Fintech vs. Traditional: Guideline's 401(k) Growth Model

[0:06] Speaker A: Yeah. [0:07] JD: Welcome. Welcome, everybody, to another episode of Retire. [0:09] Speaker A: Alex. [0:10] JD: That's our new intro song. We'll be playing it for the rest of the year. I don't know who that is. [0:15] Chad: Oh, God. [0:17] JD: Let's see. We're gonna go straight into headlines. Straight into headlines. Brandon, you got a little graphic for. [0:34] Kevin: Yo, [0:37] JD: what up, my 401k peeps? It's been two weeks too long. It's good to see you again. Trans America. Good old Trans Am. And Smart partner on a pooled employer plan. I saw this headline and I started scratching my head. I was like, wait a second. Smart to remind everyone, was this company that came over from the United Kingdom, and they had crushed it in the United Kingdom with their version of pooled employer plans over there. They're the main go getter when it comes to those things. So they figured, hey, let's reconfigure this, come over the United States and crush it over there. So much to my concern or confusion when I'm partnering with Transamerica. I thought Smart was a record keeper. So does anyone have the answer to this or you as confused as me? [1:33] Chad: I thought they were doing more financial wellness when they came over and rolling out their solution on originally the Trans platform. I thought they were always utilizing their back office. [1:44] JD: No. So I picked up the phone and I called Danielle, and sure enough, she confirmed all of my suspicions. And she didn't tell me. I couldn't share this information, so I'll share it with y'. All. Turns out that Smart got over here and maybe. Maybe our guests can comment on this a little later. Smart got over here and we're. We're. I don't want to say unprepared. They got caught off guard with the complexities of the United States regulations as it relates to ERISA and 401K. [2:22] Speaker A: That's a new one. [2:24] JD: And. And so self. Admittedly, they say, whoa, okay, we still want to be a record keeper, but we're gonna. We're gonna put it off or not put it off. We're gonna need to be working on it for the next few years till we come to fruition. But in the meantime, let's pivot. We've got some sick technology, according to them and what is it? And [2:48] Chad: Mark was waiting for it, and [2:49] JD: we can lay it on top of record keeping platforms like Transamerica. So I said, tell me more, Danielle. What are you talking about? And she said, look, it's. It's like about. [3:02] Speaker A: Too late, Brandon, you. You can't. [3:04] JD: No, no, it's like Their, their enrollment process. We might talk to Kevin about this later. Like we can enroll people in 10 minutes or less and, and bring them on and set them up. So that's kind of the thing with this. But I just wanted to bring it to everyone's attention because. Caught me off guard. I don't know. You're a big shot, Kevin. Do you pay attention to smart? They had a couple hundred million dollars in VC backed funding. Damn it, I didn't do that one on purpose. [3:31] Kevin: No, honestly, I'm not being a dick. I just haven't heard of them before. Except for this. [3:36] JD: No, I think they're pretty under the radar. But they did look them up. They did have, I want to say, north of $100 million and in funding to get this. [3:45] Chad: Well, and they, they weren't starting from the ground up. [3:47] Kevin: We can talk about that. That's not a big deal. [3:50] JD: Yeah. Oh great. We're going to talk all about that. I love it. [3:52] Kevin: Funding is funding. [3:54] JD: I'm excited. [3:55] Kevin: What you do with that money is funding. [3:57] JD: All right, so anyways, don't forget to, to kind of check in on smart. They bought Stadium. The money manager. Did you have a thought, Chad, before I move on? [4:07] Chad: Well, I guess I'm just a little curious. We know that the pooled employer plan space Trans has multiple solutions there, right? They, they partner with TAG in the past. They've built out other different back office solutions. [4:23] JD: They've bought tag, by the way, just [4:25] Chad: so they have now. Remember the conversation we used to have? [4:31] Speaker A: Very distracting background. [4:32] Kevin: Sorry. [4:32] Chad: It is the conversation we used to have. Them. Excuse me. People would come to us and say we want to use plan Premiere at American Funds. We would say, well, essentially it's the chassis of Great west and Fast Core. Like maybe we should look directly at that. I feel like that's almost where we're getting in the pooled employer space is that if we're going to be using Transit's chassis and transit systems and Trans's back office and Trans's technology, why don't we just go straight to trans? Yeah, right. [5:01] JD: Well, SMART would tell you because they've got this overlay of a user experience that's slick. Remember Chad Parks with Ubiquity? You know that name, Kevin? Chad Parks Ubiquity? [5:13] Kevin: Yeah. [5:13] JD: And the deal that he did with Principal Financial Group. Why, why, why did Principal do that deal with Chad then? Chad? [5:22] Chad: Well, I mean that one made sense for both sides. Principal is not profitable in that micro market space. They didn't want to touch it. And UBIQUITI is looking, saying we've got the scalability to go ahead and offer this. We don't need the marketing, we don't need the wholesalers. We don't need to. To pay those people to get out there and bring us business because principal is going to do it all for us. [5:40] Kevin: Is this a big deal at all? I mean, do you guys sell a lot of pooled employer plans? [5:44] Chad: I like this guy. Oh, Transamerica does. Yeah. [5:47] Kevin: What did they sell? I mean, honestly, like, we don't even compete with, you know, it's going to [5:51] Chad: be the funny part. Neither do we. [5:57] Speaker A: What? What'd you say? [6:00] JD: What's going to be a lot of fun is. [6:02] Mark: I heard it too, Mark. [6:03] Chad: Okay. [6:03] JD: When they. When they file their. I'm waiting for when they file their 5000 500s. And we'll be able to dig through all of their numbers and see how successful some of these pooled employer plans have been and how many other. But it's nice to hear you say, Kevin, because I've gotten in some recent fights with pro pooled employer plan people and saying, look, my guys sell, you know, a couple hundred plans in the course of a year and we never run into them. But to see you who's selling like 14, 15,000 plans in a year and you're saying you're not running into them makes me think, you know, never. Yeah, interesting. [6:45] Kevin: We never see. [6:47] JD: Really. Okay, let's. Let's show Kevin what we're all about. Let's spin the wheel of ice. Get out of the way. Spin it up. The wheel of. The wheel of. [7:03] Chad: Been so long I don't even remember. [7:08] Mark: Like getting. [7:10] JD: It's my Lord again. Okay. [7:11] Chad: He's batting.600 on 20, 23. [7:15] JD: I'll let you then set this one up. Chad. This was an article that our beloved chat bar guest, Jim Sampson was in. [7:26] Speaker A: Is he even here today? [7:28] JD: I don't know. [7:29] Kevin: He was. [7:29] Chad: SAMHSA was here earlier. [7:31] JD: It is titled why More Advisors are assuming. No, wait, that's not the article, is it? [7:37] Kevin: Yeah. [7:37] JD: Why more advisor assuming the 338 role responsibility. But it goes on more to talk about the core menu and. And why in this. That is not the article. I'm sorry, I'm on my iPad. [7:49] Chad: The article is about setting up a core menu in an unprecedented times. You have inflation climbing, you have interest rates changing. And it goes on to say, well, a lot of people are trying to figure out what to do now. And Samson and some others were ahead of the game and have always had investments in the Menu, like I don't even know Treasury. Some of the tips. [8:12] Speaker A: Yeah, just say the acronym. [8:14] JD: Isn't it Treasury? [8:20] Speaker A: All I know is as I read that article, my first thought was no way that Jim Sampson said any of this. So I believe that he had artificial [8:28] Mark: intelligence do it for him. [8:31] JD: There's a theme through this article and maybe we'll get Kevin's thought on this first and then, and then puns it to you guys. There's a seam. A theme in this article is they're interviewing advisors where they're explaining how their processes be hands on and one on one education and how this is an important role. Mostly when they're sitting with people who are older, have built up some wealth, they're reaching their retirement age. We all know about sequence of return risks and all that kind of jazz. But, but in this, as Chad mentioned, in this high inflation mode where by the way, fixed income performed horribly throughout 2022, it's these advisors that are kind of waving their, their flag of being proud of, like, look, we're the ones that are able to talk to these people, give them other strategies in the core menu and help them. So my question is a simple one. Is that a cool thing? Like, is that, is that something advisors should be proud of going forward? Is that, is that a reason why they exist? Or can we just replace these fuckers with AI bots and those they can help them with the same? That's to you, Kevin. [9:39] Kevin: Oh, that's to me. [9:40] Chad: All right. [9:41] Kevin: Yeah, we do that. So I don't know, there's a time and place for everybody, I think. We don't do individual investment advice. So we don't have, you know, we're not individual investment advisors, so we don't take that sort of customization. We have a set fun menu that essentially we deliver a model portfolio to you through with like a suitability algorithm. So we don't take the individual route at all. And that's intentional because of the ria where like Internet based ria, not a damn it. Investment advisor. So. But I totally see value in having these advisors. But I don't know that you know, guaranteed income and all that sort of stuff is right for 401k. [10:34] JD: I love how Kevin answers on behalf of guideline as opposed to just like the industry as a whole. But that was insightful. It's good. So Chad, back to you. Like, it made me kind of, my heart kind of swelled, like, wait, there's a place for these guys and girls and if they execute well, like this could be important to plan sponsors for [10:53] Chad: for, for nearly 15 years. I have a. Well, not quite because the share class game was heavy 10 years ago and beyond but I've essentially set the stance of like the the investments are irrelevant from provider to provider because you're going to get an institutionalized share class and if you're a good advisor or good338 you're going to be able to set up something solid. That story is starting to change. I. I think with some of the opportunity to set up certain investments maybe guaranteed is one of those. Maybe fixed income is a different one. What I struggled with in this article and JD My heart did swell. My heart swelled saying people are, are proactively thinking about the lineup once in a while and, and doing something that is in the best interest of the participants. That creates some complexity and makes it harder for them to run their reviews. And, and in the article Samson's talking about I had to tell clients like hey, I know. No, there's no money in this. There's been no money in it for five years but at some point we may need it. Well, that points now what I didn't like and what bothered me. [11:58] Speaker A: Jim, Just like thinking ahead. [12:01] Chad: Kevin. Kevin, you're gonna love this. What bothered me in that JD is is the strategies that he's talking about. Having access to many different fixed income solutions doesn't really exist in the micro small market space. Your fixed income opportunities are with the record keeper in which you're choosing very few. Right. You might have because that's where they're getting their spreads. And so I think while I loved that article, I looked at it going here we are again. The upper market is getting access to stuff the small market can't because of profitability for these record keepers. [12:35] JD: That's a good point. If you're a, if you're an older participant in a small micro market plan with all the record keepers we don't have to name now your advisor couldn't even go in and add any kind of like interesting fixed income option to the menu because they're not available so [12:51] Chad: they can't have a competing fund with what is. [12:53] JD: We'll move on from this. But I do think it's so funny that you know the re these regional banks are on the headlines now and, and Kevin, I, I was a proud member of the Silicon Valley bank. So that's where I banked. [13:06] Kevin: Sorry man. [13:07] JD: But not only did all these banks not foresee that interest rates were going to go up, which to me is silly because we all knew that they were eventually going to have to go up. But also the target date funds in our industry had these sleaze that were negatively impacted by this. Like the, the very income funds that we relied on had bad investment choices in this area and we all knew that this was coming but yet we failed to make any like any real decisions around it that made. That helped anybody and everyone just got fucked by it. Basically we followed the same old asset allocation model and a lot of people got fucked when equities and fixed income went down at the same time. But we'll move on the American retail. [13:53] Chad: Let me, let me make one more comment JD because we're talking about the inflation and the, the effects of interest rates on three different calls in the past week. On the cash balance side there's been a struggle. Not ours, cash balances. Where I'm, I'm analyzing but it's. It would happen on ours too where advisors were heavy in the bond market because it's a cash balance. We're looking at 3 to 5% rate of return and they got annihilated. I mean they're looking at a 7 to 8 to 9% negative rate of return for the market in 2022 and some of the investment floors they created and the minimum funding for the cash balance is high. This goes back to the point of the heart swelling like advisors who are staying in tune with the market who are actively helping their clients, especially in the cash balance space, actively helping them create a menu that's. That is meaningful to the current day and not just setting it, forgetting it. There's a huge value there that I think didn't. Wasn't talked about since what, 2010. We've been on this heavy bull run like it hasn't been a big conversation and it needs to be. [15:01] JD: It's definitely more viable now. This is how it always works right in finances is now that we've gone through what we've gone through, you could sit down with prospects plan sponsors and talk to them about the nuances around rising inflation rates and the type of investments you could have in your plan and why didn't you. So it could be a great sales tactic but I want to move on to the American Retirement association and how they have just some genius people over there in the marketing space. Let me explain. Recently the area has come out with a debate and Kevin, Mr. Guideline, notice when I, when I go afoul of the rules, I don't drink from my Mexican lager. I drink from the fucking vodka. [15:52] Chad: And that he Filled with a lot of work, Kevin. [15:56] JD: They recently came out with a. With a podcast that was a debate style show pitting two people against each other. I actually participated on that. And isn't that innovative? Isn't that cool? And then recently, they came out to promote their spring national conference with. Wait for this. [16:12] Speaker A: A poem. [16:13] JD: A poem. [16:14] Speaker A: Did you write that? Yeah. [16:16] Mark: I was wondering, was it. Was this 75 related or. [16:18] Chad: No. Yeah. [16:20] JD: No, but where did. [16:21] Speaker A: I honestly thought. I'm like, oh, geez, why are you. [16:24] Chad: Nobody did. [16:25] JD: Where do they get these great ideas? I don't know. So we'll move on. Income America. [16:31] Mark: Hold on. [16:31] Chad: No, no. Toot your horn, jd. I've sent your. Your great debate with Pete Swisher onto a number of people now. Damn, dude. That was 19 minutes of enjoyment like that. The way that you guys handled that, John, getting you guys to. To come at one another, but in a respect, like, it was solid. It was really good session. You guys did that. [16:52] JD: Well, thank you, Chad. I appreciate it. [16:55] Chad: It's mostly Sullivan pulling it out of [16:57] JD: you, but I think I KO'd Pete, but I'd be curious what the chat bar things. Oh, I've got to be kidding me. [17:05] Mark: I missed. [17:05] JD: Okay, Matt Wolnowitz, our buddy, is now at, you know, Income America. And if you remember, Income America was this consortium of, what was it? American Century, State Street Global, I don't know, a bunch of different companies. And here's the news. Hey, guess what? You can get Income America and Nationwide Financial. Well, no, Sherlock. I would have thought that would happen eventually, since Nationwide is part of the consortium. However, as you read this article, I started to get more and more confused, and I don't know how these things work. So it doesn't seem like Income America is now like, a guaranteed option at Nationwide. Based on this article, it looks like through the managed account service offering, and specifically through Pro Accounts, which. Which is Nationwide's proprietary managed accounts, you can gain access to Income America. Is that how you all read this? [18:03] Chad: Yes. Yeah, I don't know if it's gain access or if it's a sliver inside the Pro account. [18:10] JD: Is Pro Accounts just using it as kind of. [18:14] Chad: The way I read it is that they're using it as a guaranteed fixed income portion of their portfolio. [18:19] Speaker A: I thought that was only one of two options. No, that was the first. [18:22] JD: So they talked about their target date is also available in the program. Um, but here I go again. I. I feel like. And you don't need to throw up the graphic, Brandon. I feel like a lot of these companies are pivoting again and they're going at it one way and then realizing that that's not going to work and then trying some other way. Maybe I'm reading way too much into that and I apologize because I love a lot of those people. But you know, this whole debate around guaranteed income. Kevin, you're running, you're running a big record keeping firm, 40,000 plans. We're going to talk about it the second half of this show. Yeah, you kind of alluded to this earlier. Do you have, do you have very little interest in, in plan guarantees? Are you, is Guideline not looking at this stuff at all or are you just. No, you're shaking. [19:05] Kevin: We don't look at it at all. Like it's not, it's not in our purview. It's not. We look at retirement up to the vent right now just being like the company that we are. We're developing software up to retirement after retirement. We're not handling that yet. [19:22] Mark: Okay. [19:23] JD: Yes. [19:24] Mark: So there's plans too, I feel like. [19:26] Kevin: Yeah, I mean we have a road map, right. And it's, it's in anything in and around retirement. So we're looking. I'm going to start looking at, you know, health savings accounts, all that sort of stuff. [19:34] JD: Let me write down that road map in my notes. I like that. [19:38] Chad: I'm gonna come back, throw it up. If you gotta follow those dollars, that's [19:42] Kevin: what everybody else is doing. [19:49] JD: I think this is a great time, time to dive deep in with our guests. So this is a time of the show where you out there in the audience, you're gonna rate Justin on his midro and he's going to intro our guests at 0 to 10. Remember people, his job depends on it. So take it away, Justin. [20:06] Mark: He's a man that seems to have accomplished the impossible and turned JD into a believer after years of talking on his company. While the rest of us were scared of the sun. During COVID this man grabbed life by the horn and decided to become a or to get his pilot's license. He's a former army brat turned self made millionaire who sees who saw JD's Lambo and raised him by a plane. Ladies and gentlemen, Kevin Bus or Busky, sorry, CEO of Guideline. [20:38] JD: Welcome to the show, Kevin. I'm gonna let everyone know how this kind of all started. We were doing a show, I think in late January and as, as Justin mentioned, I talked about, Justin said a lot of vodka. I talk mad shit about Guideline and drinking a lot of vodka in My free time. [20:59] Speaker A: And I thank you for giving me that button, Brandon. [21:06] Mark: And every time I hear Mark laugh, I think he's actually laughing in real life. [21:09] JD: And I wasn't just talking shit about Guideline. I was talking about human interests and all the other disruptors out there. But, but yeah, I took some shots at you and then you had tuned into one of the shows and so when I got an email message from you, my first thought was, oh, like, oh my God, okay, the guy's actually listening to this. Like, and you were actually really polite. You said, like, hey, you guys got great show. Like you got a lot right. But you know, I think you use the word misinformation as well. Like a lot of, a lot of stuff kind of went. Wasn't totally accurate. And so I really appreciated that you reached out like that and that kind of gave fruition to where we are now. So now you're here. So if we could, let's split this into two parts. I'd like to start with kind of like the metrics, the finances, the stuff around guideline because it's, it's really impressive and I mean that. I'm not just trying to be nice. And then we'll play a game and then we can break for the second half or we can talk more kind of about like operational stuff and maybe the future of what you're doing. Because Chad likes the nerdy stuff. [22:13] Mark: Yeah. [22:14] JD: So you, in that email you wrote me, you said, hey Buddy, we're pushing 40,000 plans now. That's, that's public knowledge now. We saw, we saw a 401k wire article that tapped you guys in 2022 as selling almost 15,000 plans. Which by the way, like that's up there with the paychecks and the actual deferral percentage, people. So that's, that's pretty phenomenal. Like no matter whether you like love or hate you like that you cannot ignore them. [22:46] Chad: Oh, you're such a third party administrator that you used actual deferral percentage for what is their name? Which is not their name. [22:56] JD: Who cares? [22:57] Chad: Those guys Automatic data processing. [23:00] JD: So, so let's bring us up to speed here. 40,000 plans, 8 billion in assets. What do you think the participant count is? I'm guessing like three quarters of a million or something, or I don't know, about 600,000. And how has 2023 gone? Are you still at that pace? Are you exceeding it? [23:26] Kevin: Like, we're still at that pace. We had it. We had a big Q2 last year with Cal Savers. I Don't know if you guys, you saw that mandate, you saw that deadline. I know you guys have talked about it a bunch. So we had a big, we had a big push last year, but we're, we're essentially doing the same as we did last year, hopefully a little bit more. We got some exciting things to announce in Q3. [23:46] JD: You must see. [23:48] Speaker A: How do you incentivize your salespeople? What do you, what do you do for them? [23:52] Kevin: It's a good question. Actually. I don't, I don't. They have quotas, you know, and they hit quotas, they get bonus. [23:58] Speaker A: Oh, that sounds awesome. [23:59] Mark: Yeah, no, no quotas. [24:02] Kevin: But we're truly, we're a product led company so you guys would be surprised but 55, 50% of all of our plans and never talk to an advisor self sold. Right. Like come to our website, go through our flow, you know, eight, ten minutes later, they get, they got a 401k. [24:19] JD: You think that's direct, Kevin, or do you? [24:21] Kevin: Yeah. [24:22] JD: Or is that, is that. But, but does that also include a lot of like your gusto relationship and everything? [24:26] Kevin: No. So I would say it's a little bit different than that. So it's like a 60 40s split for us. So about 60% through payroll partners, 40% direct. But 92% of all of our 401k plans are on integration with one of our integrated partners with payroll. And that's really important to understand sort of the difference of guideline and sort of the traditional 401k administrator. We all know 401k is incredibly data heavy. That is sort of our bread and butter, right. As this new age record keeper, we integrate super tightly with all of the payroll companies that are cloud based and sort of forward thinking to be able to offer these services and these plans. [25:10] JD: But you weren't the first one to go to those types of companies and try to partner up. And I mean this in a positive way for you, like there's something that we can learn from you because we, long before you came around, we knew that partnering with payroll companies could be a strategy. But. But we just failed. We didn't make it happen as an industry. And. And the same is true of all those other integration partners you're talking about. So you did something different. Yeah. To get their attention. So to kind of back to Mark's question. In the beginning and today, did you have a big sales team, like did you have people in suits or quarter zips or whatever the fuck they wear running around and talking to people or did you literally just build this shit. And they came. [25:59] Kevin: Yeah, essentially we've productized. You know, the regulation begins with an E around it. We've done a lot on the plan setup side of things, but we've kept it. When we started, it was incredibly simple. Incredibly simple. So I saw a question go by here and like, how did you advise them on all these sort of ins and outs and plans? We offered something very basic and that's what we started with and that's what we integrated with. And our first integration was gusto and then rippling was our second. And we chose those folks because they're forward thinking and we knew we could build APIs that we needed to ingest the data and sort of administer made that 316 much easier. [26:48] JD: You can always finish your thoughts and save up your drink, but I don't know. That's crazy, Chad. So the very reason why I thought you would fall flat on your face was because I didn't think you understood distribution in our industry. And I thought that this, you probably heard this before, that this stuff needed to be sold, it would not be bought. Now maybe you are selling it. [27:14] Kevin: That's a great point. Like we didn't sell it. We didn't have salespeople. We had one. [27:19] Chad: You did though. You did. You did it through the payroll providers partner. They were your salespeople. You just said 92% of the business and 60% of the incoming business is coming from them. 92% has a relationship with them. So even if only 60% is coming from them, there's still a significant amount that is because of that relationship, that integration. And J.D. we talked about, we've talked about this for more than a decade and we even, we even looked into opening up our own payroll solution for a while because I truly believe that is the necessary step to be an effective offering in the 401k space. [27:58] JD: That integration, I can look back on it now, Chad, and say, well, how. How was. What's actual cert. I don't adp. I'll drink her. How is how was them and paychecks get their success because they were. Were killing us in our own marketplace. Right. They were always the number one and the number two of new plans sold in a year. Now you can all out there in the chat bar argue about their retention and how long they've kept these plans and how good their service model is or whatever. But my point is, is that they crushed it and they continue to crush it every year. It sounds like guideline and Kevin just kind of Took a slightly different variation on that strategy and executed on it. So I didn't see that coming. [28:44] Chad: And we've said for a while and Kevin, you hit it. You looked at forward thinking payroll solutions, right? You didn't go after ADP and paychecks, which is what others have tried to do in the past. Yeah, I'll drink that. You looked and said, we're a tech based platform. We want to work with forward thinking businesses that are willing to go there. And JD There's a marketplace for that. There's a marketplace for businesses that look at the 401k space and say, I'm sick and tired of, of what I've seen. I'm sick and tired of the, the big dogs running the, running the track and I want something different. And you guys have by far been a successful entity that has helped that. [29:24] JD: So, Kevin, one more time on the sales though. But someone had to go over and, and have a talk with these payroll companies with Gusto and convince them like you had salespeople running around talking to these partners and convincing them to hook up with you, didn't you? [29:42] Kevin: Y. I did it. I did it. These are, these are my connections. I convinced Gusto to give us a shot. [29:50] JD: You yourself did. [29:52] Kevin: Me? Myself? Yeah. [29:53] JD: So I'm. [29:53] Kevin: My background's also in software, so I'm not a finance person like y' all either. Are we more on the tech side? So, no, I did it and I told them what I was building and why I was building it. And it was because of a company that you mentioned. And that was the experience I had previously and it was garbage and I wanted to fix it and I knew I could fix it being a data person. So I built a record keeper along with my two co founders. And the trick there is like, we're not finance people, we are software people through and through. Guideline is a software company. And then we just layer on sort of the subject matter experts to help us understand all of the regulations around what we're building and how we should build it. That's a big difference between us and everybody else in the market, quite honestly. And that gives us that advantage when we can go to payroll companies and say, hey, look what we're building. Like you don't need. You have an easy way to attach to your user base, your payroll company user base, a 401k. And we can pay you for that as a solicitor. So we have solicitation agreements with all the payroll companies. And that was really important, right, because you all know, well, maybe you know, but when you attach an integrated 401k for 1k plan to payroll, the payroll, actual retention doubles. Right. The stickiness of payroll. [31:21] JD: Sure. [31:22] Kevin: And you know, adp. Sorry. Damn it. ADP and paychecks have a retention problem. [31:28] JD: Okay, let's stop there for one second. And first of all, I say this with as much humbleness as I can have is because you've clearly executed. But 360 payroll integration is something that Voya and empower when they're called Great west and Nationwide and principal were doing 15 years ago, like so. And that didn't take off for us. So we could run around and tell plan sponsors whether they're new startups or existing plans, hey, if you come with us, you don't have to push a button when it comes to your census. Like, that's in your payroll. That'll just funnel right over to your record keeper. Not a problem. Like that always existed. So I don't think that that's really what set you off on the pace for 40,000. I think it was you guys waving the flag of low cost, being anti establishment. I think you marketed yourselves very well as being anti Wall street, new Silicon Valley, which I think is. You probably hate me for this, but a lot of smoke and mirrors more than actual shit, but. And people bought on. And then you went to all your partners and they liked it and they kept going. And so again, I stand proven wrong. Like. But help me with that, Kevin. We always had the ability to do 360 payroll integration. You guys didn't fucking invent that shit. [32:51] Kevin: Yeah, absolutely. And there's companies that just do the integration. Right? And that's when you end up with all of these middlemen. So what we did in our breakthrough was to become a record keeper, become a 316, do the integration, deliver the product, be the 338, do a turnkey solution for these smaller clients that everybody else was ignoring. And they were ignoring them because they had. They didn't have assets. Right? So like the legacy 401k ecosystem couldn't monetize these folks unless they own the whole stack. But guess what? Nobody owned the whole stack but Kevin. [33:25] JD: But Kevin, my father started Plan design consultants in 1975, and he was right there in the Bay Area, and he sold plans to startup plans. We're coming up on 50 years. So this market that you're talking about being ignored, it's. We were servicing it for my entire career. My whole company is built on servicing those plans. So to say that the industry was ignoring them to Me is another one of those kind of political sound bites. Like that's not really true. We were always running around trying to help small businesses set up 401k plans there it just a lot of them not. Sorry, all of my clients are those types of plans. But we didn't solve the coverage gap because things stood in their way. It was too expensive, you know, it was too much of an administrative burden, et cetera, et cetera. And I think somehow you spoke to that in partly in the product you built, but mostly in your, in your [34:23] Chad: marketing and in the process. Kevin is right. And we all know this. With proper payroll integration you can relieve that plan sponsor. What do we say? 70% of plans have operational mistakes and those operational mistakes usually happen around timeliness of deposits and the proper withholding and sourcing. And so that, that's, that side of it is eliminated with proper payroll integration. [34:48] Kevin: Absolutely. It's not just contribution syncing. Like what do you do on payroll reversals? Right? Like it's a nightmare. Like you defund things. Like that's a total nightmare. We automated all that because we can do the 360 appropriately. So we have webhooks that when we get told that somebody reversed a payroll, guess what? That like bleeds directly into our system. So there's, there's levels. J.D. and I'm sure your father was doing a great job, but maybe had like a distribution slash awareness issue there, right? Like we're in all these marketplaces where a checkbox to a benefit tab like that stuff didn't exist before for your father before, you know, gusto and zenefits and rippling and all these others, it just wasn't there. So he's doing it. But. [35:35] JD: And don't forget that these guys sitting next to you, they're not going to sell 14,000, 15,000 plans this year, but they're going to sell several hundred and they're going to sell a lot of them in that, that micro startup market. So we're not at the scale that you are, but still do have a solution. And it is sold and it's bought and people are happy with it. And we could go back and forth on. I guarantee you there's some third party administrators in this chat bar that are just smokes coming out of their ears because of the value. I'm not going to have that debate with you because I have enough respect for what you've done and how it is succeeding. As much as some of the industry might, might say that it's not. Before we go into Some of more of that. [36:17] Chad: The comment that we have to at least make, the comment though, JD Is that when, Kevin, you say a plan can be set up in nine minutes or a step by step on the website. I'm not saying I disagree. Obviously you've set that up. It can be what. As someone who's been doing this for 15 years that knows the intricacies of the. In the Employee Retirement Income Security act, it shouldn't be that easy. [36:43] Kevin: We're. [36:43] Chad: We're really downplaying the value that consultants bring in this space. The understanding of a client's needs and creating profit sharing that allows them to save or, or customizing a program that meets what they're trying to accomplish or [36:59] JD: chad them knowing what it is that they're agreeing to. [37:02] Chad: So that was the next point is what percentage of these plans are actually out of compliance. And, and I and Shannon people are saying voluntary compliance program. The time spent in there. You're right. The number of times I see these disruptor plans leaving and coming over and we're telling them, hey, you got to go to an attorney and we have to fix this and we have to go back and correct that is very common because they got no damn clue what they just set up. [37:26] JD: How about this, Kevin? [37:27] Chad: We have to at least make note of that. [37:29] JD: Even if you have a payroll feed, if the client's messing up the payroll and not doing it properly, then you're getting improper data, you know, around comp rehire, dates, ownership, you know, a son or a daughter at the company, like, if they're not using their payroll properly. And I would argue that most micro, you know, flower shops, auto body shops on the corner tend to fuck that shit up. You might have a lot of problems on your hands. I mean, do you ever lose sleep over that or. [38:02] Kevin: Yeah, we definitely, you know, look at that a lot. But I mean, you guys have that same problem, right? [38:07] JD: Well, but we don't. Yeah, we look at their census and we're. [38:11] Kevin: You look at their payrolls? [38:12] JD: Yeah, we go back to them. Yeah. [38:14] Kevin: Every. [38:15] JD: Every time they run, people laughing at me. That's what. Yeah, people in the audience do it too. I know, I get you. I totally agree with you. I'm an idiot. [38:22] Chad: But I'm not even getting there. I'm talking about the consultation up front to make sure that they know how to run the plan. [38:30] Kevin: Yeah, no, let's talk about that. I think for us and for the plans that we serve, simplicity is really the key there on the micro plans. You guys may disagree, but I Think a lot of the companies specifically that are in our line of business, meaning in professional services, there is a type of plan and has common features that is appropriate for them. And it's not everybody. And that's why we have a GFA product. We have guidelines for advisors and oops, I guess my own acronym. [39:03] JD: No, you're. [39:03] Speaker A: I don't even know what that is, but it's letters. [39:05] Mark: What percentage of plans do have advisors, Kevin? [39:08] JD: Oh, sorry, what's that, Justin? [39:09] Chad: Sorry. [39:10] Mark: What percentage of plans do have. [39:11] Kevin: Yeah, so it's about 12% of our business now. [39:14] Mark: Yeah. [39:14] Kevin: Small. [39:15] Mark: So that's still scary, right? If they don't have the guidance or the clients don't know what the heck they're supposed to do, I mean, the chances of them being out of compliance is very high. [39:23] JD: I just want you to know that we actually do agree with you on the simplicity standpoint. So I know you have three tiers at your company. I can't remember the names, but. But we also, like. Chad is talking mad shit on you right there. A little bit. Chad will sell plans that are a Safe harbor match, that are on a per payroll period basis that have a standardized eligibility of like a year in dual entry dates. And he'll literally send an email along as a. For a new client saying, hey, this one's a basic 1, 2, 3, 4, not a problem. Go ahead and set it up. Tell me. We don't do that. [39:56] Mark: But those are the biggest pains in [39:58] Chad: the asses that we sell sometimes, those ones. [40:00] Speaker A: But. [40:01] Chad: But let's quantify this, JD because you and I have this conversation every February, and let's use a very round number. If I wrote 100 Startup Kickstart, super simple Safe harbor match plans, how many of them actually start funding and put in their safe harbor match every year? There's at least five of the hundred. [40:24] JD: Well, argue on that. [40:26] Chad: Come back. We set them up in October, right before deadline, and then we're waiting on the record keeper, and the record keeper's not getting deposits, and we're going back like, dude, you need to be funding this. [40:36] JD: You're just proving Kevin's point now. So if Kevin's the record keeper and he's built it all in and he's a Silicon Valley software stud, he can create technology that will capture that [40:48] Kevin: there's no unfunded contributions. [40:51] Chad: I don't think that's true. Kevin, I'd like you to honestly ask your team and look at the 15,000 plans you wrote and tell me how many of them, if you wrote A document in nine minutes and they signed it. How many of them started funding that plan? [41:05] JD: I can't believe I'm going to fight for Kevin here. I can't believe I'm going to fight for Kevin. [41:08] Kevin: Chad, it happens automatically on every payroll run. [41:12] Chad: You have 8% of plans that have no payroll relationship. So there's 8% of plans of 15,000 a year you're selling that don't have the automatic features associated with it. [41:23] Kevin: No, we have. We have a custodian that we dictate the amount to pull and that gets pulled in every pay run. That's where the match comes from. [41:31] JD: He's talking about when your client gets lazy and doesn't do what they're supposed [41:34] Chad: to do, doesn't set it up in time. [41:36] Mark: But. [41:37] JD: But I would imagine that that happens everywhere too. And that. But Kevin's tech could then tell him that that's happening and then they can reach out proactively like those types of automatic alerts. [41:46] Kevin: I get all this. [41:47] Speaker A: I want to get. [41:47] JD: I want to. I want to go more to. We're never going to solve this argument of like. Because you know what's fun right now, Kevin, is there are some people in the chat bar that are like, you know, legacy 401k people that are very anti what you're doing. I'm going to say this to them because they're my friends too. It's like, I'm not like, I totally understand where your head's at. Like some of these. I tried to simplify my father's company, by the way, and cut some corners and do some things differently. You just gone to the next level. And for all those people listening in, he's truly proved that the consumer wants this because they're banging at his door to get it. But what I. So we're not going to solve this argument of kind of old school, hands on, white glove. Look at the details, laugh at me when I look at census and go back to the client type of thing versus efficiency and technology. Let's just leave that there. That's a great little debate for ongoing times. I want to know some more of the numbers before we play a game here. You've had like north of 300 million in venture capital backfunding. You tell me how far off I am on. On some numbers here. Those 40,000 plans you have, you charge 8 basis points on asset based. How much are you tossing to the custodian? Is it three of that or. And you keep five or. Do you even know how that works? [43:14] Kevin: I Know how it works? I don't know the number off the [43:17] JD: top of my head, but it's something like that, right? You got to pay them. [43:20] Kevin: Something like that. It's something like that. Like that. I want to say it's either four to. Between four and six, maybe. [43:25] JD: Maybe. [43:26] Kevin: And it's ratcheted depending on, you know, the number of. [43:29] JD: Maybe a 4, 4 split. If. If you were taking 5 basis points and you've got 8 billion, that's $4 million in revenue. We know you charge $96 per participant. And so regardless of whether it's the Core, the Flex, or the Max program, I'll put something kind of in between Core and Flex. I'm imagining you sell a lot of Core, right? It's probably your number one go to. [43:54] Kevin: Correct. [43:55] JD: So you said 600 participants. I'm gonna just up you to 750 because you're. You're selling now, right now. So 750 participants. That'd be another 72 million in revenue. Okay, so we've got 4 million revenue. 72 million revenue. And then you got this base fee, which, again, slants depending upon which one you're using. Sorry, the $8 per participant is the same regardless of Core, Flex, or Max. But now for the base via can, it can vary. And so I'll just kind of ramp it up to 60 per month, and that's another $30 million. So 4 million plus 72 million plus 30 million. You're like $106 million in revenue. I know you've got the guideline Individual Retirement Account two. Like, I don't. So tell me total revenue annually. And obviously this is a moving target, right? You're growing. But are you at this kind of. Am I way off, like 106? Are you at 150? Are you at 200? Am I missing something? [44:52] Kevin: You're close. We're approaching 100. [44:55] JD: Okay, you're approaching 100. Good. I overestimated, which is great, because you're growing, so you'll be there pretty quickly. When the. When the VC. God damn it. When the venture capital throw 300, and whatever million dollars at you. This is not my world. When do they want their money back? How much do they want, you know, on that 300 million? And then what is your roadmap, as you put it, to get there? Like, when you do the PowerPoint presentation to them, what are you telling them? Oh, we're going to grow. And by the way, I'm imagining you've exceeded what they'd hoped for, like, in eight years time. To have 40,000 plans and 8 billion. [45:40] Chad: You're sanity. [45:41] JD: Proving that you can do what you're doing is more of the PowerPoint also. Like look, and then we're going to expand into individual retirement accounts. And then we're going to expand into wellness. And like to help us understand. Because even at 100 million, I'm thinking, well, you're not. You're not there yet. Like, I mean you employ what, 350, 400 people or something like that's going to cut into what, $30 million of that? [46:05] Kevin: So easy. [46:06] JD: So [46:09] Kevin: yeah. 50% of our companies are indeed too. So these are like super highly paid. Damn it. [46:16] JD: Great for that. But that's worth it. Wow. [46:18] Chad: Yeah. [46:19] JD: So you are not smart. [46:21] Speaker A: Wait, wait, wait. [46:22] Chad: What. [46:23] Speaker A: What do you say? [46:23] JD: Say you pay. [46:26] Kevin: Sorry, distracted there you. [46:28] Speaker A: Well, you pay a lot of money, you said. [46:30] Kevin: Yeah, I mean. [46:31] Chad: Research and development. [46:32] Kevin: Yeah, research and development, folks. [46:34] Chad: I can do that. [46:35] JD: That's what I do all day. Which means you're not just status quo. This roadmap of yours has bigger plans. [46:46] Kevin: We are a software company through and through. And we'll continue to build against that roadmap. [46:49] Chad: Right. [46:50] Kevin: And like, like me and my co founders, we set the roadmap. We have the vision for the product that we want in the end. Right. [46:56] JD: And that does take time. [46:57] Speaker A: Which. Which person, yourself or your co founders decided the name of the company would be Guideline. [47:04] Kevin: My CTO actually put it on paper. Oh, perfect. You knew that was coming. [47:11] Speaker A: I didn't actually know, but I'm gonna act like I knew that. [47:14] Kevin: I'm gonna. [47:15] JD: I'm gonna just spit it out. Are these other channels of revenue. And I hate this term. Robe guy hates this term. But do they center around monetizing the participant? And I don't mean that in a negative way. Like sell other things. I shouldn't say sell. [47:32] Chad: Right. [47:34] JD: Will you help those participants with other financial decisions in the future for a reasonable fee, potentially. [47:40] Kevin: Or we'll partner with other companies that will do that. They are better suited to do it. Right. [47:46] JD: Give them access to your. [47:47] Chad: Well, of course. Every. It's 750, 000 people, right? [47:51] Kevin: Yeah. [47:51] Chad: Access. [47:52] Kevin: I mean we have. We have reach. Look, we know what we're good at. And to your point, JD, like VCs obviously want their money back. A typical time. Time period. Damn it. It's harder the more you venture capitalists. They do want their money back. It's a typical. Typically 10 years start to finish. Right. So we're. [48:14] JD: We're slightly interesting, but Kevin, they Just don't want their money back. [48:19] Kevin: No, they don't. [48:20] JD: They give you 300 million because they want 2 billion or I'm making up, I don't know. [48:25] Kevin: So look at, look at like public market SaaS, companies that are growing quickly, like US [48:34] JD: software as a service, I think it's called. I don't know. Let me give you some, let me give you some context real quick. So Voya is a big 401k record keeper. They have 510 billion and 6.5 million participants. Very different from you because they only have 51,000 plans. So obviously a different market there with Secure 2.0, with the tax credits. I gotta think that you feel like that's going to be a second wave of Cal Savers for you, like nationally it's coming as well as other state mandated plans. You've already, you've already experienced California. That's going to happen in some other states. I'm assuming you think you can keep this pace up and so are we going to look at Guideline in, in five years and you're going to have a hundred thousand plans? Is that the goal? [49:25] Kevin: Yeah, absolutely. In five years. I mean, just extrapolate, you know, 14, 15,000 per year. We're already at 41,000 plans. [49:35] JD: Is there nowhere in the roadmap a plan of an initial public offering or would you, why wake up and open the Wall Street Journal and see that you sold to fucking Voya in three years or something? [49:48] Kevin: I mean, maybe. [49:51] Chad: Oh, wow. [49:52] Kevin: Yeah, here's how, here's how it works. And that's not my decision, just FYI, like I have a board of directors, [49:59] Speaker A: just for your information. [50:00] JD: That's an act. [50:01] Kevin: They're all the venture capitalists. [50:05] JD: Fair enough. [50:06] Kevin: Any, any valid offer for Guideline. I as a fiduciary of guideline have to bring it to the board. [50:13] JD: Understood. [50:14] Kevin: And then it's the preferred, it's a preferred stockholder. I'm not a preferred stockholder. I'm a common shareholder. So it goes to a board vote. A board will vote on it. Yeah, because obviously as the CEO, if they want to keep me around as a CEO. [50:30] JD: No, that makes have a record breaker. Those, those people that gave the 330 million, they deserve a right to say, like, hey, we'd love to cash out at 1.5 billion. And by the way, for everyone listening in, I saw online, so it doesn't make it true, but recent valuation of Guideline is north of $1 billion. [50:51] Kevin: Right? [50:52] JD: Yeah, they got that, that evaluation from Rogue guy, but still. Okay, let's. [50:59] Kevin: Yeah, but look, like, just to my point, if you take a public market valuation and you compare it to our revenue and the way that we are growing, you're right there, right? Like that's how you get to 1.1. Super easy to put in. 300 million already at 1.1, we add 15 to 20,000 plans per year. [51:17] JD: That's what it is. [51:19] Kevin: You know, I don't. We're right in this, we're right in the sweet spot. [51:22] JD: So I don't. [51:22] Kevin: Our investors are very happy with us. [51:24] JD: I don't walk in your, in your circles. But if you do 100 million revenue and you have a billion dollar valuation, obviously I know enough to know that that can happen. It seems off to me. But then when I look at your growth and I look at the possibility of what you other revenue lines that you might have and the power that you might have, I mean, I'm sure your VC people are looking like, I'll drink for that. But like Fidelity and Voya and Vanguard and Principal and think, oh my God, look, it took them a hundred years to do this. Our boy Kevin is becoming a player in the market. In eight years time, he's going to be right there alongside these people on 401k. So that's going to rise your valuation for sure. So I get it. [52:14] Chad: But JD, in terms of that comment though, don't ignore the fact that the names you just gave, you're only talking about comparison and revenue for them in the 401k space. All of his other businesses have thousands and thousands of employees and other lines of revenue that make. [52:31] JD: But also understand that that Voya and empower and whatever, 401k is a big part of their pie, buddy. Yeah, like it's a massive part of their business for sure. It takes over most of the pizza pie. So let's play a game. [52:45] Kevin: Delightful. [52:45] JD: Right now, Kevin, this is the totally original, never duplicated, never no for Dope Game. This is a special edition of the no per Dope Game. Because usually what we do is we go out on a pop culture and we try to find things that you would either say thumbs up to or thumbs down too. [53:23] Kevin: I'm terrible at this. [53:24] JD: On today's show you won't be because on today's show I was snooping around your personal Instagram and every nope or dope question is going to come from a picture in your Instagram that we're going to show the audience. Not only can you answer, you can tell us what's happening in this Picture on your Instagram, Kevin. The first one is, I like to refer to it as nacho libre, Mexican wrestling. I think it's called Lucha libre. But what the were you doing in arena Mexico at the side of this? And are you yay or nay on [53:58] Kevin: nacho libre is so dope? I was in Mexico City with my girlfriend, who is Mexican, and we snagged front row seats for like 30 bucks. And it was amazing experience. Had be like micheladas that are massive, [54:13] JD: you know, I love micheladas. [54:15] Kevin: Oh, my God. And it's just. This is such an amazing experience. She's gonna be psyched you put this on you. [54:21] JD: I noticed though, in Mexico, in. In the usa, the. Oh, why would I say that? The michelada is like this tomato based thing with the spicy stuff on the rim. When I'm and I order a michelada, I get something a little different. But I want you to know that rogue guy is also dope on Mexican girlfriends. [54:45] Speaker A: She's my wife, by the way. Yeah. Wife of, I don't know, 11 years. [54:50] Chad: Can anybody. [54:51] Mark: We don't have a shirt. [54:53] Chad: Can anybody else. Oh, Justin, chime in on this one. I can't. Nope. Or dope this. I've never been there. [55:00] JD: No, I wasn't gonna ask, man. [55:02] Chad: Oh, but I want to go. I desperately want to go, to be honest. [55:06] JD: It definitely looks like a fun time. [55:08] Chad: Okay. [55:08] Speaker A: By show of hands, who used to watch wrestling growing up? Like World Wrestling Federation? [55:15] JD: No, no. [55:16] Chad: I wrestled dummies all the time, but I didn't watch it. [55:19] Speaker A: Oh, come on. Do you have a childhood if you didn't watch wrestling? [55:23] JD: Next one. [55:25] Speaker A: Shame on you guys. [55:26] JD: Next one. I thought I was better than all or most other human beings when I purchased my second Lambo, but I did not have an airplane, so. Nope. Or dope on owning your own airplane. Tell me I'm wrong. That's your goddamn airplane. [55:49] Kevin: That is. Yes, that. That was my airplane. I just recently sold it. Oh, no. I bought this. I bought this airplane to train on. This is that airplane that has a parachute that comes out of the top of it. This is the only way I was going to do this. So I wanted to become a pilot. I've always wanted to become a pilot. In Covid, I decided to become a pilot, and I did it in this airplane. [56:16] JD: And this one. You said you would only buy the one with a parachute. I get this. Because if something went wrong, you just pull the thing and float down. That's sick. All right. [56:29] Speaker A: Like a parachute on an airplane. The physics to that doesn't add up to me. [56:35] JD: Did you? [56:35] Kevin: It does, man. Check out YouTube. It's crazy. It works. [56:39] JD: I love that. Did you upgrade the airplane? Do you have another one now? That's. [56:43] Kevin: No, I. I sold it mostly because I'm in a relationship with the. The Mexican lady and I just fly commercial now. [56:52] JD: Okay, fair enough. [56:53] Mark: But you guys could fly to Lucia Libre. [56:56] Kevin: No, you can't fly that far in that plane. [56:59] Mark: Okay? [56:59] Kevin: That's like a. That's like a 500 nautical mile plane. [57:03] JD: Oh, interesting. [57:04] Kevin: And maintenance is a. As somebody put in there. It's awful. [57:07] JD: I can't imagine anyone would be nope on having your own little plane. That's pretty cool. Okay, last one for the game. [57:15] Mark: I mean, he's kind of. Nope on having his own plane. [57:20] Kevin: It was dope. And then it became nope with all that maintenance. [57:23] JD: Fair enough. Justin, that's accurate statement. Posting pictures on Instagram of bars or the drink you got. Because this seems to be a repeat offense for you. Like, you like to show us what you've been drinking and where. So you must be on this, I [57:43] Speaker A: imagine that's the bar in your house [57:45] Mark: right there, isn't it? [57:46] Kevin: That is not the bar in my house. But the rest of these pictures are in my house. So I love making cocktails and me and my co founder love doing research at bars. And this is what we're going to do after we retire. So that's why you see these photos. [58:01] JD: What? Get drunk and die of alcohol poisoning? No. [58:06] Mark: It's going to be fun. [58:07] Kevin: No, man. That was a whiskey tasting. You get to taste it, right, Robbie? [58:11] Mark: Yeah. [58:11] JD: No, for dope. On people posting their alcoholic beverages. [58:18] Speaker A: I'm just nope on everything of anyone posting because I don't care. But that's just me, right? Like, I'm okay with it. I guess so. [58:27] Chad: Maybe. [58:28] JD: Okay. Chad. Chad, you're a boomer. Nobody gives a what you think. Justin, on posting alcoholic beverages. [58:36] Mark: Depends on the frequency. If it's this much. I'm sorry, it's a nope. [58:40] JD: You know that I'm a. [58:41] Kevin: Like, this is over like three years. [58:44] Mark: Hey, we can't see that from here. I'm just. This is right now. [58:48] JD: You. We all know that I'm a clinically diagnosed alcoholic. I've never done this in my life, so I'm kind of nope on this too. [58:55] Chad: Dude, you've taken pictures of your kegerator out. [59:00] Mark: You just harsh one of his stories. [59:01] Speaker A: Yeah, jd, Nobody wants to see pictures of tall cans of Miller Light. Okay? At least Kevin's drinking good stuff. [59:09] Kevin: Making his own that teremana, that's absolutely horrendous. [59:14] Speaker A: Is that. [59:15] Mark: Don't let the rock hear that. [59:17] Kevin: That's the rock stuff. Yeah. [59:20] Speaker A: Can we also say this celebrities. [59:22] JD: Can we stop having. [59:24] Kevin: No, I'm with you. [59:25] Speaker A: Because they just suck. [59:26] JD: Yeah, dude, I agree. [59:30] Speaker A: Kevin, can you quit guideline and just start making booze? You sound like you look like you probably know what you're doing quicker. [59:36] Kevin: Maybe that's what I pivot. [59:39] JD: I like that. Just so you know, Clooney invested like someone fact checked me on this, but I think he invests like $250,000 or something. [59:54] Speaker A: That was a win. I get it. [59:55] JD: And he's smart. He made hundreds of millions of dollars. [59:59] Speaker A: Everybody else is trying to do the same thing now. Now, Diddy did Ciroc. That was a great deal. He didn't invent it. He just decided to bring it over to everybody, though. [1:00:09] JD: They were ahead of the curve. I know some professional surfers that were behind the St. Archer's beer brand. They sold out and made a shit ton of money. So anyways, it can anybody tired of [1:00:19] Speaker A: seeing Mark Wahlberg and his 3am workouts and whatever booze he's pushing? It probably sucks. [1:00:25] JD: Kevin. I'm just saying, you might want to revisit that roadmap and throw a little, you know, little alcohol action in here. I don't know. We're never, like, tied to this 530 thing, but we can push it to the after show. So we'll see if Kevin sticks around for the after show. [1:00:42] Kevin: Let's do. [1:00:43] JD: Let's do last week last. Not last week's. Last show's chap. Our champion. Congratulations to Hackler. He was last show's chap. Our champion. Now, Hackler, you know we love you, and so our intention to give you a gift is a deep one. We want to get all of us together and really come up with something, like, glorious. We. We're flakes. We're procrastinators. [1:01:09] Mark: We didn't make that happen with that, with you. [1:01:12] JD: So we just did a little, like, you know, what's it called? Amuse Boucher. A little like a little setup. So, Brandon, if you could throw up on the screen. Amaze bush. Amaze bush. [1:01:30] Speaker A: Why did you order him? [1:01:32] JD: My daughter lives in Paris, and she always gets mad at me when I try to pronounce. Yeah, you shouldn't say the e on the end of that. It seems Parisian to me, though, to say it. We sent him some crickets, some red shrimp, and some grasshoppers. [1:01:47] Speaker A: Are these edible? [1:01:48] JD: Yeah, Sure. I mean, you're supposed to feed them like iguanas and stuff. Or your life. [1:01:54] Mark: When we were texting about it today. [1:01:56] JD: So anyways, Hackler, you got those. I know you got them because you texted me. Jason Grant's very high in protein, yet Jason was saying on a group text that people eat. These are delicacies around the world. Grasshoppers. And he said shrimps were the grasshopper of the ocean. So, yeah, if Hackler wants to dig any can. But Hackler, stay tuned. [1:02:16] Speaker A: No, they used to serve lobsters in prison in. In on the east coast because there's like an abundance of them. [1:02:24] Kevin: Yeah. [1:02:25] Chad: Really? Yeah. [1:02:26] Kevin: Lobsters were like [1:02:30] Chad: chickens. [1:02:31] Speaker A: Yeah. [1:02:32] Chad: That's crazy. [1:02:33] Kevin: Super low end. I wasn't going to say peasant food. He said. [1:02:38] JD: So, Hackler and everyone tuning in. Your chat bar champion prize is not done. We intend. [1:02:44] Speaker A: Yeah. This is buying us time. [1:02:46] JD: You will get a chat bar champion prize that has never been seen before. We just don't know what it is yet. So this is just a little taste. [1:02:53] Speaker A: Oh, maybe we can get Kevin to fly us to Hackler's house to do something. [1:02:59] Mark: No. 500 nautical miles, man. [1:03:01] Kevin: It's not gonna happen. [1:03:02] JD: And he got rid of the plane because. [1:03:05] Speaker A: Oh, that's right. [1:03:05] JD: I won't repeat why I didn't. That didn't make sense to me. [1:03:07] Chad: But. [1:03:11] JD: Okay, so tonight we will vote for chapter champion so we can close out this regular show and kind of go into the aftershow a little bit. I don't. I don't even know if I have a vote. Justin, who's your vote for chapter champion? [1:03:24] Mark: And Mrs. S. Woods. [1:03:26] JD: Oh, nice. Okay. All right, I'm gonna see. I'm gonna go last. Chad, your vote for chapter champion. [1:03:35] Chad: I'm going away from. From Shannon. Although she was fantastic and brutally honest towards Kevin. And it was from one comment, it was Dave and K when he told Kevin he needs to shake down empower style to start get some revenue share from the mutual fund companies. [1:03:53] Kevin: 10 billion, right? I think that's when they told us. They told us to piss. [1:03:57] Chad: It's hard to get them till you got 10 billion. [1:04:00] Kevin: Yeah. [1:04:01] Chad: Interesting. [1:04:02] JD: I was gonna say it's hard to get paid to play when all your funds are Vanguard funds, but. Okay, that's true. [1:04:11] Speaker A: I'm just gonna go with it. I like new names in the chat bar. No offense to all you regulars. You know, it's like going to a bar and I just envision all of our chat bar champions just always at the bar, just hammer drunk. And sometimes I'm just like, yeah, I want someone new to walk through the door. Michelle Cobble. [1:04:29] JD: Okay. [1:04:30] Chad: Yeah, yeah. [1:04:31] JD: And she was pretty. [1:04:32] Chad: Good night, Michelle. [1:04:33] Kevin: I missed the pornhub analogy. [1:04:36] Chad: The pornhub analogy was solid. I think that was David K too, wasn't it? [1:04:40] JD: I forget what that was. Kevin, your vote. Amongst all these haters in the chat bar, who will you choose? [1:04:46] Kevin: I don't know. I. I don't know that they're. Maybe they're haters. [1:04:50] Speaker A: Vote for Jim Sampson. It would be epic if you did. [1:04:55] Kevin: I couldn't read the name. [1:04:56] JD: Anyone in here? [1:04:57] Kevin: I missed it too fast. I'm not up to seats. I think it was David. Something said, thanks for coming. So I'll take that one. [1:05:05] JD: Wow. Is that David K? So David K. Has got two votes. Shannon's got one. And Michelle Cobble. I kind of liked Shannon's blood pressure vibe. Like, she was really pissed. I could feel it actually, like, in my bones about all this. But I like Mark's little someone new. So. Yeah. [1:05:29] Speaker A: Who was. I'm gonna. I'm gonna sell this dude it. She was willing to just go for it. And we don't get a lot of people who jump into this. [1:05:37] Chad: They get nervous for sure. [1:05:39] JD: Cobble, it is. Michelle Cabo, you are the chapter tonight. We will be sending you in two weeks, a bunch. Yeah. [1:05:48] Speaker A: We're gonna give you a free subscription to Guideline 2 and 2. Right, Kevin? [1:05:53] Kevin: No. [1:05:56] JD: No. [1:05:57] Mark: Okay. [1:05:58] Chad: Yeah. Everybody's saying it is a tie because you had two Michelle's and two David [1:06:03] JD: Case, two David kids. All right. Okay. Let's break the tie. The tie is broken. [1:06:15] Speaker A: That was a glitch. [1:06:16] Kevin: Fucking love it. [1:06:17] JD: Technology glitch. Hey, David K. Right, let's go. Kevin, thanks for hanging out with us. Congrats on all of your success. And I want to publicly apologize to you right now. Like, you don't know this, but I've literally been at national conferences in front of audiences on a hot mic and said, fuck a guideline. Fuck their shit. And so I apologize. I am. You're. You truly are a smart entrepreneur. You saw a pathway. You built your roadmap. You're crushing it. And you know what? You are helping the coverage gap. So we got the people in Washington that are struggling with. With our current system that's not doing what they think it should be doing. And companies like yours are helping us with that. And so we really should stop talking so much smack about you and kind of bring you into our fold and maybe we can start. [1:07:19] Speaker A: I would just like to say I've never talked with you. [1:07:21] Kevin: I'm just seeing these comments with like the irs and this is over, right? I don't have to drink this shit. Irs, like we've already had those audits, guys. We have third party audits. [1:07:32] JD: Like hey, Kevin. [1:07:34] Kevin: Yeah. It's not like we're just like skirting under the thing. [1:07:37] Chad: Kevin, they're not worried about you. They're worried about the process and the individual plan. Those small market plans aren't seeing the IRS or do all audits, Kevin. [1:07:45] Kevin: Absolutely they are. Absolutely. [1:07:48] JD: No, no, no, they don't, they don't get those audits do. [1:07:50] Kevin: Because you get a complaint of something, right? Or somebody goes under or somebody's going out of business. They absolutely do. [1:07:59] JD: Well, what I wanted to back you up is that paychecks and actual whatever service company, they also this, this industry been talking about them for the last 15 years. So what we're worried about is the quality of work that they're doing. And anytime we feel like people are trying to create efficiencies and use technology, there's a known as this, this is, by the way, this is an old school, new school debate about everything. [1:08:28] Speaker A: This is. [1:08:29] Kevin: I'm not here to drink anybody's milkshake, right? No, not what I'm doing. Like we have another platform for advisors. If you guys can figure out how to do some value add on top of it, more, more power to you. Like we just want to, we literally just want to make it accessible to everybody. And that is really what I'm going [1:08:49] Speaker A: as as consultants for you. [1:08:51] JD: Well, again, J.D. [1:08:54] Chad: the truth is when the industry, and I'm talking about the folks in the chat bar and myself, when we feel our value is diminished by setting up a plan in nine minutes, that's when we get defensive because we know what we've been doing 15 years. [1:09:09] Speaker A: You feel threatened, Chad, you're scared. [1:09:11] JD: Here's what I think. [1:09:13] Kevin: I get it. Like on plans that are super complicated, I understand the value add. I'm not fighting you guys on that. [1:09:19] JD: Well, it's not complicated, Kevin. I think the simplest of plans are the ones that get up the most. So it's not about like cross tested profit sharing and different dual eligibility and all that kind of shit. It's literally the simple one. So we have a program that's similar to yours, we call it Kickstart, and basically all the decisions are taken on the client's hands. Like they're kind of forced into a square box, if you will, you know, square hole. And, and they fuck it up all the time. And the reason they fuck it up is because they're left to their own devices. But what I wanted to do is back you up and tell everyone in our industry. What we need to do is start talking less about Kevin Guideline and some of his peers. I want. I want to ask you about human interest in the after show, because what we should be doing is actually learning from them a little bit. [1:10:12] Chad: Absolutely. [1:10:12] JD: And learning from how they're succeeding. Obviously, everything Kevin's doing is not all wrong. Everybody out there, he's doing some phenomenal things. So what can we learn from him? And can we. Can we tweak? Can we pivot our business model to be more like guidelines? And I know that's probably. [1:10:31] Chad: We have to survive. [1:10:33] JD: Anyways, let's wrap this with some music. Kevin, thank you for being with us. We'll head to the after show. Everyone who tuned in, thanks for tuning in. We'll see you in two weeks. We're going to have Scott Colangelo, Helen Julu. [1:10:47] Chad: Oh, nice. [1:10:49] JD: Yeah. By the way, everybody stick with us through. What are we in May? Right now? May, June, July. We have got some phenomenal guests on the roster coming up. So some big dogs. We got Fred Reese later this month that we'll be doing a live show with. So check that out, Fred. And so thanks for tuning in. Keep tuning in, Kevin. Thanks for being here. Let's play some music. I'm gonna take a piss. Are you out, Justin? [1:11:25] Speaker A: I leave them going. [1:11:26] Mark: I got a few. [1:11:28] Chad: I'll be back in a second. [1:11:30] Mark: Eight and a half minutes. [1:11:34] Kevin: Kevin, we're going. [1:11:35] Mark: Pete, don't worry. [1:11:35] JD: Kevin, sit there awkwardly by yourself on the music. [1:11:38] Kevin: I'm gonna go see. I'm gonna get a fresh one.