Why Cathie Wood's ARK Made Its First Startup Bet · Dylan Robbins, Founder & CEO of Lucra

0:00 Loyalty, which is a $50 billion industry, is ready for change. The Gen Z and millennial cohort, what they're looking for in loyalty is very different than what's in the market today. We think that the days of points and punch cards are over. Like kind of riding the tailwinds of what's working in sports betting, the dopamine hit, the immediate gratification, and how do you translate that into loyalty? All right, we are back for another episode of Under the Number. Today, I'm joined by Dylan Robbins, the founder and CEO of Lucra. Dylan, thank you so much.

0:38 Hey Brent, thanks for having me. Looking forward to chatting. Well, you're off of a fresh off of an amazing milestone with a recent $20 million raise. And notably, this round was led by ARK Invest, Cathie Wood's group, and it was the first lead investment in a startup that ARK has ever made. Tell me about how that happened. Yeah, we're super thankful and proud of this round. You know, humbled and, you know, definitely a little bit emotional. You know, 5 years is you know, these things are like your baby when you start a company, and it's been a long road to to this milestone, and a lot of changes and wiggles and waggles to find our fit. And we we finally found it, and we're we're humming now. And you know, having Cathie and her team and, you know, Nicolas Groult and and who's joined our board come on and and support us in this way is is truly transformational. It's been It's been an amazing journey. ARK is so forward-thinking, and they have their their hands in a lot of exciting cookie jars. They're doing a ton of AI and robotics and gaming.

1:33 Mostly with later-stage companies, and I think Cathie and her team have decided, "Look, let's let's go a little bit earlier in the life cycle, and let's let's meet these companies earlier on and invest in these founders when they're when they're in you know, series A, series B stage, so that hopefully they can take us to to an IPO, and we can get into the public market fund down the road." So, I think it's cool as Cathie's expanding her her life cycle of you know, investment management. And they have just such a deep network. I mean, already we've seen it even in the recent investment they've made, it's just who they know in the space is incredible. Well, and we're not one phone call away from anyone in the world, which is pretty cool. So, it's been an amazing partnership so far, and we're we're really throwing them back. I mean, you you said it. They're the most arguably the most future-oriented, you know, looking group that exists.

2:16 It's hard to for anyone to go toe-to-toe at that level with ARK. What was maybe a mega trend that they identified that you guys fit squarely into that had you not that had them knocking on your door to do something like this? Yeah, I think we aligned on our We both have the same thesis that loyalty, which is a $50 billion industry, is ready for change. You know, the Gen Z and millennial cohort, what they're looking for in loyalty is very different than what's in the market today. And they're now the demographic of buyers in loyalty. You know, the the 13-to-35-year-old cohort, right? And so, we think that the days of points and punch cards are over.

2:53 Like, who wants to get points that they don't know what to do with. Maybe you only go play mini golf one or two times a year. So, those points that you get are really not that valuable. And so, our thesis aligned on kind of riding the tailwinds of what's working in sports betting, the dopamine hit, the immediate gratification, and how do you translate that into loyalty? Right, playing for a burger that you can only cash out in the next 2 hours, or playing for a discounted buy one get one free wings, or you're playing for five bucks with your buddies. And that's an immediate gratification, right? And so, I think that's their thesis and our thesis aligned on that, and they were already looking a lot at the loyalty and gamification space. And so, the timing really aligned you know, for us to partner up. For someone who's heard of Lucra, help us kind of wrap our our hands around it. I know that powered by Lucra is kind of a good way a good foundation in the you know, to kind of level set the way that you guys work with some of your big partners. Yeah, absolutely. So, Lucra is the leader now in white-label loyalty and gamification.

3:49 You know, our thesis is very simple. We want to digitize offline competition. So, think of anywhere in your life where you can where you can compete. I mentioned mini golf or the arcade or a Peloton ride or you're at Topgolf or you're playing Wordle with your grandma or you're playing board games with your spouse or a bar game or you're riding the bus and playing Candy Crush. Like, you're competing in your life multiple times a week without even often even knowing it or thinking about it, right? And a lot of this stuff is offline, right? And you're hey, we're playing pickleball, loser gets the court time, right? And I often ask people, "Oh, do you you know, do you ever do anything Do you ever you ever play for cash? You ever Do you ever Do you ever wager?" Like, "Nah, that's not for me."

4:24 And I'm like, "Well, what are you good at?" And they're like, "I'm great at ping pong." And I'm like, "Would you play me for a beer on that?" They're like, "Absolutely." I'm like, "So, that's part of the consumer behavior is this the stigma of like playing for five bucks, but all of a sudden you're playing for something, and it's like it it's tangible. And so, Lucra, we sell this technology to brands. We say, "Hey, this is happening in your ecosystem already. People are doing this offline.

4:44 You're not capturing the data. You're not monetizing it. Let us put this in your So, we're behind the scenes partner. We say, "Here's our tech, the payments, the banking, the legal, the compliance, the fun. You brand it. It's your colors, your design, your fonts, your name, and we'll power the engine." And then the one plus one equals five. We, you know, drive more people into the stores, we keep them there longer, we get them spending more money. And and almost most importantly, and this is another thing that ARK and I aligned on, is this a huge data play. You're capturing a ton of unique first-party data about you know, we can get into it more on on kind of what Brent's doing and why in those ecosystems. So, that's kind of the summary on on Lucra and and what we do and why we do it.

5:20 And so, you said behind the scenes, but white-labeled offerings with these partners. I know that one of your partners is Five Iron Golf. And as far as plugging into the technology ecosystem that runs Five Iron, I can wrap my head around that because it's all powered by a TrackMan, right? And so, being able to have the TrackMan as your single source of truth and upon which you guys are able to facilitate these friendly wagers between people, that makes a ton of sense. One, if I missed anything on on that summary, kind of double-click on that. But also, tell me how how does it work with like a Dave & Buster's or some of these other partners that don't have necessarily a TrackMan built in that's as easy to wrap your head around to a plug in. Yeah. So, first of all, you nailed it with Five Iron. What an incredible business. I mean, I as a golfer, I love it. You know, I live in New York City, where it's cold, so it's just amazing to be able to go and hit balls. But you know, before we worked with them, every time I'd been there, I'm playing for something. I'm going with my buddies, we're betting, you know, burgers or beers, or I'm hey, five bucks closest to the pin. Like, it is just ingrained in their consumer behavior. So, it's a perfect fit for us cuz we're saying to their team, "This is happening. Let's make you guys some money on it." And so, it worked exactly as you'd think. You're right, we hook up with the TrackMan.

6:30 Every shot is tracked. You can join tournaments with other people asynchronously. You know, you could be in Texas, and I could be in New York, and I could be Saturday, and I we could both enter the same closest to the pin challenge, which is super cool. So, it allows you to play with people you don't know in a trustful system. It's an amazing partnership. So, you hit on a good point where our our best partners often I don't want to use the word best, but our easiest functionality is with automated data loops. We love partners where there's automated data. Something like a you know, TrackMan or Five Iron.

6:57 You know, Puttshack mini golf, they score all of their data for the mini golf mini games on your phone, fitness challenges. You know, we have a great partnership with a company called ClickFit, where you can track your stats and challenge other people, etc. That being said, you mentioned it, there are many other platforms. Pickleball's one of them where there's not a ton of data, right? And so, if you and I go play pickleball, and we say who's going to win you for five bucks at the court time, we do have a manual settlement option. So, we allow both users to click, "Hey, who won?" And if there's a disagreement, you know, we give them their their their funds back. So, we're doing both manual and automated, but I would say it's about an 85-to-15 split, automated versus manual.

7:30 I'm sure you've seen it. One company I find really interesting that feels like another natural fit for you guys is Poolhouse. Andrew O'Brien, how are you? Good to see you, my friend. Great great We we love we love Poolhouse. We've been in a long talks with them, and they're they're opening some really cool locations. I would love to partner with them, and they'd be a great fit. So, I would say active dialogue there. And again, they have the data, right?

7:51 What's awesome about Poolhouse is I've been playing pool my whole life. You know, if you can't tell already, I'm a I'm a bar game type guy. I'm the guy in the bar always playing for something on foosball or darts or or pool. And I play at Amsterdam Billiards here in New York, which is the one of the best pool halls in the country. But there's no data. You know, there's just no way to connect that. And the Poolhouse ecosystem brings that ability in. So, I think really awesome opportunity just to partner with someone like that.

8:14 So, if I walk into a Dave & Buster's with you, and we want to do a wager on Pop-A-Shot, how does that actually go? When I walk over, I'm like, "Hey Dylan, let's go play. Let's play for 10 bucks." How do we actually make that happen? Walk through the mechanics. Yeah, so you you you walk in, and Dave & Buster's has an app, right? So, just like any of our partners, you know, most of them have an app, some of them have a website. You know, so we do both iOS and Android native integrations, and we do web integrations.

8:44 You download the app, and there's a a play tab now. You can challenge, you know, other people, and and you play for something. And within that tab, you can choose a different game. So, at Five Iron, maybe it's closest to the pin or longest drive. Dave & Buster's, maybe it's Whac-A-Mole or Pop-A-Shot or Skee-Ball. You know, at Puttshack, maybe it's nine holes or best three holes or hole-in-ones or whatever it is. You That's customizable to to those businesses. You pick your game, you pick what you want to play for, right? So, you can play for cash, you can play for discounts. So, we go to these brands, and we say, "Hey, what's not selling right now?" Often, it's appetizers and desserts or whatever it is. Great. Let's give 10% off those or 20% off those.

9:19 It's free for Brent to do that. And he wins the ability to spend money. So, it's amazing to see the user behavior change when they've won that code instead of just giving it to them on the table. They've won it. And so, they go and do it. We then go play. If we have the automated data loop, it we automatically settle the contest. If we don't, the user picks the result, and then we automatically pay out the winner of their money or their code. And so, if it's a code, they get a QR code, they can run right up to the bar and spend.

9:43 And if it's money, they can take it out in their PayPal, Venmo, credit card, debit card, ACH, you name it. So, it's a pretty seamless flow. I will also mention, we were just discussing peer-to-peer. My My feature is tournaments. What I love is the multiplayer mode, right? Like instead of it just being Dylan and Brent, there could be a closest to the pin all day Saturday for any 5 iron member. Or there could be a steps challenge today. Who can do the most steps Saturday in New York, right? And so you can compete against other people.

10:10 It's great for these brands from a customer acquisition standpoint. Instead of onboarding customers two at a time, they can onboard them 200 customers at a time. And they can play on the the FanDuel DraftKings amazing put $1 into win a thousand. I mean, that they can they can play on that mindset of oh, it's free to enter or it's $1 to enter and there's a big shiny prize, you know, at the end, right? I think that's what, you know, the big sportsbooks do such a great job of of just kind of creating that risk small to win big mentality.

10:36 and we're trying to, you know, amplify that in recreational competition in a fun and a friendly way. It's amazing how how big of a market it really is when you when you think about it. I mean, you mentioned Peloton earlier. You can picture how this works with Strava. You can picture how this would work with Garmin. Like it's it's massive. So, backing up a little bit, you said before we got started that you've had the idea for this for a very long time. You ultimately got it going during your second year at GSB at Stanford.

11:05 What did it take? What maybe external factors and internal decision-making were at play to make you take the leap to get it going when you did? Yeah. I mean, so in college, I graduated Duke in 2015. So, in my undergrad, it was the rise of fantasy sports. This is before sports betting. This is when DraftKings and FanDuel first launched fantasy DFS and I was hooked early. I thought it was an incredible product. I loved it. I'm a huge sports fan, die hard die hard New York Knicks fan. Very exciting night tonight. Hopefully we can clinch our our series.

11:36 And so I was playing on all these sites, but my buddies weren't. They were still that like stigma and friction against it. It was like was it legal? Was it not? But then the second we'd be like, you know, at the bar playing foosball, they would like play me for Venmo five bucks. So, I knew that I always had the sense that like the peer-to-peer element of like casual was a was a thing. But there was not a lot of movement on the on on doing something legal. I mean, the regulatory environment was very unclear. It was very gray. There had been people who had tried peer-to-peer in the kind of 2010s that didn't work. So, we kind of just I kind of just was kind of waiting around as a consumer. And then 2019 was the big moment where PASPA, which is the huge kind of federal, you know, sports betting act got repealed, which basically allowed states to make their own decisions on sports betting. And that's why you've seen in the last five years, you know, 40 plus states or whatever it is now have allowed some sort of legal sports betting. And when that door opened, it was kind of the aha moment of well, now maybe peer-to-peer is also possible. So, the first iteration of Lucra many, many, many years ago was actually a peer-to-peer sports platform. Like before we did anything we just talked about, we started with that, you know, digitizing that peer-to-peer challenging.

12:42 Brent, who's going to have more points tonight, LeBron or Durant? And we play for five bucks. That's how Lucra started. And so, it was a combination of kind of regulatory timing, market timing, and you know, I was at Stanford, which is just such a hotbed of innovation and entrepreneurship. And I was just so inspired to like do something that those kind of two things paired together to to make Lucra possible. Outside of regulatory, maybe assuming that there was some tech limitations, why didn't it work in the 2010s? Yeah, I think it was really consumer bias and behavior.

13:12 In the 2010s, there was just a massive stigma. Like I was, you know, betting with a bookie, I was afraid to tell my parents that I was betting on sports. Like that's what was happening in 2010s. Now every billboard you look at in the state of New York is sports betting. Every commercial you watch is couch to your probably what I mean, it's insane how much has changed in the last 10 years. So, like, you know, the stigma has has changed. I think, you know, a great example is my wife who I adore for putting up with my career choices for all these years. I've been trying to get her to play on these sites for a decade, right? DraftKings, FanDuel, Caesars. Every time there's new promos, I'm like, this is free money.

13:46 You got to try it out. Nothing. And one day I came home from work like six months ago and she's betting on Dancing with the Stars on couch. Unprompted. Right? And I'm like, the the move has happened, right? Like this this this change has been made, you know? And so >> the laggard has entered the arena. >> has entered. Exactly. So, now I'm like, okay. So, like it was a combination of regulatory but also consumer behavior changes that I think we're now in a new world. And why Lucra's been able to take advantage of that so much is there's thousands, if not tens of thousands of brands that are missing that tailwind and feeling a ton of FOMO. Like like Topgolf has so much friendly competition, but they're not getting any of this, you know, DraftKings or FanDuel. You know, maybe they have some small engagement there, but like people betting on longest drive at Topgolf is currently not monetized, right? And so like there's huge opportunities in these kind of consumer brands who have 30, 40, 50 million Americans who go there a year to capture some of this. And I think we we're now giving them the technology to be able to do that.

14:44 You know, you you talked about how your investors, which I want to talk about some of your other ones cuz you have a great very interesting top table, how they were saying, you know, the Arc people were saying that loyalty is just this unbelievably underserved and disruptable category. I totally agree. Loyalty and the lack of loyalty and rewards when it comes to professional team fandom. Mhm. And how insane it is that people, and the example that I brought up, you know, my grandfather was in the first group of New Orleans Saints season ticket holders ever.

15:20 And in 1966 or '67. And my aunts and uncles and you know, his kids have continued to be strong patrons of the New Orleans Saints. I can't imagine how many dollars have been spent inside the Superdome and outside of it buying merchandise and going to away games and tickets and and yet you don't really get anything for that. You don't get recognized for being the stickiest, most loyal fan that exists or consumer that basically exists. It's true. Why do you think that is? Is it just they're getting lazy and they're and they're kind of resting or is it >> knew why, but I definitely agree. Especially and I think it's a huge risk because the maybe the millennials, definitely the Gen Zs, are not consuming sports the same way, right? So, most of the Gen Z customers that we talk to, they're watching highlights on House of Highlights or they're watching like sports content on TikTok. Like they're not going to as many Knicks games as, you know, I'm going to. They're not buying season tickets, etc. And so like that's got to change, right? And I think you're right, there's an opportunity there. And you know, we want to be part of it. Right now, we're not doing too much in the sports space, but it's something that we're starting to dabble in because we see the same opportunity of you playing for buy one get one free wings, why can't you be sitting in your seat, who's going to score the next point and get a discounted Wendy's Baconator or, you know, are the Knicks going to, you know, score 25 points in the first quarter and you get, you know, a free nachos with it if you buy a burger. Like I want to drive revenue into the stadiums while also driving that fan loyalty. Or pick your favorite player. If they hit a three in the first quarter, you get a discount on a Fanatics store to their jersey, right? Like all this should happen. the one thing I know for sure, having dealt with many large enterprises and sports teams, is these are slow-moving beasts that are tough to prioritize with a lot of different stakeholders. And that's probably I think the issue. It's like they're these are these are some of the biggest and most valuable organizations in the world. And so change is kind of hard to come by. So, I think it will come at some point, but maybe in a few years.

17:14 Yeah. Further on this gamification and loyalty topic, is there like a trivia element? Because if I were doing it for a team, I don't understand why again, teams, colleges, why do they not have these tournaments >> Yeah. Yeah. of guys who knows ball better than anyone else in the country on the New York Jets or the, you know, LA Clippers or whoever it is. And you need to be rewarded for that. You are putting your deep deep fandom on display to the maximum extent.

17:49 >> Yeah. You see me smiling because trivia is really hot in our world right now. We are doing we are about to launch and I will try my best to not, you know, supersede those those big press releases. Three or four big things in trivia. So, we're going to be doing something with trivia and movies. That was public. We're already partnered with hollywood.com on that. We're very excited to launch that. We're doing something with trivia and music. We're doing something with trivia and sports with a massive, one of the biggest content creators in sports is going to be launching their own platform to do trivia there. We're thinking about how to resell a package trivia product to other sports teams or entertainment centers. So, so yes, we we agree. Both real money trivia to capture on like that amazing HQ tailwind that is still out there and and and ride that wave.

18:28 And also free to play trivia to win to your point discounts and rewards and things to spend money in those ecosystems. I mean, it's hard to think of a better value cut prop of play for free, have fun, and win and win something for free, right? And so we want to allow that that kind of loop to happen. But yes, trivia I think is huge. And look, one of my other dream teams to attack, which we haven't yet, is every single mom-and-pop bar in the country that hosts trivia night. I mean, I've been to a lot of trivia nights. I'm pretty bad at trivia, but I like the Guinness, so I go for Guinness and and look at watch trivia. And like all of this is done on a pen and paper. And there should be a a simple way to do this and and put the money in the pot and play for prizes and stuff. So, we are working on that. We just, you know, it's a space we haven't been able to crack yet. Well, you were a Stanford guy. Did you ever make it to Rosen Crown trivia night?

19:09 >> Rosen Crown, I played darts there a ton. I played trivia there. I played a ton of darts there. Those two dartboards in the back, I spent far too much. I don't think I could I don't want to admit how much time I spent at Rosen Crown. Yeah. No, that's that that was fun. Go to trivia night there. It's it's a great and and like it's kind of a good segue into my next question here. Like what I like about what Lucra fosters, I guess, and facilitates is like these are social, get out of the house, go be with people, go do something, in some cases active, like interact with other people. I write here and there and on on under the number about the craziness of prediction markets, gambling, all this stuff. And I have a new I try to have a nuanced take.

19:52 I'm not anti everything. I'm also not let's just let it rip and make gamble on every single thing ever and there's no age requirement and Yeah. And so, you know, I get kind of depressed when I see these Instagram ads that I'm starting to get of like AI-generated slop advertising real money gaming casinos that are just praying on honestly, like young people >> poor and young people who are on their phones and then going to sit there and scroll and lose all their money.

20:22 Tell me I mean I I I don't mean to like answer the question for you, but what is your take on that? What is your take on the the spectrum of gambling and I gaming and real money gaming is so large. Why do you feel good about what you're building with Lucra? >> I think it's a fantastic question. It's something we think about often at Lucra. It's something I think about as a consumer. I know I have a young son.

20:42 Thinking about my son. Like it's a real thing. I I'm very happy to say that I like where we are positioned at Lucra to point. We're all about friendly fun. The average contest on Lucra is $9. All most contests are played with someone you know. Most contests are played 90% plus in real life out on a run or in a fitness class or at the bar or etc. So we are trying to build community and honestly we're just digitizing in most situations what's already happening offline, right? So that's what we're trying to do. And today we are we have stayed away from sports. We just not not that we don't think that there's not money to be made there. It's A it's a very saturated space and B I think it's hard to manage the risk and the responsible gaming. So we do a lot you know of limit setting and responsible you know gaming and and everything we can at Lucra, but really our innate product is what positions us in the best way possible to be safe and secure. So that's kind of our my my Lucra stance on it. My my Dylan stance on it is that it's a very odd time because of the regulatory regime and the you know current environment in the market.

21:45 There's kind of going to be a green field next couple years. It's going to only get bigger, right? And then there's going to be some change potentially after the next election cycle and it's just a lot of unknown. So like I think it's honestly why you're seeing some of these bigger companies run so free, so fast and loose is it feels like this kind of potential time box before things start to get regulated. Like there there has to be regulation. The fact that you can do some of this stuff on an airplane now not geolocated in any state and that has to change at some point. So it's just these regulatory bodies are you know they're they're they're slower to move than the disruptive startups as you have been and and at some point that will likely catch up. So we're just trying to play in the very black and white It's always been legal for Brent and Dylan to go to the course in Fort Worth and play for five bucks. It's always been legal for Dylan and Brent to go play pop-a-shot for a burger. And we're going to we're not taking a fee on this. We're facilitating what's already legal and we're going to stay in that in that lane and kind of watch from the sidelines as the rest of things evolve. Yeah, makes sense. I just obviously it's a very topical with like the Brandon Staley thing this week and it's just been in the news a lot and I think that there are some cracks in the other end of the spectrum and one of the things last week in the newsletter I do this thing called field notes every other week. 4-3-2-1 is the format and the one is one stat that matters for sports media and entertainment and I pull it and tell you why, but the one from last week was the number was 50% or one half and it was the port that is the portion of 16-year-old American boys who have gambled in the past year and for 11-year-old boys it was 1/3. This is from Harper's Index which then will source another primary or credited another source. It's it's linked.

23:22 Obviously, I see that and my my commentary on that was just this is not going to be pretty and yet people will still act confused when we see extremely poor outcomes for a generation raised as degens. not to not to get on a soapbox, but No, I'm with you. I mean I think that's scary. I have not seen that stat. That's a scary stat and that means we need more regulation and oversight for these things and like the the real main challenge is there's a lot of different people regulating this. You have obviously the states themselves, you have the federal government, you have banks, you have payment processors, but like everyone's kind of got like one finger in, right? And the rules are kind of you know it's like so it's it's an interesting time and I think again we're excited about the lane that we're playing in because we feel like we're adding value not subtracting it. We're helping people have more fun and again, I think I don't want to misquote the stat, but it's somewhere over 40 or 50% of our contests last month were were free to play, right? So a lot of what we're doing, yes we are offering big money prizes and tournaments and challenges for those types of users, but a lot of what we're doing is play this little game, get 10% off risk, go have fun or oh you wanted to go get that prize and now you have a chance to get it at a cheaper price and we're just trying to driving that brand loyalty and we're getting that data and we're allowing for retargeting. So it's it's we're really leaning into that ecosystem. It's more about the fun.

24:36 Yeah, which I think is important. Yeah, and I'm I'm never one to want like heavy-handed government regulation as my default, but it's just something I'm paying attention to. So I want to know a little bit more about what you've learned in dealing with your customer set. These types of big big businesses with long time brands, my guess is that you're are you seeing a lot of companies that have said, "Hey, we were told you know 10, 15 years ago that we had to collect big data and we had to have a data plan and we had to get like aggregate this stuff and be able to capture it." Are they starting but for a lot of companies and what a lot of these AI businesses and and services companies have been able to capture is like, "Okay, we're now going to take that giant field of data and make it actionable and tell you what you can do with it."

25:22 Is that kind of the the point where these companies are at where they say, "Look, we have it we have the raw data. We don't really know how to best use it and that's where you guys come in." Or again, I don't want to ask such a leading question, but tell me about I would say I was surprised. I think that's what I thought I was going to go find. I'm surprised how limited data a lot of these companies have, right? Like just like there's just Okay, maybe they know that Brent went in and they know Brent's name and Brent's email or like they know what state Brent's in.

25:50 But they don't know what games Brent's playing, why he's playing them, who he's playing them with, what time of day he's playing them, what he's playing them for, right? And then to me that's a much more valuable information. Like you can only do so much with like Brent is X years old and he's from Fort Worth versus with Lucra you can say Brent went to X location of X company at this time, played for this, played with this person, you know, did this type of gameplay. And like also then all of a sudden we target these customers in a very specific way. Like Brent likes you know Patron margaritas and Dylan likes nachos with with you know loaded chicken. You want to market different stuff to these people, right? And so I think we're just we're just A adding a whole new like customized personalized data set for brands to have and then B we're working on using AI to then provide really custom marketing and personalize insights, right? So the goal is that when Brent walks into a location and Dylan walks into a location they have different experiences based off their cohort or things they've done in the past. And that's where as we're building this Lucra ecosystem and Brent starts to get Lucra involved with Lucra at different places, we may know more about Brent before Brent even walks into one of our new partners. That's when the aha moment happens, okay. Oh wow, we learned a lot about Brent when he you know did this putt-shack mini golf activation. So when he walks into Five Iron or he goes and plays backyard baseball on his phone, we actually have information about you already and we can provide like value to other partners. So I think that's where we like to get to, but I think my one of my biggest surprise is just the limited amount of data that was existing today and and how unorganized it is. So we're trying to add value there as well.

27:22 Yeah, backyard baseball. I had backyard sports Lindsay Barnett came on the show last last summer. >> You you you've interviewed like all of our people. I love that. Lindsay's amazing. I'm trying She's great. Yeah, she's fantastic. I'm so excited about that new game they're launching this summer. The new backyard baseball game is going to be amazing. It brings back like my childhood and they're adding so many bells and whistles. Hopefully some you know sneak peek. Hopefully some gamification soon with us. So there's there they are they are they're awesome with what they're doing.

27:48 They're on fire and their head of ops Zack Oliver is a friend of mine who's also been on the show. Good friend of mine, too. Hi Zack. Zack's the man. Okay, so I teased it a little bit earlier. Tell me about some of your other investors. Who else has gotten involved over the last five years cuz this isn't like an upstart, you know, you didn't start this last week. Two-part question with a fresh $20 what is that going to go towards?

28:10 Yeah, so you obviously Arc led this most recent round. We're we're thrilled to have them on the cap table. But to your point, we've had a lot of investors that we would not be here today without. Like this to to be where we are now, you need a lot of people who back you during pivots, during twists, during turns. So you know, can't name them all, but a couple just to call out. Obviously 76 Capital, you've interviewed Wayne Wayne Kimmel and Chad Tender and their team have just been day one folks for us. Not just you know, great capital partners, but great thought leaders and partners.

28:36 You know, Chad Tender's been on our board for many years and that's and that's been super helpful. You know, Mark Lasry was one of our earliest backers and I owe a lot to him just you know, putting his name on the business in the early days. I mean before we even had a product, Mark was like, "I believe in Dylan and we're going to we're going to back him." And and that was huge for us to to bring in other capital as well. in this new round we also brought in Harlo Equity Partners out of Canada and they have a huge entertainment background which we're excited about. Simplex Ventures who is a big you know venture capital you know thesis these days. Tholus who was one of the early investors in PrizePicks.

29:08 And then she's known Adam coming into this round which we're pumped about. We've got some great athletes, too. You know, Giannis is an investor. Zack and Julie Ertz are investors. John Isner, one of our earliest advisors and investors. I've always thought it'd be fun to have John hit like 120 mile an hour serves at people and see if they can return them and do like a fun. So John, if you're listening, we still should do that.

29:26 you know, his kick serve is still going like over my head, so I don't know how that's going to work. 7GC and Jack Leeney and his team have been amazing investors of ours. You know, so hopefully not. David Gannic, a long time investor and friend. so there's there's tons of folks. I mean we've we've been so lucky to have a great network of people around the table and you know, one thing I definitely didn't realize when you started is how long these relationships are.

29:51 You know these are these are you get you take money in the first day like I'm going to go build this company and I'm going to get to ABC in a few years. Like we're coming up on 5 years and we are now really hitting our stride. So we got another 5 years to go. So these are long-term relationships. Also Rock the Group, don't want to forget them. They're one of our early investors. So yeah, it's a very fortunate and very thankful.

30:07 Well, Isner's a Dallas guy who I've been trying to get in touch with on a we've been on an email thread. >> Okay, well maybe I can help you get him on your podcast John. Brent's a good guy. You should do it. No, he's he's fantastic and a ton of fun too. Yeah. Okay, well wrapping up here. You work with companies that have been around for decades in some cases and then you also have businesses like Five Iron Golf I had never heard of until probably 18 months ago which maybe I was living under a rock, but I talked with one of their guys Matt who like runs their UAE operation. It's such a bigger business that I had than I realized and such an amazing business. What are some other like challenger or emerging kind of you know fun entertainment businesses we mentioned Pool House earlier which I think just opened its first real location in London. What are some that you are really bullish on? Yeah, I'll give you a couple. One is company called Chess Kings which we're super excited about. This is going to be the first ever real money game of chess online ever. So you know this is a you know think you and me play a $5 game for five bucks a five minute game for five bucks, right? And so their team's been amazing.

31:11 I just played the most recent version of the app. It is incredible. I can't wait it's launching like any day now so you'll be hearing about it soon. An upstart company. It's a great a great example of of Lucra's kind of value. they have built this awesome chess game, but they needed the legal the compliance the payments the banking you know the the legal opinions. And so they we kind of had a great match made in heaven there. Another cool one in the golf space is company called Skill Shot.

31:33 Super excited about that business also just went live. Think going to the golf course and you know putting a few bucks up to see if you can make a hole-in-one or hit it close to the pin. And they have cameras and you can film so it's automatically trusted in the ecosystem so you know if you hit it close and and and challenge other folks there. We're super super excited about that business. This company ClickFit I mentioned which is a really cool new step challenge business where you can like challenge others for how many you hooked up with your Apple Watch or your Whoop for how many steps you've taken. So I think what's been so cool about Lucra is we're partnering with brands that are literally just getting their first money in and starting their first version with brands all the way up to Zillow who have been around for decades and the theme is the same. We're digitizing friendly competition. We're providing the software and we're letting them do what they do best which is market to their customers. The one thing Lucra doesn't does we're not a marketing engine. We we partner with brands who who know their customer and and can handle that side of the pie.

32:24 So you're 5 years in. What has been the most challenging part that caught you off guard? There are some things that people know when starting a business like yeah this is going to be very challenging and this is going to be pushing a boulder uphill. And then there are other things that you just can't prepare for. What's something that comes to mind? Yeah, one of the things that caught me off guard I think is how much of my time I would spend investing in people. Like what makes or breaks Lucra from the beginning at this point is that is the people that we hire and you know I think I I've spent an inordinate amount of time in the past year hiring people onboarding people and investing in people's development at our company. And I think it's been a worthwhile trade, right? I think that at the end of the day when you're a startup in a room and you're five people you can do it all.

33:14 You know I was head of product, I was head of legal, I was you know co-CTO working on the tech, I was doing all the sales etc. But if you're going to build a billion dollar company you physically can't. And so how you succeed is going to be A that first layer of people below you that you hire because that's going to trickle down to the next layer below that etc. So it's all about people and building a culture. So I think I don't think I expected that and that's been a pleasant surprise in some ways.

33:38 It's been a huge time expenditure but it's been amazing to see that kind of come full full circle. Also I think another thing I've I've learned over the years is you know the highs and the highs and the lows and the lows when people say that you know for startups are real. I think you have to find a state of numbness. Like I think to do this to do this well you have to be numb to both the highs and the lows, right?

33:59 So for example when something goes wrong you know big customer churns or some sort of issue like you need to not get too low. You raise $20 million you need not get too high, right? Like we celebrated that for a day and then we were back at it. You know it's like otherwise you get into a danger zone of of you become lose focus or you can you know just emotionally it's leads to instability. So I think over the years I would say if you looked at my like my my heart rate monitor like in year one it was like this and then in like year three it was like this and now I'm kind of trying to to be like this, you know.

34:29 Yeah. I think that sounds like the only way to get to that level heart rate is by having those wild swings. There's no other way to to And that's and that's why I absolutely get why VCs often back second time founders or third time founders because when I start when I start my next one knock on wood I can start hopefully regulated, right? Because I've I've lived this now, right? So I think I think it makes sense. Like you can you're right the only way kind of out is through. Yeah. Yeah, only one way to learn. Okay, last question and maybe that you kind of hit on it you with that first answer.

35:00 What is something that has energized you in running this company that also caught you off guard that you didn't expect to be so much fun? Wow. I'll give you two answers cuz you're right the first one I'll just double down on. The fact that we have now 35 people that work here that every day come here to work for us that believe in this mission that we like you know pay their salaries and put their kids through school and like it's incredibly rewarding. I mean it's also terrifying in some ways. I mean it gives you a lot of motivation, right? Like when when things are tough it's like that's what motivates me through. I'm not thinking about myself I'm thinking about okay all these people that work for me and they bet on me and I have to go get make this happen. But when things you know when you're moving and humming it's just so rewarding. So I think that's definitely number one. Number two I absolutely thrive and love and I I I guess I didn't expect this how much I love how no two days are the same. Like I I it's never boring, right? Some days are hard and some days are stressful but like I wake up every day and I look I say what am I doing today, right? And I think that's really fun. Like I just I I came from investment banking where it was the exact opposite. Every day I did the same thing, right? And so now I I'm I my I'm I'm using my brain every single day. I'm thinking creatively. I'm having interesting conversations. I'm meeting new people. I'm traveling. And what's so cool is nothing is off limits. We can do whatever we want, right? Like our investors back us make no I think if we started selling shoes tomorrow they'd be a little bit confused. But like anything in this gamification loyalty realm is fair game. You're going to see a massive announcement from us in two weeks on a new whole new project that we're working on which is a brand new vertical that we just kind of came up out of thin air about six months ago, right? And so it's it's been really cool where you can kind of start startups within your startup and kind of keep those creative juices flowing.

36:37 So we're having a a ton of I'm having a ton of fun with that. I think I was surprised. All right, well Dylan thank you so much for your time. Congratulations again on the raise and I look forward to following along as you keep your foot on the gas in this this next chapter of Lucra. Brent thanks for having me. This was a ton of fun. I really appreciate the conversation and the best of luck to you as well.