Ridge CEO Sean Frank: ChatGPT delivers $12 revenue per session — he'd be first in line for ads

users and grow your business today. And we have a happy apploving customer in the reream waiting room. We have Sean Frank from Ridge. He's the CEO. Welcome to the show. How you doing? Good to see you.

Oh, you got the polo bear on. What's this?

Is that the Winter Olympics Team USA? It is the newest drop, guys. You guys like it? I put on just for you.

Insane. Fantastic.

Fantastic.

Insane. Brought the brought the emergency podcast. We have why we wanted to have you on because OpenAI introduced ads. How quickly are you thinking about uh ramping up, testing it out?

Is Conor waiting in line outside of OpenAI to try to be the first? [laughter]

Dude, no joke. We are We would be the first advertiser if they let us. Um, you know, we measure a lot of traffic sources over at Ridge and the most like revenue per user out of all traffic ever. I mean, Google branded, meta, whatever is chat GPT. We get like $12 from every one of those sessions. And it like,

you know, for Meta, you'd be lucky to get a dollar per user, right? So, the revenue per session from a AI user is just through the roof. And,

you know, we have some data. I don't know if you wanted to share it or not, but like North Beam put out their 2025 report and they track, you know, probably 2,000 merchants, billions of dollars in revenue and AI search in January was like 0.01% of all traffic on all e-commerce websites and now it's like.7. So, it's just like shot through the roof

and there's not ads yet. As soon as ads roll out, I am so excited.

Okay. Um, we would expect the dollar per user to fall based on ads, correct? But do you still expect them to be high intent? Because there were, you know, we were talking to Ben Thompson about this and he was saying that they should have launched two years earlier because it's going to take a while for the ads product to work its way up. I imagine that the the chat GPT users that land on your website are super high intent because they've probably been asking ChatGpt about your product specifically or wallet specifically or products specifically. Uh now if they're researching the Roman Empire and they just see a little ad at the end that you purchased and it's not targeted at all, they might click on it and check it out, but it's probably going to be lower intent. How optimistic are you about CatchyBT ads delivering at a level above Facebook quickly?

Well, Google is rolling out their direct AI offer, right? And what that is is if someone asks, "Hey, what are the best gifts for dads?" Right? they're gonna ask that specific, you know, question. Yeah. Um I can now bid to show up with an offer for those people. It's like, hey, the Ridge Wallet's a really good gift for dads and they're going to give you 20% off right now if you click this link, right? Um so it's incredibly bottom of the funnel, like people who are ready to purchase and that's Google's ad offering inside of AI and that's coming out soon. So I think that was like what pushed Chat GPT over the edge to roll this out. They probably do a a carbon copy of that. So, it's not going to be discovery ads like you get on a apploven or a meta, right? What it's going to be is um you know like that last point of sale almost like an affiliate like push you over the door like a honey competitor or whatever, which I think is

would you be unhappy if uh the offering was just give us a dollar amount per customer and we'll go find you customers? uh something that's fully blackbox. You're not doing any demographic targeting, no keyword targeting, or would you like those features?

Well, that historically if you can tell somebody like here's 20 bucks, find me customers and you're you just look at your average order size, that's like the holy grail of advertising, but it usually ends up being

Yeah.

bit more comp.

But but but is the is the initial product that they roll out does it matter to you or will you just take what they what they give you? Yeah, it's it's what we've seen the organic traffic from any AI search is already so valuable, right? Um any way to get more of that we we would we would spend a lot of money for but

you know the beauty of the Facebook ad product is that they figured out a way to take half of everybody's revenue, right? Like affiliate is like people

Let's give it up for Mark.

Yeah,

I'll take you do the work. I'll take half. [laughter]

Yeah. T T T T T T T T T T T T T T T T T T T T Tik Tok Shop affiliate people don't want to give more than 15% of a sale. They're like, oh, that is too much. Right.

But all performance marketing is is just a is affiliate in a different coat, right? It's like they're they're able to like, oh, you're going to generate your demand and if you have a better offer, you'll get a better return, right? But really, they've just figured out exactly how much money they can take from everybody at the optimal level and that's why they do hundred billion dollars a year in revenue. Um, so if the offer from Chad Chie and Sam Sam Alman is, hey, give us 40% of your revenue and we'll give you new customers you wouldn't get otherwise, I would take that deal because I'm already giving Mark Zuckerberg 50%. Right.

One thing that's exciting is I think once people start seeing more once they start seeing ads for products, they will just naturally start using LLMs for more product research. Like I still find myself if I'm like if I'm uh doing like product research, I'll still go to Google search quite a lot even though in many ways the experience is inferior just because I'm so trained on that. And so I think like as they roll out ads they're just there's going to be like more organic activity. So hopefully as a brand you should be getting more people just landing on the site organically because they're just finding out uh finding out uh through their own research.

Totally. Half of all product searches start on Amazon. So like Amazon has been able to take over like the product search box from Google, but they spent $500 billion in two decades doing it. So if Chat GPT can start stealing some of that, you know, glow that Amazon's been able to do, they'll have an amazing affiliate business and ads business and and whatever you want.

Yeah. What do you what do you you you guys sell a ton on Amazon? What what do you think Amazon's like play here really is? uh because they obviously don't want to give up the golden goose of their massive ad revenue business. Uh they want to like protect that. Uh Alexa is like not even in the picture as far as I'm concerned in terms of like a shopping assistant. So what's the play? Well, you know, Amazon has a beautiful ad arbitrage system where they spend they're like the number one spender on Amazon on Meta and on Google because they can spend $2 to get a user and then those users click on a bunch of ads on Amazon. It's a free money machine that they've invented. So,

kill.

Yeah, I think they would um love to partner with everybody because once you're on Amazon, you're still going to click around. You're still going to do shopping and they have an ad product. The more interesting question is what does Shopify do? Because you know Shopify is a product feed of all these merchants, right? Um, but will they be able to win over any sort of of these deals? They don't have an ad product. Like they make all of their money on me hosting my website and then a percentage of the sales I drive and it's a very small percentage. It's a payment processing company. So it's like how are they going to survive if more and more of those transactions are happening inside of chat GPT or inside of Gemini? I think Amazon's fine. They have a big enough product, you know, feed they could feed it in everywhere. And if you do come to Amazon, they get all their money back with all the clicks. But walk me through walk me through the risk of Shopify because if I am if I'm looking to there's a lot of there's a lot of brands like there's a ton of I would say like the real like shopping that I've done over the last 5 years is like almost always on Shopify stores, right? Like Amazon for like essentials and things like batteries and things of that nature. But I feel like a lot of my uh like like um like like lifestyle consumption is happening on Shopify. And so you mentioned that that not having that like ad flywheel, but am I not still like discovering Ridge and just popping over to your Shopify store and like to complete the transaction and if they're effectively a payment processor like they're still making their money,

right? Well, it's just if websites continue to be important. Like I, you know, I I'm I'm going to operate under the assumption that

Yeah. But all

but calling calling Shopify just like a website company, like in my view, it's like a catalog and it's a CRM and it's a payment processor.

Oh, you for sure. It does all those things incredibly well. Bro, I'm so bullish on Shopify. I love I love Shopify as a thing, but the challenge is the website will become less important in the future. Just like mobile apps had a moment, they're not important anymore. Where was the last time you guys opened a shopping mobile app and before that it was cataloges, right? like the user experience has become easier and easier and easier and the way you interact with brands has changed and I think the website will kind of be replaced just by asking chat to buy you stuff and may maybe you'll still go to websites but kind of like how you still kind of open cataloges and

I don't open cataloges.

Yeah.

Straight in the recycling. I'm like I did not ask for this.

Totally right. And that's just like the the worry of of the website. So Shopify is incredibly important for us, but they do have to plug into every single LLM, right? They have to be that product feed everywhere. And

yeah, but I think they're they're they've taken the approach of just like being more quick to partner with the LLMs than an Amazon has because again, they don't have that same like they have like less to lose, right? They're not worried that because they don't have an ad business. are not like like I feel like Amazon has to be a lot more when you look at the when you look at the marketplaces that have partnered with um Chat GBT it's like Etsy right Etsy doesn't really have anything to lose right like they're uh they just want more traffic more more sales like they'll take it however they can get it whereas like Amazon has something to lose

right you know and it was big news when Shopify partnered with Chat GPT until Amazon partnered with Chat GPT and Amazon comes in an equity round and like now all of those products are going to be feeding into chat GPT and that's one of the the worries of Shopify. like h how do you stand out h right now like it's like beautiful brands with beautiful websites with shopping experiences and that is different from what Amazon offers but if all of those products are just going to be discoverable inside of chat GPT and competing for the same space

I don't know the value of my website in three years like that's one thing that we're we're worried about at Richidge right now

well what about uh ad creative I there's this weird trend where uh DTOC companies were effectively making TV commercials uh with TV production techniques, cinema cameras, high res photos, whatnot. Uh but wound what what wound up working on Tik Tok and Instagram reels and YouTube shorts. There's a lot of UGC, a lot of stuff shot on iPhones, a lot of stuff that feels more natural. Is there a world where maybe you want to get good at creating Sora videos or or AI generated images? Even if they don't look like a real photo, it looks more natural within that app, within the chat app. You're expecting to see AI images. And so you want to lean into AI image versions of your products. Even if the background's a little a little crazy, hallucinogenic, it's what people will be used to. They'll be in that mode.

Yeah. I think when Chat GPT launches their ad product, it's probably going to be thumbnails to websites with really aggressive offers.

Yeah.

Um,

but right now in our ad account, if you guys go to the Facebook ad library and pull up Bridge, we are running full-blown AI videos, right? And they are they're getting spend and they are winners in the ad account. Yeah.

Um,

so we're all probably underestimating how much it's going to affect the ad industry. It's like by the end of the year video is going to be if you want to make AI video it'll look just like human video and like the highest level productions are already being basically monopolized by AI

and something I've been thinking about that feels inevitable uh is you know two years from now we'll look back and laugh that people would like make an ad and then serve the same ad to like a hundred thousand people or a million people because it's like if you're going to spend a lot of money serving somebody an ad, you should serve them the most like hyperargeted like Sean Frank, I have an athletic brewing company beer for here for you. I got an offer for you, Sean. Just click the link and check out. Like eventually it will just get so so so so targeted that it's basically like ads are being generated on the fly for individual customers.

Oh, dude, that's for sure coming. Matt is working on it. And not only that, they'll put you in the ads. They'll be like, "Hey, look how cool you can look in this sweater. You should buy this sweater." And they want to do that because then the CPMs just go up. Right now, I get a $12 CPM on Meta. They would much prefer me get a $200 CPM and just show way less ads to everybody, right? So, I think that the personalization of ads is coming. And we've already just seen like in my ad account right now today, maybe a third of all my spenders will be AI ads. And that's crazy.

That is crazy. Double click on the the the AI ads that you're running. Are you running stuff that you could shoot that's indistinguishable from human photography, human videography? Or is there a unique value to saying, "Look, there's just no way that we could take a ridge wallet to the top of Mount Everest, shoot it into space, have it turn into cake, have it turn into a cat, like crazy stuff that's just impossible. maybe with like a massive CGI budget, but truly like breaking the laws of physics or are you just trying to do like, hey, it's just a Ridge wallet on a beautiful background and, you know, we were able to generate that.

Yeah. So, really what it is is, you know, we have wallets with every college and let's let's say there's 200 colleges in America, [clears throat] right?

Now, I could get 200 jerseys and I could get 200 fans and I could have them talk about this particular wallet with this jersey, with this fan. like a very bespoke ad um and then serve it into a market like Ohio. I could do that, but that would cost, I don't know,

$85,000 to run that campaign. Or I can have one guy do it in one day with uh a Hicksfield or whatever, right?

So that's what we're doing right now. And

are you guys using Hickfield?

We're having them on the show in just a couple minutes.

Yeah, I love Hicksfield. Uh so yeah and I I don't think like I think normies are using chat GPT now like it's fully broken through the mainstream but like I like the all of the the tools around that I mean everyone knows lovable at bolt.new but like if you want to make videos at scale I think feels like the best easiest way to do that right now.

Yeah. So the pipeline is you specifically want to multiply your creative so you are filming one human video and then you're creating variations with AI. Is that the correct use case right now as a as that example?

No. No. So, so what we're doing is we we have B-roll of actual wallets being used that we've shot, right? Um, but we need an opening hook of a a Buckeye fan, right, in a jersey or whatever. So, that is that is being done with AI and then intros to the wallet. Got it. Okay.

And you can pull up our attic right now. There's a woman like Hunter. She's walking talking about like, hey, like I bought this for my husband. He's like, you know, whatever. That she doesn't exist. That is all AI. [laughter]

And and it's because for us to find a woman hunter who's out in a field or whatever, we could we could do that. It would just take, you know, two days and it would probably cost $2,000. And we can test that concept right now in real time inside the Facebook ad library. So,

it's going to be interesting. I'm so curious to see what happens to the brands that like try to take like some type of like moral aesthetic or ethical high ground and just say like we never use AI and like what actually happens to those

Well, dude, it's one of those things. Yeah. It's like not using AI. It's like it's like if somebody said like, "Yeah, we don't use computers." I'm like, "I don't even know what you mean." [laughter]

It's like everything's AI. Everything's got to be AI. So, um, look inc. incredibly bullish on uh ads coming to any surface of the internet. So if there's any service of the internet that doesn't have an ad, I would love an ad to be there. Uh you know you guys [applause]

you guys did the apploving ad read um brand new to e-commerce and I spent millions of dollars there and I love I love it as an ad product. So more of that is just really good for me. So, if it comes to Gemini or Chad GPT now, I just don't think they'll do big beautiful display ads. I don't think there'll be any video ads. It's just going to be, hey, you're looking for a gift, Ridge Wallet will give you the best price ever right now. And then they'll take a 30% commission.

I really want to see more flashbangs come. [laughter]

Watch out. Watch out. We got you. [laughter] I hope you

Do you have any flashbangs on your podcast? You're the You're the one show that we would give you the the the effect if you want if you want to flashbang your boys.

Okay, cool. I'll get the ad rights to that. [laughter]

We also have a horse that runs across the screen now.

We'll we'll save that. We'll save that

for right now.

Uh wait, have you have you uh [laughter] have you used any other of the uh AI ads? Uh like AI basically like I heard Perplexity was rolling out ads in their product. Did you demo that? Have you have you thought about using that? I know it's like smaller and earlier. Do they have they are they actually live? You have any experience there?

No. And I have a list of in front of me like I told you earlier North did a report.

Yeah.

And chat GPT is 99.5% of all AI traffic to e-commerce websites right now. Wow.

So, [laughter] uh,

so it's a big [clears throat] one. So, this is a big announcement today. So, uh, yeah. What does it take to actually get Ridge live?

I don't know, man. You got You guys know Sam, dude. Hit him up. Say he's got his first paying customer right now.

He's a little busy today. [laughter]

He's got to go back and forth between Oakland and traffic.

No. Uh yeah, we'll we'll we'll put in a good word for you. I would love to see what consumer What kind of broader consumer trends are you tracking this year? We were talking about the sauna wars in New York City.

Uh people setting up these like bathous. I was somewhat bearish on the trend like nationally. I just think there's a lot of places in America where people will be like, am I going to pay couple hundred bucks a month for this like sauna like bath house membership or do I just want to buy one uh you know for my house and and um

uh but what what are you tracking?

Uh well on the sauna wars I mean pause is a franchise-based sauna business. They have them in Venice. They have them in Southern California. I was at a e-commerce or like a a private equity conference. I think those guys are going to expand aggressively. So I think they're selling to right now.

I used to live down the street from a pause. I would go there. I enjoyed it. I was like, I like using a sauna and I like using an ice bath. And so I just bought one because it was like a $100 every time I went. I just did the math and I was like, it's nice to go there, but it's it's nicer to just have it in my house. And so that's that's one of those things like I I don't know how much like actual spend that they can capture long term or what the LTV is. Like if you get somebody hooked on using the sauna eventually they just run the numbers, right? It's not like a gym where it's like a gym I'll pay the however much it is a month because it's nice to go somewhere out of my house to work out and I don't want 300 different machines and all these different plates. So, I'm not convinced that it's actually going to scale that well outside of, you know, major metros like LA and New York.

Yeah. Also, the cost per use of a gym is really low compared to a hundred bucks every pop of a of a pause. But I they're going to expand like crazy and it'll be a great private equity transaction for somebody. But yeah, long term it's I mean I don't I don't think it's a good trend. Uh the thing we're most interested in is fiber. I think fiber is gonna have a protein like moment and protein's been like on a mega trend for 20 years or whatever and has billions of dollars in spend behind it. You know, creatine had like a little taste of that, but fiber will be like the next, you know, thing that even reaches something like a protein. So, we think fiber is like the the obvious big trend right now that's going mainstream.

Will we see will we see you you guys enter the category this year? Oh, we're secretly in the fiber space already. So, we're not talking about it, but we have we have a brand bubbling up. We have real customers that are paying. They don't know what's behind Ridge, but we'll talk about that uh maybe offline.

Amazing. So, you're going to post your revenue every single month to invite thousands of competitors into the category, right?

Yeah. Yeah. Seems to be the smartest thing to do, right?

It's like I I the the the build the build in public movement brought to consumer is just an absolute nightmare. It's like if you brag to the world about how much revenue you're doing, there are going to be smart people that enter your category and they're going to do it fast and they might outexecute you. I don't think they'd out execute you guys, but um I've yet to see see a consumer founder build in public that didn't ultimately regret it.

Oh yeah. You know, we're pretty public with Ray just because I think you have to be stupid to try to sell wallets in 2026 or whatever.

Yeah. But but but for you guys it was it was never like you were just like here's our investor update. I'm publishing it cuz it's so good. Like you guys don't have investors but like it was never like I'm going to flex monthly on the timeline which is the approach that I think a lot of people have had uh like on on the the consumer side.

Yeah. I mean consumer is a knife fight man. Like there's no moes at all. It's it's the digital equivalent of opening a restaurant I think. So, you know, like you're you're fighting for every single transaction, right? You guys were just having, you know, Sequo talking about it's a great time to sell Enterprise SAS because you guys have hostages and not customers. And it's like,

yeah, I would love I would love to have [laughter]

Yeah, there's truly no lock in once you buy one. It's not that you have to come back the next year, whereas that for a lot of enterprise SAS, if you stop paying, your entire business shuts down. So

yeah, the the moat is like scale, operational excellence, but those things like those things can erode.

Very team- based.

Well, thank you so much for taking the time to hop on.

Great to see you. Next time you come on, come in person.

You know, it's not that long of a drive.

Yeah,

dude. I would love to. And

wait, you're crushing it.

Once you once you actually have the the OpenAI ad platform live, let's come here. Let's put it on the big screen. We'll get a bunch of monitors and we'll just monitor the situation together.

And we'll clap every time a sale comes in.

Yes.

And and thank you for hooking the team up with Ridge Wallet. You guys are too.

Uh I was in the gym this morning with some of the folks. They they had the suitcase. Look at the suitcase. There it is in the corner. Every single member of the team is rocking a Ridge suitcase. There are more Ridge wallets than you can possibly count in this ultra dome.

It's amazing.

We're huge fans.

We love you.

I carry a ridge wallet every day. I love it.

Talk soon,

brothers. Thank you. Keep crushing. Goodbye.

Goodbye.

Goodbye.

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