Robinhood Drops a Nuke, Republic Reinvents The Forward Contract, and Rocket Dollar Founder Henry Yoshida On Self-Directed Private Investing

Speaker A: Okay.

Speaker B: You ready?

Speaker C: Yeah.

Speaker A: I was born ready.

Speaker D: Nick.

Speaker C: Let's go, man.

Speaker A: You got the touch. You got the power. Yeah.

Speaker C: Welcome back to the Scott Show.

Speaker B: On today's show, I've got the founder of Rocket Dollar now the head of retired dot com, Henry Yoshida. Uh, what a day. Wow.

Speaker C: Uh, I would have done an emergency

Speaker B: podcast today after all of the Vlad stuff in the last 48 hours from Robinhood, had I not already spoken about it with Henry for an episode coming out this week. So timing could not have been better. Henry is one of the OGs in the space. He helped build the bridge between old school retirement accounts and modern self directed investing. I guess you could think Robin Hood meets Fidelity for Alternatives. Um, it's not perfect, but it's kind of there. If you listen to the episode, you'll know what I'm saying. Uh, we talk about the shrinking public markets, the generational shift towards private equity access, and how platforms like Rocket$, which, by the way, I invested in their original campaign on Republic years ago, uh, are unlocking trillions of dormant capital, both in the generational transfer, which you'll of course continue to hear about, but also just in general, uh, the, the Gen Z, millennial, Gen X kind of roll up of people trying to access private equity. Just in general. It's like you can't turn on the news or scroll through Bloomberg or Wall Street Journal anymore without hearing new breaking news about access to private. Which couldn't come at a better time. Uh, we'll talk about this in a second, but the Vlad, uh, Robinhood CEO from Cans. Cans. Cans. I don't know how the cool people pronounce it. I'm going to say Cans from Cans, uh, with the ascot and the pinstripe con man suit. And I love Vlad and Robinhood, but man, oh man, if I was going to sell crypto, there's no better way. It just goes to show how incredibly important marketing, um, and salesmanship is.

Speaker A: Ah.

Speaker C: And will continue to be in the

Speaker B: world post AI, where everything is basically automated and the only thing that stands out is your delivery and your show of force, your show of power. Uh, maybe that's why our political system is running the way it is too. I don't know. I'm not trying to draw conclusions, but what I am saying is that we are going to continue to hear and talk a lot about the access of retail investors meeting with private equity in private markets. So for this episode, if you are a founder, investor, uh, platform builder, runner, operator, user, uh, just someone who doesn't want to retire broke. I feel like this show is for you. Um, before I get into it with Henry, I mean, holy cow. Like I said, we would be doing an emergency pot if we weren't already doing a pot. This is insane. Um, so right as I'm wrapping up with Henry, what happens? Robin Hood Vlad drops a nuke that he's been teasing. How. And plugging along for months, if you're paying attention. But really, like a week, uh, he had the conversation with Ethereum founder, uh, you know what, two days ago.

Speaker C: It's just sort of like everyone is

Speaker B: like, waiting and bated breath to see what are we talking about.

Speaker C: Stablecoins.

Speaker B: What are we talking about?

Speaker C: Apparently everything.

Speaker B: Um, what we did talk about, like I said before, with his ascot in tow, tokenized stocks, European rollout. Free tokenized shares of OpenAI and SpaceX for early adopters. It's literally a headline factory. And that's not even it. Republic, one day prior, is on Wall Street Journal talking about what they're calling mirrors, which is a very, very innovative take on tokenizing forward contracts, which I'll get into in a little bit also. And I will tell you, uh, next week, the new episode of Kingscrowd podcast will be hitting you. Kings Crowd newsletter. Uh, to get it, um, I go really deep in it with Brian Belay, who's the head of product at Kingscott. I think that show is well worth your time. I'm just going to give like, a Cliff Notes version of the conversation here. Um, but look, we are entering unchartered territory. Let's just call it what it is. It's a shot across the bow of the. Of the private markets. Robinhood is not fucking around.

Speaker C: They're skipping the polite intro phase and

Speaker B: going straight to the heat. Uh, tokenized access to the sexiest companies in the world. They're fucking giving them away. Literally in Europe, they are giving five dollars. Uh, five, sorry, five euros to every single person who signs up between now and, like, July 7th or 10th for access to, uh, stock tokens. Again, this is only in Europe for now, not available in the us But I'm sure it will be soon. I actually heard a little birdie whisper in my ear and say that Republic partnered, or I should say Robin had partnered with Republic to do that, which is completely makes a ton of sense when you factor in, uh, the Republic also just launched the mirror product of OpenAI and SpaceX and is the leader when it comes to tokenizing venture capital and private equities. Uh, Ken is literally the best. He's A good friend. I'm an investor of the company. I've worked with them to roll out Hamilton Lane, and he's been a guest on the show many, many times over. Um, so that happened. Um, and that's not it. It's, it's not like, I guess the question is, like, is it purely marketing?

Speaker A: Sure.

Speaker B: But it's so much bigger because the word is, and I'll just say it, the whole rollout might be happening in real time with all of the major players. The blackrocks, the Securitizes, the Republics, the Robin Hoods, like, we're just going for the grand old opera. The grand rollout of tokenization, which I think brings in a different question. Um, to me, tokenization is sort of like a feature. It's not the product right now, it's being sold to us like it's the product. I liken it to taking a train downtown Chicago, or taking a car. Uh, sometimes the train is faster and better, more efficient, except for when it's not. Um, and at the end, the goal was to get downtown, and I did. So it doesn't really matter what Rails I took. I think there's a future where tokenization is table stakes because the assets are all trading at fair market value. And I could literally buy my OpenAI, uh, private equity share, and I could trade it for access to my Hamilton Lane fund on a dollar per dollar using stablecoin. And I could probably also throw in some public stock into that. That's the future of Vlad selling. That's the future everyone is trying to sell. But at the moment, if it's treated like a secondary, where I'm getting a 30, 40% haircut, buying or selling my, my asset for another, it, it's novel and it certainly means that, you know, liquidity is possible, uh, but it doesn't mean it will happen and it doesn't really equate to value. So right now I, I, I'm all for tokenization. Obviously a huge fan and a very early investor publicly in the IPO of Robinhood and a very, very early investor privately in Republic. So I hope all these things come true. I'm building my own company in the background that I think will fit right nicely in between the two. Um, but that doesn't change the fact that I think that until everything is tokenized and assets are truly, uh, trading properly and there's a real secondary, uh, a secondary market, I kind of think that this is just like a lot of marketing, which is, okay, um, we're going to get there and we need these kind of advancements to get there. But I just say keep your eye on the ball. Speaking of Republic, they just launched the Mirror, which I think is the coolest shit I've seen come out in a long time. There's, it's not new, uh, the idea of a forward contract. The problem with a forward contract is in theory, in principle is that most companies are unaware or prohibit the buying and selling of their, you know, of the shares that you own of the company. And so it's just like very difficult. And what ends up happening is you either have to invest and have access to it and you're basically selling access to your, your shares, or you're going to go out and buy them later, maybe on the secondary, and you're promising those shares at a certain strike price relative to what the price that people are buying their future at. In this case, it's tokenized and it's a mirror. The positive is that Republic is invested in almost every company that's listed on their site. And the bet that they're making is basically that they beat the spread that they get in low enough where they set the new price for the Mirror

Speaker C: and then you get to keep the

Speaker B: upside while they get the cash up front and then they can reinvest it and on we go. It keeps going. I can tell you, I think it's fucking brilliant. One, the tokenization component solves and resolves so many of the issues that make the traditional forward contract kind of bulky and clunky and not great. And there's a couple people who've built and tried to use it, but it's just ultimately not been awesome. I will say there's other companies I know that are working in the space to modernize it. And to be honest, this used to be something that was kind of glossed over. It was like a tipping point for the company. When they would issue new shares, uh, to investors, it would be like, this is prohibited. It was just assumed that you couldn't transfer your, your shares or assets. I'm seeing it now becoming a bargaining chip and investors basically saying, hey, we kind of need this. Like, we'll give up a little bit extra on our end to the founder

Speaker C: or to the owner of the company

Speaker B: or the, you know, the board in exchange for the access to transfer or trade or sell. Because they recognize this future world where everything is moving hands, it's tokenized and it's trading and we're on like, ah, a 24 7. I think that's inevitable. So I'm already seeing new deals coming through that pretty much stacked to that. Um, but what Republic just did is I think is one of the most novel things that, that I've seen in years, to be honest. So um, look, tokenization is, is here. Uh, whether or not it ends up being the promise that we're being given,

Speaker C: you know, I don't know.

Speaker B: The, the promise that's being sold by, by Vlad is absolutely enormous. You're telling me that I could use Rocket dollar to invest via my IRA into tokenized late stage shares of companies and also stocks and also private fund of funds and then someday find liquidity or by trading those, or even bundling like the entire world becomes one gigantic cryptography base where everything is basically stuck and tacked to a stablecoin which then we can use and trade and unitize anything and everything and do so on a contract and basic, on a digital ledger requiring almost nothing.

Speaker C: Which then, you know, now I'm going crazy.

Speaker B: But then like roll that into this futuristic AI world where decisions are being made for us. And quite literally your, your AI bot takes your cash, converts, it's stable and it's trading 24,7 across private and public markets real time. Incredible. Uh, unfortunately today there are regulatory constraints, there are technological gaps, there are certainly educational and lack of investment sophistication and, and there's just in general like hesitancy on the capital side to be in token all the way. But the more of this stuff comes out, I, I think we are heading to the dreamland very, very soon. And I just think that if you're looking at what the future looks like, what the 25 to 32 to 44 year old investor by the way, who will probably be 50 to 65% female driven, decision making. I think that that world looks very tokenized and digital. It looks like what Vlad just promised, it looks like what Ken and Andrew just announced.

Speaker C: Um, so I'm really excited about it.

Speaker B: Shout out to Vlad. Shout out to Republic. Shout out to the Robinhood team, the product team. I haven't seen a company pushing product this fast in fucking forever. Uh, so it's just really cool to see. Shout out to all of you who

Speaker C: are building towards this kind of weird,

Speaker B: incredible future of fintech that we're all uh, looking at, I mean where retail doesn't just get access but they get equity, they get upside, they get a seat at the table for once. It's incredible. Uh, so if you can't tell, I'm pretty enthused about this and, and just

Speaker C: where everything is going.

Speaker B: Um, I couldn't be more enthused to. Welcome back to the podcast Henry Yoshida. Uh, as I, as I plugged at the top. Uh, but before we talk to Henry, let's have a quick word from our

Speaker C: sponsors@kingscrowd.com looking for the smartest way to invest in private markets. Kings Crowd gives you data driven ratings and research on the best startup deals so you can invest with confidence. Skip the guesswork and start making more informed decisions today by visiting Kings crowd dot com. Welcome to the show, Henry. It is, uh, it's been a while. Last time I saw you on a show was, uh, after investing in Rocket Dollar on Republic's campaign. I feel like that was. Was that 2020? Was it earlier? I don't. That was earlier.

Speaker D: That was 2020. I think it was. Yeah.

Speaker C: Yeah, something like it's been, it's been a while. Uh, so it's great to see you. Uh, welcome, welcome back to. This is a different show, but same host and most the same conversations for the most part. Just somebody gave me a check for the other one and so I started a new one as one Dice.

Speaker D: Well, I love the way that you say Scott Katoon, you know, like uh, with fire. So hopefully you still do that in this new show.

Speaker C: Very excited. I'm very excited about, about the, the, about my shows.

Speaker B: I don't know.

Speaker C: I, I listen. I'm probably the biggest listener of my shows. Most, most hosts that I know do not listen to their content. Um, it took me a while. The first, when I did the radio show at wgn, I could not listen to it. It was like something about the sound of my voice. Uh, it wasn't even a perfectionist or anything. It was just. There was just something about it that just kind of made me crazy. And then when we started doing a lot of clips, it became like impossible to skip because all your, you know, asshole friends would send me, you know, dms on Instagram of clips that I was sending out and like making fun of me and then I would have to listen to it and then I got used to it and now I'm good with it. Now I listen to my show. I'm the first listener.

Speaker D: That's too bad. And I'm assuming that none of those took off as like some super famous meme, right? Otherwise you wouldn't have to do so much work anymore.

Speaker C: No, the only. I actually you're gonna get into this topic, uh, in a little bit here, but there's a meme that I created in January, uh, that was used more or less ubiquitously throughout, uh, Finn Fin Twit, Fin Tech, Twitter, uh, for retail investors and private equity. And the, the meme was effectively uh, well there was two. There was the Spider man meme where they're all staring at each other, um, looking for the same dollar. It's like we're not private equity, we're venture capital, but it's like we're actually the same. Um, and then the second one was uh, basically the reit, the, the private equity investor institutions basically sniping the retail as they walk by. Uh, and that meme was well into the million of views and unfortunately it yielded me uh, almost no cash. So I'm still working sadly, but have

Speaker B: the story to tell. So that's all.

Speaker D: Well, maybe we'll pull a short out of this one then.

Speaker C: I think there's, there's certainly hope. Uh, what is, what is new with you and Rocket Dollar for one for me and any of the people who are listening that were investors in the Republic campaign. And um, then in general I'm just really curious with where you're going, what you're doing business wise because this has been, man, I wish you to run this campaign now. Uh, this has been like the, the first time in my life of, of being in this kind of retail space, call it almost eight years now where when I have conversations with people about retail, private markets, retail, private investors, just general, uh, individual investors that I'm not laughed out of the room. And in fact most are asking me, oh, do you know how to reach them? Can you acquire them? So I'm just really curious where you're at because we're finally in a place, but there's tailwind. I mean we're recording this today, last day of uh, the first half of the year, uh, June 30th. Vlad from uh, Robinhood came out today and did the announcement that he's going to tokenize the whole world. Apparently um, it's all available, staked and futureed. Uh, so we are entering a, ah, pretty interesting time. And we're not even talking about artificial intelligence yet. So like this show could go anywhere. So what's new with you?

Speaker D: So uh, just for people that don't know, uh, I started a company called Rocket$. Uh, prior to that I was always in the retirement account, tax advantage, 401k space, uh, through their financial services, uh, aspect of it. So I've never been on the fund manager side. I've always been sort of in retail. I did a lot of 401k consulting and you know my second company is Rocket Dollar that I created. And it's built on the premise that there's lots of people in America, uh, tens of millions of them, over 100 million people who own IRA accounts that collectively still today IRA accounts have about $18 trillion in them and they're just US products. So we're just talking United States market here, um, in the accumulated dollars in the trillions. But the vast majority of Those dollars, basically 99% or more, uh, only sit in publicly traded stocks. So the epiphany was to create a platform like Rocket Dollar to make it easy for people to access their tax advantaged IRA dollars to make private and alternative investments. And I'm not the one that invented this, you know, this industry, this little niche industry has existed for IRAs that could do that. And that's what Rocket Dollar is. It's just um, you know, I wanted to make sure that people could find it easily online, open an account the same way they'd open one at Schwab or Robinhood, which is essentially on your phone, uh, in a digital framework or on a desktop. And you can do it in less than five minutes you can open an account and most of that five minutes is just you giving your information and probably like you know, just scanning a picture of your ID to prove that you are who you are, uh, and so forth. So at, and then last year I'd been running the company, uh, Rocket Dollar. You know we started, we're here in Austin, Texas. Uh, we grew to pretty large size and we decided to join forces. So we took a, an acquisition offer to join an organization called retired.com. and in that organization, obviously the name implies that we're focused solely on retirement accounts, uh, and alternative investments, specifically in retirement accounts. So our sister company is Bitcoin IRA which is uh, the leading cryptocurrency enabled 24.7trading IRA platform for Bitcoin 87 other coins and we're adding new ones and features all the time on that side of our house plus Rocket Dollar. And then we have our own integrated trust and custody company Inside of Rocket retired uh.com as well. So that's uh, kind of the soup to nuts, uh, what, what I've been doing for uh, the last year since we joined the retired dot com. But the mission is still the same at Rocket Dollar. It's to enable retail individual investors to access their existing IRA and old $401 to make, make private and alternative investments while keeping the tax benefits of those accounts.

Speaker C: What is that conversation like now versus the early days when you were telling people you could invest privately through uh, ira. I feel like it was a lot of hand holding and like explaining why and now I got to imagine that people are pretty or not. Actually I'd be surprised. You tell me what it's like now talking to people, customers.

Speaker D: When I first started thinking about this concept, so this was going all the way for me back to, to 2016 and 17. So I had just exited my first startup and was trying to figure out what to do and learning from the limitations of the business model. The first startup. So the first startup went after the um, uh, a very low early beginning investor type. So it wasn't this large dollar person that had a lot of accumulated money. So I really started to think about like well who are the people that do have money and what would they be interested in? In um. And the thought when I came up with the concept of doing private and alternative investments in IRAs, it, it wasn't the um, it mostly was the attitude of why would I want to do that? Right? Because you know, you were just investing in public securities, you invested in mutual funds, you invested in index funds. And I liken that 2016, 2017 conversation to probably what it might have been like for an older version of a Scott Katoon or Henry Yoshida going out and trying to do some market research out in the open, out in the wild in financial services, talking to folks in like 1998 and 99 saying like well what if you could buy your own like individual stocks, you know, instead of just buying a package from the fund or from some individual and they'd be like well why would I want to do it myself? That sounds dangerous, that sounds crazy. And now you know, we live in a uh, like a, not even a Robin Hood ified world, like probably a 10 year post Robin Hoodified world where more people actually are interested in trading individual stocks than they might be in just buying into some other someone else's strategy. So it kind of came full circle where it started with why would I want to do that back then to like now it kind of becomes a little more obvious and even to the point where we talked about this offline, that I got asked to give some comments for a major financial publication or a major publication on the administration, the presidential administration, the US government becoming a little more open to allowing individual retail investors to hold private and alternative investments and long term tax Advantage retirement and 401k accounts. So that's all come full circle and it's Just more accepted now than it might have been. So, uh, again, like most entrepreneurs, maybe when you start a business, you're a little bit before your time and then you eventually, uh, you know, the market catches up or the, you know, the ideas and attitudes change and they catch up. I mean, think about, we've technically been talking about AI for 25 years, but now our aunt and our grandmother know how to use AI and can talk to like Gemini or ChatGPT, which is

Speaker C: insane by the way. My mom uses it to like reorganize the house. And I'm just like, I'm like, you just figured out how to log into Facebook. Like how you got the advancement is, is incredible.

Speaker D: Exactly, exactly.

Speaker A: Yeah.

Speaker D: Uh, it's just become very mainstream. Yeah.

Speaker C: And so, and obviously so is this. It's, it's funny the way you, you phrase it is like as entrepreneurs, you're always, uh, afraid of being too early or too late, which is the same thing. Uh, and if you're lucky enough to be able to hang on long enough to let the time catch up, you know, great, good business models tend to be able to do that. Lousy, uh, ones tend to run out of time. We're in this situation right now. We're like, we're kind of fortunate that everything is happening at once. And I don't know, uh, you know, there's so much to dig into here. I don't know what is more important, the technology obviously, but then the education components also, you know, majorly important. I think we are entering a place where, because of where AI is potentially going over the next few years, people are going to need to make more money in different ways. And I think that the stock performance and retirement and the way that their assets are repositioned is going to have to play a huge role. If you're making, you know, now needing yield or income based investments as part of your portfolio. Like there's so much going on. Uh, and then of course all that has like a, you know, reverberation effect to those that are in the finance industry who previously made a certain percentage on the managed assets and, and everything in between. So, um, you know, I'm excited to see where things go well.

Speaker D: And there's one, there's one thing that's happening in these private markets right now too though, that aside from technology or advancements in AI, maybe one of the things that's happening right now too is that there has been a gradual shrinking of actual available public securities to trade and buy. So if the large majority of people that have money to invest sit in the retail individual investor world concentrated uh, in a large part which is the space I function in an IRAS 401ks not just taxable brokerage accounts. Well I mean also in this entire century the number of publicly traded companies has drastically gone down by a lot. I mean we live today in a world where the stock market is effectively dominated on the daily ups and downs by the same five, six, seven companies.

Speaker C: And it's only about 10% of the total companies over $100 million in revenue annually. It's like 10% are public. The most 85.

Speaker D: Most of them aren't like uh, I look at it now that that a great example right now that there's probably people like you would be privy to maybe late stage private investment round opportunities to go into an open AI. You know we'd mentioned Chad GPT earlier uh the owners of Chat GPT. Well the amount of money this is a non publicly traded company, it's a private company but the valuation that it's trading at is prob. Probably higher than maybe 475 or 450 or 400 of the S&P 500 publicly traded stocks which are supposed to be our bellwether for the largest, most sophisticated, most stable companies in the US But I'd venture to guess that it's trading privately at a higher amount. So if individual investors, they have no option to invest in these types of companies. Well you know I think the, the space that you're working in is to allow people to get some access into those private companies because they just aren't publicly available. I mean you know Amazon went public when it was doing 30 million in revenue. You know anybody could have bought that.

Speaker C: That, that's the part of this I think that is you know most important for the investor. And, and then you know what I want to also do is like we talk about uh, the way in which you guys do it which I think is all equally as important of like what the asset is, is the asset structure, how you invest. Um but I think what we are seeing and there's like brand new stats that came out literally I think it was like just Friday. You've got a handful of companies have recently gone public, have had actually good performance, you know up 24, 25% which is great. But traditionally the last few years and I don't want to like just isolate the last few years like as if that's the future because it's been a weird last couple of years post Covid uh but the IPOs have not been great and I don't want to prospect on why all of them weren't great. But I will suggest that the valuations

Speaker B: at the private market level have been

Speaker C: ridiculously high to where when a company that has basically little or no profit or is like not profitable matched up with the private price that they had pre ipo, they're being market corrected. And what ends up happening is that like even Reddit, which I think has had a pretty, had a pretty ridiculous run up, then they're down, now they're back up, they're probably like 40 or 50% of what they were uh, at their peak after IPO. It's been a really good investment for me. HIMS is another one that generally did pretty well. The question for me though is that to your point about Amazon is that the regular individual investor puts into Amazon, uh, when they're 32, with a kid on the way, maybe just bought a house, they're selling Amazon today up many, many, many double digit X, probably able to pay for college. Hopefully my kids won't even be able to go to college because they'll just use AI or whatever. But like I'm sort of joking but

Speaker B: not right, you know, so like Amazon

Speaker C: was uh, an investment that was gonna pay off in 10 or 15 years and if you kept with it or you kept buying it, it certainly has paid off. Ah, you know, many fold and Google and others meta at this point too. Um, that doesn't exist now because these companies to your point go public way later. The valuations are already juiced and by the time they go public a lot of it is like swapping private, you know, hands with, with retail hands and it's kind of not a great, you know, deal so.

Speaker D: Exactly.

Speaker C: In my mind like I'm trying to give investors the ability to maybe not like this has existed since you did the campaign with Rocket dollar on Republic. They can get into some, not all and not even the best, uh, venture deals at the early stage through crowdfunding. That's not, I don't think, a great fit. I think it's useful. But what really is important is like the series B, C, D, E, E where you start getting into the pre ipo, it's probably going to be eight years while they're still private, but there's still growth room left and that's the part they have no access to. And then to your point and everything you've built with your companies, if you're gonna be holding onto it for eight years because they're not liquid or even if they were to be tokenized or whatever, they're still in the growth phase. Why would you do it with your normal tax paid dollar? Why not do it in a tax advantaged way? And I think that's where the two worlds kind of come in, come and colliding here.

Speaker D: Well, and you know the answer to that, why? I think, uh, people ask me that question all the time and you know, they think my answer is always going to be that well, it's because, you know, you would be able to do it if the company does extremely well or the investment does. Does extremely well, you'd minimize the tax burden on it. But um, my answer to that question of the why is actually a little different. It's that the monies that are in these accounts and held by the average American retail investor are structured, they're given those tax advantages because they're required to be long term investments. So if at the age of, let's say 27 for us probably only about five years ago, I'd say right, based on the way we look, um, yeah, I'm just kidding. We're way older than that. Um, um. But if you did that, if we put that money in five years ago or 10 years ago or 15 years ago, the intent is that to get the tax treatment of those accounts or the monies in those accounts and the investments that you make with those, you're not supposed to take money out of it until you're post 59 and a half. So the idea is that they're long term. So one of the biggest drawbacks of private investments is that you don't have like a mark to market. So you don't know the value of it all the time. Uh, because the reporting is limited. Right. Uh, the other one is that it's designed to be a long term hold. You can't just sell out of it tomorrow. Well, the monies that are in these accounts are actually already have structures to where they should fit that. That's the why of why maybe you should allocate those dollars to these investments. Because if you chose to put $1,000 into your IRA as a contribution back in 2018, the idea is that you aren't planning on spending it today on June 30th of 2025, you know, unless you made that investment when you were 52 and a half and you are able to retire at 59 and a half or 61 or 62. But if you made that investment, you were 27 years old and you're 37 today, you know, eight, nine, 10 years later, you're still not supposed to use those dollars for any uh, personal consumption. It has to go into an investment. It's by virtue of long term holdings. So it matches up. Now the market dynamics change to where there's an open AI uh that trades or a SpaceX that trades at well in excess of 100 billion, maybe even 200, maybe even $300 billion right now that is not available in any way to a retail investor by clicking a button on Robinhood for example. So the thing is that those opportunities aren't there. These companies have already passed those growth stages. But you know, maybe um, you know my whole thing is I didn't create any of these investments. There's a lot of super smart people creating and I think they go on that term. I've heard this for years. But that democratizing access to private investments. And I think to myself that uh, I'm not that smart or creative. I'm more of like a picks and shovels guy thinking that there's a ton of money sitting in these types of accounts. Maybe I could just help people deploy those dollars into the creative investment vehicles that someone else created to go into these private and alternative investments so that all I've done is like just created an avenue for people to access money that they already have to go into investments that someone else needs to create the vehicle for them to access.

Speaker C: Yeah. And I think I agree with you. And I would also say I'm more of a picks and shovels myself. Like I'm looking at it like all of funds are trying very hard. They're doing you know, securitizer and tokenization.

Speaker D: Yeah.

Speaker C: Which I know that it's the talk of the day for sure today with, with Robinhood's uh, announcement everything is on their own. Blockchain layer 2 or whatever. Call me when we get there. Like you know, as far as I'm concerned until I am like the actual name on the equity piece. And it's not like some switcheroo that like I just there needs to be a full secondary exchange for token where like my asset is one to one or even even better, it's valued with appreciation that I can trade for unit if I can't. And it's just a secondary where I get out emergency latch like that's insufficient to me and doesn't seem like a financial system that I would probably lean on. Um, so from my side I'm looking at all of the different um, opportunities that are long term like Again we talked about this, I think offline, but just now even a little bit, like certain types of private investments are suited

Speaker B: to be left alone.

Speaker C: Like that's what makes them valuable is the time. It's sort of like the gem turned a diamond, right? Like coal to diamond. It's time and pressure, the same thing. These companies need time to develop, grow all this stuff to take an asset or even an infrastructure fund where you're talking about real assets. If the long term private capital lack of volatility is what makes them able to grow the way that they do, you coming in and in and out and selling in and out is completely nullifies the value of the private investment and probably compound interest and probably tax advantage as well. I look at it like all these different funds are looking for a ways to access retail. They don't totally know how to. And just making it available to purchase is not sufficient because there's an education layer, there's a liquidity layer, there's all kinds of stuff. So, so if I can help educate and grow the retail base and say, hey look, here's all these assets that are important to your future, then I can connect them with people like Henry who are like, here's a way to take money. You don't even need to go find new money. This is money you already have sitting there. Let's put it to work.

Speaker D: Exactly.

Speaker C: And I think that that is where this has a lot of potential to, to unlock things in the future for sure. Oh, uh, lost you for a second. You there?

Speaker D: Yeah, yeah. Sorry. You froze for a second.

Speaker C: We got. Yeah. Saying we got cut off. It's all right. I literally ended it right as you froze.

Speaker B: So we're.

Speaker C: I'll edit this part out.

Speaker D: Uh, yeah, yeah.

Speaker C: All right, cool. So where, where do you think, like walk me through a little bit of how the retired component you kind of tied out what rocket dollar and, and bit Ira and this are. Where do you see this going future wise? If people are going to have more exposure, more awareness of private, they're obviously going to learn the different tools. How do you see the future of private and retail kind of going as if, you know, talking about the article that you answered for earlier today, where, where do you see this going? Because I, I think there's, I think this can go in a lot of directions, quite frankly.

Speaker D: Well, and, and at first they will, they'll introduce a, A uh, light, easier way for retail investors to get into private equity. So um, let me explain, um, that right now most people end up accumulating the larger dollars that end up in their IRA by virtue of contributions to a corporate 401k or a like kind plant. If you, you know, if you work in a different type of organization, not corporate America, but. So let's just use 401k here, right? That's where people typically accumulate their wealth. And the reason why is starting in 2005, um, the United States government passed a rule to where people automatically get enrolled. So sometimes people don't even proactively make decisions to join a 401k or contribute a portion of their salary. They're automatically put into it. So they accumulate dollars. I think a lightweight way to introduce private equity into that without exposing people to uh, the risk and danger of they may not know how to evaluate which funds or what to do. It's going to be a menu. 401ks are always determined by a menu. Now inside of that menu they're going to have set fully diversified options based on time you have until your retirement date date. So they're called target date funds. I um, think the first iteration you're going to see is partnerships between large tier A private equity firms like let's say Blackstone recently partnering up with an Empower or Blackstone also partnering up with a Vanguard. They're going to basically create a fundified version of their private equity fund and make it one of the parts components of a Target date fund and then introduce that Target date fund with a private equity sleeve to the retail individual investor. That'll get them more comfortable. Um, and that'll have have them exposure. They just won't know directly how much they have or what they own. But it is exposure to private investments. And just so you know, some of these fund companies have long invested in what you mentioned earlier, late stage private companies for a long time. So you know, T. Rowe Price invested in Google pre IPO and they had that in their regular retail mutual funds. Like whether people knew it or not, um, you know that's beside the point. It's just that they've had the capability of doing so. So that's a lightweight way to introduce that. Now they had private equity, they can see how it diversified their portfolio. When they choose to leave that 401k or the company that sponsored that 401k and they want to go into an IRA, they can maybe like uh, decide to go more directly into a private investment. So they could look for a platform like Republic, uh, and go search and research companies on their own. They could go look for their own real estate deal and so forth. So it's just a way of getting people a little more comfortable, I think, uh, over time. But I think, you know, if we stair step, baby step into this, then you're going to start to get a world where five, ten years from now, people are going to have a large component of their investment portfolios, both taxable and non taxable, uh, sitting inside of private, non registered alternative investments. And it's just going to be normal. Just like right now, whenever you ask someone about their stock account or their investment account, they'll say, oh, I got a few funds and then I trade a couple of stocks. People didn't talk like that 15 years ago. You know, you did one or the other. Uh, and then if it was more than 15 years ago, there was like a very small component of people that did the stocks, and the vast majority of people just did the other, which was just handed over to an asset manager. Right. So I think in another five, 10 years, those conversations are going to be that, well, you know, I do this combo like I'm in, I'm in a couple stocks, but then I also do some private stuff, uh, and they're going to do it in the same account. So that's the capability we're trying to build. But that's the future I see, because I also see a future where my youngest child is nine. So I figure right now it's about 50, 50 on whether she might have to learn how to drive. But you and I, we have a friend, um, who has a child today. I'd probably be willing to bet 85% they would never need to learn how to drive a car.

Speaker C: I totally believe you. And it's insane to think about. Fortunately, My daughters are 4 and 6, and if you saw them, how they drive a scooter, I'm very thankful that they may never know how to drive a car.

Speaker D: It's unreal. But, but, uh, the odds are even higher for you than, than, you know, the world tends to change very, very quickly. Right. Like, I mean, you know, your, your aunt and your grandma learned how to use Facebook, and seven years later, they're talking to their phone, which is an AI agent.

Speaker C: We are, we are about to enter some uncharted territory. I think it's, it's, the timing is, I'm not a huge believer in random. Uh, but it does feel a bit like, wow, the chances of AI happening and the changes coming down the pike here, along with the tokenized.

Speaker D: Right.

Speaker C: Um, you know, it's all kind of linked together, but there's There's a huge second act coming here where I think people are going to be.

Speaker D: There is a finance different. These asset managers, uh, these private equity and asset managers, I mean there's a reason why they're looking for these dollars. I mean, uh, I think that there's a chance too that if they can tap into a whole new source of capital, not just relying on institutions, uh, uh, high net worth individuals, family offices, endowments, sovereign wealth funds around the world. If you get an influx of capital from a completely different segment that they couldn't tap before, I mean the, the, I think the, the global hope is that you'll just have more economic output and the world will be a better place because these people are now able to access the capital, um, and so forth. I mean you remember going public was a way to access capital. But if these private investment folks can actually access capital more directly, I mean this could be an infusion of trillions of dollars.

Speaker C: I think it's even bigger. I mean I think you and I both been around long enough to know things are cyclical. And everything you just described reminds me of the first version of, of IPO and then move it to app self directed private in 10 years, probably five years because everything's even faster now. You're probably looking at like picking private investment opportunities the same as you do mutual funds and ETFs today and probably doing it on you uh, know, the same app or other apps that you use. The, the other part of this and you just nailed it I think is one, uh, is you know, smart thinking by the firms and funds that they want to get into new capital sources. I don't dispute that. And that's just smart business. The other is if you're looking, if you want to tie it to AI, you're looking at the eye and you're going well we've, we've raised about 80% of our money from endowments. So whereas endowments, if kids are not going to university the way they previously did, we raise all this money from pensions. Where do we go if there's the mind force, the new, you know, quote unquote, uh, mindshare people are not working anymore. White collar is hit like we're like, I think they're looking for it. And then at the same time, uh, you and I are probably looking at generational wealth transfer somewhere around 70 to 80 trillion dollars plus over the next 10 years, five years potentially.

Speaker D: Exactly.

Speaker C: And of that 65% of that money is going to go to females, which currently this will probably Blow your mind if you don't already know the stat. Less than 3% of financial marketing is

Speaker B: spent on women that I did not know.

Speaker C: So how in the hell are they gonna like, expect to bring, you know, a new clientele of investors in who literally they've never marketed to? Uh, there's just, there's, there's so many reasons to do it now. And I think I, uh, just think the timing is just. It's an incredible time to be building in this space. And you've been at it for a really long time, which I'm jealous of. And I'm kind of coming into it after dancing with it for a while. Um, and it's just like, holy shit. Like this is just so much going on, man.

Speaker B: It's crazy.

Speaker D: Yeah, I'm just a big believer that it's a nice symbiotic circle. Right. Uh, these private equity folks, they need to access different sources of capital. There's a whole segment of the population in, uh, there's a large aggregated pool of available capital. So if you can match those things up, then business gets created, production gets created, you know, equity gets created. And um, that's kind of the whole point. And they get to share in it. Because right now it's been sort of a very closed game. But that's been by virtue of a couple things. One, maybe there wasn't a technological link, the data was hard, there's rules and regulations in place. But those things are starting to break down and they're starting to, you know, come together. And I think it's a good thing actually for retail investors. Are there dangers and risks involved? Yes. But again, I think that the industry will find a way to, uh. Every different player will play a different part, including legislative sides. And they'll end up like helping people stair step into these things. And we're going to end up with a world five, ten years from now where it's going to be very, very known, but it's going to be very, very productive as well. Because this new capital came in, the new capital was deployed efficiently, businesses were created, jobs were created, production was made, and all of a sudden everyone has more wealth because of it.

Speaker C: Well, I hope you and I are two people sitting on the top of that hill looking down at that and have had a big part of it,

Speaker D: because I hope so too. Yeah. And then, you know, kids today will have a lot of time. Cause they won't actually have to drive their car and they can think about other things.

Speaker B: But I don't know what the hell

Speaker C: they're going to do. I honestly have. I don't, I get that's where the show will end because I have no answers to.

Speaker D: I've been riding around self driving, you know, Ubers and Waymos right now. I don't know if you've been doing that in your spot.

Speaker C: I haven't done the Waymo yet. What's your. We're going to do a on the fly picture view here. What's uh, what's the Waymo experience like for you?

Speaker D: Uh, it's, it's a great experience. I mean one is that uh, you don't have to worry about the interactions of the driver.

Speaker C: I was just gonna say you're probably like me. It's like that's what I dread the most is the awkward whatever. And that's like, I just don't want to have this conversation right now.

Speaker D: Exactly. So you avoid that part. Um, it, it doesn't want you to. You don't do any tips. So Austin's a big city downtown, so if you it. Call, call an Uber, you pick one. Um, you know, chances are you could get assigned a self driving car or one of the test cities for that. So you get one like every, every third time you order one, you take your trip. It's just a nice experience. It is a little bit trippy to see the steering wheel just turning on its own.

Speaker C: Well, you know, most of the Teslas, and I assume the same for way more, are the wireless wheels. So it doesn't even matter. Like the wheel's not connected to anything anyway. So it's like once I knew that like engineering wise, I was like, well, like technically in my own car, I couldn't do anything to stop it. So like, what's the difference whether it's a driver or not? Because it doesn't matter.

Speaker D: You know, I haven't seen any of those Tesla Robo taxis that's also been tested now for the last week and a half or so in my city. But I haven't seen one, uh, on the road yet. So maybe someone else is listening in my area.

Speaker C: He was tweeting about it, he was tweeting about it yesterday that they should be out. He just had another, another one in Austin that was uh, from the factory to the house. So I, I would imagine you'll see more of it.

Speaker D: Okay. Okay. Yeah, but you know, it's just those changes are coming so, so fast and it's, it's great. Right? Tesla is available as a publicly traded company. This is a whole new market. They can get into. Um, but you know, I think if people can get in and access more of these, these private capital opportunities, it's a symbiotic thing. Now can it happen like overnight and right away? No, it can't. And do, uh, the customers that we have at Rocket Dollar, you know, they are, they're researching these deals on their own. So we've largely been a, we don't, we don't recommend any investments. We don't provide any investment products. We, we literally only give people access to their own money to go into deals that they found on their own though those deals could be to be an LP investor into someone's private fund or it could be to go buy a rental property, um, somewhere where they feel like they have the knowledge and the edge to go own and operate and be profitable by owning it as an investment. So that's up to the customer. Uh, again we're probably for that person that's much more comfortable with alternative investments. But I think that if you want to do it more broad based, you start by these partnerships between the private equity firms, record keepers and asset managers. Introduce them in a packaged way to the 401k retail investor and then that trickles down. They could just get more comfortable and know that I think that's the process.

Speaker C: Rocketdollar.com I have to plug it because I don't doubt it was a cheap acquisition. Retired dot com. Um, and then is that we're all like, do you write blogs still? Do you still do any, any of the media stuff or is there a place to follow you for that?

Speaker D: Uh, so we still do that. So we have, we have handles on social, on all the social channels for Rocket$. Uh, more so than retired dot com. Again that's just the parent company name right now. But there's a lot of information actually on how you use IRA dollars to go into private and alternative investments. You don't have to be a customer of ours. This is just if you're, if you're skeptical or wonder how the process is done. You know, there's a lot of articles there that you could see, but uh, you could follow us there. Rocketdollar.com uh, it's exactly how it sounds. R O c k e t$d o l l a r.com and you can find out about us.

Speaker C: Awesome. Well, thank you so much for taking the time to join the show.

Speaker D: Thank you. Thanks Scott.

Speaker C: All right, that's our show. I'd like to thank our uh, featured guest here, Henry Yoshida. Uh, our sponsors, King's crowd and as always, executive producer Sam Pitts.

Speaker A: Break the rules, take the heat you're nobody's fool you're at your best when the corn gets rip you've been put to the death but it's never enough you got to touch.