Diamonds, De Beers, and the Death of Artificial Scarcity | A CFO Explains Diamonds

In this episode of Run the Numbers, CJ Gustafson breaks down the diamond industry as a business model: how De Beers controlled supply, engineered demand, and built one of the most powerful pricing machines in history. From the Central Selling Organization to “A Diamond Is Forever” to the rise of lab-grown diamonds, this episode unpacks monopolies, scarcity, pricing power, and what happens when technology forces transparency.

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SPONSORS:

RightRev is an automated revenue recognition platform built for teams that have outgrown spreadsheets and billing tool workarounds. It handles high-volume subscriptions, usage-based contracts, and mid-cycle upgrades, so you can scale without scrambling at month-end. For RevRec that keeps your books clean, visit https://www.rightrev.com/CJ

Rillet is an AI-native ERP built for modern finance teams that want to replace NetSuite and close faster. With revenue recognition, close management, multi-entity support, and native Stripe and Salesforce integrations, Rillet helps scaling companies run their finance stack in one place. Hundreds of teams, including Windsurf and Mercor, use Rillet to make the zero-day close real. Book a demo at https://www.rillet.com/cj

EY works with high-growth tech companies to navigate the messy realities of scaling—from regulatory requirements to IPO readiness. By helping teams get it right early and often, EY lets founders stay focused on building while reducing risk as they grow. Learn more at https://www.ey.com/techstartups

SpendHound is a SaaS spend management platform built for finance and procurement teams that want visibility and leverage in every deal. By tracking all your software, benchmarking pricing across thousands of vendors, and surfacing contracts and renewals, SpendHound helps you stop overpaying and negotiate with confidence. Trusted by teams at ZoomInfo and Hootsuite. Get started at https://www.spendhound.com/cj

Brex is an intelligent finance platform that combines corporate cards, built-in expense management, and AI agents to eliminate manual finance work. By automating expense reviews and reconciliations, Brex gives CFOs more time for the high-impact work that drives growth. Join 35,000+ companies like Anthropic, Coinbase, and DoorDash at https://www.brex.com/metrics

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LINKS: 

Mostly Talent: https://mostlymetrics.typeform.com/to/cLTxtAsN

CJ: https://www.linkedin.com/in/cj-gustafson-13140948/

Mostly metrics: https://www.mostlymetrics.com

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Why Uber Drivers Can’t Escape the 30% Cut

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TIMESTAMPS:

All verified. Here are the timestamps:

0:00 Blood Diamond

1:55 Show intro

2:15 Diamond history: ancient India and riverbed origins

3:56 Brazil supply shock and the mining era

4:39 De Beers: Cecil Rhodes and the PE rollup

6:47 Sponsors — RightRev | Rillet | EY

9:49 The Central Selling Organization (CSO)

10:39 The site system: invite-only, take-it-or-leave-it auctions

12:22 Diamonds are more abundant than gold

13:01 NW Ayer, Bernays, and engineering demand

14:17 "A Diamond is Forever" campaign

15:13 Lab grown diamonds: 20% of US purchases

16:32 De Beers collapses: $3.1B operating loss

17:18 Sponsors — SpendHound | Brex | Aleph

21:07 Lesson 1: Rollups are powered by capital

21:39 Lesson 2: Distribution beats mining

22:11 Lesson 3: Artificial scarcity unravels

22:55 Lesson 4: Price opacity is a temporary moat

23:39 Lesson 5: Demand engineering

24:30 Lesson 6: The real product was risk smoothing

26:30 Credits

#RunTheNumbersPodcast #BusinessStrategy #FinanceHistory #Pricing #Monopoly