Adam Torres and Dan Idzkowski discuss entrepreneurship.
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Show Notes:
Inventing a product, taking it to market and making it a success is no easy task. In this episode, Adam Torres and Dan Idzkowski, Inventor at SKUNKLOCK & Co-Founder of Sidepocket Financial, explore Dan’s approach to entrepreneurship along with his two companies SKUNKLOCK & Sidepocket Financial.
About Dan Idzkowski
Dab spent a lot of time thinking about what the world will look like in 10 years and what role he can play in creating that future. His background is deep-tech and quantitative finance, but built a career as a pragmatic entrepreneur and investor with a knack for exposing lies perpetuated in monopolistic industries and building companies to right the wrongs. Dan also spent most of my vocational time founding, funding, and advising mission-driven companies that are tackling big existential problems.
His first successful entrepreneurial endeavor was exposing the harsh truth that power tools can cut through any lock in just seconds: a reality purposefully concealed. He co-invented the SKUNKLOCK, the only bike lock that fights back with noxious chemicals to tackle this 10B+ global theft epidemic and pull the lid off a corrupted industry. SKUNKLOCK has since saved countless bikes and sparked the birth of the 1B+ deterrent lock industry.
About Sidepocket Financial
(‘Sidepocket Financial’) is a venture-backed deep-tech company disrupting the antiquated wealth management industry, and solving the multi-trillion-dollar drawdown problem. American investors lost an estimated 7 trillion dollars of retirement capital in the 2022 bear market, partly due to traditional strategies like the passive 60/40 losing more than 30% after adjusting for inflation. According to BoFA Global, the 60/40 strategy collapse of 2022 is the worst in over 100 years. As the relationship between losses and recovery is not linear, a 30% drawdown requires a nearly 42.8% gain just to break even.
Sidepocket’s asset allocation technology, which applies advanced statistical analysis, quantitative modeling, and predictive analytics, is engineered to reduce drawdown in bear markets and crashes. This allows for shorter recovery time, and drastically improved long-term performance. Sidepocket has the potential to replace the investment allocation models used by existing Robo-investment apps and traditional advisors — strategic asset allocation, derived from modern portfolio theory or “Portfolio Selection,” the Ph.D. thesis of Harry Markowitz published in 1952, has been inadequate in serving tens of millions of American investors with varying risk tolerances and time horizons.
Full Unedited Transcript
Hey, I want to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to apply to be a guest in the show, just head on over to missionmatters. com and click on be our guest to apply. All right. So today I have Dan Itzkowski on the line and he’s an inventor of Skunk Lock and also co founder over at Side Pocket Financial.
Dan, welcome to the show. Thanks for having me, Adam. Good to be here. All right, Dan. So I know that you’re known for quite a few things, whether it’s skunk lock, whether it’s side pocket financial, I mean, you’re doing quite a bit. I mean, and investing. I mean, there’s a lot around that, but I guess just to, just to kind of get us started here.
Like when I think of you, I think of you as an entrepreneur. I don’t know if you like, or don’t like the word serial entrepreneur, but you got a lot going on. how’d all this start for you? I think it started a long time ago when I was a little kid, you know, I always liked building things and then I love creating things that people really wanted to use.
And I think I started out actually selling candy when I was like six or seven year old, seven years old to. They’re friends of mine at school. Oh, that’s great. You had, you were one of the candy selling kids. I loved you guys. I was the baseball card guy. We didn’t really switch over on turf. I did the baseball cards or maybe sometimes the comics.
And then some of my other friends were the candy people. So I love it. Go, we would have been friends growing up. I know it. Go ahead. I would have been your candy dealer, right? Exactly.
I love that. , so take me further, right? So obviously when you were young, you started and that’s where you got, I just like myself. I mean, we, that’s where I kind of got hooked on the idea of entrepreneur and just providing value. Like, like how’d that grow from, you know, where you’re at there to now?
Yeah, I think I just got progressively better at it and more purposeful and structured over the years. I started. You never go from zero to 100 instantaneously. You always take steps along the way. And I think I graduated from candy to bootleg CDs to, you know, selling services making websites for people and I’m actually selling things on eBay and when did you start with the website thing?
Were you early on and eBay? Were you early on? Yeah, I was really early. That was when I was probably only 10 or 11 years old. Oh, come on. So you did you, I wish I was that smart. I think I was trying to do some mail order envelope or something like, I don’t remember, but I didn’t, I didn’t have the chops on that one.
Go. Oh man. So that’s, you’re early on there then. Yeah, very early, and fortunately at the time it was still a very valuable skill. Today, AI can code most, most things on a website these days, so doesn’t pay as well anymore, unfortunately, but that’s kind of the nature of the game, right? You have to find opportunities in the market and, and see where you can add value.
So now you’re you know, obviously those are the young years, let’s speed it up to where you’re making some larger impact here, like with what you’re doing today. Like, like how’d that happen? Yeah, I’m a son of immigrants from Poland. My parents came here in the 80s and classic immigrant story.
You don’t have too many career options. You know, it’s normally doctor, lawyer, or some sort of financier. Okay. I went into the hedge fund world. I was good at making money and investing and things of that sort. So I started my career in the investing world, but I realized rather quickly that. It wasn’t really meaningful to me.
It didn’t make me feel good that I’m using my skills, just moving money around and making the 0. 1 percent of the population that’s already wealthy, just a little bit wealthier. So I wanted to start building things and that’s what I did. And I’d say my first breakout company was a personal company that or a company that was very personal to me because I had a lot.
Bikes stolen growing up in San Francisco, and the reason for that was that every single bike lock company on the planet was lying to people and actively hiding the fact that these angle grinders and these powerful power tools exist that can cut any in a matter of seconds. So my first kind of breakout company was A mission driven company.
I didn’t really care if I made any money on it. I just wanted to make it go viral and make sure to expose all the other companies in the industry. So I. Co invented the first bike lock that explodes with noxious chemicals if a thief cuts it. Wow, what an idea there like did you get when that first happened?
Or you came up with that idea? Did you get any Like backlash from that. It’s just such a novel idea. Like did you think of that? Yeah, you know, I wish I had a book available to me When I was starting my entrepreneurial journey Retail zero to one but he mentioned that the, the biggest and greatest opportunities lie in important truths.
Very few people agree with you on and that was absolutely the case with an exploding my clock. The things that I heard were no, that that’s going to be illegal. You can’t or no, you know, lock companies wouldn’t be lying to us. You know, they’re good people. They’re making these security devices. So, and then millions of bikes are stolen every single year.
There’s no way you can stop that. That’s it’s it’s way too big of a problem. You know, here, well, you know, nearly a decade later and thousands of bikes saved later, not a single lawsuit or legal issue. Big bike companies were actively hiding the existence of angle grinders. But now the industry for deterrent locks that Skunk Block spearheaded is over a billion dollars.
So, everyone Acknowledges that locks can be cut with these power tools very easily and skunk lock receives 100, 100 plus emails. Thank you. Emails every single month. From customers saying that it stopped a theft attempt. So clearly there’s something. Something there. Hmm. Do you remember the, like the ideation process that you went through to come up with the product?
Or was it just like you’re sitting there and it came to you or the other co-inventor? Like how did that, was it like a stroke of, I’m always curious on an inventor’s mind, like when these things happen? Like, or was it a buildup where you had a whiteboard? Like how did you come up with the, the concept?
I think it’s how I’ve wired my brain over the years was always. Everything and to a degree, it’s principal component analysis, trying to look at the foundational assumptions that you’re making around everything. You know, the foundational assumptions were that you can make a stronger, harder.
Thicker lock and it would be more effective Or you can use german steel, whatever that means like some of them were we’re claiming and you can resist bike theft where the truth is the difference between A 300 lock at the time and a 20 lock was about six seconds of cutting time. Wow I think for a T 50, right?
So in terms of ideation, I think I just accidentally trained my mind to have that degree of foundational thinking and skepticism and looking for these truths where I can potentially identify and then commercialize it into a product. And that’s that’s what we did over over the last decade or so close to a decade now.
Man, that’s an amazing story. And now, and so when you’re building companies and looking for, I mean, you’re, you’re attacking different niches, you’re attacking different angles. And when I saw this original, I’m like, okay, so we have a bike lock on one side and then we have, you know, side pocket on the other side.
And I’m like, that’s a, that’s a, that’s a a big bandwidth for an entrepreneur. So maybe give us like, how does that happen? Yeah. So my background is actually in quantitative finance. That’s an industry I, I always had a passion for and always wanted to return to, but sometimes opportunity comes knocking at your door and, you know, with, within 10 days or so, Skunk Lock went viral within 10 days.
I became, I went from somebody with a. Pretty substantial amount of technical skills. Yeah. And some very valuable skills. And I got deduced to the guy that made the exploding bike lock. You know, so. It’s amazing. How do you deal with that? I can’t let you get past that, Dan. Like, how do you deal with that?
That’s a thing. Yeah. You know, I, I embraced it. I accepted it. And at the end of the day, I realized there’s two kinds of people, the kind of people that are building things for their own satisfaction and own benefit. Those people are really particular in terms of what their career choice is. They generally say, I want to be X and they are ruthless in terms of getting there.
And I realized that’s not me. I could be doing. Anything, as long as I felt like that was an extremely impactful thing that helps millions. Did you have that identity or that self realization though back then? Or is that like in hindsight? I’m just curious if you were self aware of that at that point.
Cause I would have been like, I’d have been freaking out. Like, what is this? Now I’m the bike lock guy. Personally, now I have, now I have a little bit more grounding. But I’m just thinking back and I’m curious about your experience. I think it actually happened at that time. Oh, wow. Okay. Or I have to face it head on and I was doing.
Interviews with the BBC at 4 a. m. And I don’t think I slept for about 40 hours straight. So you were thrown off the cliff, man. I was thrown off the cliff. And I have to kind of face some of these things head on. Because they all end up crashing very, very quickly. So more than anything, that experience led me to learn more about myself.
As an individual and as an entrepreneur than, than any, anything, so a lot of entrepreneurs, as you’re aware are, are listening to this and a lot of, you know, senior level executives and many, I find that, like, let’s say that you know, they may have been a it may be a doctor.
They may be a lawyer. They may be something that, you know, something went to school for a long time and you put yourself in this box many times and whether you feel society’s doing it, not doing it, you’re doing it yourself, whatever, that’s not my point in the question, but like, what would you say to others that have kind of.
You know, that haven’t given themselves the room to explore or to even do something different because you could have even like before you didn’t, okay. I know you didn’t plan for skunk lock to necessarily go viral and that quick of time, right? It was just something you were trying to do for yourself to solve a problem and to help some others.
But you let yourself out of your quote unquote box. Of like, you know, and not saying you were quitting everything else you’re doing, but you did, you let yourself explore and put your brand as Dan onto something different, right? Like, what would you say to those out there that are still kind of exploring or a little bit, I won’t use the word scared, but they’re just kind of exploring that idea.
I would say the 1st thing is trying to identify the motivation, what you’re doing. That’s good. People are motivated by different things. As it turns out, the majority of people are motivated by wanting to find a partner in life. Let’s say that is. Very strong biological driver other people are motivated by wanting absolute freedom They don’t want to You know have their time restricted or how they can spend their time So people are motivated by by different things Some people are motivated entirely monetarily.
They’d be ecstatic. They can just eat the best meals have the nicest car have the nicest house so there’s a lot of variance there. So being Really purposeful in terms of understanding what is actually motivating you. I think it’s a guiding light there for me. It’s always almost entirely been the freedom portion.
lot of money as long as I have the freedom to pursue my passions and my biggest passion is and favorite part of the day is opening up those emails from. From skunk lock. That’s amazing. So, so to jump around a little here with skunk lock, you were originally, you know, trying to solve the problem for yourself, you know, saving your own bike, helping some other people there.
So that I get that part. Now with side pocket, what are you trying to solve there? Or what were you trying to solve there? Yeah, what I realized was there are 10 million bikes stolen every year, but that’s still a relatively. Great. Mentioning not everybody has a bicycle 1 thing that everyone’s life is their financial wellness, you know, their.
All of the, because that impacts your quality of life directly if you can’t afford food or shelter, of course, that’s that’s hyper critical. And what I had realized is the world has changed pretty substantially specifically the big secret or the big truth that I discovered was financial education no longer comes from licensed financial professionals.
It comes from predominantly. Friends and family. So if he includes friends and family, people you trust that’s and digital media that represents over 90%. But the. Largest and fastest growing segment of where financial education comes from is by far digital media, which is over 50 percent now. So we’re talking YouTube.
TikTok, Instagram, Facebook, et cetera. And another another part of that is content creators are not really equipped to provide sufficient financial education. And this is actually led to a significant drop in financial literacy in the United States from 34 percent to about 17%. Just in the last 12 years.
So there’s there’s a high correlation between those two things and a big part of why that is is because the incentives for content creators and we can even call them influencers are non existent. Creators get less than 1 percent of the total revenue for providing this incredibly important financial knowledge where brokerage houses like Robin Hood and Fidelity and TV end up taking.
As majority, so the of that revenue, because they get revenue on every client marginally that’s brought in for the lifetime value of that client and the industry has been keeping that. From these educators and creators purposefully since the beginning of time, pretty much. Right? So my thing here is we have new people that are fundamental in helping us resolve some of these problems that we have in the United States.
Wellness, so financial literacy, which has led to, 7. 1 Trillion dollar deficit in retirement funds. People are not saving enough. They’re not investing enough and they’re investing in the wrong. They’re gambling Americans saw 9 Trillion dollars. In losses during the down down markets and 2020 and 2022 because.
But there was a lot of speculation and a lot of shady stuff that was being done. And frankly, the models that are available to them didn’t perform. Well 20, 21st performing year for the 6040 portfolio in 100 years. Which is talking that was supposed to be 1 of the safest types of portfolios to, to invest your, your money.
And lastly, the biggest issue is there is a purposeful. An egregious disconnect and fragmentation between where people learn about investing and personal finance and where they can take action and actually invest through brokerages, RAs, et cetera. So right now, you know, I would spend hundreds of hours trying to help friends and family and I would get a lot of questions.
How should I invest my money? How can I learn to are there better ways to invest them buy and hold and robo advisors? And I would send them a bunch of youtube videos and then I would send them links to fidelity and schwab and vanguard and there’s so much lost in translation in between there because that support layer does not exist And what I realized that people don’t have that support layer they are never going to feel comfortable enough Saving and investing in order to.
Actually have a meaningful impact on their financial wellness and securing their financial future. like, what type of investor is this? Is this appropriate for just in general? Is it only for accredited investors? Is this for the everyday investor? Like, who can participate?
Yeah, so the, the best kept secrets are kept for the 1%. So that’s a part of the problem. You know, the best strategies that are applying these sophisticated methods of investing are only available to accredited investors. So I didn’t want to make anything for accredited investors. They’re pretty, they’re pretty taken care of already.
They have access. Hedge funds and other alternative types of investments. Who doesn’t is the, the retail investor with less than what’s 5 million in liquid capital. But those are the people that need it most. So what we did at SidePocket is we’re first tackling we tackled two of the biggest existential problems.
That are contributing to this, let’s say, financial wellness crisis in America. And the 1st, 1 is we have to democratize these strategies that are currently. Available to only 1 percent of the US population. And that’s what it is, and we spent many years doing that. You know, we’ve been working on that for over 5 years at this point.
And we. We did that successfully. That’s the foundation of, of what we built. Without that, you can’t build anything on top of it. But then you have to address financial literacy because if people one, don’t, don’t have trust and the minimum amount of financial literacy, then they won’t feel comfortable actually investing.
So the way financial literacy is, we have partnered and are partnering with some of the. Most well known and biggest visual media, social media influencers, and content creators, or what some call influencers in order to help us educate the, the 99 percent that we don’t know. And do it in a fun, engaging, and really easy to understand way.
So imagine having index the index fund explained to you by a food influencer relative to You know how fine dining works or yeah Baseball card collector you mentioned explain how it imagine having a baseball card collector influencer or YouTuber explain to you how what the sharp ratios relative to baseball cards and it’s it’s fun.
It’s engaging and you learn a lot. And you learn just enough to feel comfortable taking the next step and taking action. And it’s all within the same platform, which we’re calling the Content Integrated Investment Platform, or CIP. Man, I love this idea and I love your examples, like, because if you, I feel like the more you can bring like high finance concepts to to relatable things that happen daily.
So it’s not just a a conversation where you have with your advisor historically once a quarter or once every two, every six months, or maybe even annually, or for most people never, right? So if you could bring that that content. Into their lives in a meaningful way and connected to things that make sense to them and that they can, you know, they can, they can grasp and that are interesting and more importantly, hold their attention.
Like that’s one of my favorite things about the content creator and influencer, really economy is that that’s their experts at getting attention and, and, and keeping that attention. And it’s, that’s not something that, and building an authentic audience. And not everybody is obviously, but the ones that are and do it really well.
They have the opportunity to help a lot of people, especially when they align with companies like yours that are trying to make a difference in this way. So, I mean, oh, I think the concept’s great. I think it’s it’s something super interesting. I, for my long term listeners, they know I was in finance for almost 14 years.
I mean, that was, that was my career prior to media now for eight years. So spent a lot of time thinking about and talking about. This subject, and I haven’t really heard anybody else talk about, like, the content portion of it the way that you have. Like, that’s super interesting to me, and I think it’s, I mean, it’s got the opportunity to do a lot of good.
That’s what I see. thanks for that, Adam. It’s really great to hear, and I should mention, this is definitely something that no one’s ever done before and no one can do except for side pocket right now. we essentially have unique ability to do this because keep in mind the, the usual model for how.
Compensation of content creators and influencers works is, for example, a big brokerage like Robin Hood. Let’s say it’s a popular one. We’ll go to a content creator of influencer and say, Hey, we’ll give you 100, 000 to talk about Robin Hood. For 30 seconds on your on your channel, and then we’ll make this link where we’ll pay you another 100 dollars for every client you bring in.
But that represents, you know, small fraction of what Robin had actually makes on those clients. And currently, we’re the only company in the world that’s. Able to pay these creators. Potentially unlimited amount of ongoing revenue. Wow, and that’s extremely important to align interests, because as as we grow and our client base grows, we’re leaning on these creators to continuously also educate.
These clients in these fun and engaging ways. So that’s that’s incredibly important that these are highly incentivize ongoing relationships. And that’s really what we’re most excited about. We’re leaning into the fact that creators are the new. financial educator, it’s not CFPs anymore, although we have CFPs on board that are training.
Content creators. Yeah, that’s great. Well, Dan, I just have to say that it has been great having you on the show today. I look for, I know, I’m gonna hear so, so, so much more about side pocket. I mean, it’s just a great concept. Execution’s great. For everybody that’s watching this by the way. So, and they wanna connect with Dan and see all of these projects.
great way to do it is to go to Dan’s website which is iis Kowski, just like his last name, IDZ. K O W S K I dot com. And that’s going to redirect his LinkedIn and then you’ll be able to see all of his companies and also projects that he’s working on. And speaking of everybody that’s listening and, or watching this, if this is your first time with the platform or engaging in an episode or listening to mission matters, and you haven’t hit.
That subscribe button yet? Hey, this is your invitation. Hit the subscribe button. We got many more mission based individuals coming up and the line, and we don’t want you to miss anything. And when, if you want, and if you’re feeling extra friendly, then leave that review because of course that helps the show and helps us get out to more people, so we do appreciate that.
Dan, Hey, I really want to thank you again for coming on the show. I appreciate it. Amazing. Thanks for having me, Adam.
