Michael Rubin and Mike Mahan on Growing The Hobby

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Save time and maximize efficiency with adjustable shelving customized to your business's needs. Shop and save on pro grade storage at the Home Depot. How pros get more done. Hi guys, we are back. Awesome interview. It's become like an annual tradition here at scn. We get Mike and Mike, not the losers from espn, but it doesn't matter in the hobby. So we appreciate the time. Friday at the national. How you guys doing? Doing great. I mean, pretty freaking exciting. What's going on here? Absolutely. Mike, how are you? Fantastic. I mean, we're at the center of a movement here and we're just getting started. Yu-Gi-Oh How does this compare to what you guys just did? Look, they're two completely different, you know, approaches. Fanatics Fest is a giant sports festival. Really the original idea was how do we do Comic Con in sports and really just create this incredible sports festival. You know, so many of the top athletes, celebrities, artists of the world and getting new, you know, sports fans into collectibles. And this is the most authentic collectible show in the world. So completely different things, completely different target audiences. Both so important. But not tired, by the way. No, I could tell you're not tired. I am the moistest one in this room. I've been noticing I might have a little bit to do with it. I'm just saying it could be a few other factors we're going to cut. So I was noticing we have been sent up here for, for the entirety of the show and what I noticed is all these tops people keep coming up and I don't they're not tops. People like doing. Working the room. They're tops, people that are actively engaged in the hobby. Is this like something that you guys promoted or is this just something that you guys have a lot of people that love collecting? What, what I always say, if you want to be good at our company, you can do that without being co opt. Right. It's the executive skills, it's the work ethic, it's the intellectual. And all those things really matter. If you want to be great, you have to have that. Plus you have to be a client. And that's. And to me, the number one thing I think when it comes to people that we want on our team is obsession. And part of being obsessed is being in the hobby. I mean, look at this. Yu-Gi-Oh this is fun. If you can't get into this, you can't get behind this. You can't get immersed in this app. Yu-Gi-Oh I don't know what to tell you. Well, I guess my. I don't want to hog the questions here, but I guess I'm very curious. You guys have had activations at the show already. We're only like halfway through it. Are you guys planning anything big throughout the rest of the show? Because I don't know if anybody else knows. There was a Beckett line outside this morning, something I did not expect to see. That turned out to be an activation about no fees for the Fnatic Collect app, which I thought was actually some brilliant guerrilla marketing. Like, I actually got a little nervous. Weather was really the only one I was unhappy about, though. I thought it'd be better if people got arrested. Just it would make more news. Yu-Gi-Oh I was actually run over by a car, if that helps. What's that? I always get run over by a car filming it. So if that helps you, that's problems. Yu-Gi-Oh that's what they're looking for. Like, if we had. We didn't want you to die, but it was like just a. Like a medium. Wounding that would also be, you know, be good for the. For the story that flight. Jesse is good. Great. Is obsessed. That gets hit by the car. Yu-Gi-Oh exactly. I did want to go back to Fanatics because again, I think it's laughable that the idiots. And I say idiots because most of the people in the hobby, I think are pretty cool that we're nerds, but we're in the hobby together. But there's this stupid sentiment of like one or the other us against them. And you guys, which I love you guys consistently showing it by word and action. It's outrageous. Yu-Gi-Oh I think it's stupid. You guys know the National Fu and vice versa. And I thought a great example of that was the card combine. Like you guys focused on educating people at Fanatics Fest of hey, how do we become a collector and stay in this thing? Look, when we got into this business and you know, we came up with the original idea in November 2020, we got the rights over 2021 for, you know, some key sports properties and then we bought Topps 1-1-22. We had to go, how do we 10x the Hobbit? Okay. And people thought we were crazy when we said that. Sure. I think to us it was about how do you get sports fans into collecting cards and how do you make this not a real niche but how do we start to open and by the way, do it globally as well. We're still like in the early, early, early days that I don't think we're. And we were talking about we might have actually 5x the hobby so far. Yu-Gi-Oh This show alone wouldn't make me believe that. Right. And you see the Fanatics Fest as well, sports fans that become collectors. But the great thing is all the athletes that have become obsessive collectors so so many of the big stars, like that's the thing you see Fanatics Fest, that's so fun. You see, you know, whether it's, you know, Carl Anthony Towns and how obsessive a collector he is or Jason Sudeikis or Ryan Reynolds, the way he's getting into it, or Grant Williams who got into it the first Fanatics Fest, you just see this way becoming prevalent. So for us, you know, we really feel like we're just in the early days of really having this mood to get going. And I think when I look at, you know, Fanatics Fest, we are so excited about, you know, kind of the energy we can bring to the world that comes out through Fanatics Festival. The national is about what happens here. This isn't like a big social media movement or a big Internet movement. It's about great things that are happening here for the 150 or 200,000 people that are in this building over the five days. Fanatics Festival, how do we market to the world and get people into the hobby? The, the idea that you just mentioned like this is something for the US it makes me wonder where are you guys headed outside the US because there's been pop up shops. You obviously have the London shop. I'm curious, you guys have plans for other countries right now? Yu-Gi-Oh I mean we started The London store. Because there weren't a lot of great places to buy cards. Yu-Gi-Oh In London. Yu-Gi-Oh I think there's less than 10 hobby shops in all of. None of them had the experience that we wanted. And so you can create the demand, but if you don't have a place to build a community and buy the product, you're not going to build an industry. You're not going to build a culture of collecting. And so we said, you know what, we're going to build it ourselves and we're going to try to do it the right way. And we thought it would do $5 million the first year. It did 25. Are you serious? Dead serious. We think it'll do 40 this year. It's one of, if not the biggest hobby store in the world. Okay, that's awesome. And we're going to do. We're going to have Paris this year. We're going to Munich next year. We're going to have two to three per year all around the world, all international. Yu-Gi-Oh And it's really going to be this hub of collecting, this hub of community and building these markets. And you now see whether it's the London card show, whether it's the number of athletes, and you see it in the uk, there is an undeniable collecting culture. And we want to replicate that market by market. I would. You know, the one thing I was going to say to you that Mike's not saying is we've got many great hobby shops here in the US and many more opening. So we didn't feel the need to put. We don't want to put hobby shops here. Yu-Gi-Oh okay. But if you look at. In London, I remember Mike called me and he said, hey, you know, we're opening a store in London. I'm like, why? He's like, because nobody else does it well. And so we need to show people how to do it well. Yu-Gi-Oh he Goldin have been more right about that. And so I think for us, as we're doing these stores internationally, it's just. It's just growing the business a big way now. Talk about what happened when we opened London. Yu-Gi-Oh The reason I end up going to the store, they're like, hey, Mike, we need you to come over because we want to get a great star out there, and it's going to be helpful if you come out there to help get some great people out there. Yu-Gi-Oh So I went out there, we got Lewis Hamilton out there with 4,000 people in line. Okay, 4,000 people, line to get in the store. It's a big shop. I don't think it's 4,000 people. Most of those fans were Lewis Hamilton fans. Not collectible fans but they start converting now. What was happening was he open his stores. He just opened his first store last week. Oh it's open now and he's got several more stores coming. That's what you're talking about growing, that things take time but we talk about globalizing the business, getting stars involved. That all happened. Mike decided to open the store in London. I came out and we got Lewis out there and Lewis said hey I love this. I grew up collecting cards. I want to open and now he's a giant collector. He's chasing cards aggressively and he's like really into the hobby and we keep doing that person by person, brick by brick. And that's why I think we have probably 5x the hobby so far. And I think our original goal of 10xing was a bullshit lane goal buddy. Oh Yu-Gi-Oh that was. That was our poll last year. Just for the record, just for the record, it was the team that did this. Yu-Gi-Oh okay. Okay, sure. Yu-Gi-Oh Well but. But even to that point, real quick like just to carry on. That was kind of my point. With Fanatics test like that's a great event. It's a standalone. You're bringing in sports fans, guys who don't really care about cards yet. I think this is kind of where you see the culmination of hey first step now we can do that same like with you're talking maybe guys just like Lewis Hamilton that then leads them to buy a card and get in. I think it's awesome. Like I love that I was with Lewis Hamilton a few months ago. He was literally like I'm obsessed with Fanatics collect because literally he was there bidding on different things. And by the way, one of my best Fanatics collect stories, Kat told me he Goldin wait to get finished a post game interview because he had a bunch of bids live and he wanted to make sure he didn't lose them. And he rushed off the court. I'm not saying this is going to go out there. This is no embellishments. This he said he rushed off of his post game interviews to get back in the locker room in the middle of the finals to see how his bids were doing. That's how we build the hobby. By the way, if the biggest stars the one of Lewis Hamilton and Carl Denny Towns, if they care authentically about collecting. Yu-Gi-Oh Then that's going to get so many other people that care about Collecting well. And I think about how we saw an international theme throughout all of the Fanatics Fest we're seeing. Like there's a whole international section here at the National. I was thinking Fanatics Fest here in America is so big, I Goldin imagine doing more than one a year. But I could imagine doing Fanatics Fest in other countries. Because you. I went to the UK earlier in the year. I got to go to the London card show. I got to visit a few shops. You hung out in Dublin. I didn't get to see Lewis. I thought I saw him, but it was another guy. Yep. And I thought to myself, there is a ravenous group of collectors here and like you said, they're being a little underserved in a lot of parts of the world. I could see like Germany, which is also a huge collecting spot, a Fanatics Fest international. Because to see the amount of people that are willing to travel here, I would imagine that if they're already in that part of the world, they'd be finding it much easier to travel to a Fanatics Fest there. Look, when we started Fanatics Fest five years ago, we came up with the idea. We launched it the first time three years ago. I think we thought that would have been a possibility. Sitting here today, I'll tell you, we should do this once a year in New York City. It's a big ass. I mean, you've got LeBron James there for two days. You've got, weren't you quoted saying, over $80 million, something like, you know, to produce that show. So from our perspective. But when you go there, you see on social media like, it's worth every penny and more because it's doing exactly what we want to do, which is to get the word out about this amazing hub. Yu-Gi-Oh Awesome. Okay. I was going to ask you. So you've obviously been busy with the shows. You've been busy with, like, we just. Every big card that gets hit now is on ESPN or it's on the news somewhere locally and nationally. I see so much going on that you guys have your fingers in. And it makes me wonder, how do you gauge success with this? Because I view this as huge success compared to where. When we started this podcast back in 2020, it was totally different. Nobody cared about cards. But we live in a time where everybody cares about cards, whether they collect or not. Well, I don't think everyone cares about cards, but I think a lot more people care about cards today than they did. Sure. Four years ago, but you should answer first and maybe look what do we. What is our goal as an organization? It is to relentlessly enhance the collector experience. And for us, what does that start with? It starts with pride. Yu-Gi-Oh we, we are obsessive, and I use that word intentionally. You're obsessive about making great product and that's innovation, that's authenticity, that's storytelling, that's attention to detail. That, all of it. Right. And I think what you're seeing first and foremost is the culmination of making better and better, richer and richer product, whether it's sports, non sports, whatever the case may be. Right. That, that storytelling, that ability to connect the fan to the character or the athlete or the team or the moment that they love and they want to, they want to connect with. And then from there, once you really invest in product and storytelling, then it's about marketing, then it's about the relationship with the athletes, then it's about distribution, then it's about operations, then it's about customer service, then it's about technology. But we really start with creative excellence. And I think that's really been the mind shift. That's been the mindset and the shift in, in our thinking and approach is we are a product first company and we are a storytelling company. That's what we do. And that now infuses our DNA. We're obsessive about creativity and innovation and then consistency. Right? We're, we are happy to do the debut patch every year. We're happy to do the Gold Logan every year. And because our storytelling has become so good and because of the Fanatics, relationships and ownership, when we have these ideas, we go to the leagues and the PAs and the athletes and say, hey, we want to do this thing called the debut patch, or we want to do this thing called the gold logo, man, or the gold shield. And what would have taken years if it was successful or never is now a phone call away. And not only one of the reasons why cards have become so successful is it's now part of the fabric of culture. Yu-Gi-Oh And look what we just did with LeBron James, right? He announced his team through a trading on a card. Right? I mean, crazy. That's because trading cards are now firmly a part of the culture of sport. And we think we're just getting started with that. So to that point, to the other athletes, that has been a criticism, some of myself included, like, man, I'm curious how many of these guys are interested versus, hey, this is a contract thing. You've got a piece, go do something for us. Like what's the what's the balance? So first, if you weren't criticized us, you one-of-one be har. So we want. Oh, I got a list. I'm pumped. No problem. I cheered up the criticism. Exactly. I'm going to tell you something. We have a rule that we do not deviate and you can take us in face value and it will prove itself out. You can call and you'll be wrong. The rule is we will not work with anyone to get them in a business to really showcase them if it is not authentic. Okay. And so, you know, for us, the amount of people hitting this up right now saying, hey rube, hey Mahan, you know, I want open stores, I'm throwing the biggest athletes in the world. We say no to so many people because like they're not into it. I'm gonna tell you something right now. If I brought Cat here right now, he knows more about cars than two of you. Yu-Gi-Oh I talked to Cat like five years ago, by the way, in dms. He was buying cards then. So I don't doubt so much about cards. It's insane. Well, his fiance is a collector too. I got to sell her a card. Jordan is a huge collector. Yu-Gi-Oh Okay. And so when Kat came to us and said like, hey man, like I want this to be my day job, we joke like, you know, his part time job is playing in the NBA. Yu-Gi-Oh Pretty good at it. His full time job is cards. They're actually both his full time jobs. But that for us, we love it. Okay. It's completely authentic. Tom Brady. It is completely authentic. He's so into this. The amount of stars that have caught us behind the scenes that you don't hear about, they just want to get in the business to make money. We're like, Yu-Gi-Oh it's not for us. Like if you're not really into it, we have no interest whatsoever. So I'd say when you see people front and center is because these guys are into it. Like, you know, he's like muddily into it. He loves it, he loves it. So we're not like, let me tell you something. When you try to have someone do something and it's not authentic, it's eventually people see fall forward, they can tell and it falls apart. Yu-Gi-Oh So we will not do that. And that's why today, I mean, you can't. I can't get through a day without some really well known person asking, can they open stores? And the answer is no to most people because it's not authentic. They're just trying to make Money from hobby. Cool. I like it because again, like we talk about, hey, we have, we've been in the hobby for decades. We want this thing to keep going. I'm glad it's popular, but I don't want this to be a moment. I think things like that are important. You have people who are actually invested, which I love. Look, you're still really early on if you really think about it. Today, our business in collectibles is still 85% in America, right? Okay, Yu-Gi-Oh but there's, you know, whatever 325, 350 million people on a 7 or 8 billion people, you know, live in America. So there's a big opportunity globally. I mean, there was probably no bigger moment. Pros trust the Home Depot for heavy duty storage solutions for any job site or garage Right now. Get up to 15% off select storage and organization Impact and water resistant totes and shelving built to hold up to £2,500. Storage systems have space for all your tools tools and protect them in the garage, on the job site and everywhere in between. Save time and maximize efficiency with adjustable shelving customized to your business's needs. Shop and save on pro grade storage at the Home Depot. How pros get more done this episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome, that's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50 page restoration block. Or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it, ready to make anything online make sense. There's no place like Chrome. Check responses set up required compatibility and availability various 18 plus. Then we go out, we bring Kefa on as a new partner starting in 2031. And three months later you see the players, eight to 900 of them March out on the pitch with debut patches which will come out in 2031. Yu-Gi-Oh then you saw Messi Ronaldo play the last games with legacy patches. Okay. And how many global football fans, soccer, we're talking about all these patches that were coming. So it's like that's how you get someone to go from a sports fan to a collector. Or in the case of these legacy patches, I'd say an art fan to a collector. Because having how would you like to own the trading card that had the patroness's last World Cup? Yu-Gi-Oh okay. Yu-Gi-Oh he'd be retired. There's already people talking years away and there are people talking about how do I get my hands on it? That's the innovation. Mike and his team, there's a lot of, I guess, ideas of how much the growth of the hobby has been shown here at the National. I am very curious. We have five, six more months of this year. Five more months. I know how math works. So if, if you had to envision the rest of this year into the end of December, do we continue on this trajectory? Because we see every week it seems like a goat sets a new record in price. And a lot of times, some of these events we were talking, well, we know it can't continue going straight up forever. I'm curious, we don't. I'm not going to ask you when does it end, but do you think through the end of the year we're still going straight up? You have to have resets. Like it's just like a financial market. You have to have reasons. We don't want. Like straight up is bad. Yu-Gi-Oh Okay. Yu-Gi-Oh we shouldn't be confused about that. So to us, what we need to do is do the fundamental things that build a great business for the long term. And then, you know, like any market, I think he would go up, reset. Go up reset. I think resets are both. I mean, just, we don't, we don't actually spend a lot of time thinking about it because in all cases we want to make the best products. We want to amplify those products through our marketing. We want to bring as many athletes, celebrities, and frankly, people into the hobby. We want to build the infrastructure on a global basis. We want to bring technology in a bigger way. We want to do things like eliminate fees for sellers on the collect platform. We want to do the things that ultimately have sustained success. And really thinking about this long term, we're not trying to make a quick buck. We're not trying to do things that are short term. We're trying to build long term storytelling. We're trying to build long term connections. We're trying to build community. And that's. So look, do we think what we're building is enduring? Yes, we do. Right. We believe that this is both sustainable and that this is just the beginning. Does that mean I know what next week is going to look like or next month or next year? I do not. Okay. But I do know that we have every intention of doing this the right way and we think that will give us the best chance for long term sustained success. Okay. Yu-Gi-Oh In life of long term success too. And we've had this debate a little bit on the show. You've probably heard some of it the whole breaker versus card shop debate rages on, right? Like some too many breakers, not enough shops, vice versa, whatever. Local card shop struggle. How do you guys come up with that balance of, hey, we have X amount of shops with allocation, want more. We have this breaker side. Like, what does that look like internally? And it's a complicated answer with one very simple filter. What is the best for the collector experience? And when we. We look, we are very, very supportive of hobby chefs, okay? For a variety of reasons, but most notably, we think that buying in a hobby shop is a great collector experience. Agreed. Provided that hobby shop does things the right way. Right. Has the right selection, fair pricing, the right hours, community engagement. But you think about what Rip Night is, okay? And what everything. RipKnight. We started with 50 stores and 13 athletes. Three and a half years ago, we thought we were changing the world. Right? Now we have 1300 stores, 150 athletes, and 60% of the stores said it was the best commercial day, the highest sales volume in the history of their store. Okay? This was just meant to be a marketing exercise and now turned out to be a commercial exercise. The MVP buyback, right? You literally have to bring in your chrome mvp, change it, right? Yu-Gi-Oh And exchange it for store credit. Brings a ton of people in the store. They spend more, all these new customers. So we are doing. We. We think the hobby shocks are and will continue to be the fabric of this hobby. And we. But we want them to do it the right way. And then breakers, look, we think breaking is a good thing, right? It allows people accessible price points. It allows people to select for the team that they want or the character that they want. Right. Without having to buy the whole box. It's really think about it as a group buying format. That's really what it is. And a syndicated format. And what people, I think, lose sight of is it's not the breaker that gets the car. There's a collector at the other end of that, Right? The breaker opens it on camera and everyone says, oh, the breaker pulled the car. No, no, there's a collector that got the car. So we don't say, oh, are breakers better than hobby shops or vice versa. We think there are so many great hobby shops out there that drive the collector experience. We think there's so many great breakers that drive the collector experience. And we want to support everything that drives the collector experience. Now what we will do is keep pushing everybody to be better and raise the bar. This morning was the first thing we did. We got in the car, we went To Dick's Sporting goes to the new house of Sports. It was 45 minutes or an hour from where we were to go see their new hobby shop that they had there. And by the way, that was the third time that Mike and I have done it since we had them start this with us a year ago. And every time we go there, we'll give them lots of input on how to make it better and better and better. You know, today we. We actually rate hobby shops in, I think, seven different levers. Okay. And the best hobby shops, no different than the footwear companies, do, get treated the best because they give the best experience to the collector. Okay. I can tell you that one of the places I live, I'll leave it nameless to not embarrass anybody. There's a hobby shop. There's probably 200 square feet. I went in there. It was absolutely horrendous. Like maybe a year or two ago, it was absolutely horrendous. And now you've had three new hobby shops that we've sell to on a direct basis that have opened up in that city. Okay. And the new hobby shops are amazing on doing spectacular. Collectors love it. So. So it's our job to push everybody's. You be better. It's your job to push us to be better. We all need to push each other to be better. You can't be comfortable. There's somebody wear something 30 years ago. That's the way the hobby shops look. Sure. Okay. And by the way, we're talking about here. We love this show. Okay. We love the Nashville. By the way, I just got off. I think what we was. We've just been through a world cup where we went to eight games. Fanatics Fest, which I spent a lot of time in the details. Have this little party right before that. No, no, no invite. Coming out here for three, three or four days with your mic. But we got to keep saying, like, we look around here and we love the excitement, but we also want this show to be better. The same way we work with an ax. Festive man, Everything. Anytime we're ever satisfied, complaints. Yu-Gi-Oh So. So let me push back to you just on that, because then the next complaint is, Yu-Gi-Oh so, okay. Dick's house of Sports. We got Tom Brady opening card shops. Lewis Hamilton opening card shops. The next thing then is. That's awesome. Great for everybody on a big picture. I got my mom and pop shop, and I'm doing everything I can. I'm giving a good experience. I'm trying. How do we convince those guys we're not going. Yes. The exact question I was about to ask. Unity, baby. Here's what I would say and then jump in. We're going to push you to be better. And by the way, if you look at dick stores, they look better. Our guy said today who runs the hobby shop business. Yu-Gi-Oh He said this would be a tier one hobby shop is only the second iteration. Okay. How do Brady stores look? How do Lewis stores look? How do Cards HQ look? How does you know, how do collectibles look? How does Burbank look like? We like these bigger and better stores. If you say, hey, my store's gonna be the same, I'm not changing. It's gonna be the same, guess what? You may get left behind. But what if we say, hey, I don't want to be 10 franchises. My experience is great. You could have one right Store. Okay. Keep investing in that store. Make it better. I like better. Like, be like you're going to. By the way, there's room for hundreds, many hundreds of individual hobby shops that have one store. And that's a better look. Different than it did 30 years ago. And I'm good. Like, I think it has to improve. But like, I would like rlc, I would tell you to tell us, what are you going to do to make the hobby shop better? What are you going to do? Get more people. I think it's harder when you have multiple stores to keep the experience 100%. Right. Look at, look at Burbank sports cards in L. A. Okay. One of the best stores in the world. Sure. Right. That store, Tier one store. Look at Cards hq, one of the best stores. Now they're gonna open more stores, but right now I've opened one store for a while. Right. And that's the experience there. The community that they've built is special. Yu-Gi-Oh Can I just point out something though? Because you go to like a Target or Walmart, you buy product and it's the exact same price because it's retail price. They have to price it at that. But you don't have to shop, by the way, because we don't let them. Yes. Customers. And that's because we worry about making sure that there's great entry level product. The customer goes to Walmart, Target. And by the way, in other places, people try to raise those prices. We said, hey, you have to sell it in msrp. You cannot go above, you cannot Gal's customers. We will not allow people to gal's customers, which is a fantastic thing that you've done. The thing is, if you go to a hobby shop that is multiple franchises, there's going to be a lot of overhead because they're continually trying to keep up with the Genesis and make their shop better, which makes sense. So they have to price their product accordingly. And it's much, much harder to bring that price down from there. And that I think is where the customer experience could be affected. And I know that's how important something very important for you guys because if I go to my local shop where the guy is one guy, he has his mom working there and there's just a few other guys locally that work there, he has a little more wiggle room to maybe affect some of those prices over time, bring it down and make it a more affordable thing. And my concern is the more we go into a corporatization of hobby shops, even though it does make the user experience overall better, it may make the overall pricing, purchasing part of that less advantageous. We will not let that happen. We, entry level pricing for us needs to stay entry level pricing. We don't want to see marked up value boxes, marked up blaster boxes. It does not, it does not work. Now look, should a box of Dynasty be market based pricing? Sure. Okay. I think everyone knows that's the deal. Should a value box of Chrome be market based pricing? No, it shouldn't. Right. And so we're working hard to make sure that's the case. There's. Look, we don't, we don't have complete control over that, but we're using our influence to make sure that that's the case. Yu-Gi-Oh By the way, the best example would be like Horn Vault by Brady. Okay, keep me on this. I think they made the decision, this is their independent decision. They made the decision to say we're only going to sell it MSRP on retail price. We're not going to go above. Many of the independents are saying we're going to go above and get as much as they can for it. Yu-Gi-Oh sure. I'd say, you know, look, in no way, shape or form do we control price. But what we do control is allocation. So you see that you can affect allocation. Yu-Gi-Oh look, we want to make sure if we know that cardboard punk Brading is going to sell stuff at MSRP because we don't control price it, but they're not going to sell it above that they're going to get a high equity amount, they're going to get a higher allocation. Sure. We think that's, that's a, that's a good thing and we care by the way if somebody has one store is doing a great job and that store looks great, comes in and says, we're going to make sure to treat the customers really well. We're going to treat them great. We have. I, I think if you look at our tier one stores, I think it's 150. They said when a tier one, most of those are individual mom pop sellers. The people that have blessed it in the stores. That's cool. Okay. And we're not like, all right, whether it's digital presentation, educating people, getting people to learn how to be into the hobby. I mean we go to so many stores and likes in a hobby store, you know, multiple times a week, every week I'm in a hobby stores multiple times a month. So like we're in it to say how do we make everything better? I think we all need to have the mentality status quo is not good enough. We need to make better products, we need better marketing, we need better stores, we need better breakers. And we need to keep reinventing ourselves. And what it boils down to, a lot of it is a very simple philosophy. We don't want to look at collectors as transactions. We want that. We want to look at it as a relationship. And the relationship with the collector over a long period of time is important. And it's what you talked about before, right? You're worried about next week or next month or next year. Well, if you have a long term oriented approach around this and you do things the right way, you're maximizing the probability of success over the long term. Last thing I got to push on. We've talked about this before. I think one of the only times Mike has called me is when I made a video. Topps Chrome Basketball came out. It was smoking high. I was like, this sucks. Like, how do we get this price down cheaper? You called me like an hour after the video Tribute and I was like, hey, I forget the exact numbers. But for round numbers, we sold it to you guys at 500. Now it's a thousand. What are we in the Rebuy is now 800. What are we supposed to do? I hate criticism like this because I don't have the answer. But how do we do that? I love value. Boxes are valuable. Like they're cheap. Entry. That's perfect. But how do we make some hobby skus also Entry. How do we affect that? We're. We saw the thing that we experimented where we cut the seal on the Mega Box. By the way, love it. Right? I don't think that's the end of it. We learned a lot from that. So we're going to continue to learn. We're going to continue to experiment. And there, if it was easy and it was simple and there was a decision to be made without consequence, we would have done it right. So we want to do it the right way and we want to continue to conscious of it still, which I like. Very conscious. Okay, let's get this real. When we bought tops, January 1, 2022, I think top sold. I think it was 170, 200 coffee shops. I'm doing this from memory directly. We now sell 1200. Okay. Every one of those hobby shops comes in and tells us. We've met with dozens since we've been here in the last three days. They all come in and say, thank you for selling me directly. It's because of that we have a much better business. We can afford to give better pricing, lower pricing to customers. I have heard that from every single person who's come in. The direct account allows me to get better prices. I eliminated the distributors, which we've done in just about all cases. And directly selling the hobby shops, directly selling the breakers is actually lowering prices. Now, we also know we don't want hobby shops to solve weekly. So if you have a hobby shop, we talk to you to sell the collective. It's not me to wholesale to somebody else, which, by the way, I love. I was the breaking game. That's what we did. I got my cases, I flip them, I'm done, and everybody's screwed. And you may find out, if you're a hobby shop, our cases, you might not have an accountant, which I love. We report on. Good. Because what we want to do is give you the best prices we can give you and then have you treat collectors great. Yes. So we're sitting here obsessing 16, 18 hours a day, every day of the week about how do we do benefits collectors. We know. Great. By the way, we're a bigger company. So as you get bigger, you just, you know, you know, people want to come, come do with things. And sometimes, by the way, you have great input from the market as well. I mean, we listen to the market. I listen to your podcast almost every week. Okay. Like, I listen to it all the time. And there's one more important point here. You know, you got something funny? Twice. Twice. He gets sensitive. What do you want to do here? Sensitive. Made one little remark. But there's one more important point here, which is the market, for the most part, sets the price right. Yu-Gi-Oh Yu-Gi-Oh Price is a function of supply and demand. And by the way, that can change. Right? There's everyone's chasing an Ohtani card. That card gets hit. Does the price adjust? We'll see. Right? So you don't our look, it goes down to the market is going to determine the price for this. Our job is to try to figure out what that price is and price it and price our products at a price that's substantially less than where we think the end price goes on most of our products. Right. There's some products that are just designed to be accessible where price appreciation really shouldn't be a thing. Now we don't. I mean look, products like Series one or Series two or flagship, where traditionally are long run products not meant to have price appreciation, those products have also had price appreciation because sure, frankly the demand has been so strong and part of that is because we spent so much time on product innovation, so much drive on product enhancement that the demand for the products is higher than it's ever been before. And you make by the way, you make volume decisions 912 months in advance. Right? So it's very hard to forecast where the market's going to be, how strong the rookie class is going to be, how strong the market's going to be. All those things are very hard to determine. 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Check Responses Setup Required compatibility and availability various 18 plus we are always thinking about the collector experience and we want to put the right product into the right collector's hands and we want to do so as efficiently as possible. Good. I'm going to throw you a softball because I think we're almost done. I don't want Softballs. Well, we're almost done. I do buy the soft. Softballs are boring. Give us the stuff you really said. Okay. You want a hard one? Hey, Zach. Just coming to say we don't have anything bad this time. We're good. Nothing. You, Nothing. You guys ask anything you want? No. Okay. I got a tough one. But it pushes back on what was just said. No problem. Okay. So I know the market is determined the price in most cases. Yu-Gi-Oh As someone who we were very fortunate that we get to break product and we get to be able to give that product out to the audiences. What we've noticed is that comes in wave one and it is a very well priced product. Wave two is where the majority of breakers and shops are going to get their product. And that's where prices now are affected by what the market is seeing. And that's where those people then have to go above that in order to either make their money back or to make some money on it. So I would say that yes, while there are parts of the process where you make money. Oh God, I'm getting whispered. I don't know. They're trying to find out when the planes. Sorry. I mean. So you're just saying something is factually incorrect. Correct. A correct, please. Yu-Gi-Oh please. Summit. I mean, what percentage of our production? Yu-Gi-Oh it's, it's, it's all, it's all. It's always well over 50. Well over 50. 50, okay. Or almost. I mean, you know, across the board. Oh, wait, Yu-Gi-Oh I would say it's. I would say it's an average of at least 70. So it's on wave one. Okay. We always believe in day one. If the athletes cared, then others would follow. That's how to really grow. So great products, great marketing. That is care. But again, you know, who cares? You can tell 100%. I can tell who's here if the money disappears and who wouldn't be. No question. Correct. Yep. Okay, so now you come back to saying. Okay, so now do we make too much product? You can say, oh, we're making too much product. Right. Okay. We don't make enough product. Then we prices in places. Try to balance it the best you can within the knowledge you have. Look, I think in a lot of ways, like in how many people work tops. We bought the company. 300 people work the tops. How many now? 22 on up. Okay. Those of our investing like crazy. Yu-Gi-Oh Yu-Gi-Oh That's seven times the number of people that work in this business when we bought it in 2022. Yu-Gi-Oh And we're sitting here trying to figure out how can we make and all this team obsesses about how do we make the best product we miss all the time. Sure. That's like saying the best Athens don't miss. Okay. Yu-Gi-Oh We want to make the best product. We know the best marketing. We want to have the people that we're. I mean again, we're selling sports cards for the most part. Okay. In stars that have the entertainment cards, you want certain people to really care about the hobby and that makes the business a bigger business. I mean it had a goal. I think our goal tied next to the hobby was a shitty goal. I think it was too good served. And it's funny when I, you know, I started this criminal justice organization where someone told me go getting 10,000 duplite probation pro. We went for a million. You now surpassed a million. Okay. I think our number of 10x was conservative. Honestly, after seeing what we've seen in the last few years when you met us. Well, 22 when we bought top. How much bigger is the hobby today? The valuation? I mean I knew it from 2020 so I mean I didn't even know from Mike's early days. But from 2020 that was a huge boom and that's nothing compared to where we are right now. So how much bigger is it today? I think it's 3 to 5x. I would say 5. Great. So that's your numbers not light. Now remember one thing. When we went to the sports properties with the pitch, we said guys, this is 2020. Trading cards are at an all time high. Not 2020. Absolutely great Covid. Boom. Yu-Gi-Oh But guess what? There's not been much product innovation. There's been no marketing. The athletes and stars don't care about this. The collector experience sucks. There's huge redemption issues. They don't have a lot of on card all. All these issues. We heard from people, distributors. What's that Distributor. I honestly. Yu-Gi-Oh Sorry. Thank you. Like disturbers by everyone's going through storage makes no sense. Yu-Gi-Oh Cancer the biggest thing they create price gouging for this Shriners 40% in the middle 100%. Mike walked in and said what are we doing? Like these distributors, you're just handing out pro. I would be the rush chauffeur. No, not to screw you over. Just screw the and collect everybody. Brutal. So like what we've done in five years, I think you know, we're proud of but we still feel like we haven't done shit yet. We got so much more to do. We're going to keep making more innovative products where they keep, you know coming. By the way, you saw your first athlete announcement. The LeBron James Nestle is going to by the way great team to a lot of the Sixers. I don't think the last time could have seen Alan. How do you support a team like that? Let Carol. Oh my. You fleece us out of Jalen fricking Brown. We want them to come back next year. Your feet is made of glass. They're great. Listen, I actually. JT isn't a good buddy of mine. I'm actually when the Sixers aren't in it. I'm sure if the Celtics Shaw get destroyed for saying that but you can't actually root for a team when your team's not. I don't want Philly fans here. I'm good. And stay with goods. Guess what? The second is just one on two. Next year that's might be the case. I will say when in 2023 when you guys got tops. I remember thinking to myself, oh, that came too late. It's all. It's already there. It's already too late. We went to the leagues and we said, hey, we're going to give you an energy for the all time high. Yu-Gi-Oh I'm sorry, in English. A minimum guarantee. Thank you. We're going to give you a guarantee for the all time high, which is when we did these deals, we're going to be a higher royalty rate. We're going to create a whole secondary business and cut you in on that. We're going to make better products. We're going to market the stuff for the first time we get the athletes involved where we have all these relationships. They know we're to build a better collector experience. By the way, we're not going to be for sale. Like every company had been in this business the previous 10 years. All the leaves wanted to know how long you sign up for this crazy. They thought we were nuts when we did these deals. Now they come around here like ben, you guys aren't as dumb as you look. Yu-Gi-Oh we. I know you guys got to run. We appreciate the time. I will say this too. We don't have you on so we can get every answer. I know some of these things don't have an answer. I do think though it's important that the crowd at least here, hey, we may not know, but we care. I do. I think that's the biggest takeaway. Every time we talk to you, Mike has some answers for me. You do. It kills it. Great. Even when you don't though, it's like, no, but we're at least conscious of the issue. So I think that's an awesome change. So can I just say thank you for what you've done for the non sports side of things too, because every year it is growing, it has gotten bigger. And all I am seeing are more people coming to this booth looking for more non sports stuff. And that's what I love. It's just a really cool thing to see what you guys have done. We got a lot more cabin too. Don't tease me like that. Don't say this. You know, such an influential individual who's such a creative marketer. Yu-Gi-Oh Now, thinking about the hobby and you see Jason Sudeikis running around by these things, I mean, again, it's alt art of a plan to actually blow away the 10x the hobby numbers that we had. So let's do it. Keep 10 going here. I didn't know shit when I came with the 10x number. I thought. I thought it was just throwing off some big audacious bone, you know, I think the sky's the limit. Look, we also want to do things for everybody too. There's nothing. There's so many different cohorts of collectors and, you know, customers. And you see that here more than ever. You guys joke about it. Used to be the nerd, but now it's. Everybody's here. Yu-Gi-Oh Okay. Just great. Now it's awesome. Yu-Gi-Oh What number is it now? I don't, but I think we were just debating this morning because we don't actually. Yu-Gi-Oh we said five each. Where are you guys at? We think that's enough. 5. We on our own count that numbers this morning. Okay. Okay. But then we Beckett down. We thought it was three or five. Actually, we said we thought it was five. There were like might be three somewhere in me somewhere. Three. Okay. Awesome. Okay. I gotta say, we're still an American business, an American hobby. Sure. Okay. This is going global. I can promise you. What we're doing in London, what we have coming to Munich, what we have coming in there. How about it? When we open the store in Paris, I'm wearing a PSG hoodie. Right out. By the way, what's warming for being here? 100 degrees out here in store. God. Sorry. But you know we're going to have a bunch of the PSG players come out for this store. Opening the first, then the NFL games. They were the next day. You can have a bunch of NFL players come out. That's the very interest in the hobbies hit people in Paris who never thought about collecting cars before to want to be collectors of cars. Well, say what you will, I really do appreciate everything that you guys are doing. Whether some things hit, some things might not. But you can tell the effort is there and that you guys continually to innovate and try new things. And that's what I like. So thank you. We love you guys. About when you give us credit or when you give us a hard time, we appreciate because all, you know, all we want to do is be the best company we can. You know, by the way, I say this all the time now. Big sucks. Nobody wants to be baby. We want to be beloved. We want to work our asses off to do everything we can for the collective. This is like so motivating to us to have just gone through the World cup and Fanatics of aspir and, you know, I was like, you know, I know I'm going to do this. I'll be here until my document. Like, I'll be coming every year and, you know, eventually it'll be a bunch. His son is actually the future serial. Oh, Yu-Gi-Oh Nice. He actually knows more about cards than him for sure. Family company. Great. Family business. There you go. I'm already starting to recruit. How you supposed to waste the time? Yu-Gi-Oh you don't need. College is a complete waste of time. Like, come on, let's go. Kids at home. Yes, there's your message. School's terrible. Mike Hands. Mike Ruby Movement us here at sdn. Thanks for watching. Thanks for listening. We'll see you next week.