Episode of My First Million with Sam Parr and Shaan Puri.
Transcript
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Kind: captions Language: en [Music] all right we’re on the eighth episode of strategy podcast we’re here with Jai Kisan who’s the co-founder and CEO of movement watches Jake movement is an accessories company that sells fashion items that shouldn’t break the bank is that a good way to describe it or is that bad way to describe it no that’s a great way to describe it we’ve evolved since - you know we started with watches we start with six watches at our core price anywhere between 95 and hundred dollars kind of comparable to those 300 the 500 dollar price point watches and then you know the goal was to continue to build a lifestyle brand and you know grow into other accessories so now we have everything from watches men’s women’s to sunglasses to jewelry and one of our most popular products as of late is actually our blue light blocking ever school buses everyone stop in front of their screens all day and I think a lot of people least me I had some trouble you know falling asleep or sleeping in because I’m staring at screens all day we have nothing else to do and these truly fill they filter out this is kind of a what you call it is me selling a little bit but like this is a little shameless but shameless plug but it is the cool thing about him is like everyone has it the device on their screen or has an option on their screen to block it but it actually distorts the color so for us it filters the color so if you shine blue light in it just blocks it and filters it so graphic designers or gamers whatever it is like you’re able to continue to you know do what you do without affecting kind of your civvie powders but anyways that’s that’s been blowing up for us right now so and the goal is is to clean it to continue to branch out into other accessories and really be a truly a lifestyle brand who bought like who buys the bula except I feel like you know whatever I talk to people from LA I’m just like and he’s telling you about stuff and I’m like everything you just said is very la when I talked to Nick who’s a mutual friend of ours who runs thrive market you know he’s like yeah I’m taking beehive you know pollen shots yeah it’s a blue light blocker la or am I just missing I think it might have started as la it was kind of like something people like to wear and be fashioned for it even if they didn’t have prescription eyewear but I think given the world we live in today its accelerated the need for them and and and truly there’s a there is a benefit to it I mean I was you know there’s proof there’s there’s data backing it so I think what maybe was somewhat of a fashion trend has now turned into a real utility that is helpful yeah I live in LA you know oh wow so maybe it is LA I don’t know but it’s doing well for us I think around the nation in globally so gotcha okay let’s get started with like the beginning of movement watches would love to start like I know you guys launched on IndieGoGo but even taking a step back from that you know you’re the youngest e-commerce entrepreneur that’s super successful that I’ve ever met before you started movement watches you dropped out of college you were 20 I already dropped out of college in the year 20,000 in debt and then you decided to start watches is that right yeah debt so debt was to partially credit card debt so I wasn't about I think it was like six seven thousand dollars a credit card debt funding my lifestyle more so and movement partially like I was still in college and I had it stopped working at the time to put all my energy in the movement and so I was in debt to you know I had eighteen months of like interest-free credit card debt so I maxed those those out for samples and everything else and then well you know as well I had received money from kind of family and friends for a previous business that just ended up crashing and burning it was it was doing well at it's at its peak yeah I had I needed some capital continue to kind of grow it and then yeah left me in kind of a place of you know I don't think I ever some of the money came from my parents so I've definitely return that money since hood but yeah it was it was largely kind of credit card and family and friends with you so that's so quick I feel like you rarely hear about had a success that you've had and actually stood like you know legitimately you have a story about credit card debt usually it's all these like guys who sort of had you know who had like dads we're millionaires and sort of like we're able to fund their own success for the money because they had all these amazing connections you built movement or you started movement watches actually swiping your own critical yeah being like yeah I need to pay for samples yeah from me to it was like back against the wall it's [ __ ] insane yeah your back is against them I mean like you chose to make your back against the wall like you're swiping the credit card ordering samples of watches yeah because and you're like giving up your work opportunities and indeed I'm dropping out of college from this business you chose to put yourself on your back against as well yeah yeah that's a lot of [ __ ] it's all it's all you have this starting off right like for me my dad you know had a business was was you know kind of middle-class and and but during the last you know recession that we were in completely business went out when you know the closes doors after 20 years and lay off his employees etc and ran through you know their savings so I saw financial stress from them I was supporting myself in college but grand I had kind of planned on dropping out regardless I wasn't doing much in college because I had my previous business before movement that I was hoping was gonna be you know the big winner and then when that went under it was kind of like okay I have an opportunity to fund another business using my credit card you know that I currently have let me let me go big and honestly my mentality and maybe it was a little overdramatic but or maybe not it was I'll go get I'll go work anywhere if this doesn't work out I'll go pay this off but like and I think people who have their back against the wall typically end up succeeding because it's sometimes it takes that to like really figure it out and grind and put in the extra energy and you may try tentative as you know you may try 10 different dings and only one works out but like that one thing may be the difference so yeah give me a poor and hungry person in any day of the week versus like a rich server grant like 400 person who's gonna want to like succeed and has a lot more like at stake basically yeah but like it's crazy that you're like I funded my business on a credit card like everyone's like founded by business with the millions of dollars I had I founded my business with andreessen horowitz money no one's like yeah I funded my business with this Visa card but I have the same credit card that you use to buy that stuff yeah I don't have it anymore but what a great card I mean so you launch like you know you get these samples you've got six watches you launched on IndieGoGo that's how you sort of get the business started yeah so so back then it you know I think I needed some I mean I knew I needed a source to to you know Drive orders I knew I needed capital to continue to go forward we needed at least like 15 grand to actually place the first pio so so it was like okay we need at least 15 grand and and that was that was the small goal that was like if we do that we may just give the money back because yeah is it really worth it and then of the day to you know move for a week so we ended up doing like 15k the first I don't know 30 days of the campaign it was a 50 day campaign and then and based off of like IndieGoGo at the time their algorithms etc we got featured on the homepage and then went from we did another 30 K that day and then just filed off ending around 300 K in pre-orders gotcha so your mentality was look if we only get 15 K in sales over 50 days we're just gonna cancel this whole project give everyone their money back and go do something else cuz that's just not where the business but potentially it was like it does this even back out yeah so you do 15 K the first 30 days and IndieGoGo features you on the home page and you get another 30 K as a result yep and that's that which are going on were you in touch with them to get them to feature you or did they just like their algorithm was like these guys should get a home page for today no so that was that was you know we again being kind of dropouts in college we were or dropouts of college we were just kind of studying the platform yeah we knew that we knew that like there was algorithms that we had kind of figured out how they worked and some of them was like you know as the campaign is ending it gets pushed to the top of a page or you know if a campaign gets a certain amount of funding percentage-wise they get pushed if you send enough there's all these hacks like I was big the word growth talked to me back then was like I mean that was like I loved and breathed that right it was like that's what I lived by today growth hacking isn't always scalable to some degrees it can be but like at some point it was like okay I need to figure out different ways to scale the business for back then grows out I was a growth hacker yeah I mean it's still like it works when you're going from like zero to one right it doesn't work when you're going from fifty million hundred million like there's no tiny growth happening you figured out we like back in 2002 third mm yeah so in 2013 they exist I think they still exist in 2020 yeah that'll get you from like you know fifteen thousand and thirty thousand or fifteen thousand percent our use are you really running paid like you know today when people run Kickstarter campaigns and I see a bunch of Facebook ads saying hey go check out this Kickstarter campaign and were you running paid ads behind this IndieGoGo campaign was this all organic back then it was large that we were paying certain publishers certain like blogs to post about us so we had blogs like cool material and then I basically I again found a some sort of software that was allowed me to kind of reach out to editors basically it aggregated I type in the topic at aggregate articles across the web and then it gave me the editors email and I exported him to an excel and sent a personal email with their name everything so tooth to tooth to 200 people I ended up getting 15 or something of them the post about it which was great playboy was one of them I was like okay I'll take it whatever and and then those gave us kind of momentum and that combination with like kind of a few other strategies read it was a big one we we were banned from reddit actually we got kicked off a reddit there's I created about a hundred different reddit accounts we had a proxy which hides your IP address so we would log in using different IP addresses posting without different IP addresses and then upvote and then you gain momentum and then once he got in implementing you just skyrocket they call that astroturfing one of the subreddits we did was called shut up and take my money so it was literally hey here's a product I want these are consumers who are looking to buy something yeah and somehow the detectives have read it traced back something yeah there's a thread somewhere it's great and has a ton of up boats but there's a thread about how we movement Astroturf thread it and so now there's a love-hate relationship I have with reddit but anyways that was I don't know if you can still do that today but that was like a big piece of like organic traffic basically this is back when you're still running an IndieGoGo campaign you're you're trying to get ready to post about you guys so people will click over to IndieGoGo and start funding pretty much up do you think it was still like a viable launch strategy today like I feel like in 2013 everyone was talking about like I go to Kickstarter once a week and sort of look at the new projects I feel like now a bunch of people been burned by King starter and probably IndieGoGo because they're just like I placed an order for something I ordered a case for my iPhone X or my iPhone 10 it didn't get it didn't get shipped to me until the iPhone 11 came out and now this is your IndieGoGo and Kickstarter as big as they were back then or like how do you feel about that yeah I don't think you have like the big the big big winners at least that I know of otherwise because I don't hear about him anymore right and people have been burned by like the coolest cooler and stuff like yeah ship but what I would say is like you know I would rather than looking at us as like you know an example of how we did it right that was 2013 and as we know like technology and the world changes so quickly I would go and find people who have successfully funded in the last you know 12 to 18 months and if they've done it then I would say that there could be an argument to still maybe go get friends and family money or maybe before you even go out and do that it just use it as like a platform to get cuz regardless there's still millions of people that are using any gogo and Kickstarter yeah so regardless there's still an opportunity to get you know your product in front of faces for generally free so I'd argue like it's a good marketing tool whether you raise 300 K or you raise 50 K or 20 it's theirs I still think there could be a benefit to it now with Facebook and everything else I don't know how like you know the market that got the marketing stack and how it integrates with with IndieGoGo or Kickstarter but I would again if I were starting over I would look at someone who's recently funded and just kind of reverse I mean worse engineering again growth hacking reverse engineering those are the two things like I take a brand and just completely reverse-engineer IndieGoGo reverse engineer so yeah I would do this gotcha okay so you think that they're still viable strategies well did you realize once you were on ad to go that you had found a product that was gonna be big and scale or did it take some more time like you know with Native in the first two months like we were seeing a cost of customer acquisition of under 2 for the first two months and I was just like this business is gonna work I don’t have the plug I haven’t made the product yet that’s great enough to drive this tribest business but I know this business is gonna work because people are buying this stuff at 2 in advertising to sell this product like that’s phenomenal like it doesn’t happen today I knew instantly that the business would work and it took me a little bit of time to reformulate the product and really get my product market fit and see a ton of growth when did you know that movement watches is gonna work did you like was it the day you’re on the homepage from you just did another 15,000 it's [ __ ] great or did it take some more time yeah I think there's different levels of what what's working right I think yeah when we did when we got on the homepage at that 30k in a day I said okay this is this is real now that's real money this is real let's think about this but then you know you have your cube for holiday you know numbers you start seeing what you remember there was a day where we had like a 25,000 you know day and that for at that time it was like holy [ ] that’s huge and we’ve skin since then but like there’s just there’s just you have days I’d and and every each time you’re like you’re just really a ting like even what you’re thinking about it and like the expansion of kind of where your business can go yeah you know campaigns over you realize hey look we’re gonna start this business we’re definitely not refunding people’s money we’re gonna actually ship this product we want to make it look what are the Jimmy operational you know when we launch native the first time we placed we we were supposed to pick up stuff that our manufacturer we used a freight forwarder to like drive a truck there and pick it up they were supposed to arrive on a like a Tuesday they didn’t come on Wednesday did in come on Thursday I got dispatched another company gonna pick up the deodorant so we had our amount of manufacturer and the first guy picked them up and we’d already cancel that order so I was like wait are Germans are on a truck as like is this manufacturing just long time supposed to get all these deodorants and to run the wrong truck and I was like holy [ ] what the [ ] is happening do you guys have any of those operational because you guys aren’t making it stuff in the United States or are you making in the US no we’re making it now we’re making it overseas in Asia have you dealt with Asian you know manufacturers and shipping things on boats or air freight like are there operational challenges right out of the gate yeah I mean I think they’re just a learning curve I think more than anything we had a three PL so we had a third party you know kind of helping us with our fulfillment and they they took on a lot of like the logistical kind of stuff in terms of kind of importing I think I think they might have even been the importer of record if I’m not mistaken but you know was a long time ago I don’t remember us having anything that was like a major issue per se fortunately but it was more of just a learning curve and figuring out you know what what the best way to do it what the most affordable way to do it I think a lot of times you just pay a premium because you don’t know better and then it’s we ended up starting to ship ship bibo and then you have to you know kind of build that into kind of your timeline and then you also hear like you know well is the condensation like while going over the ocean like ruin the the watches in the boxes so there’s just a lot of like logistical thing you have to keep in mind and think about but we’ve never really had a major you know stopping block or yeah exactly yeah was it difficult in finding the manufacturer like I would imagine or was it look was that easy look you just go to you know the sheds in whatever fared they’re like okay there’s four hundred watch manufacturers or is it like really hard to find that kind you know you could you certainly could go to like a fair and manufacturers again we thinking of flying to China for us when we were just getting started to get some something sampled I didn’t have the credit card credit to do that so we ended up we ended up going on Google and doing some research and finding a manufacturer that kind of or consultant who knew different manufacturers and we worked with him initially and then I think once you really start to get going like once our indiegogo attention then you have other manufacturers who may be a little bit more legitimate a little bit more reputable start reaching out and I don’t think it was until err maybe almost our third year maybe our second year where we actually flew to China and met with different manufacturers and in the watch world there’s like middlemen so like for us we have we’re not middleman but we have a the movements inside of our watches you know we have a quartz my o2 movement from uh super watches so my Oda it’s there in most like quartz watches so they’re incentivized to go and introduce us to the best manufacturer so they went and kind of you know pulled us into the three top manufacturers and kind of got a see who was vibing with our business at the time and who believed in us and and and kind of went from there and if you had to switch to manufacturers since you started the business like from that IndieGoGo campaign to today have you been like I went from here I still not be on this facility so I went to you or you still with the same guy yeah so we have no we’re not with the original we have multiple manufacturers you know prior to move on the bottom acquisition we had multiple manufacturers I think for multiple reasons you know some manufacturers are better at Purdue you’re saying you know different things I think it’s always great to you know whether you want to leverage them against each other not to be not to not to bully them but just simply to make sure that they’re being giving you the best price and so there’s like there’s there’s benefits to that you know some some manufacturers can only do a certain amount of production and so just it’s keeping them you know responsible for you know what they’re doing and motivated so that they don’t take advantage of you in any way post Movado I’m not ready to talk about this have you moved manufacturing in-house like is Nevada doing a manufacturing or are you sort of stone all doing the same thing to do more with your own independent contractor so no we’re still doing the same Amana there’s you know they do Swiss and etc but I’m pretty sure that for us at least we we have still third parties and I think largely the the the you know fashion watch industry courts you know movement is all you I don’t think it really makes sense to go and yeah open up your own fact release to my knowledge so okay so you’re launching a brand its 2013 IndieGoGo campaign successful look what is it what is your revenue look like in 2014 you know six years ago or 2015 yes a year so the first three years I went so first year we ended at about a million with including the the IndieGoGo yeah and I don’t think we did much it was like blogs it was uncrate you know we were paid the money I spent was like get on Craig uncle material you know figure out you know those type of things more so than rev-share to developing commission type of opportunities so it was pretty organic which was great so you’re not we weren’t paying for unquote you were like hey I’m Craig we’ll give you 15% of sales no no uncrate there’s a few so a few publishers I’m Craig you pay you know Aflac then it was like seventy five hundred bucks for a feature but it would return you know largely a large amount of orders so those are like big opportunities that no longer exist but also they were like unknown opportunities so it’s kind of navigating a sea that no one knew like where to go it’s growth exactly so net so that so now it’s a little bit more everyone is look knows and has seen you know us for me undies are you guys on all these blogs so it’s it’s saturated and it doesn’t just business and perform like it once did but it was largely blogs and and and then some was working on it as well we did a big like refer-a-friend we really really encourage our our team to or another team but our customers to refer their friends for credit or discounts and then one of the biggest things we did back then was like every 500 likes on Facebook we did we gave away a free watch and then it got too much so we did a thousand and that was our fastest growing platform Facebook and that was just you know we were like okay we have 500 new people to like us yeah there’s at least one person’s buying a watch from that it’s worth giving out a watch and people just went nuts about that and we just scaled through that so that was that was your one your two we started to play with Facebook YouTube we did seven million and that that was like the rocket ship is where I think we were getting like 10 cpas for a hundred dollar watch and that was when it just they just took off and then so yeah three we did thirty is 2014 yeah so year one year one was a million to seven to thirty to thirty and it goes from blog to Facebook to more Facebook blog to Facebook to a lot more Facebook and then after probably thirty it was like how do we diversify different acquisition channels we don't want to be solely bet on on Facebook what if we get saturated what if CPMs go up uh blah blah here we are today yeah I remember when we were like the first time they did raise money we went to like one of our investors was putting on some sort of like marketing Day show and we went there and there were Facebook reps and they're like yeah on Instagram we're allowing certain vendors or like certain businesses to advertise and one of the first businesses and I was like how the [ __ ] did you guys know do you know that like you were one of the first businesses that get special access I think we did know that we so back in the day I was like I mean I was running it out the gay and then we worked with kind of a freelance consultant and then we ended up hiring in-house but it was like you know anytime there was a beta because we saw the success and I knew I knew Instagram was going to be huge because I used it as a consumer and the numbers of its growth so we were like get us on the beta get us on the beta I was we were really lucky for two reasons there was we worked right next to the the Facebook LA office so we basically just kind of bear-hug Facebook and like we made sure that that was like a network that we'd stay close to and I'm friendly with a bunch of people over there just in the sense of like you know not not that we were getting necessarily special kind of you know special service but it was just being able to talk to them more frequently about what was going on before we had like a small business rep in Texas and that was just you hear from him once a month and it just it was like you know surface level stuff so yeah it is weird that like Facebook is sort of outsourced so many of your representatives like I think it's an Austin and they're like you know even if you're spending you know ten million dollars a year they're like here's some rep in Austin that like I'm gonna give you great great feedback you really have to network your way within Facebook in order to get the right people under account yeah definitely I think they're I think they're doing the better job but I don't know I mean we've been we've been we bit we're now leg and we're close to them so we've been in the network so maybe we've been you know working with certain teams just because of that but we also have spent as you guys I'm sure a significant amount of money on Facebook so yeah yeah once we were a part of PMG base on PNG Rapstar account and so like you know we were no longer yeah so I'm not sure what's happening last to you yeah they have different they have I know they have different set there's like a growth like a like it's like a growth so it's like brands that are in the ten millions Plus and spending you know millions on Facebook and then you have like yeah like the the big guys who are you know big Forbes whether it's exactly exactly yeah and look you know you guys never raised a dollar you guys are funding this on credit cards and then once you sort of hit that 7 billion dollar range I'm sure you're profitable or breakeven and sort of fund a you know did you ever did you ever think that you should raise money did you ever try and raise money or were you like no this business is working I want to control our own destiny let's keep it all out yeah I mean there was there's always a an internal kind of discussion at me and Kramer my co-founder had about do we raise money why would we raise money everyone else is raising money why are they raising money does it make sense like do we need to grow faster than we're growing and and you know there was a time when we were strongly considering at a later stage to go and raise money to help kind of with expansion and growth and you know that and that you know fortunately for us it was kind of right around the time when we started talking with Movado and that just made so much more sense for us base you know the the synergies in terms of brand and and just like you know where we wanted to go they already largely knew when what we're able to support and help us so that made more sense than doing it ourselves and raising capital and deluding ourselves but it was tough I think back then the dialogue wasn't as it wasn't as there wasn't you know guys like me and you and others who were talking about like you know state staylene you know look what happened and there wasn't examples of the bonobos in and you know I can't even think what's other companies that just there's brand lists there's a what was the one that just came out the other day anyways yeah Cass look at Casper's IPO right yeah 400 million they raise four hundred million dollars yeah yeah look there's a ton of this company we work a brand blue aprons a great example there anyways probably more more so more of them than less of them right like I've turned out to be failures unfortunately and largely not not because they're necessary about business just as they raised that it crazy multiple that they can't you know kind of get you know run from so anyways that wasn't as apparent and we just kind of like we networked with a lot of people and that was the one thing because we didn't go to business school I wouldn't say that like from the finance side of it like that's not where our specialty is we were like bran builders and scrappy and entrepreneurs and kind of seizing opportunities and and you know enjoying the process so we talked to a lot of different founders to to had raised money and to be frank like a lot of them were kind of not happy and said stay away stay away and it was just weird that every time we talked to someone who we idolized in terms of the business that is yeah all over the news and gets all the press would be like don't do it if you don't need if you're making money don't do it Bubba blah and now I mean I think that just makes so much sense for so many reasons and you know from from and we talked about this even you know offline all the time but it's just like in terms of brands being able to acquire you for for a you know reasonable number like the second you go and raise money you may out email price yourself for so many you know brands and you just cause complications for you know you may be growing an unhealthy business which will hurt you in Milan yes but there's a day that that all sort of comes back and haunts you right like you could rate you could be celebrating I mean like yeah we just raised it you know I I think I mentioned you before II when we were raising money and we talked to a fund they're like we'll put in three million dollars at a 30 million dollar valuation or 30 million in a few million dollar value pair so I was like I could get a 30 million dollar valuation for 300 from this person sitting across the devil from me right yeah look that doesn't make sense they they're very honest about it they're like looking 300 you're gonna have to work here for five more years and build a 600 and I was like that's I was like five to ten years I have no idea what the world is gonna look like five or ten years from now I don't know if I've the capacity to work that luck you know I don't know if I can maintain this 800 million dollar business and the three million dollars just doesn't seem that interesting yeah you know what's crazy is now I also like when you're looking when you're starting to look at companies when I see a bunch of ads like in the subways of New York City or on Billboard's I'm just like I don't know if that no longer like holy [ __ ] that brand is awesome when I see stones happening at the end of quarters like at the end of March or at the end of June I'm just like these guys are looking to me quarterly numbers that they're you know that are that are required by their board yeah and so he's seeing how businesses are sort of building themselves specifically because they raise a ton of outside capital instead of trying to focus on building the best pasilla and I feel like the reason might be and and I'm not sure about this but like you know I think that the VCS who had a lot of experience in tech like tech needs capital often right not only is it not always as much capital as some of these tech companies have received I was just looking at Shopify I think they've only raised four before kind of before they went public it only raises like 130 million or something like that which isn't really a time honey any gray is like 60 and so Shopify is now worth seventy four billion dollars raised at like a 300 400 million evaluation and honey I think race sixty million and sold for four billion so even those companies honey raised less money than like Casper above us or guys which-which again it's like I think it's just because VCS wanted scale they wanted growth versus having a healthy brand really focusing on a consumer and like if it's resonating it's resonating you can't force it and I think that that's where people got you know people can you can force people to buy someone you can spend a lot of money you spend a thousand dollars for something to buy a watch if you bought it right like that's possible to do but it doesn't back out and that's what they were doing on you know blue apron or Casper and etc and and now the mentality has shifted I mean I hear it just from like my network that like you sees are looking for more profitable businesses and they're you know it's it's it's a total mind shift and it's funny because like back in the day I remember talking to some of the bigger like bigger funds and just just networking not even looking to raise but we talked about our business and kind of get laughs that it's like not I'd left that like it's just not it's not a real business it's not gonna be can't scale this business blah blah blah and so I don't know I wrote this article recently his name was and he's like the reason that glossier and a way of working is because they don't have any competition as opposed to like the caspere's of the world that have a ton of competition and I'm like are you [ __ ] insane you think a way doesn't have any competition in [ __ ] luck of course they're just like less competition I'm like they do a great job with branding they do a great job with marketing and they're out hustling people building and and like being operationally efficient as opposed to the casters of the world that weren't operationally efficient and burned a ton of money yeah it is insane how DC's don't get direct-to-consumer even though it's been around for so long and it puts so much money into it yeah I think they're I think you're building yeah right I think and I hope that they're starting to in it and and they're you know I think it maybe not the biggest ones because they're looking for big opportunities but some of some smaller you know VCS are look are happy with the smaller exit right like yeah they're okay with that but I think the B C's that we were talking to back in the day are you know have huge funds with with businesses like snapchat and so forth and it's a big it they want a billion dollar evaluation type of a billion dollar exit is kind of what they want when you think about it so did you like had that mind that might have already shifted by the time or was that still like I feel like that's a pretty new mind I'm not even sure like you sold the business in 2018 I'm not sure that might exist in 2018 I sold my business in 2017 I'm positive it didn't exist in 2017 in 2017 people are like why are you selling your business why do you raise more money and really grow this thing I was like we're doing tens of millions of dollars in revenue we're doing a million dollars in EBIT a month at this point like it is a [ __ ] real business and I don't know how much longer I can keep continued its growth trajectory and I'm not sure I can do it by myself you know had that mind shift mindset shift into profitability by the time you sold your business or was that still a year away I mean sorry thing were we always profitable are you saying just no no I'm saying DC's DC started thinking about profitability in I actually think one of the big or bigger articles that came out I think you were in it as well jason delray from yeah I don't know what a publication yeah yeah recode yeah yeah and he published and it was like me you too big acquisitions who and he kind of the writing on the whiteboard shadows and I think it might have been least as well he goes these companies you know either raise very little or are profitable and you're seeing acquisitions successful everyone's successful in that position right employees get money we get money like the you know the choir is happy like it's across the board it's a good acquisition and he kind of says is this the future and I think that was probably right around 2018 and I think you started to see a shift when but no bus you know kind of get got we got written off by by Walmart and you start to just see kind of a trend across the the the kind of industry but yet your point I don't think it was I don't think it was adopted you know widely until probably more recently than ever yeah yeah the talk didn't you know folks that he mentioned that article yeah anybody okay let's go back a little bit more to like movements growth you know from one seven thirty you're focusing on Facebook you diversify acquisition you know I've seen you and Cramer on television more than I've seen like no guarantee basically you know sometimes I watch TV and during commercials I'm just like I recognize Oh first stores are all consumers towards building pop-ups on TV it's just direct one time I saw you I think I saw like maybe Hubble contacts yeah and then me and I was like okay it's just us now I know some of the channels you know Instagram like influencers would like I think it was a Kim Kardashian at one point I've seen you run TV ads where are you spending money you know today over the last couple of years and how do those things that like you know does TVs still back out does it look do you know a native we never could afford influencer ads with Kim Kardashian's like major celebrities do those things back out or is it like Alert sort of test and learn process we were influencers I don't know if there's a Yelp that's good that's actually a great question I know there is definitely databases full of like you know ability to reach out and give him formation and feedback and engagement metrics so but in terms of like you know how was the experience in the back out like did they do they work with you well like it didn't really yeah at least didn't when we were doing it our first the biggest one was Kylie Jenner for us that was like early early on and that was back in the day we're like you know a lot of Instagram influencer marketing was backing out especially people like like Kylie who this was like yeah maybe it was 2015 that we did it maybe 16 so it was early on in the company today though it's spread out I mean you know we still do Facebook we do still do TV podcasts Instagram obviously I think we might still do some Pinterest and we've tested it anything from like snapchat we've done tabouleh back in the day so it's really like I mean ah I guess my strategy was you know you want to you want to figure out the right marketing mix and test into it any of an influencer you have like different tears right you have the kylie jenner's of the world and then you have people who maybe have 10 million or less who are who are influencers but that's that's kind of their their their getting product and that's kind of their main source of revenue or their a fashion you know or youtuber and then you have maybe below a hundred thousand or somewhere around there may be five hundred thousand who could be micro right yeah so we so there's like we're always testing we're always trying to figure out well you know where are we spending the most efficient dollar is it doesn't make sense our you know is that is the amount of sales that we're getting in one channel like the incremental revenue we're getting they're like what does that actually equate to and so we're just trying to figure out like we're always testing and that's what we've kind of built that in-house and that's yeah I think what's made us special is that you know if there is a marketing channel that comes around like we can identify it and apply kind of our methodology to it in it and it's a very agile you know methodology versus just you know buying TV even though buying TV the way that we probably do versus buying kind of national broadcast is different but it's a little like buying on Facebook or buying on tabouleh or snapchat any of those or Google or very or more or more similar I'd say than buying kind of paid media yeah it's crazy like marketing is really a living organism like you can't be like okay Facebook works it's gonna work for me for her you have to like diversify and like maybe Google works for ear and then it doesn't I remember snapchat worked for us for a while didn't work for us after that yeah but you really have to diversify those marketing channels pretty quickly and like constantly be testing them to be like it's a working hour if not even Facebook but you know which has been look Facebook has been a behemoth obviously in digital advertising probably since 2014 today Facebook is like right now Facebook is very different than oh my you know two months ago like if you talked to like Facebook just returning earlier today and they're like you know we're not in from advertising cuts you know Expedia that a CEO of Expedia was like we spent five billion dollars a year on advertising usually this year we're gonna spend 1 billion and we've already spent a ton of that it's because like you know kovetz going on and so these began crisis have come down yeah I wanted omen influence our advertising because I feel like you guys were one of the earliest guys to do that you talk about 2015 2016 is it just a lot of like well one can you talk about the most you ever paid an influencer like well I'm curious what is the most you've ever paid it was definitely in this it was it was somewhere around for a single post it was close to like yeah like 150,000 okay yeah maybe but that was early on and yeah that was a that was again different I’m like I don’t think that we certainly want to do that today unless it was like you know there was someone who’s we’re gonna be ongoing working with the brand or you know collab or whatever the case may be but so yeah that was that’s a big chunk of change why would you do that today is it because they’re like the numbers we’re backing out in 2015 and don’t necessarily back out look in 2015 people saw that they were like what is this I want to engage with this while in 2020 they’re like this is an ad by this influencer or something yeah I think I think it’s a combination of all the right like back then it was first off the engagement wasn’t you know repressed they you could so you were getting more engagement you’re getting you know more impressions right if she had 50 million followers or whatever it was back then you know majority of those people probably saw it Facebook was you know the post four chronological or whatever it was and you so that was that and then also just she wasn’t posting a ton of ads right she wasn’t Oracle you know collaboration so I don’t even know if she was posting much about her own stuff at the time so this was just it was just the right time right place and I think today even remove her you know any huge person you know with 50 million or more followers like I just don’t I don’t think the engagements there like people just aren’t seeing the post as much as they once were and even if they do they’re just I mean it’s it we’re just we’re just you know used to it by now to see you know unfortunately you know it adds you know they’re just even if they’re even if they’re you know as authentic as possible and they really use the product and they love the product unless they really back something personally and are like you know they’re they’re a partner like I just don’t necessarily see it backing out like it once did so but you know there’s arbitrage elsewhere always right like maybe you take stalks that next place maybe twitch right which is a big place that we’re trying to figure out especially with those blue light blocking glasses like yeah you know the gamers are farther it screens yeah and they have I mean we you’ve seen like the trends about the ninja ninja gamer and then there’s a bunch of them that honestly I feel like the average person doesn’t know much about but it’s this underground world that’s just absolutely booming yeah are you already advertising and take talk right now I don’t know that we’re do we have a tick tock account we’re creating videos we’re playing with it I created I finally created a tick tock just to figure it out I’ve now I now understand how something can get the amount of views it does and I don’t know if it’s all 100% authentic but nonetheless people are seeing it there’s there’s a lot more opportunity for the average person or or to growth act let’s call it tick tock then there is Instagram today in my opinion I think you can get a lot more impressions on tick tock for free and I see them doing some paid stuff and the great thing about their paid stuff which I don’t think we’ve gone into yet but they’re paid stuff looks very it looks like a regular post so yeah you have to almost double take and it’s there it says if you have to double taking oh that’s an ad so they do a great job their ad units is what we call them or her you know really gray but we are doing some stuff on Twitch but that’s not that’s I don’t think we’re actually paying like twitch commercials as much as we’re working with individuals on Twitch kind of yeah does any marketing channel represent more than like 25 percent of your marketing spent like its Facebook more than 25 percent are influencers I think Facebook still the majority uh still the majority yeah but just I feel like it’s pretty common for most e-commerce friends but yeah I mean Facebook is just like so good at what they do yeah we can create demand yeah and the better the better that you do at Facebook the better that you are at Facebook the the you know you get more learnings from like what creatives working what ad units working your certain audiences so just I mean you ran it yourself right for so long as well so it’s just I think it’s it’s yeah it’s the the scary thing is when you get too deep in it and and Facebook starts dictating you know your your business a little bit based off of like what’s selling on Facebook too much and you become reliant on oh well this ads working for this specific you know watch or the specific you know sense of deodorant and yeah it’s not necessarily working so it’s a balance of like is it the ad is it so there’s there’s there’s a I don’t know it’s it’s it’s still relatively new you know comparison the TV or anything else so yeah yeah I mean it’s both native it’s both our greatest strengths and our greatest weakness like we were great at it it was minting us a ton of money and it was scary as hell because what does this change what he longed to do categories are they gonna go as well as deodorant in yeah he’s really terrifying are you guys more male or female focus I have to imagine male we launched it a few years female I think maybe 2016 show so about four years now but it’s it’s actually closer it’s actually closer to 5050 now I think in terms of product if I’m not mistaken we have a look we have a lot of female buyers who buy for you know whether it’s you know boyfriends or whatever that you know the case may be so it’s yeah watches and it watches even sunglasses or can be you know great gifting items so we do get a lot of gifting I don’t know I don’t know if I don’t have deodorant as much a gifting it’s actually more than like q4 is our slowest quarter yeah like you know we are able to say hey this pack of like you know healthy freedom products yeah it works I mean it’s not as good as surprisingly okay and or watch it’s still the majority of your business right now I would have to imagine sunglass watches are still majority sunglasses law I’m just kind of secondary so sunglasses and if you if you combine sunglasses never scrolls they’re definitely you know a growing kind of segment of the business but watches are still the majority okay let’s fast-forward to 2018 you’re now talking to Movado what is the firt like is the first conversation with Movado face-to-face is it like it’s like email is it like when the first time you’ve met them face to face is in LA or wherever they are I have no idea time we met them and I think they came to us I want to say we I think they came to us we we had met with them or no we had talked to them we had a kind of a mutual contact we had talked to the CEO you know years before just more so just you know again I think you just want to if there if there’s a way to work together one day partner if there’s a way that you know just just keep the dialogue open like you know here’s what here’s who we are and what we’re doing and then we ended up kind of getting in contact when we were you know contemplating it do we raise or yeah you know what’s what’s the case and maybe there’s an opportunity to work together or partner and they were interesting interested in acquiring us and and then it was like well okay is that the right thing for us movement the company the employees and and then as we you know went further we’re just like this makes so much sense they have you know infrastructure that again complements like what we do today what we where we want to go in the future they have experience in you know obviously manufacturing and other categories so I think they came out to us if I’m not mistaken either they came up to us or we went to them because I think it was it was supposed to you know we needed to make sure that people didn’t see us you know meeting their employees or our employees so so they definitely didn’t just come in the office out the gate if I imagine correctly I think it was it was like initial kind of meaning somewhere off-site and then I can’t remember where it was a little bit there in New Jersey yes there in New Jersey and then they have an office in New York as well how often they evolve they have offices all over the world actually and I believe in Switzerland as well and well before all of this I was probably was out there too often maybe like three or four times a year which wasn’t which wasn’t too bad and then that we make a trip like last year I went to Dubai for a big conference in Switzerland for a big conference so yeah it wasn’t it wasn’t all that it wasn’t too much but definitely yeah I had never been New Jersey beforehand so this was you know four times in year after it was and the vibes a little I now have my favorite hotel restaurant you know oh here’s this uber driver that I recognize again process you know can you tell me a little bit about you know what is going on through your head as well like you know when you’re when you haven’t raised any money but you know and you’re you in credit card debt when you started a business by the end is the number that you sold for public were not public the number we sold for it was public so it’s can you imagine can you talk about that Network yes it was a hundred million dollars and then there was one million dollars and then there was like an earn a component but for us the process took about like 75 days I believe from like initial kind of conversation so what went fast because yeah again we were contemplating well do we raise money what do we do and yeah and this was you know we I mean everyone wanted to move fast so it was like a 75 day process of from initial I think phone call to you know you you know hired you know banks to kind of help you with the process and then you meet you know these parties meet and then there’s due diligence kind of that they go through on your end and and then it’s just kind of figuring out you know any questions that have essentially because they need to be comfortable with you know the business and questions as well so and were you comfortable I’m sorry do you think that the relationship that you had had for a few years these guys was helpful for us I never had a relationship with P&G or almost nearly any of the guys who were talking to us until we were selling the business was your relationship with Movado you know that was built up over time important to that or do you think it would have happened anyway I think it was important we didn’t have we didn’t have it’s not like I hadn’t you know met or talked to them much so it was like you know it was just an introduction that kept us top of mind it’s a more superficial relationship yeah yeah yeah and I’d say that you know I’d say that I would recommend for entrepreneurs if they have if they know who like a strategic is that they think that you know they could get acquired by and complement that business and help that business and vice versa I think it’s worth you know figuring out a way to get in touch with that person and you know you know you obviously you’re always scared cuz it’s competition like they could acquire you or they could you know they’re all these companies are big enough to go and start their own version of it right so you you want to you know you want to just have a conversation it’s like you kind of you know dance around a little bit and be you know you want to create an authentic relationship without sharing too much of the business but sure you know he was he was always that you know again he was a great you know the conversation we had with him was really great it was just you know an introduction time who we were what her story was dropped you know kind of what we’re doing now it was really just interested in who we are what we were doing and wasn’t trying to like you know get information or anything that was just a very and we had conversations with different people over the years and I actually have friends again who are in certain businesses who make it a point to be really friendly with like Sur and they send them product unsolicited with a note right like and they in it and it could you know I think I think I mean we’re all humans right I think if you get for some people who are really trying to reverse engineer that exit like I think yeah if you have a relationship with someone who is in the driver’s seat of making that decision and they’re familiar with your business it’s going to get them more excited about the business so versus just having no clue and then one day getting a call saying hey this is my business like it’s at that point it’s probably too late so I do think it’s probably a good idea that you know yeah it’s sometimes it works out yeah yeah absolutely and like this personal relationships are so important I remember like you know getting along with somebody who you might work for or work with it’s so I remember when you’re trying sell native there was a guy that we were chatting with and he’s like I can tell you’re not serious about selling native online how could you pop loose that we’re doing tens of millions of dollars in revenue millions of dollars in Ubud ah he’s like because you don’t own native come and I was just like I don’t know I was just like you don’t know what you’re talking about and this is like the CEO of that company and we’re sitting around like a dinner table probably 10 people and 15 people his senior executives are my bankers and I’m like you don’t know what you’re talking about it’s like there’s just silence in the room yeah I was just like you have no idea what the [ ] you’re doing with e-commerce silence and just like and like afterwards our banker the bankers and I would sort of just walking around San Francisco he’s like that was the banker was like that was a really awkward conversation and I was like yeah I don’t know what else to say this guy doesn’t know what the [ ] he’s talking about when it comes to e-commerce he’s totally he has no business in cars he’s trying to tell me about my injury I’m not trying to tell about his but I know what he’s wrong and it gets me really excited afterwards I love like afterwards he takes me out like you know he and I go to dinner one-on-one and he’s actually great and like he and I grew up watching like infomercials feather and that’s how we got good at marketing and I remember like talking about like the rotisserie chicken and like the Ron Popeil mystery chicken I love it I love the guy and I remember him saying he’s like look there are probably three people I would trust to take up my business and you’re one of them boys and I was like you know it sounds like you guys don’t get along good in reality and sort of appreciate what it takes to be a good owner and I really enjoyed them but in like those personal relationships and who you’re gonna work with are so important I especially post-acquisition right like that the day you signed the docs it’s great but like you’re gonna have to work with this guy you’re still at movement watches for you of you know it’s been a year and a half since you’ve got to go along with that person stuff no absolutely they get on that so you saw the business you know all this money you go from in 2013 be a you know using your Chase Freedom Card to now having you know what he’s like you know what do you do with the first thing you buy what do you do with all this money I think that was it it takes time to like settle in and I think for me at least like trying to figure out like what what you’re supposed to feel when you you know sell your company you know it’s obviously bittersweet because that means it’s not yours anymore and and you know like you’re waiting for this day to have you know kind of have the financial you know freedom so to speak that you want and but you’re not gonna go immediately and buy out like it’s not like you have a house lined up to buy tomorrow and even if you buy a house tomorrow like it takes another few months to like get settled in and like I’m 28 years old so like you know I live by myself so it’s like what do I do I really want to go buy a house so it’s it’s and it’s figuring out just like what life’s like and and and taking a breath and not going in and trying to invest in a bunch of startups right away so for me it was like you know I think eventually that my biggest purchase was you know a condo that I mean it’s a 1500 square foot condo so it’s it’s great for just me right now especially in quarantine but I did that but yeah it’s like you know and then it for me it’s it’s like you know helping my family out and it’s figuring out you know how I’m gonna you know invest you know the right way and and and so forth but I think the biggest balance is just like for me at least and I mention this a little bit before we started recording was just kind of like you know ultimately it’s like what makes me happy was like what I was always in kind of searched for and like building a business having a financial a big financial outcome was like always something that I thought was something that was gonna make me happy and and doing and I think it’s a component of it I don’t I think if you’re on if you’re unhappy in your life before and you sell your company it probably is gonna just magnify those issues even more versus like I think I was like in a pretty good spot but this is giving me like I can’t really be complaining about you know my financial situation so it’s just figuring out like what do I live for outside of just work and and money like what are my hobbies or what what makes what what makes me happy and I think fortunately that can be my focus right a large piece of my focus which I’m super fortunate about but it’s it’s I think it’s taken a couple years to like and I’m still working on but it’s taking a couple years to really figure out things that make me happy and like keep my my brain kind of you know I’m stimulated etc what are some of those things the one I mean the number-one thing and I think has to come out of just like working out for me I think that like if I work out and eat whether it’s cardio anything if I get a good sweat in and I instantly feel better that day like whatever I eat later I could eat like [ ] later that day whatever it is at least I got that workout in and like yeah you know and was moving and you just it just you feel better about yourself it’s it’s known to give you you know you’re sure you’re you know endorphins etc so I think that’s a big one meditating has been big you know even if it’s ten minutes a day or even a couple times a week that’s been great you know I think those have been people I think relationships I really realized like okay like you know you you have this financial outcome but like and it doesn’t need to be just like love relationships but just friends and general it’s like one of my favorite things is like going on a trip with with buddies or doing stings for you know my family whatever it is and it’s like those are things that make me happy so you know I’m on a road to still figure out I think my biggest thing in life to be honest is just to figure out it’s a pursuit of happiness what is it that you could be happy with 100 K or 50 K you’re like I think that’s great that’s fine it’s just figuring out what is it that makes you happy and I think everyone’s kind of in the race to you know make money because you need it to survive and and once you have your I think you’re kind of the your life you know your regular finances you’re kind of you know necessary finances in place I think it’s then figuring out you know the things that make me happy I’m talking about working out right like working out anyone can do and sure and you know everything else I’m talking about there are things that people can do so it’s just I’m just I’m fortunate that I’m able to take a step back and really kind of focus on it though yeah we met a few times in person certainly I think every time we get brunch in LA I’m always like amazed at how you know self-conscious you are about that happiness for me I was always like okay great being being wealthy is gonna make me happy no it absolutely doesn’t you’re absolutely right and like I would you know everyone says being rich doesn’t make you happy and I feel like no one told me as I didn’t believe it yeah you’re right it’s all about like what’s inside of you but you happy not necessarily like it’s just yeah and it makes it easier don’t get me wrong like if you it like if you want to go take a trip or buy something but like I think I realized that like having a big TV or having a nice you know MacBook or iPad doesn’t those things don’t don’t those don’t make my happiness levels for the moment I open it I get this joy and then it’s instantly gone pretty much after that but like experiences experiences are like number one yeah I think I think health mental health you know your body keeping those like at an all-time high and then experiences that ultimately like yeah like you know if I just try and look back on my life if I died tomorrow like if I look back on my life like what would I be upset I didn’t experience or do or experience with certain people right like I have so many I think I’m also excited the fact that like just going through the journey a movement like these people I’ve done it with like you know especially early on like I have great relationships with those people I’m like and I want to make sure that like as people leave or like you know as the company changes that like keep I still maintain those relationships with those people and that’s super important to me as well so yeah yeah the the people that I worked with the native or like my best friends yeah and you’re right it’s certainly a life is a lot easier but it is crazy where you’re like man I really want this thing you end up making a purchasing decision to get it or you get invited to this thing that you’ve always wanted to get invited to it you never wear and get invited to and you’re just like oh this is not gonna make me happy and you’re just like [ ] I got ya and it’s hard to also like mentally like you know I buy something and I’m like yeah you’re right moment of joy would you buy it then all of that is gone instantly and you’re like okay here’s this other thing you know but you have to be like you know what I think this thing is gonna bring me two seconds of joy I wasn’t worth it I thought with Justin Khan on Twitter he’s he’s [ ] like you know everything he says I’m just like I want to be like this guy he has a ton he has a ton of money and he’s like I’m trying not to buy anything cuz i buy this $10,000 I’m just like afterwards I’m not happy about it again that’s like crazy that that’s so true yeah and it happens to everybody yep I did it for the first time I bought like a really like I bought some off-white is what I did that was my let me get let me just see I had to do it because it and I and I swear to God I haven’t learned it once it’s still in my closet not even because of the krona just because I was like waiting for the right time and now it’s I’m just like okay I’ll never do that again so yeah it seems once you have them you’re just like I have no idea why yeah yeah you know you’re like an investor an advisor at least for a bunch of direct-to-consumer businesses I know like Skyler I think is one of them that’s go and I are both in yeah yeah yeah what do you think happens to direct your consumer you know Casper happened you know this darling of the direct consumer of this that sort of didn’t go anywhere our voices had to do a recap you know brand ‘less went out of business Cove it happened we work happen all of a sudden people are focusing on profitability in the next five years of direct consumer are people building more natives and movements or movements in a where are people still going to the you know vc-backed outcome or are they just built like you know what happens in the next five years I think for GBC businesses I think it’s it’s gonna be a more friends and family like you mean you may need more capital than a credit card you know to get it going but I think people are gonna be you know how more you know relatively bootstrapped or you know profitable kind of conscious businesses and I think it’s still very possible and honestly mostly companies that I invest in are either they’re either profitable or like very very very close to it and the only reason they’re not is because they’re growing so you know aggressively etc that it that it makes sense they’re kind of on that that fence but but yeah I think I think again I think there will be some interesting potential businesses that come out of Co bid that aren’t necessarily due to see or may need that may need capital to grow and maybe still you know chasing a big you know exhibit but I think in terms of like the direct to consumer brands I think it’s I just from what I’ve seen the ones that are the healthiest and an able to I mean this is a good example this is the most radical thing that’s ever happened right and I think pretty much our lifetime or parents lifetime and their parents but in terms of like who can you know weather the storm right now are people who you know I think it’s people who have good businesses that are profitable and can stay afloat and and if they need to be more leaning they can be more lean but if you already if you already raised at a certain multiple like the difference between getting back to that environment you know could take years to get back versus a bootstrapped profitable company who maybe it adds another unit have two years to kind of your exit or wherever you want to whatever you wanted to get to but at least you can you control your business you maintain things like you stay lean and it just adds a little bit you know longer to kind of you know your timeline which i think is fine and it’s not the end of the world by any means yeah couldn’t agree more with all that all right really check really appreciate your time you know you said one of the things that brings you happiness is relationships I feel like the first time you and I met was I forgot we’re in Santa Monica you and I were running through one of a few bootstrap is mister or like you were running one of those and I was trying to become and I always admired that and like you know inspiration from the way you built movement and like every time you and I I remember unite connect was in all of the business that you were building it was in all the way you were thinking about it I remember when you’re thinking about selling your business you’re like I’m gonna go and like I haven’t told my parents I’m gonna tell my parents super excited I’m gonna have this financial safety because of me and I was in awe of not only the way you were thinking about about how humble were this relationship there’s one that brings me a ton of happiness and I love connecting with you every time we do I feel like you know you and I are kindred spirits that want to build profitable businesses if that are willing to do that that are like you know independently that like are independent minded and sort of ignore the Silicon Valley ecosystem a ton of money and you know I’ve had great outcomes and we’re both like happiness and like I’ve realized now that certainly doesn’t come from financial success and I’m trying to figure out you realize what it is tell me Oh Cheryl sherry good I could have said it I could have said a better more yeah please couldn’t have said it better man I appreciate it it’s always been a joy to - you know hang out and to talk with you I get insight from you all the time as well so I totally appreciate it and thank you so much for having me on this podcast I haven’t done a podcast you know in a while that I can remember so I was excited about this one so and wish you the best of luck with it