EFP 119: Scoring Free Travel With Abroaders.com
What if you could get free flights just for spending money you would’ve used anyway?
Introducing Erik Paquet from Abroaders
In today’s episode, we sit down with Erik Paquet from Abroaders.com to discuss how even bootstrapped entrepreneurs can travel the globe for free using “travel hacking” tricks to score free airline miles and hotel stays.
Whether you’re a global traveler or a 2-weeks a year vacationer, you’re gonna dig this episode.
Check Out This Week’s Episode Here:
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Topics Discussed This Week:
- What is travel hacking?
- Collecting points / rewards
- Good rules of thumb for travel hacking
- How to redeem rewards
- Abroaders’ business model
- Featured Listing 40106 – Home & Garden Site – $1.52K/mo. – $30,387.80
- Credit Karma
- Best Credit Cards for Travel Hacking
- What It’s like to Fly the $23,000 Singapore Airlines Suites Class
- EFP 118: Retaining Employees in Startups
- Website Valuation Tool
- Shit Coffee
- Empire Flippers Twitter
- Leave an iTunes Review!
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“Don’t buy the toaster. Look at travel!” – Justin – Tweet This!
Do you have any travel hacking questions for Erik? Hit him up in the comments below!
Speaker 1: Welcome to the Empire Podcast, episode 119. Jonah Huge fans of the ex pat entrepreneurial movement. In today’s episode, we sit down with Eric from abroaders.com to discuss how even boot strapped on floors can travel the globe free using travel hacking tips. This work free airline miles and hotel stays, whether you’re a global traveler or two weeks a year vacation or you’re going to take this episode, you can find the show notes and all the links. Discuss this episode of empireflippers.com/abroaders. All right, let’s do this.
Speaker 4: Sick of listening to entrepreneurial advice from guys with day jobs, once a year about the real successes and failures that come with building an online empire. You are not alone from San Diego to Tokyo,-
Speaker 6: …to New York, to Bangkok.
Speaker 4: Join thousands of entrepreneurs and investors are prioritizing wealth and personal freedom over the oppression of an office cubicle. Check out the Empire Podcast and now your house, Justin and Joe.
Justin: All right, Joe can travel the world for free. What were your thoughts when you first heard about this? Travel hacking, living the vacation lifestyle stuff.
Joe: I have a bridge to sell you.
Justin: Yeah. Right. I mean it sounds a little, my picture is this guy on this like rented Yacht holing up in the rented Ferrari or Lamborghini trying to sell your shit, right?
Joe: Yeah. The, the real estate, the late night and real estate guru that like tried to tell you that buy his book to learn the real estate game kind of thing,-
Justin: That infomercial guy or whatever. Yeah, I do. I hear the same thing. And I thought that quite a while back, I thought that this whole kind of movement was either for them or for people that were, crazy balling. They were spending 20 $30,000 a month on expenses and so of course they’re going to be able to get miles or you know, they’re traveling four or five times a week on business trips and they’re having the business paid for it and they’re just, accumulating the miles, of course they’re going to get some value out of something like this. Where I didn’t know is that this is for people like us, this is for people even that are, I think they’re even bootstrapping.
Like we interviewed today, we interviewed this guy named Eric, you know who works for runs abroaders.com and he’s a bootstrapped guy himself, and his business partner aren’t crazy balling, and they’re traveling the world like it’s insane. So we know we’re going to talk about some of the things that this is, and that some of the things we’re going to start that by really just breaking down who this is for. And then I think the bootstrapped has a really good opportunity to take advantage of this.
Joe: Yeah. It’ll be really interesting to hear from an expert on this kind of thing. I just wonder if you factor in your time and how much management you have to do for it. Is it really worth it?
Justin: Yeah. Are you getting at the value? You know, we talked about this, we took a trip recently. We went to Vegas and we came back. Now, we’ve benefited from this because we’re obviously we’re sitting in business class and we’re rolling like ballers, you know, I got to come back and first class I was really happy about that to experience that first class international flight.
But was it worth kind of hassle? And I’d say like just for that one trip, if that was the only trip I ever took or that we ever took, I think it probably wouldn’t be worth it because I ended up, you know me did I deep dive on stuff. So I was deep diving this topic. But I think it is worth it if I continually do that. If we can do that twice a year and have these, kind of awesome trips so we can get some hotel stays out of it, I think it’s absolutely worth it longterm.
So we’ve talked about this before on kind of the false economy thing and I think there’s some truth to that. I think if you’re just spending, so you can get these miles or points, that’s pretty silly. But if you’re actually spending it on no everyday or monthly purchase you’d be doing anyway. Especially when you look at things like, I’m paying for Facebook traffic or you know, I have a Teespring campaign, I’m buying Facebook traffic or I’m a buying some ad words traffic. I think it totally makes sense because you’re doing, you’re making, you have that spin anyway.
Joe: Right? No, it makes sense to me. I just wonder if you add in all the management stuff and you looked at your per hour, would your per hour factor into, you just working on your regular business instead of trying to get an upgrade for free. But Eric is the guy, the man on this, and I’m sure he talks about that and I’m sure that that has been figured out.
Justin: Well that’s kind of like, that’s not the problem that they’re trying to solve, right? Is because it’s really time consuming to get the award travel, like to figure out then because the airlines make it really difficult to figure out which flights are available and how to book them. So like if you’re trying to do that on your own, it’s crazy miserable.
And so trying to find out which flights and you know when you’re going to take him is kind of a bitch. And so that’s the problem they’re looking to solve is just to handle that for you. Like, our buddy Mark Brenwall, we’ve found the show a couple of times, uses these guys religiously and I’m like, “Have you looked into all this stuff yourself?” It’s like, “No.” I was like, “But you don’t even know.” That was it just you need to learn about these? Like, “No.” I was like, “Why not?” He said, “Well, I just have Eric take care of it.”
They just say Garrett for me. And like if I spent any time thinking about that, it’s a waste of my time. I thought it was a pretty good point. So today we’re actually going to get into you know how to score these points and miles. You know how it all works and we’re going to talk about how to find this, virtually free travel or whether there are any blackout dates need to be aware of. We’re talking about some of the more outrageous kind of travel possibilities that are out there.
One of which I’m going to be trying to take advantage of this next year. I think it’s in the Maldives is beautiful, beautiful high location and we’ll talk about that in a bit, but before we do that, but I just take a quick break and cover your featured listing of the week, which you got for us Joe?
Joe: I’m not listing number 40,000,106 this week. It’s a site in the home and garden it specifically in bedding and it’s monetize using commission junction and Amazon, so commission junction, a little bit different there. We don’t usually have sites that use that, but it’s it fairly successful. It gets about 2,500 to 3000 page views a month nets, a little bit over $1,500 and we have it listed for just a smidge over $30,000.
It is a pretty passive site. Obviously you always have to add content, but I really like this side for someone who’s looking to expand their portfolio and to some different types of monetization and we don’t normally see commission junction type sites. So this is pretty interesting.
Justin: I just saw he’s looking for a down payment on a house. We see that pretty often people looking to sell virtual property for purchasing, physical property. We have some friends, I’m going to do that in Australia. So all the websites that they sell, they’re looking to reinvest into physical real estate in Australia, which seems a little scary to me. What the Australian real estate market. I know that there’s, some people talk about there being a bit of a bubble there, but I think it’s interesting to do the swap from virtual to physical property.
Joe: Definitely very interesting. And I liked the seller’s approach and, and I hope we continue to work with them in the future.
Justin: Switching subjects attention I’d say is that, I was reading this funny articles talking about how to live like a, a billionaire, a multimillionaire. It was written for someone making let’s say $100,000 a year. And Joe, you’ll appreciate this is, some of the things they argued is that you can upgrade certain parts of your lifestyle that will make it like you’re a multimillionaire.
One of the points they made was bedding. So look for 1500, maybe $2,000 you can have the most amazing, comfortable bed that’s out there. Sure. I might not be gold plated and amazing whatever. But in terms of comfort and like support for your back, 1500 $2,000 isn’t going to do it. And you’re going to be sleeping on the same quality of bed that someone worth $50 million of sleeping on. So if you want to upgrade it and you’re spending what a third of your life there so you might as well have something amazing with your bed. So just thought I’d throw that out there.
Joe: Yeah. I always liked to do that upgrade parts of my life where it makes sense. And I think that’s a pretty good philosophy when you can afford, it.
Justin: It sucks. You know, this whole travel thing, Joey, you’re on the move now to you and you’re on the road here in Ho Chi Minh and traveling around at bay sucks when you get a bad, bad huh? It’s just, it’s rough because I’ve been staying in place one week here, two weeks there. And it’s like every time I go to a place of a really nice bed on my God, okay, I can relax again.
Joe: Yeah. The bed and the place I have right now, it’s acceptable. But I wouldn’t say it’s anything to get overjoyed about, but that’s why I’m kind of looking for a home, somewhere where I can afford to put a little money into it. Upgraded things to the things that I like. So I’m kinda looking forward to the next spot to really plant my roots and I make sure I’m going to stay there for a couple of years because it doesn’t make sense to buy the $2,000 bed if you think you’re going to move in three months.
Justin: All right, man. Let’s dig into the hard of this week’s episode.
Speaker 5: Now for the hope of this week’s episode.
Justin: All right. As I said at the top of the show, really excited to have Eric from abroaders.com on the show. Today we’re going to be digging into travel hacking. We’re going to be digging into, how you gain points, how you use those points, and ultimately some of the amazing things you can do.
Eric, I’m a of your podcast. I’ve been listening for months. Thank you so much for being on the show, buddy.
Eric: Yeah. Thanks [inaudible 00:08:59]
Justin: It’s good to meet with you in [inaudible 00:09:01] were laughing and out a little bit in Bangkok and you know it’s fun. You’re one of those travel guys, so you’re traveling everywhere. I can meet up with you in any country, any city, or you’re probably be stopping in. Let’s get into a little bit about what travel hacking is. I’m not sure that our audience is terribly familiar, even though I talk about it had been on our show. What is travel hacking? What’s the deal with this?
Eric: Yeah, so basically we were using Airlines Frequent Flyer programs that are loyalty programs and using points to travel really cheap, and so there’s opportunities to travel in business class and first class and pay a couple hundred bucks for flights across the world so you can get from the US to Asia, you can get stopped in Europe. You can pretty much have access to travel anywhere and buy kind of gaming these loyalty programs and earning points and then spending them in a really effective way. You end up being able to just open up tons of travel at a price that is way lower than what you’d have to pay to get the tickets.
Justin: Before I heard about all this, I used to think that this is only for the 800 plus Vico guys. This is for the business guys that are, there are companies paying for all their flights. They’re flying twice a week and their company’s paying for it. And it’s a way for them to kind of use it. I also thought that if you own your own business, if you’re not spending $20,000 a month on credit cards, this whole thing was pointless.
So I honestly, I kind of, I wrote the whole thing off,, this was not at all that interesting to me. And I talked to my buddy and Mark Brenwall has been on the show a couple of times and he was like, “Nah, man, it’s really easy.” And I was like, “I dunno, I’m not, I’m not buying a dude.” And he’s like, “No, no, no. He’s a talk to this guy. I’ve got a guy, he’s, I got a guy that hooks me up.” And say, “Well, what’s this guy’s name” and he is like, “Eric?”
He said, “Hey, this guy Eric, he just kind of does all this stuff for me.” And that’s how I kinda gotten to your circle. So, I think there is a common misconception that this is only for the crazy ballers, right? This for the 20,000 a month in spend people like, who do you think this is for? We were talking about this before the show. Don’t you think someone would like you be spending 20 to $30,000 a year and have a six 50 plus by eco score and this could still work for you?
Eric: Yeah, absolutely. I mean, I think the credit score, first of all, doing this can improve your credit score a lot and so you don’t have to have an awesome score to get your foot in the door and get started.
Justin: It helps.
Eric: It helps. It makes it easier to scale it faster, right? If you’re trying to travel a lot and your score is not that good, you’re probably not going to be able to use points right away for all of your travel needs. But if you’re above 650 you’re in the zone where you can start opening up those relationships with the banks and you don’t need to have that much spending. So the real key and we can get into it more later in the show, but signing up for new cards, it gives you an opportunity to get a huge boost and points that with regular spend would take forever to get that much.
I would take a lot of spend and so basically what you need to focus on is going for a couple of different credit cards signups, earning a bunch of points and then redeeming those for travel and a couple thousand bucks a month is really easy number to make it manageable to start earning some points.
Justin: So this works realistically, this show and you have a 660 plus FICA score and your spending, let’s say 20 to $30,000 a year or more. This is something that you can absolutely do. So we’re going to get into exactly kind of how you do that and what this is like four, we do that really quick. Let’s talk a little bit about the difference between like rewards programs and like elite status.
As I remember watching was up in the air, right? You have George Clooney is talking about you know this and I’ve got this elite status and I’ve got that at least status. But that’s not what we’re talking about here, right? Elite status is different. It’s cool and it’s sexy because you get the whatever, prestige, platinum or whatever and you get like upgrade and stuff. But that’s different than this.
Eric: Yeah, this is actually the shortcut to get all the plus side of the elite status, right? So the idea behind these programs when they’re created is that the airlines wanted to reward their most loyal customers. And so the businesses and the individuals that we’re spending a lot of money out, business class tickets, they wanted to create incentive for them to stay with our airline, right? So if I’m American, I want to keep those high revenue flyers.
And so what happened is they created this points currency around that so that every time you fly you get a little bit of a rebate back in terms of the miles that you can use to get a free flight later on. But you don’t actually need to be an elite member to get upgrades to business class if you’re just focused on earning the miles. And so what changed is they started giving away miles through lots of third party partners and it became super profitable for the airlines to do this.
So we’re originally, it was just like if you buy a flight, you’re going to get some miles and if you buy 10 flights, you’re going to get one free. Now they’re selling these to car rental agencies and to banks and to all kinds of other third parties that are giving them away as incentives to get you to do business with them. And so that’s the shortcut. You can basically get those business class flights and not have to worry about spending the money to get the elite status.
Justin: All right. So let’s talk a little bit Eric, about collecting points and rewards. Now we were talking about it before, like the real trick or the hack here is you know the credit card signups and it’s because the airlines started partnering with these credit cards that you were able to kind of sneak into the club and get all these points and so credit card points are different than airline miles and that they can be transferred but not always one to one. That gets a little messy. We’re going to simplify that a little bit later, but just to start off, let’s talk about collecting the points.
Now, if I sign up for two credit cards, let’s say on average I get 40,000 points for each credit card. That’s 80,000 points I’m getting for the year and I only do that one time a year.
Eric: Yup, 20 minutes a time. You sign up for the cards?
Justin: Yeah. Comparatively, I’d have to spend $80,000 in spend on one-to-one sue me, I’m getting one point per dollar spent. I spent $80,000 to get that same value. That’s insanely expensive or a good deal just by signing up for the credit cards. However you want to look at it.
Eric: Yeah, that’s the 80 20 right? You’re spending can always help, but the big win is when you get that huge bonus points that’s just contingent making a small amount of spend. That’s what the bank’s offering to get you as a customer. From their end, they know that you’re going to be valuable over the long term and so they’re going to give you that huge pile of frequent flyer miles just as a thank you for signing up for their car.
Justin: Now we would be talking just about signing up and getting those points. That would be it. We wouldn’t even mention spin because like there’s so much value in the signing up except for these signups come with some requirements, right? So a lot of times it’ll be, you know, to get your 40 or 50,000 miles for the signup, you have to spend $5,000 in three months, right? It’ll be $1,000 within three months, or sometimes it’s your first purchase. So I go to the gas station, I buy one coke on that credit card and I get my 40,000 words. So it really depends. Right.
Eric: One of my first trips to Brazil is just like ah, box of tic tacs. My first branch is went and got some tic tacs and then went and got a flight for five bucks to Brazil.
Justin: I think I bought something really small, like a US airways card and got my 40,000 miles there or something. And then I bought a bunch of stuff on a different card and one of the cards, a Barclays card took transfer. So I transferred a big balance to them so that I could then get my sign up. Plus the money I got for transferring.
So, so anyway, a lot of times the only time we’re talking about spend that I think is applicable, especially if you’re a bootstrap entrepreneur, is when you have to get that minimum is, but, and that’s one of the reasons you don’t want to apply for like 10 cards at once. Right?
Eric: Right, exactly. Yeah. You got to make sure it’s manageable. And like you said, generally it’s going to range from $1,000 to maybe $2,000 a month. That’s sort of the Max that they’re asking. And usually it’s spread out over three to six months. So a typical offer is it’s $3,000 in three months. That’s a really normal one. And so if you know that you’re only going to be able to spend $6,000, you want to just limit it to two carts, keep it so it’s comfortable for you to achieve that spin.
And generally you can do it every two or three months. So if you’re not sure if you’re going to have enough spending, be conservative, just get a couple of cards and then wait till you hit those bonuses and then move on to the next cards. It’s really possible to have a very simple system where you just do this a couple of times a year and ended up banking enough points to travel quite a bit.
Justin: Yeah. And as long as you’re like balancing it out so you’re not signing up for four cards that all require 5,000 spend within three months. Right. Because now you’re putting yourself at 20,000 spin. I gotta be doing seven grand a month over the next three months, or I’m knocking at my minimums. Now there are things that are a bit outside the scope, I think for this podcast interview, things like manufactured spin, which is basically a, there was that one thing that was well known where they were buying like dollar coins from the US mint.
So yeah[crosstalk 00:17:24], the man was allowing you to pay with a credit card and buy $1 us coins for $1. So people would buy like 5,000 yeah, free shipping, 5,000 us mint coins, get them all, take them to the bank tournament and you’d be getting this credit cards and they shut that down,-
Eric: shut it. NPR ran a story and my business partner and I were literally going to the bank like twice a week with backpacks full of coins. And the bankers were like, “What do you guys doing?” We’re like, “Oh, we got this vending business.” You know, we’ve got, we’re just collected all of these dollar coins here. So there’s still a ton of those types of opportunities out there and,-
Justin: …they’re always popping up.
Eric: Yeah. That’s the thing is it’s sort of you got to stay plugged in. If you really want to get into that world, you can generate a lot of value for yourself by doing that manufactured spend thing. But for most people who are running a business, the key takeaway is you don’t have to do that to make this work unless you’re trying to travel, six to eight times a year in business or first class, you can get enough points just by regular spending, if your income is around 30,000 going up per year, there’s plenty of room to make this work without having to go through the hassle of Terry backpacks, like guides to the bank.
Justin: And if you’re, if you’re using PayPal, if you’re spending money on hotels or Airbnb like we are traveling, you’re one of those traveling entrepreneurs. If you’re using Odesk, these are all things you can use for credit cards. Buttons was a bootstrapping entrepreneur. There’s plenty of software, plenty of things that you need in your business that if you just were putting on a credit card, you’d be hitting those spend levels. You guys swapped different cards out as you need. One of the things I’m noticing about this whole travel hacking thing is that you end up with just a ton of extra cards. So I’ve got a bunch of cards. You said you have like 15 cards or 18 cards are sitting in a drawer somewhere.
Eric: Yeah. I’ve got a graveyard of credit card sitting in a drawer.
Justin: We don’t even really use them. Right. You just get that initial spin, get your miles and then you’re basically done with the card. Now there are some cards that we use pretty regularly, so we both talked about this is the chase sapphire preferred or whatever, which is kind of our everyday spend. It has no international fees. It’s got a decent signup on us. But it gives you two points for every dollar spent on food and travel. It’s like restaurants and bars and then travel, which I spent a lot on that stuff.
Eric: So yeah, I mean I like to keep it sort of, you can divide into three categories. There’s, cazzy that you get just for the bonus and those are the ones that you put away and either cancel when you know at the end of the year or you know, just leave the cart and move on to the next thing. There’s the other cards that you want to use for the benefits that they carry. So there’s some cards that just have really valuable, like we were talking earlier about some insurance deals where if you buy a new laptop, your insurance plan is double, then you’ve got up to the value of that computer if it needs to get replaced, if it gets stolen. There’s ones that offer really good rental insurance or travel insurance, and then things like lounge access. There’s definitely cards, [crosstalk 00:20:06]
Justin: Like MX platinum we are talking about the lounges are great.[crosstalk 00:20:09] You should get that. Yeah.
Eric: Yeah. And then there’s some that come with like elite status for hotels. So there’s some that just by holding that card, you know you may be pay $50 a year in an annual fee, but you get free room upgrades when you go stay at a Hyatt or you get free breakfast or free Wifi. So there’s cards like that, that are just flat out worth keeping, but the ones that you’re moving through for the bonuses. And then there’s those category spence where you know if you’re spending a lot of money on advertising or things that are getting two points a dollar instead of, you know, instead of one, those can be worth focusing your spend a little bit.
Justin: Got it. So my three categories are the ones I meet. The minimum has been thrown in a drawer. The ones I keep in my wallet, but I’m really just flashing them for lounge access or insurance or that kind of thing. And then the kind of everyday credit cards that I use on a regular basis, those are my three statuses of credit cards.
Justin: Okay, got it. Now, so I’m getting all these points where I’m starting to collect all these punches. When do they expire? How long do I get to keep them? Do I need to transfer them to an airline? How does that all work?
Eric: Yeah, so I mean there’s not a really simple answer for that because the banks and the airlines have sort of different rules for each type of currency, but some general things to keep in mind. The most valuable types of points are the ones that you can transfer to lots of partners. And so there’s three major examples of that. There’s chase has a currency that you can transfer to a bunch of airlines and a bunch of hotels and.-
Justin: These are called Ultimate Rewards?
Eric: Yeah, Chases Ultimate Rewards. Amex is called membership rewards, and then Starwood preferred guest, which is actually a hotel chain, but they transferred to like 27 different airlines.
Justin: And one-to-one generally over a lot of them.
Eric: Yeah, one-to-one. And actually for Starwood it’s if he’s transferred 20,000 you get 25,000 points in year program. So those are super valuable because that gives you that flexibility, right? If you want to redeem your points and you have just your destination picked out, now you’ve got a whole bunch of different airlines that you can choose from to transfer.
Justin: So you’re saying that if I have a US airways card and I’m getting the parts, I got my 40,000 USR, I’m doing spend on that or whatever, then that’s more limiting because I’m only getting USR where’s points? Whereas if I’m getting Starwood preferred guest or SPG points, I can then transfer them to a number of different airlines, 2030 different airlines, whatever they’re associated with nimble, these weird associations.
Eric: Right. Yeah, so that’s totally true. It gives you a little bit extra flexibility. But in terms of the exploration in general, one of the big benefits to doing this on an ongoing basis to continuing to accumulate points, especially through cards, is that most of these currencies reset the clock on when they’re going to expire every time you earn a new point. So as long as there’s like that account activity going on where you know you’re buying a stick of gum here and there or you’re signing up for a new car with a bonus in that type of currency, you’re resetting the clock. So most of the time you’ve got a couple of years before your points expire with like it just a completely dormant account.
Justin: Cool. Okay. So now for the people that are saying, look, “I’ve got pretty good credit, um, let’s say a seven 70 FICA score, I know that if I’m applying for a bunch of credit cards, it’s going to hurt my credit. I know that I’ve a chance that my credit score is going to go down. And I’m worried about that.” Like is that really, it comes out because you have customers, have you seen this happen for them? How does this work?
Eric: Right. So actually what we’ve seen for everybody, except for the people at the very highest, those people tend to stay put. But the people in the low seven hundreds tend to see a really good increase in score. And the reason being that a big part of the equation is how much available credit you’re using. And so the banks are, are essentially trying to break out how responsible you’re being with your credit by looking, “Okay, Justin’s got $50,000 in credit line and he only spends like four or 5,000 a month.”
You’re using that really responsibly and so what happens to your score is as you acquire these new cars, you’re opening up those new lines of credit and you’re adding to that top number and so your utilization, it looks really good. That’s one of the big factors that make your score go up. The thing that people worry about the most is there’s this ding, right?
They kind of hit your credit score when they do the inquiry. It’s a negative. That’s short term in the sense that the bank knows you’re looking for credit and or equation. That sort of maybe a risk factor. Like if you need credit, maybe you’re in trouble, right? But it’s temporary. And so usually knocks three or four points off your score and that tends to last like three to six months.
And then it disappears from the way that they’re evaluating your credit. So you don’t want to do 10 like you said, besides the having to hit the spend. You don’t want to do 10 cards at once because that just looks like a really aggressive play for credit. But if you do a couple at a time and space it out throughout the year and you’re going to build strong relationships with a whole bunch of these banks and they want to do business with you because they’re making money on all of those transactions as well. So this is great business for the banks and they’re just rewarding you. You’re getting a piece of the money that they’re bringing in and you can redeem it for travel.
Justin: You tell me on this thing I think is a really good resources credit karma.com and we’ll put a link to this in the show notes, but basically this gives you an idea as your utilization score and they look at it both on like your overall utilization. Let’s say you have $100,000 with a credit and you’re using, you know, 8, to 12,000 of it, you’re really good utilization you around 10% they also look at it on an individual card basis, right?
So if I have a credit card, let’s say, or really low level credit card at 2000 and I’ve got $1,000 a spin on that, that’s actually not good cause I’m at 50% so I may want to just pay that one off and put that thousand dollars on one that has $10,000 limit so that I’m better utilize on an individual card based. So it’s both overall and on an individual basis. Well when these I got from your podcasts, and I screw this up when I started this because I had to listen to that episode or something, but I applied for like 10 credit cards, right? I think I got six of them initially.
So there got all these credit cards that all of spend I needed to do, but that does tend to it. We’re talking to those Ding your credit a bit more on that initial hit. And you normally recommend three to four per quarter. Is that about right?
Eric: Yeah, it tends to be based around what you can spend as well, but that’s really a good number. Unless you’re traveling a ton or trying to support lots of people traveling with the miles you’re earning, that’s a really good pace to make it possible. Three to four cards per quarter is going to give you enough to do a couple around trips. In business class they say three or four round trips in business class a year,-
Justin: …three or four roundtrip business class tickets for virtually for free per year?
Justin: That’s boss, or what am trying to talk about redeeming and getting these crazy take get to that a little later. What about, so let’s say when is the situation, I probably shouldn’t be playing this game. Let’s say I wanted to buy a house in the next year or two years. Is this something that, can I still do it? Do I have to take it a little more easy? Like how would I go about doing that?
Eric: Yeah, I think you want to take it a little bit more easy. I mean the one the big things is, if you’re buying a lot of money for a house, then a small change in your interest rate can cost you real money. Right. And so over the term of the loan, I think that a mortgage where you’re borrowing a lot of money is one of those scenarios where you definitely want to take it maybe one or two cards at a time, but the people that are evaluating your mortgage application are not going to see like a couple of credit card applications and be like, “Oh, this guy’s totally irresponsible. We’re going to jack up his rates.”
Justin: Yeah. And you could always bounce, you could always bounced off of it for six months when you’re leading up to the point we’re going to be buying to.
Justin: Right. And, and then that actually utilization are probably actually help your credit score more than it will hurt you from a credit pull. Do you have a year and a half ago?
Eric: Exactly. Absolutely. And so, I mean like the key takeaway here is like, just do a couple of cards every few months. You know, you could do two cards twice in the year before you’re going to apply for this loan. Give yourself three to six months off before you start shopping around for the loans, and you’re going to be just fine. You’ll probably have better credit than you did when you started with this.
Justin: All right, so let’s talk about what credit these points are worth. exactly. I see people on Facebook and they’re saying, “Oh, I just got a new toaster with my Citi. Thank you points.” And you know, I just got, I actually, I did with my thank you points. I got like an Xbox 360 back in the day. I got my first, well yeah, a little better.
I got my Samsung Galaxy. But now that I’m in this space, I’m thinking to myself, “Oh my God, how many trips could I have taken work? Could I have stayed with those points?” So how do you value, you know, these points, what kind of value am I getting when I get the Xbox versus what I’m versing travel?
Eric: So generally those shopping malls, I’ve just a really bad deal. You know, like it’s kind of that simple logic that like if it’s that easy to do, it’s kind of where they’re trying to push you. And so they’re offloading that liability with the miles you’re spending a lot more miles than it costs them to give you the toaster or the Xbox. The reason that the airline transfers are such a good value is because there’s that extra step, right?
The banks not directly responsible for fulfilling flying you someplace, they’re just buying the miles and ball. And the airlines are running a big calculation because they’ve got 80 million different members in there, had frequent flier programs and so on average, those miles that are outstanding aren’t going to cost them that much. And so if you’re clever about how you’re redeeming, and especially if you’re looking at business and first class travel, you’re getting tickets that are three or four grand. maybe you wouldn’t pay three or $4,000 but you’re still saving a couple. $1,500 on a flight across the world. And that’s going to be way, way better value for your mile.
Justin: Yeah. The idea of thinking about like, you know, if I’m getting a point for you know, 1 cent or sent and a half and I’m redeeming it, 9 cents or 10 cents, there’s volume. I think it is important to remember though that would you have bought that business class or first class ticket, right. You have to take that into account when you’re, when you’re looking at this.
And that’s something that I started doing. I was like oh no this is great value. I’m good. Well no I shouldn’t just start buying up points like crazy cause I probably wouldn’t purchase those business class tickets otherwise. But yeah I think if you start to put a point value on them and I’m like you were saying like a Starwood preferred guest point might be worth more than just a straight up US airways point because of its, you know, versatility. Right.
Eric: Yeah. Well and so a general baseline is around 2 cents of point for the more valuable ones is a pretty baseline. If you really want to, you know, I think coach is actually a really good comparison in terms of figuring out how much money you’re actually saving traveling. So you can think about it that one credit card sign up can easily get you a round trip and coach from the US Europe, the US to South America. And so if you do that at the minimum, you’re saving a thousand dollars ticket, right?
Eric: And so a lot of times you could do that, make it to credit card sign offs and all of a sudden you can do that in business class. So you’re still saving $1,000 over the minimum and you’re upgrading your experience. You’re not going to spend time in the lounge, you’re going to the short line and you’re just having an overall much more enjoyable travel experience. And especially if you’re doing it for business, if you’re going to meet people like we were in Bangkok and to link up with other entrepreneurs or pursue opportunities, sometimes you don’t have that much time to be in the same place with somebody.
And so there’s also a really tangible value to getting some rest and like waking up and not just being destroyed from like 18 hours of sitting in code.
Justin: We had a problem. And were you able to solve with where Joe and I are both going back to the US, where we need to be in Vegas for an event. We’re doing a workshop and we’re attending an event and we needed to be fresh, right? Like we, we didn’t have a huge leeway in the amount of time that we were going to be able to be there, and we need to get there and be rested and be ready to go. And so it made a lot of sense for us to do, you know, business classes.
So the coach because we were able to get that rest and the flight. So yeah, that makes sense to me. So for our listeners, I know toasters don’t buy the toasters, don’t get the x boxes. Look at travel. Now there are different types of travel you can do, there are airlines, you can buy tickets. I was you to coach business first class, but you can also do hotels. Right?
So a lot of these programs, the Hyatt and you know Starwood and all these other hotels have points or how do those compare? I know that some people are like bigger on the hotels and some people are more on the airfare. It seems like the air fares better value mostly. Is that your been your experience?
Eric: I think it, I mean I think it depends on what’s important to you with your travels and how much you’re spending on accommodation anyways, right? So there’s definitely some huge values with hotels and in situations where it’s you need to be city center and it’s going to be $500 and 500 euros a night to be where you need to stay. So there’s definitely some great wins with the hotel points.
Justin: Also like what if I’m not traveling a lot, right? One of my flights and normally short hops in the US, so like I don’t need that business or first kind of amazing long haul experience. Maybe I’d rather just take my wife out for a few nights, a baller hotel and I do that once a quarter or something. I do three or four nights. Really Sweet hotel now might just be better value for my lifestyle.
Eric: Yeah, exactly. That can definitely be a big win. And the hotels are definitely not in the toaster category for value. It just, it depends on the situation. It depends on what your travel plans are upcoming. So the biggest value in this right now is his long haul a premium class. So if you’ve got long flights to get into business class, you’re definitely getting a really nice experience and saving a ton of money. But also if you’re only traveling once a year or so and you want to, you can mix in both, there’s plenty of room in this to build up enough points where you can do it. Right.[crosstalk 00:32:46]
Justin: Great. Long haul flight.[crosstalk 00:32:47] I’m flying to Bangkok, I’m going to do it first class. I’m going to stay at a sick hotel for a week and it’s going to be damn near free. That’s cool.
Justin: So if you’re just a onetime vacation or once a year and you’re doing this credit card swap, you do it a couple of times a year and you’re getting amazing value for an amazing vacation for almost nothing. I like that. That’s cool. So, let’s talk a little bit about economy versus business versus first class. It seems like you’re going to get better value for the business and first class tickets, especially when you look at actual dollar for dollar spinned.
Just I’ll give you one scenario, whatever. If you’re looking at the American Airlines saver, if I want to do US to Asia on economy, I’m looking at 35 business class one way. I’m looking at 55 and then first class, I think it’s 62 or 66 or 67-
Eric: 67 and a half.
Justin: …and a half, 67 and a half thousand. So you know, I upgrade, it only costs me a little bit extra points, but I get a much, much more expensive ticket. Is that been your experiences that we find across the board?
Eric: Yeah. I mean, so if you’re just calculating it based on like what the revenue tickets out, there’s a lot of people in that first class, Kevin that paid, $10,000 for that ticket. Right. And so it’s totally a fair objection to say like, I would never pay 10 grand for a flight. And especially once, you know, you can do it this way, you’re never going to want to pay for,-
Justin: I feel like I got ripped off so I bought, it was tiny. This is before I bought the first business international flight deck. I did LA to Manila and I bought, I had the upgrade at the airport and I paid,[crosstalk 00:34:18] $23,000 extra at the airport just because I couldn’t imagine I was sitting was really crappy seat the plane. I’m like, that is not happening. So I paid, now that I know these little hacks and these tricks and guys like Europe there chilling and business class or first class ahead of me, I didn’t pay him like, “Oh my God, dude, I was the sucker.”
I look, I look around the business class, I was the sucker on that deal. [crosstalk 00:34:41]I mean I’m not that bad, but yeah, right. I mean you’re like,-
Eric: Well, and I mean I think also one of the things to keep in mind with this too though is that there’s also a lot more restriction on the availability of tickets that you can have, right? So you are constrained in certain ways and then, which is makes it awesome if you’re an entrepreneur and you have some location independence built into your life. Sometimes the, what the airlines are doing with this right is they’re trying to manage their revenue.
It doesn’t cost them that much extra money to put you in business or first class. They still got to fly the plane out. They’ve got to pay for the fuel and the crew and all that. And so they’re trying to manage their revenue in a way that they can sell as many of those tickets as possible to the people who are willing to pay. And then you can use your points to get the other seats. So there are scenarios where you know you’re going to have to be there, be more flexible or there’s some flights you just got to buy it because you can’t use the miles at a good value.
Justin: Yeah. The most popular ones that are constantly bought or that they know they’re going to sell out, they’re not going to put those up until the very end. So they have a couple of business or first class seats, they’re going to hold those away from you as an traveler and then you know a couple of weeks before you’ll see they start popping in because they didn’t sell them. So yeah, if you had that flexibility, you’re definitely going to find, I think you’re going to get the better deals you can do it without, but you want the special deals or pave and les miles for some of the flights you’re going to want to be a bit more flexible.
Eric: Yeah, and that’s, I mean, so that’s a great point too. And like the way that you really stretch your miles further is by booking those business and first class tickets that are at the low level of pricing. And we can, we can talk a little bit more about that if you want, how the airlines set up their pricing, determine how much it costs you to get there. But the simple version is that there’s great arbitrage opportunities and that’s why it’s important to have sort of a diversified portfolio points. You want to have a few with a few different programs so that some scenarios it’s just going to be way cheaper where you’re going to use a certain type of points in comparison to another.
Justin: So let’s talk about that really quick. Good diversification is we’re going to get an a redeeming his points in a second. Let’s talk about the diversification. So if I have a nice mix of let’s say ultimate rewards, which is through all the different chase business cards, I’ve got a good mix of Starwood preferred guests and then I’ve got the Amex membership points and I’ve got, I’m pretty diversified there.
Those are great because they apply to so many different airlines. Some of those could be combined into the same airlines and I’m pretty mixed. But if I’ve got a ton of US airways and a ton of, I don’t know, Korean air or something, I’m pretty limited. Like I have to only look at Korean air flights.
Eric: Yeah. So you’ve got the fewer choices. The thing to keep in mind, the general principle here is that you don’t want to over diversify because in most situations you have to have enough points to buy the ticket. So if it’s 100,000 to do a round trip in business class, you have to have all hundred thousand you can’t have 95 and then you know, pay the difference in cash.
Justin: So you know, some of them actually do allow for that, but some don’t. And it’s brilliant upon the airline. Right?
Eric: Right. Yeah. And so I mean it can be costly if you come up a little bit short. So the idea is to have a healthy balance in a few different programs and if you can go after those transferrable ones. And so like a scenario, like you just said, where you’ve got some Amex, you’ve got some chase points. What you might be able to do is you might realize that you can transfer your chase points to United for your outbound trip and get a great business class ticket or a first class ticket on one of their partner airlines.
So you don’t have to find, that’s a really key thing. You don’t have to fly United just because you have United smiles. So for example, you might fly Singapore and being their suites class, I’ve got this awesome, awesome product and first class where you’ve got like your on suite and the plane, right? So you use your United points for that. You book a one way out to Asia, but the way back, there’s no availability, there’s just nothing there.
But because you’re diversified, you can use your American miles and now you’re going to fly back from say Hong Kong on Cathay Pacific.
Justin: Or Japan Airlines just to be with one of their partners, right. Just because you have the airlines have won, they’re all in these different, where they call them the,-
Eric: The alliances.
Justin: Yeah. The alliances.
Eric: Yeah, the airlines are like, it’s a big part of their business model, right. To be able to sort of share flow of passengers and utilize their hubs in their space properly. And so what they’re doing is each airline, there’s three majors, so there’s one world alliance, there’s sky team and then their star lines. And so each one of those, if you have points with any airline, you can generally redeem on all of their partner airlines in there.
So the plane, the paint on the tail is kind of what you’re thinking about as, as what represents the airline. You couldn’t use your American points to fly on a whole bunch of other airlines and.-
Justin: That get confusing a shit man.
Eric: It get a little bit. But yeah.
Justin: So okay. I have American Arrow, I’ve American miles. Right. And I know that Japan Airlines is a partner, so I can then use, they basically, I could book any of the Japan Airlines flights as part of the trip. So for someone just starting off and they’re talking about redeeming, they actually want to go redeem some of their miles. Yo, I was telling you this before the show that I think a great way to look at this, let’s just go to American Airlines, go to their redemption section and you can look, there are two different levels.
There’s the super cheap saver route and then there’s kind of the regular one where you book normally and it’ll have economy, business class and first class they’ll tell you on the different routes of, at least for American, oh, which ones you’re able to spend. And from there just know that any of the other airlines have a very similar type chart. It’ll be, it’ll be a certain amount of spin going here, there or elsewhere. Some of them don’t even have them online. Do you got to call them and try to figure it out? They make redeeming difficult.
Eric: No, it’s totally intentional. Yeah, that’s absolutely true. And so like one of the things that Americans doing, so their website’s a really good model like you said, because they actually do something that’s really nice and that they display a calendar of the dates and so you can actually see what the prices look like across like a whole month.
And that’s really helpful because if you’ve got a little bit of flexibility, you can see, oh there’s cheap seats on Tuesdays and Wednesdays and there’s expensive seats on the rest and you don’t have to click through 50 pages to see it all. But the airlines do make that tricky. And like one thing that American does is they’re partners with Cafe Pacific, but Cathay Pacific doesn’t show up.
Justin: That’s right. I not [crosstalk 00:40:29]saying all the book, I have the same problem. So I was looking from LA to Bangkok and so sorry, no routes available. I was like, that’s not true because I know they’re friends. I know they’re buddies with Japan depending, Airlines flies there. So I then I started looking just LA to Merino. I was like, “Okay, there’s that flight.” So I was basically kind of judging an off that.
And then had to, you know, use the service and weren’t talking about the service you offer that the offers that for you and we’ll like take care of that for you. And yeah, that’s the part that gets really confusing to me and is beyond me, honestly. I’m not even sure what figure it all gets so confusing. It’s the crux though too, because this is the way that you actually get value out of all these points are collecting.
And so I think you know, what they brothers offers and then some, the other people at this is, this helps us because we’re, okay, let’s see. I’m good at collecting the points. I can sign up for the credit cards. You’re going to help me use them and use them properly. I think that’s pretty interesting. So when it comes to redeeming, what quick tips do you have for people if they want it, why it get started redeeming some credit, some airline miles.
Eric: Yeah. So the first thing, I mean don’t get intimidated by it. How complicated this sounds, cause there’s a lot of redemption that are so straight forward. There’s a lot of ways to use miles and get great value that aren’t going to take you through, you know, a million different websites and hours on the phone. But a few key things to keep in mind like keep track of how much you’re paid itinerary is going to cost, right? So you want to do a little bit of research and just see what the cheapest flight on Kayak or Orbit or whatever. So you know what you’re comparing.
Justin: [crosstalk 00:41:49]Oh, like sky scanner. So I got a sky scanner, a see how much the tickets across the business class, first class or even economy. And then I’ve got kind of a baseline to start with.
Eric: Exactly right. So you know, kind of how much it’s gonna cost, you know, to end up, obviously being in business or first is going to be a little bit more valuable for you. You’d be willing to pay a little more. But even if you just use that coaches as sort of your baseline, say, “Okay, it’s a $1,200 flight to get out there and back.” And then you start, you just kind of look at, so American Airlines is a great website to just get a general idea, the search, United also the big US carriers are pretty good and Delta just made huge improvements in their search function on the website.
So the first thing you can do is just kind of do a preliminary search with a couple of those major airline’s websites,-
Justin: Am going to link to those people in, check it out from this show so they can just go straight to it and check out the awards.
Eric: And actually we’ve got a list of resources that tell you which airlines are searchable on different airline sites. So you can go to our page for American Airlines for example, and it’ll tell you exactly which ones are their partners and it’ll tell you which ones you’ll see on the website and which ones you got a call about. So it’s pretty simple, if you know where you want to go and you’ve got your clients pretty well worked out, it’s not too hard to do a little bit of actual work and get those tickets booked.
Justin: Cool. Okay. So let’s talk a little bit about kind of your business model. I think it’s kind of interesting. So you are heading into the travel hacking space and you’ve done it mostly through a podcast. So you guys have a podcast or a broader.com. I was listening to that like before I go to bed, listen, a couple of episodes of trying to get caught up over the last few months and I was like, “Wow, this stuff’s really interesting.”
I started digging into it a little after I started signing up for their credit cards, but I was like, “Okay, now I’m starting to see how this all works.” The basically I think the real value you guys are providing people is it comes in two forms. One you’re helping me, we’ll figure out which credit cards they need to help be diversified to help meet their goals.
It’s almost like a personalized concierge service, which I think is kind of interesting. And then the second one was really interesting as you’re helping people redeem those miles. So you know, all the phone numbers are call, you know who’s partners with whom? You know what the best hard products are. And by hard products, I mean, you know the actual seats and what kind of caviar you get in your[crosstalk 00:43:54] season.
Eric: This kind of crazy campaign.
Justin: You guys know this stuff and so you can put me on a much better flight than I might. I might get this crappy old 747 Americans flying or you’re going to put me on the pimp seat. So that’s pretty cool. And so you guys are doing this, you do it for every your service you can, I can do that twice a twice every six months, right?
Eric: Yeah. And we’re starting to actually break it down even more so by what your spend is and what your travel goals and needs are so that we’re pricing it a little bit better towards what you actually want to do in terms of your travel and what’s possible with earning your points. But I mean, the thing with the redemption is it can done easily in some cases, but there’s so many things that are worth keeping track of that we can generalize you stretch your miles a lot further by just knowing that, “Hey, this pricing chart is just way better for where you want it go.”
And so that’s where the airlines are winning. Right? We saw an opportunity to jump into this marketplace because there was such a disconnect with the information where the airlines are just progressively making it harder and harder for people to use their points and get the best flights and people get frustrated, you know? And so they end up paying way more than they have to. They don’t realize that by flying on a different day, they could save half the points and take a whole nother trip.
Justin: Yeah. So because, because if I’m stuck on one day, I’m going to spend 200,000 points for me and my girlfriend, a fly first class round trip. Whereas if I’d flown just 18 hours later, it would have been half the point.
Justin: And so the airlines are, let me ask you this. So let’s say you get really good, your company gets really, really good and you guys get just a ton of customers. Isn’t that gonna Affect the airlines? We’re going to shut this whole thing down, like the party’s over. Like isn’t that possible or no?
Eric: I think we, I mean we would have to get huge,[crosstalk 00:45:36]
Justin: This is such a luxury problem for your business?
Eric: Yeah, that would be a great problem. I mean, at that point, the banks of the airlines are trying to buy us for like $1 billion. It’s okay. But yeah, I mean, so the thing is they’re doing so much volume. You got to remember there’s 80 million members in American’s program. It’s going to be over a hundred when they’re combined with us airways. And so they’re doing this at such a massive scale and,-
Justin: …billions and billions of dollars.
Eric: Yeah. And so like an example, I think 2009 Citibank pre purchase $1 billion worth of miles from American and that’s what they’re giving away in those signup bonuses. You know, I got like 400,000 of those this year and they’re using that. I mean, they’ve made this long term investment in doing this. And so the game of travel hacking and being able to be a more efficient, it’s not going anywhere. This is just going to be a constant thing of staying ahead of the curve. And it’s inevitable that things in this industry changed.
The airlines changed their pricing, they changed the rules about how you can route and how you can get there. And so our competitive advantage is just staying ahead of that curve and knowing what needs to be done to help you take your miles. And we just want to deliver the outcome, right? You don’t care necessarily how it works. You just want to be able to take your girlfriend on an awesome trip, go, flying first class and show up in a beautiful place and staying on a ball or hotel.
Justin: So you guys models to take the pain away from that. And to help me figure out preemptively figuring out which credit cards I need to be able to take these awesome trips and do the things that I want to do. And so that’s the value. And I’ve looked at this as long as I’m paying you less than I would have paid all my own for the cards. I’m getting value.
It’s totally worth it for me. And it’s a no brainer. Who’s the sucker in this deal? Right? So, so who’s getting the shitty end of the shaft, right? Like is it the, are the guys that are running up all these credit cards and paying interest?
Eric: That’s really interesting point. So definitely one thing that you shouldn’t get into this. If you have problems paying off your credit card on it every month basis, you don’t want to be doing this because, you’re going to lose that value. The banks are definitely taking those folks to the cleaners with 25% yeah,-
Justin: And that’s right hand forever ones, miles and flights and the ones that are doing the hack and kind of, I mean not directly but.-
Eric: …but I think that’s still small part of the game. So what’s happening really what we’re doing, there’s nobody losing badly in this at this scale because there’s just extra money on the table. Right? The banks are paying the airlines really well for the miles airlines, the frequent flyer programs or one of the most profitable parts of the airlines operations. A lot of airlines are running a loss on their operations and they’re running a big profit on their frequent flier programs and the banks are doing great because on top of the interest, which is probably a decent part of it, but they’re also getting a piece of all those transactions, right?
They’re processing those transactions through their networks and so they’re making a couple percent as a merchant, you got to pay that, right? When you use credit cards or would somebody pays you guys with credit cards, they take a piece, right?
Justin: Oh,[crosstalk 00:48:21] they’re going to be all they’re doing. The banks are making, as is typical old, they’re making a ton of money and they decided to throw us a bone. Right. These points, right. I, they’re thrown us a little bit of a bone back.
Eric: And they’re just doing so they’re just doing a big calculation. Right. They know most people are just going to keep one card and they’re going to use it for everything. And so if they offer you 50,000 points, you’re like, “Oh great,” You go by your toaster or your Xbox and you’re using that card for the next 15 years and the bank one night.
Justin: And that’s one of the reasons that a lot of times, because you do pay annual fees with some of these credit card, you sign up for it. So the ones in the drawer or whatever you would have to pay annual fee for, but what you do is at the end of that year, you can call them up and say, “Hey look, I’m going to cancel unless you give me this data together.” And anyone listen to your podcasts or goes, what’s your podcast? They’re going to hear you talk about that. I think you’re actually doing some recordings.
Eric: Yeah we got [crosstalk 00:49:07]It actually, it’s really easy, right? So the banks want to keep you as a customer. They pay a lot of money, they know what their cost of acquiring a new customer is high. And so if you say, “Hey look, I just don’t want to pay this annual fee, I’m looking at this new card with competitor bank and they’re waving the fee for the first year. If you’re not going to be able to waive this fee, I just don’t see why I should keep the card. “They’ll almost always, you know, waive the fee or give you enough miles.
Justin: And if not, you can’t say, “Oh sorry, my phone is cut and my phone is cutting out. I can’t hear you hang up.”
Eric: And then you call and talk to the next agent and exactly like,-
Justin: Oh this is a pretty crazy game. Let’s talk a little bit. So I know what it brought hers does for me basically as a helped me figure out the cards I need for my goals. And that’s one of these you do is like an onboarding call to kind of get everyone up to speed and figure out what their needs are. And then you helped me redeem. So once I started collecting the points, you want me to do it and it’s pretty straight forward.
Your service is worth it or not, depending on whether or not you’re giving me an ROI on my spend and my travel when I you to do that. So that’s cool. So let’s talk a little bit about some of the like aspirational stuff. Cause I’ve looked into this, I’ve been deep dive it. That’s what I do man. I deep dive on stuff and I was looking into like what was that? We were talking about the Maldives, right? It was a Hyatt bought it.[crosstalk 00:50:18]His boss Dude. How much was,[inaudible 00:50:20] it was like $1,500 a night or something. And you can get that with points. Not even like a crazy amount of points.
Eric: No. So that’s, yeah, those are like the hotel. There are certainly some properties in some amazing places around the world where you can get places that would cost you over a thousand maybe $2,000 a night and you can get them for free or $20 in taxes or,[crosstalk 00:50:42] and yeah. So I mean like, you know, you could do a week at a place like that could normally run you five grand. And only spend up a few thousand points, a few hundred thousand points and have just an incredible experience.
Justin: That isn’t saying I was looking at pictures of my girlfriend was salivating over this place where we were like, “Oh my honey, we got to do that. We’ve got to go there.” It’s like, yeah, we’re going to do it to me.
Eric: I’ll get you set up.
Justin: Yeah. I do. Off the hook that up. So tell me about what you’ve seen in terms of like the best, longest and cheapest flight you’ve seen that was doable and business or first class or whatever. Well, what’s the best kind of redemption you’ve seen so far?
Eric: So I mean, I think right now to Asia, one of the things that’s really interesting is that US Airways and American are in this big transition, right? So they’re in this merger and they’re saying right now that in quarter two of 2015 they’re going to combine their loyalty programs. So right now you still got separate balances for your American and US airways miles and US Airways to Asia is only 120,000 in first class. And so that’s on carrier, it’s like Cathay Pacific and JAL, which are some of the nicest products. I mean they invested so much in making their planes and all the other stuff just completely awesome for that flying experience.
So that’s one of the really good ones. There’s also, I think Singapore Airlines, their suite’s product a little bit trickier to have to get the availability because obviously you know like we talked about before, they’re trying to sell those if they can, but those ones, that’s a good situation where you want to have some transferable points cause if you got Amex or chase points you can transfer rate into Singapore and they keep some extra seats open for their own program.
Justin: Yeah. Dude, did you see that Forbes article or whatever with the guy like laying out in the like double bad on the Singapore Airlines. It’s like whether you put the two together and you’ve got like this huge bed, amazing monitors. Totally closed off cabin.
Justin: It is a man that has made for a mile.
Eric: Totally. You know that they’re just like planning that out are definitely get a cell of it.
Justin: It was awesome. So the, I’m going to link to the article. Do the pictures from that are just insane. You’re going to do that sometime we are to take some pictures. That’d be good. Testimonial. Sure. Right.
Eric: Yeah, that’s super cool. And it’s totally achievable. I mean like,-
Justin: No, no, you’ve done some crazy flights for like 30 bucks.
Eric: Oh Man. I’ve had so had been so fortunate. I mean in the last last couple of years, this year I spent about three months in Europe, flew all over Europe and maybe I think total this year I spent about $1,500 on flights and took five and first class four or five in business and just a couple of short economy one.
Justin: And you are all over the place. And just for anyone who doesn’t know this, like Eric has, they’re basically bootstrapping a startup. It’s not like he’s coming from crazy money or has like a ton of money he’s putting into this. This is just from travel hacking, basically doing this credit card churn and be able to travel and meet all these interesting people. Always interesting countries, so.
Eric: Yeah. And I gotta say, I mean like the power of travel. If you’re running a business or working to bootstrap, if you’re in that same situation, the extra value that you get of being able to connect with other people where they are at the high level entrepreneurs that you want to build relationships with, that you want to find as mentors and things like that, they’re not going to come to you. And so having that flexibility to go out to a conference to go out and network with people gives you that extra boost that isn’t attainable necessarily if you’re in that early stage of business where you don’t have a bunch of money. Right.
Justin: I love this. If you’re traveling to like especially with Long Haul, every three to six months where there’s just you or you and your wire for you and your girlfriend and kids or whatever, and you’re doing that every three to six months, I as being amazing value. If you are once or twice a year taking one week or two weeks and going to a distant place and like staying for a while and a hotel. I can see these being amazing value for you to as a getaway.
Options are one year kind of extravaganza where you’re not paying any money for these amazing trips. I see as being a great value Eric, thank you so much to be on the show. Uh, anyone who’s listened to this, I definitely recommend listening to your podcast as well over a broader stock come where Golding see up to that and we’re also willing to your product, which I’m a customer, I’m the business or first class customer. I saw a value on my first sign up with you on our first actual booking.
Eric: Yeah you guys were in the air pretty quick.
Justin: It was done dude, like it was like two months later. We’re like, all right, do book of stuff for us. We’re out. It was like, I think it saved us about 900 bucks. I make your service was like 500 bucks for six months, so we already made our 400 bucks. Everything else on top of that was gravy. Plus I got my first class back in Japan Airlines up to that was abas. Anyway Eric, thank you so much.
Eric: Thank you for having me.[inaudible 00:55:12]
Speaker 4: You’ve been listening to the empire podcast now. Some news and updates.
Speaker 1: First I’ve been news and updates. We can now accept and pay out in bitcoins or something that separates us a bit from the competition and that we’re taking virtual currencies for virtual property.
Speaker 5: Yeah, definitely. There’s no other broker out there doing this, so it’s pretty interesting. And I’d really like to hear from some bitcoin folks, so be sure to reach out through us through the comments or by email. I’d love to hear what your thoughts are in converting virtual currency into something like an online business.
Speaker 1: Joe’s been dork and out in the bitcoin community I bet and like buying up some big coin barring some bitcoin and just kind of playing around with it bait. No, something that we were interested in and want to see if we could take on. So, you know, there’s both, like there’s all this amazing stuff we talked about before, like the peer to peer lending with bitcoin that’s happening now. And just the whole thing with the virtual currency is pretty interesting and people were able to buy up, you know, bitcoins at 30 $40 a coin and they’re able to trade those and now at 450,500,500 $50 per and by you know, real virtual properties. That’s kind of interesting.
Speaker 5: Yeah, I definitely think that, that’s, I mean where it is right now, I think bitcoin’s overvalued, but what do I know? So if you think that as well, I mean why not convert it into something a little more tangible that gives you monthly income?
Speaker 1: It’s interesting. There’s and this guys are work out there that’s been, saying that he thinks bitcoin’s going to 10,000 in the next year or anything, but this is the bit coin, we’ll go to 10,000 so he’s long on bitcoin. I don’t know though, man, it does seem that seems aggressive, but the idea is that it’s a limited release as it gets, you know, more out there and more people are accepting it as a real currency and not just some speculative option that it may have more value about. Right. I guess we’ll see, huh?
Speaker 5: Yeah. I think actually it has more value as a currency if it’s worth less. So if it’s more like 25 or $30 a coin, people are more likely to use it. People that don’t know anything about bitcoin right now, they see that it’s, three or $400 a coin that it fluctuates greatly and even though they’re not going to put their money into it, they’re concerned about doing a transaction is it seems like it’s so much money and you could, even though you could break it into little pieces of a Bitcoin, it just doesn’t matter to them. I think people are very standoffish.
Speaker 1: That’s funny. Okay. So like if I had to go buy something and it was one 16th of a Bitcoin, that just feels weird to people like, but it’s just a game, a zeros. But I, I get what you’re saying, “No, If I’m going to go to the store and buy some gum and some candy or something and I have to do use, 100th of a bitcoin or something, that just sounds really odd. Whereas if I just threw one bitcoin at it for three bucks or whatever for bucks, it makes a lot more sense.”
Speaker 5: Yeah. I think it’s a psychological barrier. They’ve tried coming up with different names. Like, a thousand is one Satoshi or something like that, but it’s not really catching on as much and I think that’s something, better has to be done.
Speaker 1: Yeah. Even in the people that know about bitcoins, which is still relatively small, like asking them to understand, how come I’m paying you 10 Toshi is or whatever. It’s just, dude.
Speaker 5: it’s, it’s kind of silly.
Speaker 1: All right man. The second point is we’ve been in coaching men and we’re taking the steak dinner approach. We’re going around, we had a dinner a couple of nights ago with John Myers and Dan to thank them for helping us with the design. Then I was sick for a couple of days, but you and Mike have been taking off some potential and actual buyers and sellers and talking to them. I kind of what their needs are, what they’re looking for and against some really good feedback on our marketplace and our business overall.
Speaker 5: Yeah, if you’re in Saigon it would like a free lunch or dinner hook up with me and then we can definitely chat. But yeah, definitely trying to take the live approach here while we were in town. And I think that that’s the best way to get clued into the community and kind of find the people that are the best do business with.
Speaker 1: What are you thinking about that? Cause I was doing that in Chian Mai when I first laugh. And again obviously in Bangkok. And so I’ve been doing a little while and I was some really good feedback. What are you hearing him? It’s only been a week or so, but like what kind of feedback you’re getting.
Speaker 5: I’m approaching it more from like a business development sort of aspect where I’m looking for buyers or sellers, but even people that are not typically buyers or sellers trying to make them into buyers or sellers and find out ways that we can have some sort of venture together. So that’s I think an interesting way to approach this issue because this is a big relationship type business and it’ll help to have more friends out there that are in the builder’s side or in the buyer’s side and that will help our inventory issues on the marketplace.
Speaker 1: Cool. Last thing is you’ve actually been trying to boost our inventory in the marketplace by reaching out to people that may or may not actually be looking to sell your targeting dishes that we happen to know are profitable, that are valuable. And then reaching out to the site owners, seeing if they’re interested in potentially selling with us and doing some business with us. I think that’s a cool approach.
I think I love this idea because if we can figure out that outreach portion and get these people and just didn’t get them to list, we’re going to have a nice channel for inventory that we don’t have today.
Speaker 5: Yeah, I haven’t figured out all the details yet, but it’s interesting because if you find a good profitable niche where you know the sites are worth good money and are easy to sell, why not approach sellers and just try to buy for less than 20 x put on our marketplace and be able to sell. So I would love to get them to sell. I would love them to just come directly to us. But that’s even a more convincing arguments. So if I could just buy the property and put it in our marketplace, it may make more sense.
Speaker 1: Yeah, it’s an easier sell when you’re going to them directly saying, “Hey look, you know, I can give you this much cash for it, I can do this right away, just let me check a few things.” And maybe they weren’t all that interested in selling, but you can kind of juice them into it. They get kind of interested. I think we’re going to have inventory that other people don’t have or couldn’t have on their own. Plus we’ve had buyers ask us for a service like that.
So people are looking for that because they know that’s a profitable process. I’d love to have that particular profitable process in our business. All right man. Let’s do some listener shouts also knows the indulgent ego boosting social proof segment. We’ve got a couple of mentions on Twitter from Marcus Harper and Matthew Delaney. They both really liked our podcast episode or retaining employees and startups. It was an interesting episode for us too because you know, that’s something we’ve been thinking about recently with our, our team here.
I’m wondering how do we keep them, how to be, keep them motivated what do we need to do to, attract and retain the right employees in our company.
Speaker 5: Yeah, I really enjoyed that episode too, so I’m glad other people are liking it as well.
Speaker 1: David Hamburger really dug our evaluation tool. He put his current business through it and studies almost tempted to sell his business. That’s awesome to hear buddy. Uh, you know I asked him, I started thinking about that cause he did give it a tweet and I was wondering, I was like, “Huh, I wonder if people would be interested if we just put some social buttons there at the end once they’ve gone through the evaluation tool, would they be interested in tweeting that and sharing that valuation?” He told me, “No. Because that would give to close for an indication to my earnings,”
But I think other people might be interested in that. So I think we’re going to add a piece to that that gives some social sharing opportunities right at the end. It’s basically a call to action after you’ve done the valuation tool to share it. And then obviously, it’s kind of an ego boost thing for you, but then it’s a promotional thing for us. So we can get other people that are interested in getting evaluation that can get theirs done as well.
Speaker 5: Yeah, I actually met with David’s brother today at lunch and you know both smart guys, so I’m not surprised that they’re giving us good suggestion.
Speaker 1: How’s this shit coffee business doing? That’s so crazy that he does that. The whole like the civet coffee or like he went to the Philippines, I went up in the mountains and literally there are these rodent type creatures called Civics and they eat the coffee beans and poop them out. And so apparently the coffee is just amazing. But he went out there. I like met with like the tribal elders and like went to like the area where it’s done, did a whole video on it. It was really cool actually. But I like to tease him about his shit. Coffee. How, how’s he doing?
Speaker 5: He’s doing well.
Speaker 1: Cool man. So in Zendesk I’m all asked us, do you guys work on weekends and can you get me the information on a deposit over the weekend? And the truth is, yes, we have team, our team is working almost 24 hours a day. It’s 24 hours a day during the week. I think we’re missing like maybe six hours on the weekends or sub. We have somewhat, almost always on our best times are business hours and the US Monday through Friday, so that’s when we have the majority of our staff on, but we have staff on 24 hours a day now and maybe a bit slower on the weekend, especially if we’ve got a bunch of requests in or if it’s a holiday weekend or something like that. But yes, we have people on that should be able to get back to you and most of the time within 24 hours.
Speaker 5: Yeah, definitely. It would. The holidays, the recent Thanksgiving holiday, the upcoming Christmas and New Year’s holiday, please be a little bit more lenient with the timeframe and in us getting back to you. We will get back to you. If you have any problems, feel free to reach out directly to me on Twitter or Facebook or something like that, but yes, we should be able to get back to you within 24 hours, basically seven days a week.
Speaker 1: Yeah, he got back to, you said very good service and response time. You know it’s funny though because Thanksgiving’s a rough one. It’s like very American holidays. I’m like, well, what’s what’s go off Thursday? Where are you guys? What are you doing? Are you taking a day off? Right? Yeah. It doesn’t matter. This pesky American holidays.
That’s it for episode 119 of the Empire podcast. Thanks for sticking with us. We’ll be back next week with another show. You can find the show notes for this episode of more at empire flippers.com/abroaders and make sure it falls on Twitter at empire flippers the next week.
Justin: Bye Bye everybody.
Speaker 4: Hope you enjoyed this episode of the Empire podcast with Justin and Joe. Hit Up empireflippers.com for more. That’s empire flippers.com. Thanks for listening.