we picked an American car, a 1969 Boss 302 Mustang, a 1955 Porsche Speedster—which is another iconic car, German but also something that everyone looks at and knows is valuable, a $425,000 car. And then the car that we launched with, which was a 1977 Lotus Esprit S1, which was the Roger Moore James Bond car, and it was something that was the Julia Roberts, Pretty Woman car, which starts that whole movie. And it was something that really has cultural relevance and that everybody can kind of recognize. But then, to tie it back to today, it was also the car that Elon Musk kind of based Tesla on, and he was always looking at Lotuses like, they were the engineer who was working on the Teslas first. It was something where there was always a relationship between Tesla and Lotus. 

Rob: [00:17:31] And we looked at it like, if we can tell that story correctly, everything I just said, to somebody who is somewhere between the age of, call it 21 and 35, we can make this car that really is undervalued—it looked and felt very undervalued to the market—something that’s meaningful, and something that really becomes like, the benchmark for this platform, where we launch with. So that was a $77,000 car. 

Richie: [00:17:50] So did you buy it? Or, how does that work? 

Rob: [00:17:51] Now we don’t. Now we do a lot of debt deals, where we have a lot of people coming to us, because we’ve had some success and we have access to great collections, and we’re in it for a couple of years now, to the point that we have great relationships. But back then, yeah. It was out of pocket. Chris bought that car. Like, we just went out with a bag of money and tried to find people who would talk to us, basically. While we’re doing all the legal stuff, we were also trying to find the best quality versions, so we were like, flying all over the country trying to find the best possible car to launch with. We found this car, and it was this really, really unique black, sort of metallic color on the outside. It had this sort of oatmeal velvety interior. And it was not a car that I really respected before I saw it in person, and then you realize it’s art. When you sit in it and you’re around it, you realize that is an actual piece of living art and moving art. 

Rob: [00:18:30] So we took that, we ran that through the SEC as our first offering, and then we opened it in the app to absolute crickets. Nobody wanted anything to do with it. We realized we had done all this work, we had this awesome product, we had some people around us who cared about it, but it was like, our moms, so it was something where you have to actually make it real. So then it was, throw money at the PR, the marketing effort, a little bit, and that was when we found one of our early investors. Marc Zablow from Cogent Entertainment came to us and said, “I have somebody who’s starting their own PR firm, who’s from a big firm, her name’s Beth Balsam. So like, she has some inroads to TV. Do you want to talk to her?” So, like, yeah, absolutely. So the first thing we got, right before the app was gonna launch a little bit more broadly was Fox Business. 

Rob: [00:19:08] So we did a 9:30 a.m. Fox Business on a crazy market day—I forget exactly what was happening. That was like, the start of the actual app, of this becoming a real business. So, we didn’t know how it was going to go. Chris went on TV with two of these cars, the Ferrari Testarossa and the ’55 Speedster, and talked about what we were doing as a business. And they went back to the office, we got back and opened my email, and there was like, 4,000 sign ups or 5,000 sign ups inside the app. It felt like, it was like, alright, this could probably be a real thing. 

Rob: [00:19:36] And then it became, slowly but surely, people started investing. So that first initial offering and that Lotus took around 45 days, start to finish, give or take. And now we’re at a point that, two weeks ago we did a 1961 Jaguar E-Type, a quarter-million-dollar car, and the initial offering was completed by around 600 investors in about a half hour or so. 

Richie: [00:19:56] So, just explain briefly what the completion, or kind of [what] that means. 

Rob: [00:19:59] So, to explain the process, the way that every sort of equity works is—so, like, Uber goes public, what that means is that it’s the first time that people outside of the company can invest in that company. So, Uber goes onto the stock exchange, a lot of people, the founders, it already makes a lot of money. Everybody’s jumping around and happy about it. But now it’s up to the general public to decide what the demand is, and they’re either gonna buy it or they’re gonna sell it. So, for us, the way we do our initial offerings is that we take this car, we price it based on comps in the space, some insurance value, some auction estimates, and some data—we put that price on it. We break it into anywhere between 2,000 and 5,000 shares and sell those off in an initial offering inside the app. 

Richie: [00:20:35] And then it closes, right? 

Rob: [00:20:36] Yeah. And it closes. So, once that’s completely funded, that $77,000 of that Lotus was completely funded, it closes. So there’s this cooling off period now. For three months, no transactions happen. Everybody who’s in during that initial offering has their shares. After those three months are up, we open up trading, once every 30 to 60 days on the app for that car. So you get liquidity. So you, as a buyer during that initial offering, if you want to sell, your first opportunity comes up, we bring a bunch of new users in, sort of generate demand, and figure out where the price is gonna go. It gets repriced at the end of day and that becomes a new share price. If you sold, you get your money out of it. If you bought, you get your shares out of it. If you want to hold onto it sort of medium or long term, you can wait it out. We have cars that sell off the platform completely, which is kind of like a hostile takeover, where somebody comes in and wants to buy the whole vehicle at a premium, in which case we poll those shareholders and make sure everyone’s okay with that price. 

Rob: [00:21:22] So we’re starting to see a very robust market, and we’re starting to see it act and feel a lot like the true equities market. And that was kind of always our goal, to do something where the whole flow, start to finish, is something you can be a part of. You can get in early, you can get in late, you can sell, you can hold, you can be a part of the community. All those elements are what we’re trying to build into like, a new marketplace, a brand new way to buy, sell and trade these individual securities. 

Richie: [00:21:44] So you said the first one took 45 days to get fully funded. You basically have your money at that point. What came next? And also, when was this? 

Rob: [00:21:53] Call this November of 2017. This is when we feel like it could be a real app and a real platform. Because the one big mistake I think a lot of companies make, and app companies in particular, and marketplaces in particular, is they feel like generating a wait list, or like, a lot of names and email addresses turns into customers. Those are not your customers. Like, that’s not a customer. That’s somebody who’s interested in what you’re doing, but to liberate dollars from somebody to something they care about is a whole different beast, than having someone give you their email address or give you their phone number. 

Richie: [00:22:19] Yeah. It’s so funny you say that. The RealReal just filed to go public, and they had 463,000 people as customers and 10 million people on their email list, which is about 3%. 

Rob: [00:22:29] It’s crazy. I mean, to not get too in the weeds on it, like, we get around anywhere between 10% and 20% turns into an investor, let’s say, out of people who come into the platform, but to us, like, we know that those are breakout numbers compared to a lot of other people, because we did it kind of organically, we did it the right way. We never advertised, we never did something where we were trying to sort of cold call people, like the old-school stock method. People found the way to our app and we did not ever push them to turn into an investor. We did a lot of passive notifications, we would email them updates. We would tell them what was going on, especially during this period where we have, call it 10,000, 15 or 20,000 people. They want to communicate with us and they want to see what this is about. We never force an investment on them. We would put it in a place where like, they get one email, they get one notification on their phone, it would say, listen, this thing’s about to be available, if you want to be a part of it, awesome. If not, stick around, there’s some awesome stuff coming. And that always played to our advantage. 

Rob: [00:23:15] So the way that we built this platform up is by finding the most unique possible assets, the things that had that great story, like that Lotus did, and kept putting them in front of these people, and eventually they turned into investors. And now our churn is awesome. We’re not in a position that we have to run out and find new people every time; we have a lot of repeat investors who, without saying it, they’ve referred us to others, and they put us in their group charts, and talk about what we’re doing. And that’s how we slowly start to build the app out. 

Rob: [00:23:40] So now, it’s turning into 2018, and it’s time for us to at least make a little bit of a name and let people know what we’re doing and bring this to life. So the first thing we did was a pop-up on Wooster Street in Soho, down the block from the RealReal, actually. And it was a small space, it was like, it had a garage door. We were like, this is perfect, we can roll a couple of cars in. Leave the door open, let some people walk by and have some conversations. And you know, it’s like, the tail end of the holidays, and people are sort of still around in the streets. We did like, one or two little parties, we did, you know, free coffee. We had like, some really expensive liquor in there if you wanted to come in and have a drink. So we tried to make it a place that you could feel [at] home. We put a little living room in there. And it became a lot of people walking in and saying, “What is this?” And us having a conversation with them about what we were doing as a business, and people were leaving really, really excited about it. So that was like, an awesome feeling for us, and that’s what led to us thinking, you know, what do we need to make this business work, now?

Rob: [00:24:25] And we needed some scale. We needed a full dev and product team, we needed to sort of make this a very real platform, very quickly. That’s when we kind of went out into the market, we raised some money. Over the course of three months, starting in late 2017, we were talking to a few investors, we talked to 40 or 50 people, and every single door closed. And now, with a little bit of press by accident, some users by accident, a car that was getting funded, and like, a space that made it feel very real, it became a whole different conversation.

 Rob: [00:24:50] We closed a $3 million seed round right around that time with some really great investors, with REV Ventures, who had a bunch of Ferrari dealerships, with Social Leverage, who was the earliest investor in Robinhood. With a couple of people who really understood the space that we were going into, and that kind of fueled the growth for the beginning of 2018 into where we are right now, basically. So, to keep the timeline going, it was just more cars, more things, trying to get our name out as best as possible. We’ve still never, to this day, done any type of referral system or sort of like, the give-five-get-five, and have been able to grow to this six digit user platform, at a place where, when we do offerings now, what was once 45 days is now measured in minutes. And we have a really active secondary market, where a bunch of different registered broker dealers [exist], where it’s all surfaced into the app, and kind of see the bids and ask, you can kind of watch from a distance. And the whole idea is to put everything in front of these users in a way that they can make the decision on their own. 

Rob: [00:25:42] And we’ve been really, really lucky that they’ve made the decision to join this journey with us and become investors. And they’re vocal. Like, we don’t necessarily need the most robust road map for product, ’cause our users tell us. Like, we have a situation where, when something’s going good, they let us know, if something’s terrible they tell us and they tell us how to fix it. My phone number and Chris’s phone number is with thousands of our users, and I get those texts non-stop. And like, I try to communicate as best I can with all these people, because they are like the heart of this platform, that really is just like an app with a bunch of cars in it right now. You know what I mean? So it’s been really, really good to see the reaction from the user base. 

Richie: [00:26:12] In terms of like, investment size, what does that range look like? What’s the low end people start at versus what are some of the larger checks you’ve seen? 

Rob: [00:26:20] When we do an offering inside the app, we try and make sure there’s always sort of a price point that’s approachable to anybody. So we’ve done everything from like a five dollar share price to a three or four hundred dollar share price. And it depends on the vehicle, the amount of shares, and we try and do it in a way where there’s always something happening in the app. A lot of kids come in that are 19 years old, 20 years old, and they’ll buy one share really quick. The acquisition cost is super low. That person comes in, they look at something once, they put a little bit of money in, and they see what it does when it trades, and then maybe buy more along the way. 

Richie: [00:26:47] Like, they can put $20 bucks in. 

Rob: [00:26:48] Twenty bucks in, and that’s it. There’s no minimums on that, we’re not taking any fees off that $20 bucks. Your $20 is actually $20 dollars. And they’ll put that money in and they’ll, you know, they’re like the alpha in their group, and they’ll tell three or four friends, and we’ll see those pockets form in different parts of the country, where you see that the word’s getting out a little bit. They’ll stick around. Like, they’ll sell a little bit, they’ll sell one or two shares the first time it trades, but they tend to sort of use that same method going forward—”Well, I’ll buy one or two shares of the cars that look interesting to me, or that sound interesting to me.” And those people are really important us because, to get anyone to spend $20 or $30 dollars when it only costs you, you know, two bucks to get that person? We’re always on board to do that. 

Rob: [00:27:20] And that might not be something that some other platforms care about, because to them they look at lifetime value, and they say like, you know, $20 bucks every two months is not value to them. To us, though, we really do want to open this up in a way that this is like the starter kit to getting involved in, not just financial literacy, but to getting involved in something that will be outside of cars at some point, it might interest you more than the cars do right now. We want to make sure that you’re familiar with our platform by the time we get there. So like, the five dollar investment to us is just as important as our super users who put, you know, $20 or $30 or $40 thousand dollars into their account, to trade actively. 

Richie: [00:27:52] So, going back a little bit to the retail store piece. You did the pop-up, kind of the first three months, it sounds like it had somewhat of a validating effect, of like, this thing’s real and so forth. That closed. And then, just talk a bit about the journey of saying, okay, let’s go open our first real store and so forth. 

Rob: [00:28:06] So, when we did our pop up on Wooster Street it was on like, a side block. It was something that, we had awesome neighbors, and we got like, really good through-traffic and a couple of celebrities come through, and it feels like, ah, this is like a real thing. But at the same time it was something that we never looked at as being a home base. That was a validation point. So when we started growing—and the company now had 35 people inside the office right now, and a team overseas, and some other advisers, everyone around us—we wanted to do something that was way more permanent and that felt like it was like a home base for us. 

Rob: [00:28:30] So our office is on Lafayette Street. We have the second floor of this really, really unique building that was an artist’s studio, and it has this great history, and it’s this awesome building that has an entrance from Crosby Street and from Lafayette Street. It just felt like an awesome space for us to have our office. By chance, when we moved in, the bike shop that was at the ground level was getting ready to move out and we had been thinking about our retail, what our retail concept was gonna be. We didn’t want to be down on Wall Street or be around banks, or be in a place where it was like, all the way uptown. We wanted to be in a place where you get a ton of foot traffic from a really diverse and eclectic group, and a big mix of people. So when that space became available under our office, we had already been looking at other spaces in the neighborhood, and it was just very serendipitous. 

Rob: [00:29:08] We talked to the landlord and we were like, listen, we want to do some construction, we wanted to put a car in here, we wanna do a few things, but they kind of understood what we were doing as a business already, we had a great relationship. And we said we wanted to do it for the long haul. We didn’t wanna do a three month lease, we wanted to do something that represented us putting our roots down in this neighborhood and making this our home base. So we attract customers who aren’t coming there to like, take pictures only. So there’s a huge difference between like, an Instagram store and real experiential retail, where you come in and leave with a really great feeling and this emotional connection to a brand and not just a picture. We want to always make that. 

Rob: [00:29:40] So we’re on this block between Prince and Spring where—you know, our whole block, it’s not really pop-ups. Like, we’re the only block in Soho that’s not full of pop-ups. You can always come to our store, which changes every month and a half or so, with a new car and new build out, and new merch, and new really cool stuff around it, and learn a new story and potentially leave with a piece of that vehicle when you come in. 

Richie: [00:29:58] In terms of the staff and the training, how did you figure out what they should provide, what should live in the app, what that experience is when you come in? And also the education piece? 

Rob: [00:30:10] When you come into the store, we really always enforce the idea that we want everyone to leave with something. For us, when we did this first iteration, which was this really unique red Lamborghini that has this insane story—it was missing for 30 years, it was found during an estate sale for the previous owner of Circus Circus Casino in Reno, Nevada. So… 

Richie: [00:30:27] What does “missing” mean? Just, the community lost track of it? 

Rob: [00:30:30] Yeah. So this was a prototype that was built by Lamborghini engineers. There were two versions, one was black, one was red. It was a car that would have never come out, it was too fast, it would’ve been too expensive. They did a little roadshow around Europe for it and then it went in storage. Lamborghini has one in a private collection in Germany, and then the other one kind of fell off the face of the earth. So if you go to Lamborghini’s Wikipedia page, it was just recently updated that this particular car is owned by us, whereas until about a month ago, it said it’s never known to have ever actually existed. Like, they weren’t sure where it was. 

Rob: [00:30:57] So we put this in the space, and we said, everyone’s gonna walk in because they’re gonna walk by and say, “What is that? Why is there a $700,000 Lamborghini sitting in the middle of this storefront? Let’s go in.” And then when they get in, it’s kind of like, we want to make sure that we’re passively explaining what we’re doing and that they leave with either that a-ha moment or they’ve like, purchased something in the store, basically. And we’ve been really successful doing that. Like our average time in-store right now is somewhere around three minutes for any individual walking in and out, and that includes someone walking in to take a picture and leave. So we’re getting people that stay for 15, 20 minutes, and they want to learn everything—not just about the car, but about the company. 

Rob: [00:31:31] So, the way we start every conversation—and we’ve trained the staff in a way where it’s like, the welcome conversation, like, “Hey, let me know if you need any help.” And then they say, “What is this?” And it becomes the conversation about, well, it’s the stock market for classic cars, and we do X, Y and Z, and here’s what we’ve done to this point. They wind up going through our version of the app that we have in the store where they can see the whole carousel of other cars that we have. They can see where they’ve traded to this point. 

Rob: [00:31:50] But then we kind of surrounded the store in a way that, you know, we took a lot of cues from the 80s when this car came out, and we took the original press photos and we put those on a t-shirt. But then we did stuff like, we had a piece of leather from the Lamborghini factory that we reverse engineered into a candle that was made by a private label brand that did like, a run of 200. So we do stuff where like, you can come in and really just love the car and like the idea of it and leave with something, literally. But you can also come in and have the conversation and figure out whether or not there’s something you’d want to be involved in. 

Rob: [00:32:16] So, we’re building out more inside the store to make sure the experience comes to life, a little bit of virtual reality. We’ll be doing more events and more unique activations inside the space. The space is big right now. We took a small portion of it in the front, so around, call it a thousand square feet. We kind of put a wall up to separate for right now, with the idea that we’ll make the back into the clubhouse a little bit and do some more unique stuff, and panels and events in the back. And then we want to replicate this, too. We don’t want to do it just in New York. We don’t want to it just in major cities, we wanna be in places where our user base is. So, for us, we have these big pockets of really engaged users in places like Texas, like parts of Georgia. And we wanna do it in some of the more rural communities, so that it shouldn’t be just behind the velvet ropes in cities. And that’s something we’ve always kind of stressed, is that we want to be everywhere where people care. And Rally Road as a name was always intended to be like, you know, it’s a road somewhere in the Midwest, it’s not something that’s on Wall Street. 

Rob: [00:33:06] So the more we can kind of replicate this model and do it in a place that doesn’t feel like a pop-up, it feels like an actual destination, that’s where we want to be and that’s what we wind up doing. 

Richie: [00:33:13] How do you think about security? 

Rob: [00:33:15] Yeah. I mean, we have a guard that’s there for like, any of the major events or like, the busy weekends but it’s weird, ’cause we’re down the block from Supreme. And there’s this, this weird relationship that people have with Supreme, where it does feel like Supreme can spin up a store right next to their store and they’ll just double the amount of people who are waiting on line to go into Supreme. But it’s this weird dynamic, where you have these security guards who are like, yelling at little kids, and they need your license and your credit card before you walk in the line. And more power to them, it works, and it’s part of their business model now, I think. But, for us, we wanted to do the exact opposite of that. 

Rob: [00:33:45] I think that if you treat people with respect, they’re gonna respect your brand, they’re gonna respect what you’re doing. We want a block that has a lot of really expensive stores on it, but we’re probably the cheapest price point of anything on the block right now, either a restaurant or actual retail store. 

Richie: [00:33:58] But also the most expensive at the same time. 

Rob: [00:33:58] But all at the same time we have this $700,000 thing in the middle of the store. But it’s on a little platform, it’s something where we have a bunch of cameras on it. Everything’s insured, obviously. But we treat people the same way I would treat anybody I’m having a conversation with, where they come in, they ask questions. It’s kind of implied, like, don’t jump in the car but, knock on wood, it’s never been a situation, that someone didn’t ask before doing [something]. It’s like, “Can I get in, can I take a picture with it?” And it’s like, “Yeah, absolutely. You can’t get in the car, you can do whatever you want around it, though.” And it’s kind of implied in a way that we don’t really super enforce, to make sure that people feel comfortable, because that’s a big part of our platform, too, is that the auction market and the place where you can buy a lot of these really high value assets is not a comfortable place to be. It’s very velvet rope. It’s very have and have nots. And we don’t want to treat people like that or treat the business like that. 

Richie: [00:34:44] You mentioned before, kind of the interest in moving into other, call it asset classes or categories. Talk a bit about the interest and the status there. 

Rob: [00:34:52] So, as those sort of personas that we talked about kind of built, and we realized that the person who cares most about our platform isn’t necessarily somebody who’s a super-enthusiast car collector, they’re somebody who’s really into it in terms of something new, as a financial instrument, and as being part of something unique with a high value asset. Those people, to us, they’ve told us kind of where they wanna go next and what they want. And it’s not just cars, it’s a lot of stuff that’s adjacent to cars. So it’s things like, the first two asset classes we’ll go into, the categories outside of classic cars are things like watches, like really high-end wine and whiskey, like high-end collectibles. So we have like, some of the most meaningful sports and political memorabilia probably ever that’s in our collection right now, that we’re starting to work through. It’s really unique first edition books. It’s things that have that same resonance, where it’s art. It hasn’t necessarily been treated like fine art to this point, but we want to make it accessible. So anytime we can open up that access lane in a marketplace that has similar dynamics of the classic car market, that’s one we’ll go into. 

Rob: [00:35:46] And then, for us, like, the big goal is to go into intangibles, I think, as quickly as we can, but with the most respect, with the same respect that we’re treating cars with right now. So things like music, potentially things like medical research, places where the delta between the money, where it comes from and the risk are a little bit misaligned, we feel like. Where we can go in and affect change and do something really unique with a group of people who want to be a part of it. 

Richie: [00:36:08] Like in the research cases, in funding research or something? 

Rob: [00:36:10] Yeah, potentially. I mean, this is all very abstract right now, we’re starting to put the thoughts on paper. Music, for example, is something that we’ve always looked at as a space where everybody wants to be first. Everybody wants to be the first person to see a band, everyone wants to be the first person to own the merch, everyone wants to be a first person have that conversation. And we started putting people around us, where we have the group at Mass Appeal Records as an adviser for us right now. Nas is an investor in the company. WndrCo and the team out west are investors in the company. 

Rob: [00:36:33] And we try and keep people around us that are in that space, because we feel like putting those people around us opens up those conversations when we start thinking about the way we can go into intangibles, we can talk to the gatekeepers first, and talk to the people who really understand that space. And understand what it means for the next independent artist, potentially, to come to a platform like ours and really decide their worth, as opposed to letting a major label decide their worth. And where that goes, we don’t know yet, but I think that’s something that’s gonna be really interesting to our user base. Because they’re not necessarily car people, they’re people who really want to have access to unique investments and unique stuff in a way that resonates with them, and isn’t something that like, someone from a different generation is telling them they should put their money into, like a mutual fund.

Richie: [00:37:12] I should probably ask to this point: how do you guys make money? 

Rob: [00:37:14] Yeah, so that’s a good question. So, for us, we have a great group of investors and people around us who understand that this is potentially transformative technology. So, for us, there’s like, a small sourcing fee on each of the vehicles right now, because we’re doing like, just for the research, the paperwork. A lot of that stuff goes into the bank account of the car, basically, where if and when the car gets sold, it gets redistributed, sort of as a special dividend, kind of. But, for us, the way that we look at the long term is by doing a premium tier that we feel like will earn people’s money before we kind of ask for it. And we’re in a position that, right now, keeping everything free is the right way to get to that scale, and to be able to provide that. 

Rob: [00:37:46] We also take a small piece of the equity that we buy out of operating capital, that we do believe in these assets. We want to make sure, not just [that] the interests are aligned, but that if everyone’s making money in this, we rally together and made some money, that we’re able to sort of benefit from that as well. And that, you know, that we actually do care about these vehicles we’re putting on the platform, which is part [of] the strategy right now as well. But long term, doing stuff where we create some really unique financial instruments around what we do, access to money things in a different way, and do that subscription fee, for us, is a meaningful way to provide great value to our users, and at the same time potentially turn that into a really meaningful part of the business, too. 

Richie: [00:38:17] Zooming out from more of a macro perspective, as you see things like Uber, Lyft etc., challenging the idea of car ownership, how do you think about—I guess, specifically, maybe the car market from more of that macro perspective of, one: are there cars being created today that are gonna be the examples that you’re listing and finding in 20 years, or is the supply piece changing, and then also the demand piece on not everyone, again, is looking to buy or own these things, or so forth. 

Rob: [00:38:45] Yeah, that disconnect between like, the utility of a thing and like, the value of the things are starting to become very prevalent right now. And, to us, all of this, like, what’s happening now, it’s so early in, when we talk about autonomous vehicles we talk about sort of where that equity component lies and what we’re gonna be able to do with that. It’s so early in the process now. And we look at things like what Instagram did for analog photography, and what, you know, the Spotify’s of the world did for music and brought back vinyl. 

Rob: [00:39:07] The way that a lot of this stuff, if you look at the data, the newest peaks in some of the, what’s considered an antiquated way of doing things are now. And it’s in a wave that we feel like we’re very much ahead of the space, where all these things get looked at as sort of antiques and the new version of the utility form is gonna take shape really quickly and it’s happening, but we feel like that creates a lane for us to put more attention on the times when things were made in a very different way. Where it wasn’t mass produced, it wasn’t robotic, it wasn’t completely autonomous. It wasn’t done on pure digital assembly line, it was done in a way where every bolt, every thing, every piece of attention and detail, all the way down to the design was done in a way that a person’s emotion and thought and feeling was in what was actually being made. So the more we can bring that story to light, we feel like this runway for something like classic cars or collector cars has way more runway than the autonomous vehicles or the ridesharing apps or the platforms of right now, which are solving the immediate need. We’re trying to solve for this long term. I want to be a part of something that doesn’t exist anymore. It’s a finite amount, it’ll never exist again, and we want to make sure that we’re telling the right story around that. 

Richie: [00:40:12] And then from a supply side, are there things being created today that you think will be of that providence in ten, 20 years? Or is that declining, too? I guess it’s also a question of, where does that like, heritage come from, in a sense?

Rob: [00:40:24] Yeah. Yeah, it’s a great way to put it. There’s a lot of—even in the car space, like Ferrari and Porsche in particular—they do a lot of stuff right now. They put a lot of vehicles out and a lot of things out that are that super-low production, they’re allocated to a very specific type of person. A lot of times, you know, a million dollar Porsche, for example, or a Ferrari or whatever it is, will come off the line and go into a person’s hands, and they have this 18-month no-sell clause, because they’ve basically made a million dollars as soon as they get the car. They got lucky enough, if you buy ten or 15 or 20 Ferraris over the course of six or seven years, you’re lucky enough to make it to the top of the list when that really rare Ferrari comes out, which is essentially a gift from Ferrari. They say, “Give me a million dollars and you’re basically getting two million dollars worth of equity in a vehicle.”

Rob: [00:41:05] So, stuff like that is always interesting to us. At the same time, like, we want to be in a position that we can kind of dictate what that looks like, too. So anytime we can partner with a brand or work with somebody to make a one-off for our group in particular, that’s really the definition of our platform. It’s giving you something and giving you access to something that you may not have had access to before but is really, really interesting and unique, and you might be the only person with it now. So if we can do more stuff like that in the future, we feel like there’s a huge lane for us to partner with really unique brands in a bunch of different spaces, to sort of allocate a very small percentage of the total float to a big group on our platform. 

Richie: [00:41:38] In terms of like hold periods, what does that look like? Have people held stuff since the first offering? Do people generally trade after a short amount of time? I’m sure it’s kind of a range. 

Rob: [00:41:47] Yeah, it’s all over the place. I mean, it’s something that, we see a lot of kind of medium-term investors. We see people who truly do believe in the assets and the asset class as a whole. So when they put their money in, they know that this isn’t something that’s trading every single minute, that’s fluctuating wildly every ten days. It’s something where you’re in it, in a place where I go and check my portfolio potentially accumulate a little bit more, and maybe sell a little bit, but it’s really part of this diversification method. So, for us, the cars are technically always for sale. So we’ve had a couple of exits off the platform now, where someone came in—you know, we’re creating this collection which is potentially best in the world for a lot of these cars, so if you want the best version, you kind of have to come through us in some cases. So the first two assets that sold off the platform, one was a four-month hold, one was a six-month hold, and they were 17% and 17 1/2% respectively, in terms of returns. So it’s our fiduciary responsibility to make sure stuff like that can happen, and it does happen, but to say that it’s gonna happen every time would be speaking out of turn a little bit. 

Rob: [00:42:40] There’s also situations where, you know, assets will trade up or trade down, so there are cars that have traded on our platform right now over the last, call it year, are down anywhere from 3% to up 25% or 30%. It’s dictated by the market, and we wanna make sure that the market always has a say, whether it gets sold, whether it’s just buying and selling throughout the course of trading windows. Whether it’s something that everybody wants to hold, and the sort of bid/ask dynamic kind of speaks to that. 

Rob: [00:43:03] So you’ll see certain cars have massive, massive bid cycles, where everybody on it is trying to hold onto it right now. We surface all that into the app, so you kind of get educated on the financial component, not just the vehicle component of it. 

Richie: [00:43:13] In terms of like, risks, what’s the like, keep-you-up-at-night from a business perspective, in terms of what could go very wrong, or things just to ensure there’s downside protection on etc?

Rob: [00:43:23] I mean, it’s everything. It’s being 36 and trying to figure out like, what the next ten years looks like! Like, I don’t know, man. There’s inherent risk every day. We have this business where we’re essentially constantly raising money. So we have a bunch of initial offerings that go live, and if it’s a $600,000 car, you wake up in the morning, the initial offering goes live at noon on a Friday from 4 a.m. until noon I’m thinking like, this is gonna be successful today. You know, it’s one of those things where, it’s not just that— 

Richie: [00:43:46] Because you already have equity or debt in that asset, right?

Rob: [00:43:48] Yeah. We have debt in that car. We have something where it’s on paper. We owe somebody $700,000 if we’re trying to raise $700,000. It’s also something where in terms of like, the platform, people expect it now. It’s become a situation where we drop an initial offering, it feels more like a sneaker drop than it does like an investment. It doesn’t feel like a market opening, it feels like everybody’s gotta get on this right now. So for us, you know, when something goes live, there’s so many moving parts, and now it’s a much bigger team than it was a year ago, and it’s way more eyeballs on the platform than it was a year ago. So the keep-you-up-at-night type stuff is always like making sure there’s a level of success that’s not just the success that you feel as a business, but the optics have to feel right, too. That’s something that we’ve always been sort of very cognizant to, but we’re way more aware of now, that there’s way more eyeballs on what we do. 

Richie: [00:44:27] In terms of what’s next on the horizon, what are you most excited and interested about?

Rob: [00:44:32] I’m most excited to see where this space goes. I think the idea of like, fractionalization, it’s been thrown around for a long time. When the jobs act came out a few years ago, when it released, it was something that was meant for like, the Kickstarters of the world. And it was something that allow for non-accredited investors, people who don’t have tens of billions of dollars to sort of invest in the things that the rich had access to. And it’s been sort of being worked through for the last four or five years, and no one’s really, in my mind, taking advantage of it, in a way that really opens it up. It’s a lot of big real estate platforms which are still for the haves, and for the people who already have access to that type of stuff. There’s one or two of these little fractionalization platforms for like equity and companies, but they’re not necessarily getting the best possible deals. 

Rob: [00:45:11] For us we feel like this is so, so early. We feel like the Uber of this space has yet to be sort of created. You know, we see four or five years from now where the space is gonna be, it’s gonna feel like the same way that ride sharing feels like right now, and the smartest people in the room are feeling the same way. But no one’s really jumped on that opportunity, and we feel like there’s this massive opportunity, not just from a business standpoint but from a whole new stock market type of standpoint, where something’s been the same literally since the 30s. Nothing’s really changed that dramatically. A bunch of rich people got a lot richer from all these unique financial instruments that were created, but no one said like, listen, do you care about this? It’s something that could make you money. Here’s a way to do it without losing your shirt, without sort of having to put millions of dollars into it, or hundreds of thousands of dollars into it. And we feel like it’s so so early in that process, and we just wanna stay ahead of it by doing cool stuff and making sure that people understand and are educated and know what we’re trying to do as a platform, and get involved in any level that they feel comfortable with. And that really hasn’t existed to this point, so we’re excited for the future. 

Richie: [00:46:05] How do these goods do in a recession? 

Richie: [00:46:07] It’s interesting because like, the top 1%, what we’ve seen, of assets, of best quality assets, they’re the things that people sell less during that wave. It’s a little bit of an emotional connection, a little bit of sort of a value, they know that there’s value in it. It’s like gold, it works very similarly. In 2008, 2009, what you saw is that there was a little bit of a breakaway in terms of correlation. Everything got hit but, at the same time like, collector cars, for example, lived in this little plane right above where a lot of them didn’t get sold during that period. But the values maintained a little bit better than real estate, for sure, and a lot better than equities. And then the recall, the rubber band out of that was dramatic for the classic car industry as well [as] for the collector car world. 

Rob: [00:46:44] So anything can happen. Obviously, if there’s any type of massive downturn everything’s gonna be affected by it. For us, we look at that as an opportunity to educate a little bit, too. The idea of like, “buy low, sell high” has never really existed in alternative assets. It’s existed for equities for a long time. But to be able to educate somebody on the fact that, you know, you can come into something where potentially there’s value, and buy lower than it’s gonna be later isn’t something that’s been thought about when it comes to like, baseball cards or collector cars or by the mass public. We want to use that potentially as an educational point for our user base. But they do act uncorrelated in some cases, it’s a rush to safety in other cases, but everything gets hit when everything gets hit. So, you know, we hope we don’t get to that point, but we’ll see what happens when we get there. 

Richie: [00:47:22] Is there like one car, maybe one asset that you’re dying to have on there? 

Rob: [00:47:25] We had it! It was this Jaguar XJ220, which was a car that I remember from when I was younger, ’cause it looked like nothing else. My grandma bought me this die-cast model of it I had where the doors opened up and stuff, and that was a thing I just, I had a really, really strong emotional connection to from when I was younger. I would like, sit on my grandma’s stoop and play with the car. So that was like, a thing that I thought, it would be awesome to have this one day, and I’ve been thinking that since I was 11. And then, when we had it, I was just like, ah, this is like, a really weird, seminal moment it felt like—I dunno. 

Rob: [00:47:49] But there’s some other stuff too. Like, I went to school for fine art, and that was something that I always thought in my mind like, I would love to have a really meaningful art collection. The art mantra is always like, buy what you like, and if it makes money, that’s great. But to me, like, to have access and be in the room with some really, really great unique pieces of art and of sculpture is something that’s really interesting, and I’ve been lucky enough to be a part of now because of this platform. 

Richie: [00:48:08] Awesome man. Thanks so much for talking. 

Rob: [00:48:10] Thank you. 

Richie: [00:48:16] Thanks for listening to the Loose Threads Podcast that you can read full transcripts of the podcast and join the newsletter at LooseThreads.com. Feel free to leave a review on iTunes, we always appreciate it, and thanks to George Drake, Jr. for editing this episode. We have a great roster of upcoming guests and we hope you tune in next week.