At some point we tried to raise more money and, you know, the investor was like thing. Entire natural deodorant industry is something like $30 million a year. So why would anyone be interested in investing in a category that only has $30 million a year run rates? And I was like, if the natural deodorant industries $30 million a year, where the entire natural deal, we're doing $30 million a year at this

point. Okay, I got to say, this was my favorite episode of podcast. What you're about to hear is a episode I just recorded with Moyes Ali. He is the founder of Native deodorant, which is a natural deodorant brand. It's basically $12 stick of deodorant. My wife just bought it. She doesn't know that I know boys. She bought it because she didn't want to use deodorant that had aluminum, innit? Parabens, all kinds of funky chemicals that you see on the back of a deodorant stick. So this is the story of how he started it from his brother's dining room table, essentially where he was doing the packaging. He was doing sales,

marketing, the customer service as a one man show for a very, very long time. And over over two and 1/2 years, hey built this company raising very, very little money, mostly because investors were kind of just laughing him out of the room, like, Okay, you're starting a deodorant company like What is that? And so he sold it two and 1/2 years later to Procter and Gamble for $100 million. I like this episode not just because the story is great and the tactics that he shared are actually quite insightful, but because he's a very entertaining guy, very charismatic. In fact, there's a portion at the end of the episode where he is talking about how some people who didn't believe in him and he named some names that we had to bleep out.

So we left the story in what we had to bleep out the names, which is a podcast first. But I think you guys gonna love this episode. Let me know what you think. As always, you can tweet at me. I'm at Sean BP, or email me poor e dot Shawn at gmail dot com. Love to hear from you guys. All right, enjoy this episode. Native deodorant. You build a deodorant brand of all things. Yeah. You build it from scratch from a dining room table, you build a actually good enough business where Procter and Gamble,

one of the biggest companies in the world, looks at it, makes an acquisition and buys native deodorant for $100 million. So that's the end. But we're gonna rewind to the beginning. The beginning is what set the scene. So where are you when you have the idea for native deodorant?

So I'm in New York City, running another e commerce business on buying like axe deodorant from a Duane Reade at 14th and third in New York City. You know, I've lived in the same place for, like four years, and so I'm really familiar with this place. I go by it, I'm waiting in line. I flip over my deodorant and I can't pronounce a single ingredient on the back of that thing other than the word aluminum. And you know, I've been seeing this problem for the last four years since I've been buying the deodorant from doing read. And you know, I'm an attorney. I'm not a dumb guy. I know howto read English and I can nap. Pronounce a single one of these words. And so I'm like if this product is going to stay on my body all day,

every day, you know, I put it on right after I get out of the shower. It's on my body for 23 hours and 45 minutes, and it'll be on my body for 23 hours and 45 minutes for the next 60 years. I should at least be able to pronounce some of the ingredients in this day. And so that's really where the problem starts. And then my sister gets pregnant and you know, she's telling me how she's using Dove, and she's like, I'm really scared of Dove because I'm about to start breastfeeding And what happens with the ingredients and my dove? And do they like Gettinto? You know, my baby is a result of me using this antiperspirant, and so I'm like, Okay,

now this is Ah, not a hair on fire problem, but a problem large enough for me to solve, right? That's that's

how native starts. So my wife is currently eight months pregnant, and she started using native and she was like, Yeah, I just bought this, like, $12 Theo and I was like, Is it made? And she's like, Yeah, I was like, I'm gonna about to have him on the amazing And then she was like, I was like, Why did you choose to buy? And she was saying the same thing like Oh, you know, because of the baby I'm like,

have a heightened awareness around What am I putting on my body and in my body? And she was like, It's paraben free. And I was like, What's a pair of what is your harem? And I actually don't even know

it, like the real thing that we shoot for is like we're aluminum paraben and Valley free Aluminum is probably the largest thing that where, like people are concerned about when it comes to the deodorant category, and what it does is aluminum acts as like a plug toe block your sweat glands from excreting sweat. And so if you think of your sweat glands is like a duct, aluminum axes a plug, and as a result, you can't sweat. And that's why when you use it, ah, aluminum based product, it's called an antiperspirant. It stops you from perspiring. And the way I always liken it is Look, if you could take a pill to make you stop urinating, would you take that pill? Doesn't that sound so weird?

Like if your body is trying to expel a fluid from itself, shouldn't you let it? I'm like, Yeah, OK, I want to go to the bathroom like this. A bodily need. I don't want to take a pill to stop going to the bathroom. I just want to go on P. And so that's the way I thought about sweating. I was like, Look, if your body wants to sweat because it's really hot, let it sweat. Let the deodorant sort of absorb the sweat and block odors, but we don't need to prevent it from sweaty.

And so that was like the genesis of like, Okay, look, we think we can create a deodorant that does the job of antiperspirant the other way. I thought about it was look like a lot of us work in office environments where we commute in a car, we get to an office, we sit at a desk and work in a computer and you know, using an anti person every day were generally not an environment. We're gonna be sweating a ton. So it's like taking an Advil in the morning when all you need is glass of water. You're, like, dehydrated, and so you what you should be doing is drinking a glass of water. But instead you're like, let me take an Advil to cure my dehydration.

Just take the glass of water. It's a lot simpler and safer. And so that's the way I like. Using native to an anti personnel is like, Look, you're probably working in an office job or a lot of a lot of our customers are working in office jobs. You don't necessarily need all the effects of an antiperspirant aluminum free deodorant do the job for you. And so

you say we. But at the beginning, it was just

you. Correct? That's right. Eh, So we launched the company in July 2015. I remember I bought the domain name on my birthday in July 2015

by the name Native. Why did Why that domain?

Yeah, sure. I really liked what it stood for, which was like, we want to use ingredients that were, like native to the earth, Like we weren't trying to say, Hey, this is owned by Native Americans. And we weren't trying to say we're a natural product and will never use an artificial ingredient, cause I don't think that that's necessarily the case. What we wanted to say is, Look, look, we want to use ingredients that are native to the earth, and we want to make those ingredients part of our deodorant, as opposed to using ingredients that nobody can pronounce.

And so that was the genesis of the name. Bought the name in July 2015 basically 12 days later launched the business. I was like, You know what? I think we can launch his business really quickly and see if it works.

But what do you mean, What, you being launched the business? Because how do you even have deodorant? I if I wanted a lot of deodorant brand, I'd be like, OK, I guess I need to manufacture some deodorant or by someone you know. How did you do something? 12 days later?

Yeah. Great question. Um so launch. The website had zero deodorants and stock was speaking to a couple of manufacturers about using or dieldrin formula and having them make it. But initially I was like, Look, I don't think this business will work out. Like are people gonna buy a deodorant online? Generally, they're buying it. Dwayne Reeds and Wal Marts and targets. So I was like, Well, launch it and we'll see what happens. And so we had contacted some manufacturers, particularly like small mom and pop ones, and our first mom and pop manufacturer was basically making the deodorant out of like their hobby room in their house somewhere in Southern California have launched the product on product hunt.

And so day one I like, you know, it's late July and put it on product hunt Product Hunt has multiple pages, and I don't even realize that we're on page two of product Hunt. We get one sale, and I'm like, Okay, this business is over. Forget about like I'm not going to all this hard work to sell $12 of deodorant every day. I can open up a lemonade like I'm 30 years old and I'm basically a revenue of $12

a day, right? So you literally launched without a bang. That's right opposite of a good luck. Yeah, exactly the opposite

of a good launch. One sale had zero product and inventory. I was gonna email the guy and basically be like, Look, we're trying this out. It didn't work out. We're gonna refund your order, have a nice life, right? And then what happens is I'm working out of this toe working space called the Founders Dough Joe and one of my friends in that co working spaces like, Hey, I know an employee of product hunt, and what I'm gonna do is I'm gonna have him try and put you on the first page of product hunt again tomorrow, and usually you're not allowed to do that. You're not allowed to be on product on two days in a row. But he got me an exception. And I'm on the first page of product hunt the day after I was on the second

page. And what was the little tagline at that time? Because I know that for businesses, the pitch evolved, like, right now, when you described it, it was, like, really compelling. I loved it, made sense to me. It was kind of inspiring. Yeah. I should use products like that but I know what the beginning. Our pitch is like kind of sucker. They know less.

Yeah, Yeah, it was terrible. What was it that was like, investing yourself? I'm not even sure it was like and, you know, we had gotten a financial product. Exactly. And we got in a photo, like, you know, we didn't take any photos at the time because we didn't have any products. So we got some guided, like three D render the image of what a Native Deodorant Bar would look like and like, that's the image that we have associated with product Aunt, On our website,

we have a hero image, and the hero image is just a bathroom. It doesn't even have a photo of native deodorant on it, because no native deodorant exists at this point. But on that second day, we get, like, 50 sales, and I'm like, You know what? Maybe this could be a real business. So, as a result of now, we have, like, 51 sails.

We got 50 sales day to one sale day one, we contact our manufacturer, and we're like, Okay, we're gonna buy 100 of these things, ship them

over we have, ah, tangled history with the guests that you're gonna talk about. You mentioned product. We have Ryan Hoover on the podcast. Yeah, you mentioned Founders Dough, Jo, I think earlier when we were talking, Sam was on the podcast earlier. And your brother was the first episode of the podcast. Actually, till this day, the highest, highest sort of listen podcast good for him. And so he said that he said told a story on the podcast, which was that at some point,

you guys were like ordering deodorants off, etc. And you're just testing the utterance. You were like, put one under one arm at the other end of the other arm and, like, go run around the block and see which one looks better. Was he full of shit or

is this real? No, that was definitely, really were. Like before I launch Native. I was like, Okay, you know what? I want a natural deodorant that works. Um, not so does my sister. Because she's pregnant. So I started testing every deodorant I could find. I tested like the Toms remains of the world. The Schmidts of the world, the you know, the FC deodorants of the world,

and I was just like, Look, these products aren't cutting it. I'm not sure if it's my personal body chemistry or what it is, but, yeah, we're testing natural deodorant, left and right from etc. And from every story could possibly imagine

you order the first batch of that first batch. Yeah, I'm

living out of like Salomon's apart. I moved to California like during that time period. Basically moved to California, living out of my brother's apartment. Order 100 units, start packing amount of dining room table so I get, like, you lined boxes delivered to the house. I get a bunch of crinkled paper delivered to the house. What's wonderful is my brother is the messiest person in the world. When I moved in, he had a birthday cake from like three birthdays ago. Still in his refrigerator, I moved in. I'm like, I can't live like this. You're you're too much of a pig like I can't live like this.

And then I was like, You know what? This is perfect because I've got all this crinkle paper and all these shipping boxes and all this stuff floating around here, and it's making a huge mess. And my brother is the only person in the world

with you. Yeah, he doesn't

even notice the mess because he's just like living in a pig sty himself. And so we're shipping these boxes out. We ship 60 out, and then sales start dropping because, you know, we're off a product on. Yeah, and I'm like, Okay. And my last business, we had built the entire business on P. R. I start contacting all of these like reporters, and I'm like, Hey, you wanna write about native and they're like, No,

they said deodorant. Let's let's take a chill pill over here. This isn't that compelling. And this is in 2015. You know, like today there's a new natural deodorant that launches every day in 2015. We're basically one of the few guys out there. And so we start like, we start running a bunch of Google ads and, you know, we haven't fund raise, so it's all my own money I spent

How much money? Yes, it sounds like you're gonna answer that. How much money did you decide? Like I'll put into my kind of testing and figure

out if this is really budget. Yeah, I'm the cheapest person in the world, so I probably spent, like a grand launching the business. So the 1st $500 was to buy products, and the next $500 is too, like by Google ads. And I'm buying Google ads. And I spent $500 I get, like, $100 of sales, and I'm like, this is not working out Well,

I found a way

to Yeah, burn money. Yeah, exactly. And this is like my mom would be so upset at me right now. She'd be, like, quit this business tomorrow. And so I'm like, Okay, Google ads aren't working system. We start advertising on Facebook and look pretty clearly. We get some product market fit on Facebook, Facebook ads start going well, and, like what happens is I created this Excel spreadsheet where every day I tracked every single ad I had the click through Rate the O. C.

P. A. The Return on Investment. And I start doing that every day starting, you know, probably August 2015 or maybe September 2015. And like, that's really how I started getting good at Facebook ads. I was tracking every single ad we ran on a daily

basis. And I'm gonna guess you're now you. No company got acquired companies much larger. Lots of people in the company. Do you still get hands on with the Facebook ads?

Definitely. You're saying? Yeah, absolutely. Yeah, I mean that, Like like that. That was our bread and butter. And I really enjoyed it. And it's something I'm good at. And it's not just a job for me. It's something I really enjoy. In fact, I was that Facebook's headquarters, like, two days ago, talking about Facebook ads with a bunch of the execs,

and it's great. Like to understand what products that they're launching and how they're thinking about the business. It's insane, but in any case, so we're like running these Facebook ads, we see a ton of product market fit, and then our manufacturer, you know, scales from 100 100 units a week to about 500 units. Week. She calls me up, and she's like boys, this is a fantastic business. I used to be selling, you know, products at a farmers market and now,

in making 500 dealers for you a week, you know they're charging me about $6 a unit, so it's pretty expensive. And I'm like, Okay, great. I'm glad this is working for you. And she's like, we're going to scale this business. We're both gonna, like, hit home runs with this business. And I was like, Great, this is like, I really appreciate your commitment to this.

Two days later, she calls me and she's like, my son is sick. I'm out. Like, forget it. I'm not making any more deodorant. And I was like, Are you kidding me? We had a conversation 48 hours ago when you were in 48 hours later, your raft. And so that was really jarring. And I'm like, Okay, you know what? We're selling 500 units of dieldrin a week,

which is, you know, a few grand and revenue and appears to be working well, but like it's a few grand and revenue, you're out. How do I replace you? I don't really want to be making these deodorant in my apartment. Like, at some point, we'll Salomon doesn't He doesn't even have pots. We're not gonna be able to make this over here. And so I'm like, Okay, Maybe this business is over. And then I'm like then I go on vacation with a girl that I was dating at the time We get a, like,

the Dominican Republic or something. We get back, I'm a little bit more like patient now. I call the manufacture and I'm like, Okay, look, how about you make 500 units a week for the next four months, and then afterwards, I'll pay you like a few $1000 bonus, I think was like a five grand bonus. I'm not entirely positive. I was like, I think I'll pay you a five grand bonus and and then I'll find another. I'm committed to finding another manufacturing that period of time. And, you know,

she's like, Okay, that sounds fair and reasonable. And so let's do it. And so she starts, you know, making the 500 a week again. In the meantime, I'm like Googling and I'm like, who makes deodorants like I've got a formula I want to make. Who can I get to make this?

All right. Quick break in the action to talk about hustle con. So as you guys know, this podcast is published by the Hustle they send out a daily email newsletter with the best news of the day. Everything you need to know about tech. But that's not all they do. I've been two or three times to hustle Con. It's a conference. It's happening December 2nd 3rd in Oakland, they rent out the Paramount Theater, which is really amazing venue. I saw Chris Rock there, Jerry Seinfeld there, and I guess House work on is happening there. They have a stacked lineup of speakers. So when I went under, we work was talking and let me look at the list for this year.

Founder of him's the founder of Madison Reed Straw, Va. Calm method and all the Lime bunch of CEOs and founders of multibillion dollar companies and startups that come on stage and share insights about how they did what they did, how they got started and how's Okan is very different than a normal conference. Normal conferences are kind of stuffy where you see a lot of people in suits like shallow networking going on. How's it going is very different. Vibe. Meet a ton of people who are guests in attendance, but also the speakers are very approachable. So they're not only sharing good insights on the stage, but you get to meet them afterwards. And that's a really cool experience. So highly recommend coming. In fact, bringing out the editor of this podcast to come because I just think it's a really great opportunity. He's 1920 years old.

This is an amazing way to sort of get in the mix. If you're thinking about starting an idea business or you are, you want to do that someday or you're doing it right now. Either way, listening to speakers tell their stories, being in the audience amongst a bunch of other like minded people, that is a really, really good way to get amongst it. So does my genuine recommendation for House icon that gave me a promo code. Let me give this to you guys so that you can get a discount If you do want to get a ticket with the Purple Code, when you check out is my 1st 1,000,000 all caps? All one word again. That's my 1st 1,000,000 That'll give you 50 bucks off a ticket to Hustle con, and you know what? If you are listening to this and you want to go to house a con and you can't afford the tickets. I will buy your tickets for guess myself and I will send you two has a gun.

You got to figure out your travel to get there, but I'll buy your tickets to the conference itself. Email me cory dot Shawn at gmail dot com. Happy to give this as a gift to anybody because I think that going toss a con, it can really, like sort of change the trajectory of your business life, one meaningful relationship or one key insight while you're there that can make it worth it. That's been my experience with conferences in the past, so okay, you guys know the deal. Hustle Con December 2nd and third. Try to get there, if you can.

I call some guys up What there was a guy in Chicago will never forget. I called him up. He gave It was like an hour long conversation, and I probably said five words. He talked the entire time, and he's like, Yes, it will make your deodorant. I'm like you don't know anything about my needs, and you spoke for 59 minutes and 55 seconds. So like I don't think you're the right guy. Red flag. Yeah. Terrible. Red flat. Finally, we find a contract manufacturer.

That's like, Yeah, we have a low minimum order quantity. Hello? M o que, I think there m o que is 80. And so that was, like, Great, we can we get We want more than 80. I'm not gonna like a, you know, bankrupt the business or I don't have to mortgage my house based on this. And so she starts making 500 a week for us in this tiny like, 800 square foot manufacturing facility in the United States, and things start going well.

And so, like, you know, we launched, like, you know, in July 2015 we're doing a couple $100 in revenue a month by January 2016 were probably doing around 75 K and revenue a month, and things are starting to scale. Well, then, like, you know, the first of the beginning of the summer hits in 2016 in May 2016 and somehow all of our deodorant start melting. I go to our shipping facility, which is located in San Leandro. It's like these two guys called fulfill co nicest guys in the world.

You know, I call up all the time. Like you know, there are small business. I'm a small business, Easy to talk to the owners. I go over there, they're like, you know, it's probably an hour drive that rent a Zipcar and I go over there and I'm just looking at our deodorants. And I put my finger in one of the deodorant because it looks weird and it turns out it's got the consistency of lotion. You could just put your finger all the way down to the bottom, and I'm like, Holy shit!

And you have, like, how many? How many units are we

talking here? You know, we probably have a couple 1000 units, which is a lot of money at the time, because that's like, you know, we're not. We're not doing a ton of sales. That's a lot of lotion. It's a lot of lotion. Yeah, it's no deodorant and a lot of lotion, and so are manufacturer at the time, Like she didn't like the woman who ran it didn't fly, so she was randomly had driven up to San Francisco to have a meeting with me like the day before hand and, like all of this is just, like,

works out randomly. So I called her up, and I'm like, Hey, are you still in San Francisco? I want to have another meeting because I think there's a problem with the deodorant. See, just ship me, and she's like, Yeah, I'll come by your office later this afternoon. She comes by and I'm like, here. I brought a few of the deodorant, and she's like, Holy shit.

What happened to these? Like, you know, she sees it immediately. She calls up her facility, and she's like, Stop making deodorants. We've got a problem here, and I'm like, Okay, well, maybe this business is over again. Like, you know, we we moved to a new manufacturer. Like, what are we gonna do here? And

you know, the type to get down on it? What's the like when stuff like this is horribly awfully wrong? Yeah. Are you? Some people go in words. They get very quiet to some people. Get angry. Some people get sad.

Yeah. What's your reaction? I'm like all three of those. Anger is the number one thing for sure. Like I'm fuming but I think for like the first hour, I'm just like, forget it. This isn't worth it. And I think every time I have ah, major problem like that for the first hour and less like this isn't worth my time. I'm quitting. Works right away. Yeah, exactly. Divorce right away. And then like, our two comes along and you start getting,

like, determined and you like, you know, great your teeth. And you're like, Wait, I'm better than this. I'm gonna fix this problem. I've got something that's working for me. This is not going to stand in my way. I don't care what it takes. I'm gonna fix this problem like our one I'm like, forget this business, our two. I'm like nothing can stop this business. We're gonna We're gonna succeed.

Thank you. Yeah, You bring it on. Yeah, Exactly.

Yeah. Look problem. Don't worry about it. You've got the best problem solved in the world right here. And so you know what would have been happening is that over the course of the last eight months, since it's like last four months since this woman had been making deodorant for me, like we've gotten a lot of customer feedback, basically saying our formula was kind of mediocre. There were a lot of problems that we're trying to solve for people were like, Look, it does a great job in absorbing wetness and blocking odor, But it's really flaky. It's hard to apply. Men in particular were like, Look, I've got hair under my arms like this pulls the hair under my arms out and they're sticking to the deodorant. And so for a while we've been attempting to make a better deodorant like better formula.

And I've been sending out samples to people and say, like, you know, our best customers who were like communicating with me and I'd be like, Hey, what do you think of this formula? Is it any better than, like, you know, the formula that you actually paid for And a lot of like, You know, we had said we had done hundreds of these formulas. I was at home. I would rub the formulas on T shirts, throw him in the washer, the dryer and see if they stay in shirts and like, you know, I have 1000 of these state insurance. Solomon's like you're running the washer and dryer every day. What's going on over here?

And you're not a scientist or biochemistry. So how are you even figuring out the formula, right? Like whenever I listen to a guest till the stories I think to myself, Could I do this business? And I think there's a lot of things that are relatable, right? Because you started this with essentially note. Didn't have to be a programmer, right? Yeah, that's right. E commerce site. That's great. You didn't make the stuff yourself. You found a manufacturer just by googling. Who the heck makes deodorant?

Yeah, that's right. But then when it comes to like figuring out the right formula to prevent flakiness, that's one where I'd be like, I don't even know what. I don't know what to do there. So how were you figuring

this out? Yeah, that's really Look, I remember starting the business. I told one of my friends from law school and starting this business, and her husband was like, What the hell do you know about deodorant? Like, you know, nothing in as like, Yeah, you're right. And in the next six months, I will be an expert on deodorant and really, what happens is like you email all of these customers, like, you know,

the customers are like, Hey, here's the problem. Customers will even like, do diagnoses. And they're like, Hey, I think it's because of this. And I'm like, Oh, out great Thank you for like doing them that, like that science that I was supposed to dio. But in reality, hero is a little easier because, like one working with our contract manufacturer, they did have a chemist,

and two is easy to diagnose the problem because with deodorants, you want a balance than of the amount of powder and the amount of oils. You having that deodorant to make a product that, like absorbs wet s blocks odor, but still glides on really easily. And so, like, you know, sometimes we make a bad batch of our deodorant, and we'd be like, Oh, how did this batch turnout? Because, like, you know, Oh,

we forgot to add this amount of oils and so we start pouring like, you know, we take a look at it and we're like, Oh, this is what we forgot to add oils. And it's way past, like, way more flaky. So you're like You know what? It's the oils that make it Glidewell.

How frequently were you going to the actual manufacturer? And also, it sounds like you really paid off that you weren't just using a Chinese manufacturer that's hard to speak with. Hard to work with and doesn't guarantee

quality. Definitely. Eso won. Well, you've never used a Chinese manufacturer. All of our deodorants are made in the United States for two reasons. One, you're right. It allows us to have a really flexible supply chain to it allows us to have life faster, demand creation. So, like, you know, when we give them a purchase order, they're able to make it much faster. And three, I would be scared as hell.

Using the Chinese deodorant like that is something I don't want to do. I don't know what quality control looks like over there, and it may look great the day I go over there and terrible the next day and we didn't want it. We didn't want any of that kind of stuff like a whole point here was we want to avoid the doves of the world and in order to avoid Dove dove antiperspirant, make it in the United States with ingredients, you know, like you know where they're being sourced from, and you know what

they are, right, Okay. And we're gonna jump back into the story. But one more tactical piece when you when I build, I build products like software. Sure, with software is pretty easy to get a rate, it's pretty easy to, you know, a B test. We can send 11 visitor of are apt to see one experience and the other visitor to see another experience. It very easy to do that sort of thing. How you talk tactically about how you operate with

a physical product. Sure. Uh, I'll talk tax. Really? About how we did it would be getting first and then how we do it today and the beginning. What we do is we send out samples to our best customers who would like were vocal and be like, Hey, I love your deodorant. I'm to be a customer. But I wish it did this and we'd say, Hey, we're trying to solve your issues hero, too. Like I remember we're doing this. I was like, This is version seven of the deal that we produce this is version eight of the deodorant.

We produced their blood. Like, you know, you don't know within them. We're giving you free samples. Compare it to the one that you purchase from us and tell us what you like more and like. That's the type of feedback that we do early on.

And that's unusual, right? Like I've bottle dealer in my whole life, I've never had anyone from the deodorant company ever reach out to me and spoke to them. They never sent me different variations. So this must have been kind of unusual for people, I guess. Yeah, I guess that's

true. I mean, look, the way I think about it is if you if you buy dieldrin from, like, target and you like, you know, you buy an axe different from target, you're never gonna contact the manufacturer if you buy directly from us. We were following up with every customer. Like, you know, if you purchase from us 20 days after you purchase from us, I sent an email to every single customer's ang. Hey, how do you like this deodorant? Do you like it?

Do you hate it? If you like it, leave a review on our website. We'd really appreciate it. If you hate it, please reply back to this e mail. There's a human being on this side of the table, and we want to make this product better. And so that's how we got feedback from consumers. And today, what we'll do is we'll actually run those A B tests along huge swathes of the population. So we'll send, You know, the Shawn's of one world baking soda that's milled to a certain particle size and Sam's of the World, a baking soda that's milled to another particle size and world monitor your reviews six weeks after you purchase and your repeat purchase rates 12 weeks after you purchase and say, You know what, the sands of the world are buying again more frequently than the Shawn's of the world, and as a result, it must be that the formula that we sent to the sands of the world are better. And that's how we can monitor what is the best baking soda particle mil size that we

should have. That's kind of amazing. Is that standard because I've never heard it suddenly

not standard because, like we have this to wreck relationship with consumers that allows us to monitor repeat purchase rights and have a direct line of communication with, um, been really phenomenal for us, because things like baking soda particle size are unique and you have no idea what's better. Like, you know, in a laboratory versus in a consumer setting, you're gonna have very different results. And so that's how we baby test formula

changes. Team. You guys are sending different versions of native deodorant formulas, two batches of people, cohorts of people. And then you're able to see these guys Reaper trade at 28% versus this one at 21%. Therefore, we believe this formula

is better. That's exactly right. Yeah, but we're doing like tiny changes, like, you know, like the changes that would even influence the ingredient tackle that were like, Hey, look, do you think we should put in, you know, Ah, 1% of this ingredient or 1.5% of you to see what's better, Like nerdy deodorant stuff we're getting into? Yeah, we're getting into the weeds as much as possible.

Okay, we're going back. It's so rewind to that part of the story where deodorant lotion. Oh, my God. We gotta fix this. And you guys are starting to troubleshoot. So this is sort of like a near death experience. Number two, Definitely

this take it from there s so we talked to our manufacturing. Well, like look, let's first. We're not setting out any more of these deodorants. That lotion. We're either going to refund the customers and close the business or do something. And so what happened is we had been working on different deodorant formula to fix for consistency. And so we're like, Look, we think we have good feedback on here. We don't have as much feedback as we would have liked. You know, we still had a bunch of samples that we'd sent to customers and hadn't followed up with them yet. And so we're like, Look, push it.

Push is coming to shove. Worried they're gonna close this business or switch formulas. Let's switch formulas and see what happens. So we switch formulas basically, because we have thio. We think it's supposed to be better and start shipping them out. We email all the customers and were like, Hey, look, your product was supposed to ship out today. We had a problem. It's not gonna take two weeks to ship out customers air up high rate, just absolutely irate. And I don't blame them like, you know, deodorants,

Not something you can really go without toothpaste. I need this. It's time to go get another product. They're irate, but a lot of them are really kind. And they're like, Hey, we appreciate the, you know, the honesty. We're willing to be patient for it. Two weeks later, we start shipping it out. This is May 2016. Ah, we're probably doing around 100 can revenue at this point.

And immediately we see reviews go up like the quality of our reviews has gone up significantly. You know, six weeks later, we'll start seeing repeat purchase rates go up as well. We can monitor the cohorts, and early on we get a really good indicator that repeat purchase rights are gonna be substantially better with the new version of our formula as compared to the old version. And so we're like, you know what? Maybe this, like, you know, this terrible experience has led to something really good. Ah, much better formula. And then, like, you know, May 2016 were doing AH, 100 K and revenue a month. I'm

still the only employee of the company was going to say How many people are there? So you're saying we But we may just

me just me doing 100 Can revenue a month or something like that, Just me at the company. I'm doing the customer service. Have a really good idea of what the problems are, the company doing the operation. So I'm talking to manufacture all the time doing Facebook ads to understand, like product market fit.

So let's talk money for a second. This podcast is called my 1st 1,000,000 Yeah, it's called my 1st 1,000,000 because since you know, when I was growing up, I wanted to have a 1,000,000 bucks. Yeah, who doesn't? Who doesn't? Exactly. I I was not, You know, Silicon Valley. There's a lot of people. That cool thing to do is say, I'm here to change the world. I'm down with changing the world for sure, But let's be clear.

I'm starting a business. I'm trying to make money. I'm not afraid to say that. So my whole started career was around. How do I build a business that makes money for me, for my investors, for my employees. And in order to do so, we're gonna have to make an amazing product that customers love. Otherwise, why would they give us their money? And so I like to think that I like to get give my listeners understanding because a lot of people who listen to spot gets right now they're commuting to work. They work out a 9 to 5 job. They have aspirations of either leaving that job and going and starting a startup or they're doing a startup is not quite taking off. You know, they hear you say we're only 100,000 month in revenue and they're like,

Oh, my God, I wish I could get 100,000 month in revenue. So let's talk money for a second. Before you started the business, what was you know, Were you already doing well financially? Where you are you comfortable? Where were you at before? Let's start with that question.

Sure, I was an attorney in New York for a couple of years, and during that time had basically paid off my law school student loans. One of my law school classmates and I left our jobs, you know, back in 2012 to start in e commerce business, we sold that business for a seven figure sum and, like, we hadn't raised any money. So I would say I was comfortable, Certainly. But, like, you know, wasn't Ah, you know, it wasn't gonna be able to say Okay,

you know what? I'm gonna retire for the rest of my life. I was in a position where I was like, Okay, I bought myself a couple of years of not having to worry about rent and not worry after having to worry about, you know, food or vacations. But I haven't bought myself, you know, 50 years

of not having to work, right? And so now you get to this 100,000 month of revenue. Yeah, and it's taking the business. About how long? At this

point, it's taken about 11 10 11 months,

10 11 months. Great. And what does that mean for a deodorant business? So you know, you make 100,000 but margin wise, what were you Do you know what were you able to take home at the end of that shirt? We break even We're better than that. How are you doing? Yeah, so

we were selling $100,000 of deodorant a month. You know, the deodorant was costing us a lot of money at the time because we didn't really have any economies of scale. I was the only employee, and I wasn't taking a salary. But I'd say on $100,000 in business, I'm guessing because I don't really remember. I'd say the company probably made about $8000 in net profit selling $100,000 of deodorant.

And you and your brother are very business savvy you've invested in, I don't know, 80 plus businesses. Something like something, something like that. You started multiple businesses. So what was your mindset around this? Did you think, man, this is gonna be a big business. Where you like This is just kind of a fun project, I guess. How are you thinking about it when it was at that stage? Because 100 k a month is good revenue, but you're only taking on a k. Maybe that it's not clear at that time. And there's not a whole bunch of other examples. You could go look at it other big, different businesses that were startups. So how did you think about this business? Definitely,

I think the first, like four months of the business. I was like, Look, let's see if let's launch this business. I'm bored. I don't have a job. Let's see what happens when I launch the business. Pretty early on, I thought that there could be product market fit and I was like, You know what? We're seeing good return on investment when we buy ads on Facebook, Not necessarily on Google at the time. And even on Pinterest, we're seeing a good return on investment. The problems that we have our we have a low repeat purchase rate, a good product,

but kind of mediocre and, like, you know, a decent review average something like four stars. And so I was like, Look, if we can improve our product, we really have something. I saw product market fit with the product, but I also saw that there was a larger opportunity. If we could just make our product

better. And why not hire people? I think a lot of people like to rush to hire people. I'm anti yeah, hiring people. I want to maximize the sort of earnings per capita in my company. Definitely. And like, how did you resist that? What was your thought process around that? Because you're doing it as a one man show. Sure. One

we like. You know, in Silicon Valley, a bunch of people raise money. We also raise money to be clear. We raise about $50,000 in November of 2015. So, like a few months after we started, and then another $250,000 in about April of 2016. And this was friends and family, or this was these were both outside investors that I had just met. Like, you know, I had Ah, somebody introduced me to them, and both of them invested and you know, So we had about $300,000 in the bank account,

plus the $1000 I kicked in. So probably $304,000. And so we're like, you know, we've got some cash, but not a ton of cash. I didn't hire anyone for a couple of reasons. One was super busy trying to run the business. Like if you're doing marketing operations and customer service That's a full time job on Saturdays. I would spend the entire day. Basically, I've got a workshop cafe and crank out a bunch of customer service like enquiries. So people got responded to within 24 hours. So one was really busy. And then, too,

I was afraid that the business was wasn't gonna survive much longer. I didn't want to hire someone and then fired that person three months later because the business was collapsing. And four, I wasn't sure I could afford them. Sure, we had $300,000 in the bank account, but we had $8000 in net profit. If I hire someone between employment taxes, their salary and benefits were certainly giving up that $8000. And so I was like, I don't know how long we're gonna be able to afford this person. The future of the business doesn't have, like we don't have a ton of profit right now, so I don't know how long I'll be able to afford

you. And what was your schedule like? So you're saying Saturday Saturdays is customer service day, huh? When you are the one doing operations, marketing and customer service, plus everything else that goes and all the little things that go into a business. How were you organizing your time in your day? Are you like a I work 18 hours a day kind of guy or tell us about, like, kind of your schedule. Yeah. I

was, like, eyes waking up and going to work. Yeah. I mean, I would work until you know, 78 p. M. Early on in the business. Probably the 1st 45 months I was doing. All the packaging is what the shipping is well out of my apartment. And so, like, I'd go home at 7 p.m. Turn on Netflix, And while I was watching Netflix, I'd be packing boxes and shipping

them out. Right. And you're lower. Michael Scott. You were Dwight on saying. That's right. You're Darryl in the warehouse, right? You were

the whole office. Yeah. Toby being like, Oh, that's a terrible company. Long days. In the beginning, we get to June. We've got a higher repeat. Like, you know, we've got oh, we got a higher repeat purchase, right? Better reviews. You know, in June of 2016.

So about 11 months into the business, we hire our first employee and she's helping doing customer service. And I'm like, Great, this is I need so much help here because like, customer service is endless and I can't like, reply like, you know, it's just taking up so much of my time. So she comes on board. We do 250 k and revenue that month. So we've basically double the business between May and June, and the customer service in crews have gotten to be even more than she could. She and I can handle together. I thought I was done with customer service. We double the business,

and it turns out she and I are both doing customer service all day. So we hired 1/3 customers. We hire another person in the third person to join the team, and he's doing customer service. And I was like, Great, this is wonderful. Now I can really stop doing it. And by like, you know, by November 2016 we're doing a $1,000,000 a month, so we go from 100 K and like may toe a 1,000,000 in November, and now we've got a bunch of customer service people, including the you know, just crazy customer service. Look,

we have these things called power Hours were like Everybody does customer service and it's not entirely their fault, like AA. Lot of it was, we were not able to keep up in terms of production with the demand that we had, because we didn't expect to 10 x the business over the course of five months. And so our manufacturers running behind. If you buy the deodorant on a Wednesday, it probably gets made Friday and shipped to you. You know, the following were doing like we don't know what's going on. The business is growing really quickly, but we can't keep up with it. And I certainly can't like I'm like, Well, I have to do customer service. I have to make sure that I'm trying to produce more deodorant. I'm trying to run our advertising and, you know, I have no idea what our business will look

like a year from now. So what caused the business to grow from that 100 K a month to a 1,000,000 a month? Yeah, that's a huge jump. Was it just spending more on ads? Did you guys obviously, the form it was getting better So obviously the product isn't better. But is it just Is it just like that? It's a 1,000,000 little things getting better. Or was there a breakthrough or ah, point of emphasis that really was

highlighted. There's three things. One word of mouth is growing a ton. Like you know, it's it's small. It's hard to have word of mouth when you're doing 50 k a month. It's a lot easier to have word of mouth when you're doing 250 K 500 a month, so that's growing a ton to We're spending more on ads because we understand product market fit, and we understand that we're profitable when we spend money on ads. So we're spending more money on ads then three. We have a higher repeat purchase right, which is the most important thing that's like this sounding exactly. There's a huge snowball effect I remember in like So in January 2017 were doing just over a $1,000,000 a month, and I was like by December of 2017 I wanted to a $1,000,000 in repeat purchase revenue a month, and we hit that $1,000,000 in like March.

It sounds like focusing on repeat purchase was a key in sight that obviously, if you're in D C businesses, that's that's kind of known as a good standard. But if you're new, you know that's something to hone in on. How did you know that at the start, it's a mentor. Tell you, Hey, repurchase rate is the thing key. And on I

think for like it depends on the product you're in. If I was selling Casper mattresses, I would be concerned about new customer acquisition, cause how many mattresses? So is someone gonna buy? You know what? I bet Casper is doing a really good job with repeat purchase rate. But like when you're selling a consumable by like deodorant, the whole point is that people are brand loyal. And once they find a deodorant, they're going to stick with it for a really long time. I used axe deodorant from, like, you know, probably 12 years old, till I was 30 years old, right?

18 years. And so for me, I was like, Look, we have to find if were producing a deodorant, we need to make sure that people love it and they don't just turn and go back to their doves, their degrees of the world.

And why were you able to charge $12 for deodorant? Is it still $12?

It's still $12. It's $4 at Walmart. $12 a target, $12 our own site. And really, the the way we did it is I worked backwards like early on the dieldrin cost us about $6 to make. It cost us $3 some change to ship. And then it cost us like another dollar. 50 for random expenses, like the box and like a you know, a card in there, a bunch of other expenses. So we're looking at an all in cost of $11 some change. And so I was like, Look, I can't lose money on every dealer and I make I'm not brand lous, so I have to charge $12. Otherwise we're gonna lose money on every single order. And so that's really where it came from.

And a normal deodorant acts or old spice or whatever they're not. I mean, what's the I almost don't even think about? I just pick it up off the shelf. Typically, three

bucks. What is the 3 to $4 is like a traditional priced anti like a traditional price. And so when

you were going into this war, you know, if I was your friend at that time, I would have been like a butt. You sure you're gonna be ableto for X? The price of deodorant? Like, are we sure that's a good idea? Yeah, I guess

it really would happen. Is by the time people started asking that question, it was It was like

we were doing a $1,000,000 a month, So I think I think we're okay. Okay. But I do

remember like we had this one question from an investor. At some point we tried to raise more money, and, you know, the investor was like the entire natural deodorant industry is something like $30 million a year. So why would anyone be interested in investing in a category that only has $30 million a year run rates? And I was like, if the natural deodorant industry is $30 million a year, where the entire natural deal, we're doing $30 million a year at this point. And so I think from our perspective, we were like, look There's a lot of external factors that say we should not be doing this Yeah, $12 Children is really expensive. The entire natural dealer and industry when we launched was Tom's of Maine, which was $30 million. And we're just like,

I think this is a product that people want and need and like, you know, let them tell us that we're doing something wrong and we'll try this anyway. And that's how it worked out. Like, you know, by the time people were telling us it's a $30 million total addressable market, we were doing that much revenue.

And so you you've said the phrase customer service a bunch. Yeah, people are playing the drinking game at home, taking a shot every time you say customer service they're dead on. And so a lot of people like, you know, we just got acquired by Amazon. Amazon has this phrase. Customer obsessed is what Jeff Bezos says. A lot of people say that, but I think you guys are doing something specifically that your actions back up your words. I say awesome little things like, you know, you know, first, the stories you told about reaching out to customers. Yeah,

days later, saying, What could we be doing? Better sending them different formulas to try out working with them. But also right when you sign up, you get funny email from you guys. Talk about some of the things you guys have done on the customer service or customer obsessed.

Sure, I guess, like ah, one of, Ah, the goals that were one of values we really have is to try and build a human business, like we want you to know that when you communicate with us, there's a human being on this side of the business, and it's not some corporate entity, and you're not gonna, like, get one of those you know, Comcast, like responses where people are like I don't care about this Let me transfer you to some other customer service representative and like they'll deal with it and they'll transfer. When you contact us, you really human being who sits in our office response, and then we try to build a really human element in a few ways.

One is when you order from us, we send you this over the top order confirmation email and or over the top shipping confirmation email. When you order from us, we say, Hey, we're popping bottles of champagne and this is fantastic. And when you when we ship the order, we say, Hey, look, we're writing your name over the Golden Gate Bridge. We're putting a sign in our parking lot that says World's best customer with your name and photo on it. And it's really over the top two men to be playful and toe s So you know that the brand that you're purchasing from sort of subscribes to your values as well, Which is we don't take this too seriously, but at the same time, we're really,

very seriously like this is deodorant. And so, like, we know that this isn't like product that you're gonna is gonna make a huge impact in your life. This isn't like having a kid, but at the same time it's important that you use a deal in the works. And you, you know, you're buying from a brand that really resonates with

you. So you've hit this scale that really matters. Now you're doing a $1,000,000 a month. Yeah, this point Any nonbeliever at this one has to sort of be thinking okay. Something real here. And the company size at this time was still pretty small, right? How many people were at native at this time

was probably around five employees.

And so you're you've got this business on your hands and you ultimately decided thio to sell. What was the thinking around that? Why? Why decide to sell when things were sort of when the going is good? And I'm gonna ask you how you sold it? Because, as I've learned, selling a company is both art and science, and I'm curious to hear how it all went down. But why? Why decide to sell in the first place?

What would happen is that light Somebody came knocking on our door in about February of 2017 indicating that they wanted to purchase the business. And we're like, Look, I never heard of them, and I'm like, Hey, you know, we're growing. I don't know who you are. I think it's like, you know, this isn't serious. And it turned out that they were like, you know, this is a privately held company doing a $1,000,000,000 in revenue, and it was very serious and so that really kick started the process. They started knocking on the door and,

like the knock became loud enough that we couldn't ignore it any longer, And that's when the process got kicked off. It turned out that they were a lot less serious than I anticipated, but I went out to meet with them and, you know, they're like, OK, great, send us all of your, you know, financials and your information. I sent it out in, like, June of 2017. They don't even reply back for like, 90 days after,

Like they're just radio silent. I follow up with them. I'm like, Hey, is this still going on? If it's not, no problem. Just give me a heads up because, you know, at this point, you know, we've started a process and we're talking to a bunch of other parties. I'm not on sale that I just say, if you're not interested anymore, no problem. Just let me know. But just radio silence like being ghosted from an ex like, you know, a tinder date is what's

happening. And were they you think they were just picking your brains to get the numbers from you, and then they were like, great thank you very much. Or what were They were just bureaucratic internally. I

think they were just like I think there was, like, a little bit of a brain drain going on. And I think that it was also just like, uh, you know, they have their own business and they're like, you know, maybe this is too small were a $1,000,000,000 business. Maybe the oh, you know, the right person internally was like, we don't really care about this business, I think was a bunch of factors. But at some point, like, you know,

we started going our own way and we're like, Okay, because you knocked on the door so loud we started our own process and we've got all these other suitors. They ended up coming back, like, you know, a few months before we sold for like, a month before we sold the business. And they're like, OK, yeah, we're interested again. And I was like, No, I'm not going through this again. We're really far along in the process with a bunch of other guys and you guys don't have the credibility to continue doing this. And so

you're some of the business do you feel like you know how to do this

process? Definitely not. This'd is like, you know, Look, there are so many different emotions that happen all of the time when you're trying to sell a business. I was really thankful that, like, you know, my brother was there with me. He had just sold his business. He had hired a banker and sort of gone through the transaction and knew what to expect. So we start this process ourselves, you know, we create a one page document that's like a teaser. We send it out to a bunch of potential acquirers. It doesn't even have our name on it.

They say yes. Are you interested in, like they're like, Yeah, we're interest in this business. We're like, No, we don't care about the deodorant category. Get out here. The guys were interested. Sign an N d. A. And we send them a book that's like, you know, probably 120 pages long, telling them all the information about our business.

This is what our financials look like. This how many people we have? This is where our businesses and growing the banker put that together or you put that the banker, the banker and, uh, end our team. Put that together. So a bunch of people have this book, and then what happens is that they they send us letters of interest where they're basically like, yeah, we are interested in this business if they are, If they're not, they just go away. But if they are interest in the business having looked at our financials, they say we're interested in this business. We think that we would purchase this business between,

you know, 10 million and $20 million or something to that effect. And then what you do is you say, You know what? These are the views of the guys who I think are really serious about this. Like if some guy's offering you 10 to $20 million you're doing 40 million in revenue, probably don't want that worth a conversation. So, you know, we take a bunch of these and I think there's 12 suitors at the time, maybe 14 and so we say, OK, everyone come to our office in San Francisco and have a conversation with boys and so on. Like the bachelor, your said this was

the back of the roses and you're inviting mall to the party. Yeah,

I'm not sure if they have the roses or I have the rest of it. I still don't know, but yeah, we invite them all to the party and they're here and they're like, You know, I talked to them. Ah, and like, you know, business is sent out like some businesses will send out one guy who's like the head of the North America and P and G. L send out, like, way we were sitting in, My brothers were squatting in my brother's office. He has a large conference room that can probably see it like 18 people. P and G sends like 25 people. And I'm just like there's this is standing room only here.

We didn't expect this And don't expect me to pick up the tab for lunch. And so we go through this process with a bunch of these guys and then what we say is like, look, years. Look, if you're still interested in this business, here's all of the data. Here's all the diligence that you need in the business. Here's all of our contracts that were a two and 1/2 year old business. We barely have any contracts. You know, we have probably three material contracts. No change of control provisions like the whole like in there. There's very little data in the data room, and we say Go through all the data. Here's a draft merger agreement.

Mark it up, give us an offer, and you should be ready to sign that. You should be ready to close that offer the day you give it to us. And, you know, look, that's really aggressive, incredibly aggressive. We're basically like, Look, we've got we've got this awesome business. You want it? There's a bunch of you guys. There's one of us

trouble. Those guys in that room are paid to, like, do a 90 day diligence process. Exactly. What am I doing here? Yeah, that's exact Out of a job

here. And so we're super aggressive about it. During that process, a couple of guys drop off for one reason or the other. A couple of guys realize, Hey, look, we're not gonna be aggressive enough like it. We think they're gonna be better strategic fix for this business, and it's not worth our time. Toe put in an offer a couple of guys just get scared at the price. You know, I remember one potential acquirer was looking at one of our competitors, and they're like your competitors selling for $5 a target. How are you like? And at this point, the entire business is online.

You know, we sell deodorant and only deodorant. We saw it on Lee through our own website, and we sell it only in the United States. And so one of the things that we sell is like the sizzle, right? We're like, Look, if you you know how to sell it, you know p and G g Not a soul in sight. Target. If so, imagine how native would do a target. Do you know how to make other products with the word native on them? Help us do that. And we could make this a bigger business.

Do you know how to sell in Canada? Great. This is gonna be a bigger business. So we sell that sizzle that strong? Yeah. That is really strong. And so, like, a couple of guys are like, You know what your competitors are selling for $5 a target. You're not gonna be able to sell next to those guys. So we're out or we drop our price by half. And then push comes to shove, and P and G hasn't done a deal in, like, 10 years.

This is the first acquisition they're making in 10 years. So our bankers like, Look, I have no idea how these guys operate. Like I know how you know Unilever operates, and I know how these private equity firms operate, but P and G, nobody's seen them in the world in 10 years.

Pop a Viagra just to do a deal like this? Yeah, exactly. Not used to this exactly. I

like I don't even know howto let get a reference on P and G to see if they're serious because no one has seen them in the market. And

at this point, had you put out a price yourself of like, this is our target. No, You're letting everybody coming, letting everyone coming with beds. And did you What did you internally? What did you internally think about this? You know you Are you dreaming about a certain number? How are you internally? Think about the price. Great question. I'm not

sure you know. There are. There are times where I'm like Okay, like the month month closes and I'm just like we generated, you know, four million in revenues. This'll month. Add another zero to that price,

buddy at

two more zeroes and then they'll be like one bad day where I'm like, You know what? We had this like hiccup because of operations and like, you know, something happened and and I'm like, Take a gal, take anything, somebody come in and give me anything And like, you know, it's like a roller coaster. And the roller coaster isn't even week to week. It's our tower. And, like, you know, during diligence, people are asking for random.

There was one company that asked for every e mail that we had ever sent out. A copy of that Theo open rate, the click third rate and the revenue generated from that email. And I'm like, Look at this point. We have a 1,000,000 customers. We send out millions of e mails a month and you want this from the beginning of the time that we launched the business and they're like, Yeah, that's just to make the first board meeting really productive, and I was like the board is gonna go through e mails because even I barely like I mean, I look at that, but I don't look at that, like a quarterly basis. And so, you know, they're just like,

eh? So you're up at 2 a.m. Preparing these things for them, and there's, like, a bunch of these acquirers. So there's a bunch of them. Some guy, like the guys who were most interested in the business, ended up dropping out in the during the during the acquisition conversations. And I was like, I don't know why you did that. And so, you know, all of these things were happening and it's like a roller coaster thought. The company that you thought was gonna marry you gets up to the altar and they're like, We're out of here. You're just like, Oh, my God, who's gonna marry me now?

I remember when we were going to the process just now, because it's pretty fresh on my mind. Just a couple months ago, there were these moments where you're having a conversation and certain things they say something, and in your head, like this is the moment I need to say something, and whatever I say right now is gonna really actually swing the way this whole process is going. And there are these a key moments that are just happening over a coffee or on the phone or whatever. Do you remember any of those kind of conversations or key moments

along the way? Yeah, well, there's 21 was with everyone, Which was it? An issue we had with our trademark. And I'll get to that in a second and two. I remember one guy who was like the CEO of the company was like, You're trying to judge my marketing ability until he's like, If you were, if your brand was represented by a celebrity, who would that person be on? And I was like, I know the guys like this is one of those things where you think either I'm intelligent or I'm an idiot on. I remember I hadn't even thought of this, but I like Michelle Obama and he's like, Okay,

you got it right. He's like, that's a good answer. That's great. But in reality, we had a trademark issue until we sold the business. This was a serious apart like that delayed the transaction with everybody and that, I think, made it harder for us to sell the business. We simply didn't own our trademark until five days before we sold the business. So we bought our trademark. Unlike we sell the business on like November 8th. On November 3rd, we purchased the trademark, and that was the one thing that we still had. Two.

D'oh. In order to sell the business like P. And she was like, We will not buy this business until you own your own trademark right, which was completely fair of them. And we were like negotiating with the person who owned the marks simultaneously. Yeah, exactly. In order

to get to feel like a deal is not close to being done is not riel until the deal almost falls through. That's like the test right through. Yet it's not a real deal. I was talking to Michael Birches on this sitting where you're sitting a couple weeks ago and he sold Bebo today well for 100 50 million bucks. And I was I didn't ask him this on the podcast, but I've asked this before. I said, you know, was it smooth? How did it go and he was like, You know, he was kind of like, You know, I just let the bankers kind of do their thing. It was such a big transaction that there's all these lawyers, all these bankers. It's not pleasant,

but we almost got it. We got to the very end, and then with Bebo, which is a social network. They started getting sued by the music companies at the 11th hour, and the music companies knew, Hey, these guys are about to sell. We have all the leverage in the world right now to just just go ahead and sue, and they'll have to pay that to settle because they want to close a deal. So you know they go in soon. I think it's like a $15 million like settlement is like needed or whatever. So Michael goes to the investors, the V C's, and he's like, Hey,

um, I might have got the numbers wrong, but it's something like 10 15 million bucks. He gets the feces like a look to close this deal. We really need to just settle this issue and then you know, we could go sell this company. These guys are not gonna go away unless we do this. And they were like, Yeah, you know, you're right. You really gotta settle with them. He's like, we gotta settle like, No, no,

I think you're gonna settle with him. And so he ended up, out, basically out of his own share. Had to, like, settle with these companies in order to settle the lawsuits to get the deal to close. And, of course, he holds it against those veces like, you know, to this day, definitely. But these were the crazy stories that happened at the end of the deal, you know, right when you think you have it, that's

really terrible. Because, like, I never felt it wasn't a wee with my investors like they were all, like, super happy and super excited about getting the deal done. And, you know, if someone had come to if one of our investors and been like, I don't love this and I'm gonna try and vote no and fuck this up, I would have liked been devastated and, like, felt like there was a knife in my back. Right? So I don't know who those investors are there, not Michael, but he I hope you shouldn't mention their name everywhere he goes.

Yeah. So this is actually that that might set Your brothers told me about this. He says he's like my brother boys, you know, he's He's great. He does a great job. He's like, but if you flip the temper sweet, she's like he has this, like, retribution streak. If you wrong me, I will. Publicly right the wrong for the next

50 years, I'm devoted Thio example of Yeah, sure. I'll give you an example. Right now. There's this company called. They said no to us because I was like, Hey, I want to launch this refillable deodorant early on when we're launching a business. Sounds like we're launching this refillable theater, and they're like, No, this is terrible. Get out of here. And like, you know, in the last six months,

I don't even remember what. But they invested a refillable deodorant company, and I'm like, Well, I see that you're doing a refillable theater. And

now this is a bad idea, huh? You've reached out. No, I didn't

say anything. I was like this, like stands by itself.

You

know that. You're doing this, and I know that you're doing this, but like, you know, do what you gotta do. But you could have had the opera. You had the opportunity

four years ago. I also heard the sort of once you get Proctor Gamble, obviously they have a sort of much tighter view of risk tolerance around Twitter and some of some of your tweets. Has that been for you since since joining. You know, the mothership,

Basically, what happened was sent us this letter, and so I tweeted it. And I was like, If you're wondering when I decided to destroy your business, it was when you sent me this letter before I was like, You know, you guys are in that, and I don't care about your tiny business and I'll let you exist. And now it's personal. And I like, you know, my life's mission is to make sure that you regret sending this letter every morning. You should wake up, and you should be like, Fuck. I sent that letter,

and now my life is fucked. Someone. It's called someone a PNG, and they're like, you have to take down these tweets like,

why should we take down these tweets? We should

show how competitive we are when people come after us. You know, uh, really go after them 10 times harder. You know, like, uh, Donald Trump is always like we're building this wall 10 feet higher. That's basically what I was

like. You come after

us. We're building this wall 10 feet higher.

And where did they come from? Where did that strategy or mindset come from? Is it like an early age? Were you doing this with your brother? Like competitiveness with him, or where is the I think it came from him. I think

he's just does a better job of like, hiding anything. Yeah, he's just more charismatic than I am. So he says it and everyone's like, Oh, you know what poor? You know, Salomon's like, funny and like, This is good and good humor. And when I say people like boys is vicious, he's just more charismatic. So it comes off nicer. But he's got it himself for

sure. I love it. Okay, So company finally does. The offer does come through. Procter Gamble was serious. Take it from there. How did it end? How did it feel and where you guys at now?

Yeah, sure. So one. I think one of the issues with these types of companies is always about. You are with the deals like deal, certainty. How comfortable are you that the other guys are gonna close? Or try and do something at the 11th hour? Because, like, you know, if you say no to all of these other companies and then your deal doesn't get Consummated, you come back and you're like, Hey, do you want to do a deal? They're like, What's wrong?

Why did the first acquirer not end up buying you? I've got the leverage here. Damaged goods? Yeah, exactly. And so there was a lot of deals, certainty with P and G like they were fantastic partners throughout this. All they like, you know, they came out to San Francisco, We met with them. We went to dinner with them, they made the offer, They came back again before the deal signed. And they're like, This is how it's gonna be.

Post acquisition like this is how you're gonna report to us. This is how we're thinking about the business. How do you feel about it? And I was like, Wow, you guys aren't trying to like hide anything or be at like, you guys were just genuinely nice Midwestern people who are honest and like I mean what you say, right? And so that was that. Give me a lot of comfort going into the deal, and that was wonderful. And as soon as we bought the trademark, I basically knew the deal was gonna be There was only five more days, but I knew the deal was gonna close. Since then, you know,

we've grown the business, Aton. We've launched into Target and Wal Mart. Where, like the number one selling natural deodorant target the number one selling natural deodorant in Walmart. Native coconut vanilla is the best selling deodorant skew at target over the last 52 weeks. And we haven't even been there for 52

weeks. 11 question on this the sort of what's Ah, it's not flavors. What's the sense sense? Yeah, You had these, Like, I saw something like a pumpkin spice latte. Sent eyes this like, Is this just like your marketing genius or what? Super fun?

Because basically were like, look, why are we taking this stuff too seriously and like, you know, you can use a cent for a season, and you don't have to go through the entire deodorant stick before you can get rid of it in the same way that you do not like. If you open up a Diet Coke because you want to treat yourself, you don't have to drink the whole thing or you don't have to have an entire like Snickers King size bars were like, Look, why don't we launch is really fun sense. They work in their effective. They're good for PR and hopefully you find out about the deodorant through net Native pumpkin spice latte, and then you're like, This was a great deodorant. I don't want to smell like pumpkin spice latte in April. Maybe I should buy, you know, coconut

vanilla scent. This is what I love about businesses and start ups is if you're Procter and Gamble, you're not afraid of Unilever. You should be really afraid of the Moyez at his dining table, thinking up pumpkin sized lot scents and getting PR and really getting this thing off the ground like it's it's, you know, one or two people in a bedroom. Definitely. Actually, the threats to these, like giant multi $1,000,000,000 companies because you have creativity and you have nothing to lose. Yeah, exactly. Fresh perspective. Yeah. I'm like all the things you've told me so far Just fall into those buckets. And if I'm listening to this,

I'm taking one thing away. As, like, do not be afraid and do do not sort of conform to the sort of practices of the industry. You don't know anything about deodorant. You went in with basically no money, no staff, no nothing. And you figured it out. And I like, what do you think is the message for, you know, the next Yoo Hoo baby doesn't have this sort of confidence today. What is your message? That person who's thinking about an idea like

this? Yeah, it's really Look, stop listening to other people and start listening to yourself. I remember when we were growing the business people were like, Look, you're not gonna be able to sell this until you launch a second product outside of deodorant. That really is a home run again. So people, so you can prove this is a repeatable model. Other people were like, Hey, you need to do influence our advertising. This brand is not gonna have any legs, and no one's gonna care without influence or advertising other people like you needs a launch. Pop up stores, like,

you know, the all birds in the ways of the world. That's the only way to do this. Other people will, like you haven't fund raised. What are you doing? This isn't a real business until you've got a cat like, you know, millions of dollars in your balance feet. And I was like, You're all probably right. And I have no, like, you know, I don't have the time for any of this kind of stuff. We have a business that's working and so,

like, give you advice to somebody else. Like, I know what's working in my company and some to keep doing that. I don't want any of this advice. Uh, look, I I appreciate the advice. I'm not gonna take any event and like, it's really hard to sort of be like, Hey, look, these other people that have a lot more money than I do and they have a lot more experience than I d'oh are gonna give me advice, and I'm gonna reject it, and I'm like, Okay with that you have to have a lot of like independence and be okay with what's going like okay with,

like, living and dying on your own intelligence. And for me, like what gave me a lot of conference was, you know, things were working early on, and so when people were giving me this advice as like, Look what's working, like what's working for us is working. We're gonna double down on that instead of doing anything that you suggest. And it's hard. Look, you know, for us we had that great safety net of, like a success already or like momentum. And so it's It's if you don't have that trust your gut.

Nobody's gonna be able to, like, come into your business, talk to you for 20 minutes and give you an amazing idea that you haven't thought of people would be like, Have you thought about influence or advertising? And I'm like, I only live and breathe this business every day from morning

tonight. What a genius idea. Tell me more

about this. I was like, Yeah, I thought about that, but we just did a $1,000,000 a month, and we're we're gonna try and do $2 million a month next month. And so I'm focused on that. And don't really have the time till, like, contact influences on instagram. And so you just gotta trust your gut and, like, listen to yourself. Other people's advice can help you, like, you know, get through the rough patches.

And I think our investors did a great job of that. But ultimately, like, it's up to you And, like, your live and die by your own merits.

I love it. And what was it like when the deal closed? Day off. Money hits the bank. This is my 1st 1,000,000 Yeah. People want to know. What is it? What changed? What did it feel like? What did you do? Did you start bawling out of control? Like tell us you started bawling out of control?

Sure. Yeah. Well, let me tell you the story of one of our investors I'm telling all of our investors were selling the business. It's a couple days before we actually closed the deal. Our first investors, this Chinese guy named Waco doesn't speak a ton of English and the nicest guy in the world. I text him and I'm like, Hey, I got a chat with you. Do you have You have a few moments today and he's like, Is this origin? I was like, Yeah, kind of. I need you to sign documents and like, the next 24 hours,

and so he's like, Okay, great. Call me. So I call him up like we turned your 50 k to a $1,000,000. He's like, Fuck, this is awesome. You know, ever. He's like all these people in China told me I didn't understand American consumers. I'm to go back to them and show him this deal. Fuck them. And so you know, I tell him, You know,

I need you to sign these docks in the next 24 hours. He's super excited at the end of the call. He's like, You know, I asked you if this was urgent via text message earlier because my wife just gave birth to my first kid. But this is the best news I've gotten all day. It's so made. I'll never forget him saying that. Anyway, we closed the deal. You know, money hits the bank like we haven't raised a ton of money. At that point. We've raised about $500,000. So have the vast majority, like 90 some percent of the company is controlled by me.

And like my family's in town to help celebrate, which is really fun. We go to this like Thai restaurant for dinner. We it is really fund. But like, what's shocking is like how little life has changed. Like, you know, I still live in the same apartment. I still have no car. I still rent, you know, like very little of my life has changed despite the financial windfall. And like one of the things I realized afterwards. You know, all these people like being rich is not that great.

And I'm like now, fuck you. You just say that because you have money, you can appreciate it, you dumb idiot. I'll be able to spend it really well. And then you're like, You know what? Like the journey of like, the friend ships I made with all the employees that I have and like a bunch of like, most of the team is still there, you know, like when we were building native and we did you know, about the month and we sold the business. We did like a $1,000,000 in net profit, which was insane a $1,000,000 in net profit.

And I was like, You know, if a bus hits me on the way to work, I'm still gonna get to work cause I love this job like there were so many great things that were happening with the business and is that journey that was really amazing And like the thing that I really appreciated and even today, I mean, I'm still I'm still running native on a day to day basis. It's like the people that work there and how devoted they are to the business. That's amazing. Like getting them like seeing a bunch of people sit down there like this. A problem. How are we going to solve this? How do we delight customers? How do we met? Like, you know, we had this contest internally to make another email funny and very human,

and I was like, Wow, thes people like care, understand the business and want to make, like, you know this company better. I have no idea how they got that way. I have no idea how they were motivated to do that. And there that way, and It's really fun to see that and like that meant so much more than the money. And that's still surprising to this. Even when I say today, I'm like this guy's an idiot writes myself saying it. It did,

Yeah, I trust you when you say because there's a lot of people that say that I'm like, Okay, you don't have to say the politically correct thing around me. It's cool to Dok Money is amazing. Yeah, I do this isn't it? This change. But when you're saying it like I believe you, I believe what you just said because I think you're wired like me and that you thought it would be X and it is good. But man, why is a lot actually has made a bigger impact on? It

just makes me happier, like being in the team makes me happier and like, you know, now when I get a restaurant's like one of the best thing is I'm just like, all order, whatever I want. I don't care if this entrees $14 or $22 like I don't care. I'm taking the $22.1 because I want shrimp tonight. And like That's definitely something Ideo like. You know, I try and spend a lot more time with my family, so I like will go and fly and visit my family more often because I'm less worried about where the next paycheck is gonna come from. And I'm less worried about the cost of airfare, so it's not like nothing has changed. But it's not like there's a Lamborghini sitting in my garage where I own a car. It's just like things are like easier when it comes to doing what you want to dio. But at the same time, you realize what you want to do is build those businesses. And that's like an amazing, amazing high.

If you were 21 today, starting from scratch, you have the intelligence you have today. You have the knowledge about the world you have today, but you don't have. The resource is and you have all the time and exuberance of a 21 year old. If you're 21 today, what business would you want to go start? What, what space would you want to go into? That's

a great question, and I think that it could be inserting a bunch of different ways. Like if I had no resource is, I would say, started to drop shipping something. Find something that on Ali Baba the can purchase and sell more in the United States on Amazon or some something else and arbitrage that difference. I've seen so many people do that, and so many people do that well. And that's a great way to get your feet wet into e commerce and understand what's going on without having any personal capital at risk. And if you're more ambitious and you're like, Look, I can quit a job, I can quit my job and I want to do something I can tell you for me. I could never start a business and I could never start a new business until I quit my old one. I would say, Look, look,

E commerce is amazing. You don't need a developer. Everything is really cheap. Out of the gate. Figure out product market fit and be obsessed with your consumer, and you will find something that works like you know, even if you have to let go through a bunch of products and you're like, you know what? I tried to sell him shampoo or I tried to sell him a toothpaste, and that didn't work out. Now I'm trying to sell something like, you know, deodorant go for it, like be obsessed with consumers. And And that, like the biggest problem that I think director consumer businesses have is that they,

like the founders, disconnect themselves of customer service. Then you're like, you know, you're just like the CPG Giants where you're like I don't have I don't have a direct line of communication with people who use my product Every day we have that direct line. 1000 people email us every day and were like, Hey, look, this is what they're thinking today. It gives us incredible insight into what we should be making and how to fix our product. So I think e commerce is amazing. I would do that again. I love e commerce. If you don't have any resource is and don't have any technical knowledge, you can still do e commerce. The one feedback I'd give after you chose that. If you chose that category is, do not disconnect yourself with consumer

Lovett. And if I'm listen to this and I'm like this guy's awesome, I want to talk to this guy. I want to send in my ideas. I want to send in my my company right now. How should they get in touch with you? And really, who should get in touch with you? What's the Who do you want to hear from?

Sure. Look, if you're any commerce and you're like, you know you've got some legs under you and you're thinking about raising money or looking for an adviser or just wanna bounce ideas off of, please reach out to me like you know, I love when people have gotten skin in the game. I think the hardest part for me, too, is to have conversations with people who are still. I used to be a lawyer who are still lawyers, and they're like, I'm thinking about doing this. I'm like, Look, if you think about doing this, quit your job. Like if you want to do this,

quit your job. That's the biggest telltale sign that you're in. If you're not in like, don't like, don't go around asking everybody. Don't do that shit. Do that shit. Do this, Do it or don't do it. That's your own call. And like that depends on your personal financial situation, how old you are and how much energy you have and all a bunch of things. But if you're in and you're like starting a business and it's got some traction and you're like, Hey, how do I start scaling this? How do I get from that 100 K to a $1,000,000?

Ah, happy. Happy to answer any questions. Happy to talk to. You can find me on linked in. Certainly I'm at more easily on Twitter. Love talking e commerce, uniter in this room on a Saturday I had a bunch of e commerce calls earlier today. This This is where I like

to do on the weekends. I love it. All right, man, this is fantastic. Thanks for having me.