This guy sold his company to Unilever for $1.2B after just 3 years

SPEAKER_01

Zero to over a billion dollars in 32 months. It's maniacal.

SPEAKER_00

We're quite literally just getting started.

SPEAKER_02

Where do you think is that gap to really jump from average or good to great?

SPEAKER_00

If you want to have the greatest odds of success, it's by creating a new format. New formats win.

SPEAKER_02

You obviously spotted one really great opportunity. I'm curious what other opportunities you spot.

SPEAKER_00

I think there's an idea that no one else is going to be able to run at. There's a $10 billion business idea.

SPEAKER_01

You should just say it now and we'll bleep it out.

SPEAKER_00

We'll talk about that. I think that's the biggest opportunity for founders.

SPEAKER_01

What are the inputs necessary to get to $100 million in revenue for an e-com brand in three years?

SPEAKER_00

Here's what I'll say.

SPEAKER_02

So here's three things I'd love for you to deliver. One, I want to know the origin story. How the hell did you have the idea? And why did you have the confidence in the idea? We're going to go there. Two is you sent us a thing about your marketing funnel. What does world-class marketing look like in this scenario? And then the last part, I want to riff with you, brainstorm on where to from here. You obviously spotted one really great opportunity. I'm curious what other opportunities you spot. Yeah, let's do it. Okay, sweet. Dude, I've been taking Grooms for, I don't know, six to 12 months now because it's basically eating candy.

SPEAKER_02

It's like you open up a pack of gummy bears and then you eat them.

SPEAKER_01

And then you're like, I just had vegetables.

SPEAKER_02

Totally. I hate to be very honest, but I think I just had vegetables maybe.

SPEAKER_01

Totally.

SPEAKER_02

And so I want to know where were you sitting when you were like, you know what, what if we did this?

SPEAKER_00

Yeah. So I like to describe myself as an entrepreneur who had short stints in private equity and investment banking. I've started three companies. This is my third company. And I actually didn't want to start a company. I was on my way from Boston at a private equity firm called Summit Partners and was leaving that investment firm to go get my MBA at Stanford. And I told myself, look, I just want to have a normal MBA experience for two years. I'm not going to start anything. Maybe I'll do an internship in the summer. And then it was two weeks before going out to Stanford.

SPEAKER_00

I was at my parents' place in Utah and just doing some work and I'm drinking a greens powder in my dad's office. And I just remember looking up super vividly in the corner of the room and being, there's no way I'm keeping this habit past 30 days. I'll do it because I always finish what I started. But I'm not going to stick to this habit post 30 days. And it wasn't just the taste. For me, it was you got that weird frothy sediment at the bottom of the drink. And the biggest thing for me that I think this is probably unique is I remember staring at the bottle sitting on the countertop on the drying rack. And I remember being, and I'm an OCD person.

SPEAKER_00

I remember just being, if I commit to this habit, I've got to stare at that bottle on the countertop for the rest of my life. Right? There's just no way that's going to happen. And so that got me thinking about, hey, how do I take a comprehensive supplement nutrition and put it in some format? I didn't know it'd be gummy at the time when I had the idea. How do I put it in some format that gets people looking forward to it? Like they'll go to bed at night being, I can't wait to have that the next day, which is a complete pivot, I think, to how people think about supplementation.

SPEAKER_01

Can we roll it into a blunt now?

SPEAKER_00

Yeah, exactly. Look, hey, we'll— Smoke your greens. We'll talk about that. And I think, I honestly think that's the biggest opportunity for founders. People just want to rip on the formats that work. But I think if you want to have the greatest odds of success, it's by creating a new format. Right? So if it's a blunt, awesome. If it's these little Zen pouches that people are doing now and making those focus so it's non-nicotine, great. New formats win.

SPEAKER_01

Did you think that, I mean, it's maniacal. 32 months to a billion dollar exit is maniacal. Did you call your shot and you're like, that's where we're going to go? Or were you like, who knows? Where was your mindset when you started it?

SPEAKER_00

This is a bit shocking to hear, but we've basically met the forecast that we put in place since the very beginning. You have to appreciate, I talked with thousands of entrepreneurs when I was at Summit Partners. I looked at the proprietary data sets. I don't have them obviously anymore, but I have a very visual memory. So I know the LTV, the CACs of hundreds of brands. And for me, it's weird. I could tell you I won't, but I could tell you what every big brand's LTV, the CAC and margin looks like. All the brands that we know of today.

SPEAKER_02

I didn't really forecast beyond a hundred million of revenue because that would be pretty pointless. I'm not a sociopath. There's a fine line between ambition and being absolutely batshit. So you're sitting there now. I want to ask you something about in between when you're like, oh, I don't really enjoy this form factor. What if there was another? And you said you didn't have gummies right away as a, it's not like you immediately had the fully baked idea. But I'm curious, what were the companies or products you admired? Because I sort of have this thing, which is what you admire becomes a little bit of your destiny, right? Your admiration becomes your destination.

SPEAKER_02

And if you think about a lot of great entrepreneurs, Steve Jobs famously, who did he admire? What products did he admire? And then you steal little elements of that. They sort of bleed out into your final products years later. Same thing with comedians and movie makers. And you said you didn't have gummies right away as a fully baked idea. But I'm curious, what were the either companies or products you had admired?

SPEAKER_00

[SPEAKER_02] Because I have this thing, which is what you admire becomes a little bit of your destiny, right? Your admiration becomes your destination. [SPEAKER_02] And if you think about a lot of great entrepreneurs, Steve Jobs famously, who did he admire? What products did he admire? And then you steal little elements of that. They sort of bleed out into your final products years later. Same thing with comedians and movie makers. [SPEAKER_02] What were the products and companies that you thought were kick-ass that you feel like inspired some of the result of Grooms?

SPEAKER_01

[SPEAKER_00] Yeah, look, I sat on the board or observed the boards of great brands like Ruggable, Dr. Squatch, Brooklyn Inn, Chubbies, Solo Stove, Thuma, 12 different businesses. And so I learned a lot from the unique problems and frankly, the recipes that worked for each of them.

SPEAKER_00

I would say that the brand that I think we most closely resemble in terms of execution is Dr. Squatch. [SPEAKER_01] Is that deodorant?

SPEAKER_02

[SPEAKER_00] It's the cold process soaps. So the bar soaps for men.

SPEAKER_00

[SPEAKER_02] I've seen the marketing, but I think I have the deodorant, but I don't know what's so special about it? Is there something cool about it? So what's cool about it is they just sold to Unilever last year for 1.5 billion. And that business, what's cool about it is cold process soap is more natural. So you're not getting all the chemicals and it's a very clean product, but because of the branding, the approach, the partnerships they do. I mean, they've done partnerships with Harry Potter, Star Wars, SpongeBob, all sorts of really cool, fun partnerships. They've taken an approach where you as a consumer relate to the brand. Right.

SPEAKER_00

And so prior to Dr. Squatch, I don't even know what I was using. I was probably using whatever my wife was buying and stocking in the shower. But they were the inspiration for us.

SPEAKER_00

I think that what they've done within the personal care space, making it a joy for the consumer is what we aspire to do with supplementation. Where, I mean, we all spend time on social media. You get one ad and it's like, oh my goodness, Sean, Sam, I don't know how old you guys are, but you're blank years old and you've never heard of creatine. What the hell are you doing with your life? Like you're going to die tomorrow and then you get a colostrum ad. What are you doing with your life? You need to be taking colostrum right now. It does a blank percent increase in blank body metric.

SPEAKER_00

And I just think that the way that we have approached and took inspiration from Dr. Squatch is to take that and make our supplementation a lifestyle, something that people look forward to. They feel like it resonates with who they are and how they live their lives. [SPEAKER_02] All right, let's take a quick break. This podcast is called My First Million, and it's probably the question we get asked the most. How do I go from zero to making my first million?

SPEAKER_00

[SPEAKER_02] And so I did an episode a while back where I broke down exactly the philosophy and frameworks that I would use. So things like finding your white belt business or identifying your bear on a unicycle advantage, the core way that your two skills can overlap, or why maybe starting a service business is better than starting a software business for your initial businesses to make that first million. [SPEAKER_02] And so the team at HubSpot has created a guide that took the stuff I said in that episode. They laid it all out for you. You can get it for free in the description below. Just click that link and it's all yours.

SPEAKER_00

[SPEAKER_02] All right, back to this episode. [SPEAKER_01] How much money did you raise to get to your first million in revenue and how fast did it come? Yeah, month one, we did like 30,000 of revenue. Month two is already like 230,000. So I guess we, a month into the business, we had already crossed the 1 million run rate, probably 2.5 to 3 million at that point.

SPEAKER_00

I've never really looked at the business that way. Maybe you've heard me talk about LTV to CAC. I would say we probably burned through like $8 million of capital until we reached profitability. That could have been less if we slowed down growth a little bit, but that's just the way it worked out. I think we burned through about $8 million of primary capital before we hit profitability. [SPEAKER_02] You mentioned focusing on LTV to CAC. For you, what's good and what's great?

SPEAKER_00

Yeah, I think table stakes for businesses that need to be acquired—you need to be at least three. The best I saw, I won't obviously disclose where we're at, but during the COVID era, I would see brands in the four to five range. Those brands are probably two and a half to three times right now. [SPEAKER_01] But when you say LTV, are you referring to—so LTV, lifetime value—is for an e-com brand, does value mean your contribution margin?

SPEAKER_00

Yeah, let me describe that the way that I always look at it. I use a three-year period. So 36 months. And LTV is fully burdened gross profit, meaning Sam orders our product. What are the total costs stripped out of that value to get it to Sam's door? So you've got product COGS, you've got discounts, returns, you've got fulfillment, shipping, merchant processing fees. You've got all of that that gets it to the door. That's your lifetime value over a three-year period. How much contribution gross profit are you getting from the consumer over a three-year period?

SPEAKER_00

[SPEAKER_01] And you use three years, not because that's how long someone subscribes to Grooms. You just said three years for everyone should use three years. Because you can't do a lifetime value.

SPEAKER_02

[SPEAKER_00] Yeah, I think it's a productive way of looking at it to optimize against. I mean, we obviously look at three months, six months, 12 months, and try to make adjustments based on that. [SPEAKER_00] But yeah, I mean, we've got consumers who are 32 months old. So we haven't hit that 36-month mark. But there's very clearly going to be consumers who are around purchasing into, I guess, quote— [SPEAKER_01] You just said three years for everyone should use three years. [SPEAKER_01] Because you can't do a lifetime value. [SPEAKER_00] Yeah, I think it's just a productive way of looking at it to optimize against.

SPEAKER_02

[SPEAKER_00] We obviously look at three months, six months, 12 months, and try to make adjustments based on that. [SPEAKER_00] But yeah, we've got consumers who are 32 months old. [SPEAKER_00] So we haven't hit that 36-month mark. [SPEAKER_00] But there's very clearly going to be consumers who are around purchasing into, I guess, quote, perpetuity. And you picked a name that if you had told me, I would have been like, hey, brother, do you want to win? Or are you going to put a umlaut over one of the letters and nobody knows how to say it? And then you won. So I'm an idiot. [SPEAKER_00] What gives?

SPEAKER_01

[SPEAKER_00] So what I always say here is, and Sam botched Grunz at the start, he said Grunz, which is totally fine.

SPEAKER_00

What I tell people is I do not care how you pronounce our name as long as you're buying. So you can call it Grunz if you want. You can call it Grunz, which is correct. [SPEAKER_02] It's Grunz. [SPEAKER_02] But did you think it was a good name and you knew something none of us do? [SPEAKER_02] Or did you just not care about the name? [SPEAKER_02] And how the hell did you arrive at that name? Yeah. So the word Grunz with an S, I can show you here.

SPEAKER_02

[SPEAKER_00] With an S at the end actually doesn't mean anything in the German language. [SPEAKER_01] It may not make sense in America, but that's that.

SPEAKER_00

[SPEAKER_02] I definitely sense it. I am fluent in German. And so when I had the thought. Pretty sick assignment.

SPEAKER_01

[SPEAKER_00] Yeah, totally. [SPEAKER_00] It's literally called the Alpine German speaking mission.

SPEAKER_00

Yeah. [SPEAKER_01] Someone else could have been assigned to Reading, California or. [SPEAKER_01] Yeah, totally. That wouldn't be too bad. That wouldn't be too bad. There's worse. [SPEAKER_02] All right. [SPEAKER_02] So you have the ideas. [SPEAKER_02] How long did it take you to go from idea in your head to I know what the product is going to be and I have my first batch and then I go for sale. [SPEAKER_02] What was that timeline?

SPEAKER_01

[SPEAKER_00] Yeah. [SPEAKER_00] So coming up with gummies took about a day. [SPEAKER_00] I grew up.

SPEAKER_00

Those big single day servings of sour patch watermelon slices. Yeah. Yeah. I would eat those gummies. One of those every day in college, a full 450 calories every day. I've always been a gummy fiend. And so now I get to have a productive health gummy every single day. And there's a ton of them that we sell.

SPEAKER_02

[SPEAKER_00] I have a ton of ideas always circulating in my head and this notion doc I have. [SPEAKER_00] And typically I sit on those ideas for about a year. [SPEAKER_00] This one, I was, it's so obvious. [SPEAKER_00] I got to do this. [SPEAKER_00] I'm the right person to do it.

SPEAKER_00

And so I started working on it immediately, getting it to launch. Now to answer the question there, I immediately, within a week of having the gummy connection said, okay, why hasn't somebody done this in gummy form, right? You've got a ton of gummies. Why hasn't somebody put comprehensive nutrition in a gummy? And the big aha moment for me was the entire gummy industry is built around these 60 or 30 count bottles, transparent bottles with a cap on the top. That is as gummy exists. So I asked the question, what would need to change?

SPEAKER_02

[SPEAKER_00] What would it need to look like to have gummy be comprehensive nutrition? [SPEAKER_00] And then that's when I went down the path of, okay, if it's a pack, how big's the pack? [SPEAKER_00] How many gummies are in it? [SPEAKER_00] What's the flavor of the gummy?

SPEAKER_00

Right. What's the total advantage? [SPEAKER_02] This is important. [SPEAKER_02] Sam, you've never taken the product, right?

SPEAKER_01

No, I'm going to buy it now though.

SPEAKER_02

So the way it works is, this is a good point you just brought up, which is you don't, when we say it's a gummy, you think it's a gummy.

SPEAKER_00

[SPEAKER_02] No, a single serving, you eat eight of these things. [SPEAKER_02] So it's literally having a pack of Sour Patch Kids, which seems fine, whatever. [SPEAKER_02] But that's actually pretty non-obvious. [SPEAKER_02] And if I'm reading between the lines of, or if I'm understanding what you're saying, you're saying one of the reasons nobody had done the comprehensive gummy was because the gummy would need to be four inches large to contain everything. [SPEAKER_02] But what if we made it, what if we made it where it's not a gummy a day, it's a pack of eight. [SPEAKER_02] We package them as little pouches of eight.

SPEAKER_00

[SPEAKER_02] And that's how we can do this when other people may not have tried to do this.

SPEAKER_01

[SPEAKER_00] Yeah. [SPEAKER_00] Yeah. [SPEAKER_00] Our packs are about eight.

SPEAKER_00

We go off of gram weight, which is about 20 grams. And some grams are smaller or bigger than others. But yeah, I'd say it's a full, every gummy is identical in terms of nutrition.

SPEAKER_02

[SPEAKER_00] The total of the eight in this case make up the full desk. [SPEAKER_01] I just think that it's insane that I asked you a question that I thought was going to be ridiculous about you pointing like Babe Ruth and saying, you know, we're going to get to this. [SPEAKER_01] And you're, yes, that was part of the plan. [SPEAKER_01] I mean, it's pretty audacious to say, I'm going to get to a hundred million in revenue in less than three years for the people listening. [SPEAKER_01] What are the inputs necessary to get to a hundred million in revenue for an econ brand in three.

SPEAKER_00

It's the total of the eight in this case that make up the full desk. [SPEAKER_01] I just think that it's insane that I asked you a question that I thought was going to be ridiculous about you pointing at Babe Ruth and saying we're going to get to this. And you're like, yes, that was part of the plan. It's pretty audacious to say, I'm going to get to a hundred million in revenue in less than three years for the people listening. What are the inputs necessary to get to a hundred million in revenue for an econ brand in three years?

SPEAKER_00

So it doesn't have to be consumables. I think everybody points at consumables these days and they're like, ah, supplements. It's a better business. It's not necessarily a better business because if you're selling a hard good, like bed sheets or furniture, your margins are going to be worse. It's going to be more difficult to ship. There's a lot of things in there, but you theoretically make money on day one and supplements you don't. You got to make that money on the retention. So that's a new lever you got to pull to make the business work. So to answer it directly, Sam, I think first and foremost, you've got to have a good product and good product. It doesn't mean making a better version of Gruen's like that's not going to work for people. What's going to work is finding that product category, that white space. Good product equals new white space. So you've seen these nicotine pouches, the whip and ultras of the world. I would not encourage.

SPEAKER_00

[SPEAKER_01] And energy. [SPEAKER_01] It basically looks like a Zen, but it's not tobacco or nicotine. It's energy.

SPEAKER_00

Yeah. It's caffeine and other things. They like the nicotine pouches. Amazing. Not because I'm a believer in the product, but amazing because now you're taking a new format, a form factor that doesn't have competitors. And so I think anybody looking at it and being like, oh, I'm going to do it too. You might find a little bit of success, but you're not going to sell your business. You're not going to be the winner here. Go find a new product format. Symbiotica. I came out with these little liposomels. Who else have I seen that's created new? Oh, you've got the product dose. It's the liver health product. It's these little shot glasses. It's a concentrated liquid. That's another one. I wouldn't encourage people.

SPEAKER_00

[SPEAKER_01] Wait, a concentrated liquid of what? Liver? Their supplement is a concentrated liquid for the liver. So look up, I think it's dailydose.co is the website. That's another product that has a unique format. Another one for you. You guys know Mary Ruth Organics or Rho Nutrition RHO? [SPEAKER_01] Uh-huh. So those are like, I'm not sure if they're liposomal, but they're liquid vitamins. Right? Their approaches were the liquid vitamins. I'm shocked there's not more competition doing that. These are big businesses. Every single one of the ones I just mentioned is a big business doing really well.

SPEAKER_00

[SPEAKER_01] So the framework of this is taking a thing that everyone knows or many people know and just slightly changing the form, the way you consume. But everything that you've named so far has been a consumable.

SPEAKER_00

Correct. Because that's the space that I'm most familiar with and people typically are looking at right now. But it would be the same thing. Do you know how big Cozy Earth is? Their whole thing was bamboo sheets. Right? And I don't, if you ask me, I'm sure other businesses sell bamboo sheets, but that's their thing and they're a big business as well. And so I could give you examples across all sorts of categories. Obviously supplementation is the easiest for people to visualize.

SPEAKER_00

[SPEAKER_02] Wow. So step one you're saying is good product, but let's say that less generically, what you're saying is the right product and the right product is a category that's not already super saturated. And you either take an existing category, you change the form factor to make it new, or you find a new pain point, new problem, new supplement, whatever, and you're going to do it. You need some point of key differentiation. Yeah. [SPEAKER_02] Your vitamins, but your liquid, your sheets, but your bamboo. Your greens, but your gummies. And you find that key point of differentiation, which gives you new category. All right. That's step one.

SPEAKER_00

Exactly. The machine. And to be clear, a couple that I've just seen recently, and then I'll tell you the step two, I've seen jelly beans as a form factor. I've seen lollipops, right? People are doing it. Do I think that those businesses are going to be huge? Probably not. It's a little bit niche, but they're probably going to be more successful than somebody making a gummy like us. [SPEAKER_02] Hey, stupid question. You started this by saying Sour Patch Kids. Yeah. How come none of the gummies are sour? Why doesn't anybody be like, it's sour vitamins? I would eat that. TVD. I would eat that.

SPEAKER_00

[SPEAKER_01] And this might be the category, or maybe I'm just hungry. Wait, you actually said something interesting. You said it's too niche. Is there a, what's your, to getting to a hundred million in revenue? Is there a, so you said, take the form factor. And then the second, or I don't know if it's the second thing, but there is a TAM related thing here. Is there a threshold where you're like, this has legs? [SPEAKER_02] I would eat that. TVD. I would eat that. [SPEAKER_01] And this might be the category, or maybe I'm just hungry. [SPEAKER_01] Wait, you actually said something interesting. [SPEAKER_01] You said it's too niche.

SPEAKER_00

[SPEAKER_01] Is there a, what's your, to getting to a hundred million in revenue? [SPEAKER_01] Is there, okay. [SPEAKER_01] So you said, take the form factor. [SPEAKER_01] And then the second, or I don't know if it's the second thing, but there is a TAM related thing here. [SPEAKER_01] Is there a threshold where you're like, this has legs? Look, I'm a bit psycho, right? All I've seen around me is businesses getting to hundreds of millions of revenue quickly. So my gauge for success is in the business I started, the first business I started, I literally sunset six months in, it was at a hundred thousand of revenue and 90% EBITDA margins.

SPEAKER_00

And I sunset it because I said, this isn't big enough.

SPEAKER_02

[SPEAKER_00] But that's how I'm wired, right? [SPEAKER_00] If somebody wanted to get to a $5 million cashflow business and run that, that's massive success.

SPEAKER_01

[SPEAKER_00] So I'm not going to deter people from that.

SPEAKER_02

[SPEAKER_00] But I want to know your threshold. [SPEAKER_00] Yeah. [SPEAKER_00] My threshold. [SPEAKER_00] Well, my sights are even bigger now, right? [SPEAKER_00] I'm still working on Grooms and new tribes and juiced and these products you see behind me. [SPEAKER_00] We have more than just Grooms now, happy to talk about that. [SPEAKER_00] But at this point I'm looking only at stuff that can be one $10 billion outcomes somewhere around there. So let's keep going in your formula. What's, did we do step two or not? [SPEAKER_00] Number two, and this is the end of it is LTV to CAC. [SPEAKER_00] So if your business has an LTV to CAC of three times plus you are golden.

SPEAKER_02

[SPEAKER_00] Anytime people talk about profitability, anytime people talk about MER, I'm not sure if you're familiar with that. [SPEAKER_00] It's marketing efficiency ratio.

SPEAKER_00

The way that you think about it is if you're spending 20% of your marketing or of your revenue on marketing, then the inverse of that is a five X MER, right? So one divided by 20%. [SPEAKER_02] All you're saying is I want a machine where I can buy a customer for a dollar. [SPEAKER_02] And I know that in 36 months, that customer will pay me back $3. [SPEAKER_02] And I'm going to dump as much dollars as I can into the front of that funnel as long as that's possible. [SPEAKER_02] And I'd say the key here is most people, I don't know, maybe I'm just wrong, but I think a lot of people think lifetime revenue, lifetime value as just revenue.

SPEAKER_00

[SPEAKER_02] And what you're saying importantly here is it's the fully loaded gross profit.

SPEAKER_01

[SPEAKER_02] So to get to three, you're probably actually doing $6 of revenue on that customer, close to a five, five to six to get three bucks of gross profit off that customer. [SPEAKER_00] That's correct, whatever your margin is, but yeah, that's correct. [SPEAKER_00] You've got to do, but if you hit that three times fully burdened gross profit LTV divided by your CAC and that equals three or more, you've got a business. How did you know that Grooms was going to be one to three?

SPEAKER_01

[SPEAKER_00] I didn't. I've seen enough to know how it might play out, but we came out with a CAC, everybody in our company since day one knew what our CAC ceiling was, that would result in a three times or greater LTV to CAC. Can you say what that number is or no? [SPEAKER_00] When I first started, I can't really tell you, but what I'll tell you is it's two X higher today than it was on day one of launching the business. [SPEAKER_00] Why?

SPEAKER_00

It's not because we magically got better LTV. It's because I set the CAC so low to ensure that we'd be able to hit it. [SPEAKER_01] So what does that mean then your ads need to be extra catchy in order to make extra catchy ads? [SPEAKER_01] You need a super good offer or a super good story or a super, what I mean? [SPEAKER_01] It's all of it. It's all of it. And that's where I think this gets so difficult is people are, sometimes I see the shadow figures that are running these drop shipping companies and they're like, Grooms ads are bad. They're not even good. They're so non-creative. And that's because we're a reputable company that doesn't say we can cure cancer.

SPEAKER_00

You can do these things that some of these shadow figures do. That's not creative. That's just actually bad to do as a human. But to answer your question, it's not just creating good ads. You've got to have the good offer. You've got to have the good retention. You've got to have a good product, right? You have to have a product that people actually want to take on. Our Amazon LTV to CAC is phenomenal. And that's on a platform where we're not advertising the way that you do on Meta. We're not, you don't have your subscription portal in a certain way.

SPEAKER_01

[SPEAKER_00] It's a one click cancel button. [SPEAKER_00] And that's leagues beyond what I've seen with other brands in terms of Amazon economics. [SPEAKER_02] D to C is one of these funny spaces.

SPEAKER_00

[SPEAKER_02] I think I DM'd you. I read our DM, Sean, from 2023, three months into the business, you're asking about the landing page. [SPEAKER_02] Yeah. [SPEAKER_02] So three months into the business, I think I just sent you a compliment. [SPEAKER_02] I was like, Hey, I think your landing page is really great. [SPEAKER_02] You know, I guess the interesting thing is you were really quiet, right? [SPEAKER_02] Because there's this weird paradox and I would call it the drop shippers paradox, which is the louder somebody tends to be about their e-commerce success.

SPEAKER_00

[SPEAKER_02] I proportionally increased my skepticism and I feel like you were very quiet and you built a killer business. Business, you're asking about the landing page. [SPEAKER_02] Yeah. [SPEAKER_02] So three months into the business, I was, I think I just sent you a compliment. [SPEAKER_02] I was like, Hey, I think your landing page is really great. [SPEAKER_02] I guess the interesting thing is you were really quiet, right?

SPEAKER_00

[SPEAKER_02] Because there's this weird paradox and I would call it the drop shippers paradox, which is the louder somebody tends to be about their e-commerce success, the more I proportionally increase my skepticism and I feel like you were very quiet and you built a killer business. [SPEAKER_02] And then now once you've reached a big exit and a mountain top, sure, you could talk a little bit more about it. [SPEAKER_02] You're doing a little bit more, spending a little more time. [SPEAKER_02] What do you think about that? [SPEAKER_02] What do you see when you look at the landscape of people who are quite vocal, quite loud on D to C Twitter and other places?

SPEAKER_00

You know, I want to have sympathy for how others run their businesses.

SPEAKER_01

[SPEAKER_00] And so what I will say is I've had chats with some of these people who are louder, who are running these businesses that they're little shadow businesses. [SPEAKER_00] Like you don't know what their business is, but it's doing a hundred million of revenue or whatever.

SPEAKER_00

And what I've come to realize is some of these people just don't know yet that what they're doing is inappropriate, right? That the ads they're running are inappropriate. They don't really understand the consequences. They're fist bumping their friends about the Lamborghini they just bought. And so what I would say there is I think it's less about how loud people are. I think it's about the natural evolution that we all go through as we learn what it means to be a reputable business person running a clean business. And that comes with time. I have to learn most of it through amazing brands with great executive teams that I learned from who are mentors and friends.

SPEAKER_00

And I think for some of these people they're learning and it's going to take a little bit of time. [SPEAKER_01] So from the outside, I look at you and I think, well, you seem really, I've only known you for 30 minutes. [SPEAKER_01] You seem very calm. [SPEAKER_01] You seem very well balanced.

SPEAKER_01

You seem like a lovely person. The success has been off the charts and I think, well, everything's perfect. Of course I, that's not the reality.

SPEAKER_00

[SPEAKER_01] So what has sucked about this journey? You know, it's funny, the team has this joke internally that I'm the chillest guy we know. And it's true. I am actually a pretty calm person and I think mistakes are all part of the learning. No business is perfect. A perfect business is one that learns quickly from the mistakes that it makes and people aren't to blame for that. What I'll say is, you know, I could give you an example of actually a really rough day we had on January 29th of 2024.

SPEAKER_00

And I can tell you a little bit about that, but I would say the hardest thing about building a business like this that folks just don't appreciate is how difficult it is to build a team of all-stars and more difficult than that, unleash them, give them the space to play and run and execute according to their abilities. And that's really been our unlock: one, getting amazing individuals. I think if you look at our executive team, if you look at our entire team, the 130 people plus of this company, I think people would be like, that is a stacked team. And they're not going anywhere.

SPEAKER_02

[SPEAKER_00] We're having a good time. [SPEAKER_00] We've got a lot ahead of us that we want to do. [SPEAKER_00] And the culture here allows for them to excel in a way that they wouldn't be able to do. [SPEAKER_01] Can you dive deeper on that? [SPEAKER_01] Because people always say hire the best people and all that. [SPEAKER_01] And I say that too. [SPEAKER_01] But I hate when I give that advice or when I receive it because I'm not trying to hire the worst people. [SPEAKER_01] I am trying. [SPEAKER_01] So what does the best people actually mean? [SPEAKER_01] What attributes do you look for? [SPEAKER_00] Yeah. [SPEAKER_00] You know, it's so funny about this, Sam.

SPEAKER_02

[SPEAKER_00] I've heard people be like, oh, well, somebody could be the best for your role. [SPEAKER_00] And I'm like, no, no, no. [SPEAKER_00] There's legit people who are the best.

SPEAKER_00

You're probably just not able to hire them if you're saying like, well, we got the best for this narrowly carved out role. So what I say is the best is what we're looking for: people who have confidence to make decisions, right? So everyone has the ability to be essentially a CEO. And frankly, I would not be surprised if we're talking five years from now and a lot of the folks here at Gruen have started companies that are really successful because they've had that skillset, that repetition of making decisions as if they're the CEO.

SPEAKER_00

And so I would say that it comes down to reps, experience, training in whatever function, if you're a marketing person or retention person, if you're a product person. And then the hardest part again, and this is where I think the people listening to this who might be founders or CEOs have to check themselves: how do you unblock these people? How do you get out of the way to ensure that everybody together is building something massive? [SPEAKER_02] I want to ask you about your marketing because I think you did world-class marketing. [SPEAKER_02] Like we said years ago, first thing I ever said to you was, you know, nice landing page, right?

SPEAKER_02

Yeah. That's the highest form of respect I give. I want to actually open up here. Let me screen share. I want to show you your Facebook ad library. And I just want you to talk us through a 10-minute masterclass on marketing.

SPEAKER_00

[SPEAKER_02] Yeah. [SPEAKER_02] So I want you to tell me what you see because the average person will look at this.

SPEAKER_01

[SPEAKER_02] I want to ask you about your marketing because I think you did world-class marketing. [SPEAKER_02] We said years ago, first thing I ever said to you was, nice landing page. [SPEAKER_02] Right? [SPEAKER_02] Yeah. [SPEAKER_02] That's the highest form of respect I give. [SPEAKER_02] I want to actually open up here. [SPEAKER_02] Let me screen share. [SPEAKER_02] I want to show you your Facebook ad library. [SPEAKER_02] And I just want you to talk us through a 10-minute masterclass on marketing. [SPEAKER_02] Yeah. [SPEAKER_02] So I want you to tell me what you see because the average person will look at this.

SPEAKER_00

[SPEAKER_02] They don't really know what to take. [SPEAKER_02] I want you to point out what's interesting here. [SPEAKER_02] Let me see if I can zoom this a little bit. [SPEAKER_02] What's interesting here? [SPEAKER_02] What to notice? [SPEAKER_02] What to learn from that would apply to other people in their businesses? [SPEAKER_02] How to think about marketing the way you guys thought about marketing? Yeah. I mean, the first thing I see when you go back up is what does it say? Poop more? What other supplement brand do you know that's being a little bit sassy with commentary like that?

SPEAKER_00

Now you see it a little bit more from these brands that are talking about their clinicals all the time, which nothing against clinicals. We do clinicals too. And we test our product exceptionally well beyond what's required. But we just don't talk about it because that's not fun. So what I would say here is these are fun ads, right? If somebody sees that, they're probably laughing a little bit. If you scroll down, we spent some time on GLP-1 as an angle.

SPEAKER_00

And I'm really proud the day that we decided to do this because everyone around us, and I don't spend enough time on Instagram to know everyone around us is like nature is ozempic or they'll say something like that, which is objectively wrong. You're not supposed to say that.

SPEAKER_02

[SPEAKER_00] We've never taken that approach. [SPEAKER_00] We are what we would say the best friend to ozempic, tirzepatide, zepbound, whatever the GLP-1s are.

SPEAKER_00

[SPEAKER_02] So you were able to surf that wave. [SPEAKER_02] You were able to hijack some of the momentum of that product and position yourself, not as a replacement, but as a companion. [SPEAKER_01] Wait, why did you have an Olipop? [SPEAKER_01] Okay. Well, it was a GLP-1 new crush ad that was that Olipop image on it. And so we're running a limited time offer right now with Olipop. So this is Gruens. It's an Olipop flavor.

SPEAKER_02

[SPEAKER_00] The first one we did was a Granny Smith apple flavored. [SPEAKER_00] We did a Grinch, sour Grinch punch last year in November. [SPEAKER_00] So we do these. Back to the whole, how do we make this fun? [SPEAKER_00] You tell me one other supplement brand that's doing drops in, making it actually fun to take the product each day. So it looks like you've got different angles. You've got, hey, we're Olipop's best friend. You've got poop more. You've got a nurse, you know, Nurse Jackie talking about nutrients. So you have these different angles.

SPEAKER_00

[SPEAKER_02] And I'm guessing that these each lead to a landing page that aligns with that message. [SPEAKER_02] Correct. [SPEAKER_02] So it's five, six different angles, each to a tailored landing page that continues that message.

SPEAKER_01

[SPEAKER_02] And then you're, are you doing that just to experiment to find one winner?

SPEAKER_00

[SPEAKER_02] Or are you like, no, we're going to keep running five or six of these because there's different markets of different customers who have different mindsets and we're going to try to get all of them. Yeah. To make this super applicable for people, you should test ads in high volume.

SPEAKER_01

[SPEAKER_00] Find new angles, test all over the place, find what sticks with an eye towards being a human, right?

SPEAKER_00

Don't say that you're going to make somebody's sex better if your product doesn't actually do that. Actually do the science validation if your product can help with certain things. Once you've identified an angle that seems to be running, then you build the entire funnel around it. So you've got static ads that talk to that angle. You've got UGC, sort of camera angle ads that run at that.

SPEAKER_01

[SPEAKER_00] You've got more cinematic type shoots that run at that angle. [SPEAKER_00] Everything you're plowing all sorts of ad concepts toward, or sorry, ad structures to that angle. [SPEAKER_00] From there where people land is really important. [SPEAKER_00] What people receive as a pop-up is really important. [SPEAKER_00] What people receive as email and SMS is really important.

SPEAKER_00

Everything is tailored to that message. So if you came in on a gut health ad, we want everything tailored to, hey, you know, Sam just expressed interest in the gut health ad. Great. Then Sam's probably interested in gut health. Let's give a pop-up that helps them understand what about gut health is he interested in? That pop-up informs what messages we send on email and SMS towards Sam's expressed concern. That page is dialed for Sam's intent. And then on the back end of that, once people have purchased, this is something that we're trying to put into process now is how do we talk to Sam long-term?

SPEAKER_00

He may have started on gut health, but how do we get Sam to understand that there's so much more to this product than just gut health and do that over time, building on the foundation of why this product was important. [SPEAKER_01] Most everything you're saying, it's when I read the book, How to Win Friends and Influence People. [SPEAKER_01] I'm like, oh yeah, this is obvious. [SPEAKER_01] Makes sense. [SPEAKER_01] But the hard part is execution. [SPEAKER_01] And it seems like you're ruthlessly, in a kind way executing what's. So I'm going to ask a bunch of questions that I think you can answer in one go. on the foundation of why this product was important.

SPEAKER_00

[SPEAKER_01] Most everything you're saying. [SPEAKER_01] It's when I read the book, how to win friends and influence people. [SPEAKER_01] I'm like, oh yeah, this is obvious. [SPEAKER_01] Makes sense. [SPEAKER_01] Makes sense.

SPEAKER_02

[SPEAKER_01] But the hard part is execution. [SPEAKER_01] And it seems like you're ruthlessly, in a kind way, executing what's, so I'm going to ask a bunch of questions that I think you can answer in one go. How many ads and landing pages per month are you putting out?

SPEAKER_00

[SPEAKER_01] And I think you only said you had a 30 person team. [SPEAKER_01] That seems like a lot of output for a relatively small team.

SPEAKER_02

[SPEAKER_01] Can you talk about who's doing the work? [SPEAKER_00] Yeah. [SPEAKER_00] We're probably putting out hundreds of ads a month cycling in and out. [SPEAKER_00] Just trying to find that next unlock. [SPEAKER_00] We try to create new concepts pretty consistently. [SPEAKER_00] So it's not just about ad volume. [SPEAKER_00] It's actually structured around how much of that is business as usual ads that we already know, or concepts, themes that we know already work. [SPEAKER_00] And how much of that is we're trying to find new frontier of applicability.

SPEAKER_02

[SPEAKER_00] In terms of the team, you know, when Sean reached out to me in December of 2023 saying, hey, nice landing page. [SPEAKER_00] That was me, right? [SPEAKER_00] I was the guy that built that landing page. [SPEAKER_00] We didn't use an agency. [SPEAKER_00] I think I even said that in the message. [SPEAKER_00] You asked that was me from the beginning. [SPEAKER_00] And you see our buy box, it's that place where you do the add to cart, which seemed people ripped that over the last three years copying that buy box.

SPEAKER_00

And if they only knew that random dude named Chad, who's not an e-comm expert, you know, broadly across DTC, I know quite a bit, but I'm not an e-comm guy who builds these sites. The whole industry is mimicking this format. Yeah. It's really interesting to see that I think people need to test their own. Since then we found new formats that work, but talking about the team, we've got people across, we've got three folks on the retention team who do the emails, SMS, who set up all the flows that allow for our consumers to have a good experience. So they're focused on after order one, what does that journey look like through order hundreds, right?

SPEAKER_00

We've got a large team doing paid. So creating ads, the actual creatives, we have probably four plus maybe five or six creative strategists who actually create the ads. And then we have people who design and do the video edits. And then we have the people who actually manage the ad accounts, right? There's probably four or five of those who actually are looking at the analytics, evaluating, passing back to the creative strategist saying, here's what's working, iterate on that. We've got an e-com team that's absolutely dialed. The velocity coming out of the e-com now. So landing page designs, iterations on the cart, checkout, post purchase, all of that good stuff.

SPEAKER_00

We're constantly iterating on. I mean, it's so fun to see, right? It used to be me throwing up a quick website against an ad angle. And now we've got a full infrastructure around it.

SPEAKER_01

Still, that's crazy. That doesn't seem like a big operation for creating hundreds of millions of dollars of revenue and hundreds of ads. [SPEAKER_00] It doesn't require a lot. [SPEAKER_00] And I would tell people that they can do it themselves, right? [SPEAKER_00] You create a template in, you know, shout out to Replo is the platform that I used. [SPEAKER_00] And I think you can do hundreds of millions of revenue on Replo. [SPEAKER_00] I think it's replo.app is the website and it's a Shopify plugin. [SPEAKER_00] I mean, it's such a good platform. [SPEAKER_00] You can just create a template.

SPEAKER_00

The only thing you need to swap out is the headline, whether it says gut health or it talks about pick your other ad theme, substitute the little blocks on the page with the new ad copy. It's not that hard. In a day you can create a completely new ad funnel that is going to have incremental performance against a general landing page. [SPEAKER_01] That guy's got to clip that clip and make that an ad. [SPEAKER_01] Yeah. [SPEAKER_01] Get ready to see your face at a Replo ad. Look, and I have no problem. They don't charge. I mean, I've told them before, they don't charge enough. It's stupid how much value you can get out of that.

SPEAKER_00

And I would say this about a lot of our platforms. They're just getting a shout out because it's relevant here. [SPEAKER_02] What do you see when you look at average marketing versus world-class marketing? [SPEAKER_02] What do you think if I'm somebody who's got a brand or a company and I have a landing page, I got ads, I'm doing all the things. [SPEAKER_02] He said, test creative. [SPEAKER_02] I'm testing creative. [SPEAKER_02] He said, test landing pages. [SPEAKER_02] I think I'm doing that.

SPEAKER_00

[SPEAKER_02] What are the most typically missing when you either advise a founder or you go look at somebody else's brand and you're like, oh man, they're just not doing this one thing. [SPEAKER_02] These two things well enough to really jump from average or good to great. Yeah.

SPEAKER_01

[SPEAKER_00] Have a better product is typically what it comes down to, which is so unhelpful. [SPEAKER_00] Because it's like, you got to cut your losses. [SPEAKER_00] But a lot of the people who are trying to find these hacks, they're doing it with a mailed in product. [SPEAKER_00] They didn't, we took a year to develop our product. [SPEAKER_00] It's custom blends. Well, how did you know that it worked? Because a lot of times when I take vitamins, I don't necessarily know if it's working. Did you get your blood tested a bunch? [SPEAKER_00] This is the beauty of this industry. If you go to PubMed, are you familiar with PubMed?

SPEAKER_00

[SPEAKER_01] It's a public, it's where studies are, right? Cause it's got to cut your losses. But a lot of the people who are trying to find these hacks, they're doing it with a mailed in product. Some, they didn't. We took a year to develop our product. It's custom blends. [SPEAKER_01] Well, how did you know that it worked? [SPEAKER_01] Because a lot of times when I take vitamins, I don't necessarily know if it's working. [SPEAKER_01] Did you get your blood tested a bunch? This is the beauty of this industry is if you go to PubMed, are you familiar with PubMed? [SPEAKER_01] It's a public, it's where studies are, right? Yeah. All the studies are published there.

SPEAKER_00

If you put vitamin C in your product and there's thousands of studies about what vitamin C does. Sure. Maybe I don't know the precise outcomes of 120 person blind sample survey, placebo controlled trial. But I can pretty much guess what the outcomes are going to be based on the thousands of other published studies against vitamin C. So to answer your question, Sam, no, I didn't prior to launching do those tests, but I looked through thousands of articles to land on what I believed the right formulation would be for our product. And that's also what I tested with consumers pre-launch is what's your perception of this label?

SPEAKER_00

What's your perception of this many gummies, the size of gummy, this flavor of gummy, all of that stuff. [SPEAKER_02] Sam McLean

SPEAKER_02

What's on your ideas list, but you're not going to actually go do it. So you can riff with us here of brainstorming other brands, other ideas that you think are interesting, may or may not work, but interesting. Sam McLean [SPEAKER_01] Yeah. And also you mentioned that you have a notion doc, if you're comfortable. [SPEAKER_01] If you want to pull up your bank balance, we can also just do that. [SPEAKER_01] Sam McLean Tell you wiring instructions too. [SPEAKER_00] Sam McLean [SPEAKER_00] Here's what I'll say. [SPEAKER_00] One thing that I disagree with is people say ideas aren't worth anything. [SPEAKER_00] Oh man, do I disagree.

SPEAKER_02

[SPEAKER_00] I think ideas are worth so much in the right hands and in my hands, they're in the right hands. [SPEAKER_00] I believe, and every founder should believe that about themselves. [SPEAKER_00] Sam McLean [SPEAKER_00] And so there's certain ideas I can't share. [SPEAKER_00] Cause I have an idea that years from now, I've still got a lot I want to do with Gruen's. There's a lot I want to do with this business. [SPEAKER_00] I'm not done here. But years from now, I think there's an idea that no one else is going to be able to run it. There's a $10 billion business idea. [SPEAKER_00] And I'm, you should just say it now and we'll bleep it out.

SPEAKER_02

[SPEAKER_00] And we can react.

SPEAKER_00

[SPEAKER_01] Sam McLean [SPEAKER_01] Give us a code word or something. [SPEAKER_01] Sam McLean We can at least give you credit for it. [SPEAKER_01] Sam McLean [SPEAKER_02] Hey, look, we're the wrong heads. [SPEAKER_01] When you see it, you'll know. You'll see it and you'll go, oh yeah, this is a bill. [SPEAKER_02] This is a big business idea. [SPEAKER_02] Sam McLean So I don't think anybody's going to do that in the meantime, while I'm finishing my chapter here at Gruen's and doing what I set out to do. Okay. Well, what are some other ideas that if in the right hands are great, that aren't your hands? Sam McLean I had this idea one time.

SPEAKER_00

[SPEAKER_01] It has nothing to do with consumer. [SPEAKER_01] Sam McLean [SPEAKER_01] And I actually almost ran with it around the time I was starting Gruen's and I still think it's a good idea, but I'm not going to be the one to do it. So I'm happy to share it. Right now, there is no way to direct the money that you have coming in from direct deposit. So that direct deposit hits your checking account.

SPEAKER_00

And then we've all got to have the willpower to decide, oh, put 10% in savings and put this against your bills and do this over here. What if you become essentially the distribution layer of ACH transfers? So it hits this distribution layer. And before that person has to have the willpower to decide what they're going to do with it. And this is helpful for so many people in their lives, right? It gets wired out to the rent that they have. It gets wired out to their car payment. It gets wired out to blank over here into their investment. And so what actually hits their account that they're spending against is 500 bucks for groceries or whatever it is. And the technology exists to do this, right? It hasn't been structured. I can't remember what platform allows for it, but there's a platform that can facilitate what I just described to you. So this idea could be done tomorrow. That's a great idea. Even whether it's for consumer or for businesses, have you ever read the book Profit First? No. Somebody recommended on the podcast and they go, it was the time when my girlfriend bought me the book, The Game, before I went to college and we were going to break up and it's, you need to learn how to talk to girls.

SPEAKER_00

And I was, oh, thank you. It was a gift, but it was also a message. And my friend told me about this book Profit First. I think it was a gift and a message.

SPEAKER_02

[SPEAKER_00] And the message was, hey, you're running this business and you've been doing it for years, but you're not pulling out any profits and you don't know where all the money's going. It's profitable on paper, but you're not getting money out of this. And that's a very common business owner problem. And there's this book called Profit First, which has this philosophy, which is basically you preset the budget. So what most people do is they say, I have this much revenue, then they have all their expenses. And then it's, surprise, whatever's left over, that's your profit. And you're usually quite disappointed with that surprise.

SPEAKER_02

[SPEAKER_00] The better way what this guy advocates for is you set a budget for your P and L. You say, oh, I'm going to spend 25% on OpEx. I'm going to, I need to reserve 20% for taxes. So I'm not stressed out every tax season. So I just want to put that. And you literally just create four [SPEAKER_00] business owner problem. And there's this book called Profit First, which has this philosophy, which is you preset the budget. So what most people do is they say, I have this much revenue, then they have all their expenses. And then it's like, surprise, whatever's left over, that's your profit. And you're usually quite disappointed with that surprise.

SPEAKER_01

The better way what this guy advocates for is you just set a budget for your P and L. You say, oh, I'm going to spend 25% on OpEx. I'm going to, I need to reserve 20% for taxes. So I'm not stressed out every tax season. So I just want to put that. And you literally just create four separate accounts. You create a tax account, a checking account. So automatically 20% goes in there and that's waiting for, it's in a money market account until tax season. You have your OpEx account. And so now your team has to run on a budget. It's like, this is how much you have to spend. You don't get to just spend whatever and keep eating out of profits. And you set a profit threshold where you say, I want to have 50% profit. So it basically pre-allocates to your, as every dollar comes in, 15 cents will go to the profit bucket, 25 cents will go to the OpEx bucket.

SPEAKER_01

[SPEAKER_02] And it's actually a life-changing idea because it forces discipline. You think you're running pretty lean until you actually have a hard cap on expenses. And then you realize, oh, actually there was way more fat I could trim. I actually could have been this profitable yesterday. I just let it be an output rather than an input. But unfortunately there's not an easy way to do this. You have to set up seven accounts with your bank and then you have to tell your accountant, hey, keep doing these sweeps every two weeks.

SPEAKER_00

Have you guys heard of Simple? Do you guys remember Simple? I loved Simple. It was really cool. I don't think it's gone. [SPEAKER_02] Neobanks. [SPEAKER_02] Yeah. Neobanks. And it wasn't even a description back then. It's like the envelope system where you put digitally money into different envelopes.

SPEAKER_00

Yeah. And I didn't make a lot of money at the time. And I was like, but I want to fly home to St. Louis to see my family. And so it's going to take me four months. And so automatically, when it would come into my bank account, the way it would visualize it, it was still one bank account. It was like, well, this is how much is left. You have 350 bucks in your spending account, but you have another 400 in your vacation account. So don't touch that money. It was pretty cool.

SPEAKER_00

So Sam, here's what I love about this idea. And Sean, you're bringing up actually why I think this is even potentially more compelling for businesses, because if you're changing the way that the P&L works, I mean, venture capital firms want that because now there's more discipline around the money that they're giving. [SPEAKER_02] Totally.

SPEAKER_00

[SPEAKER_02] The small founders who are making 5 million a year who want to pull 500,000 out, they want it because now it's like, oh, well, I'm forcing myself into that discipline to pull 500,000 out every year. It's a huge use case that I wasn't thinking of. And in terms of personal, the problem with budgeting today is it's done. I grew up in a family where at the age of six, I was in Quicken and I had to take every receipt, scan it, type it in. Your mom and dad made you do that? [SPEAKER_02] My dad taught me budgeting. Yeah.

SPEAKER_02

That's awesome. And we were so against debt and everything else, but I liked it was awesome until there was an imbalance at the end of the month. And I had to go search for the 20 cents that was off. Is that a Mormon thing? Because I've met a bunch of Mormon buddies who are very disciplined with their monthly budgeting. Yeah, it might be. Honestly, it might be something that's. I mean, there's a lot of financial discipline in general, but to put the headline on it, to me, what I love about this idea is it solves what I think sucked about the granularity of wasting hours a month, a week on typing in all my stuff.

SPEAKER_02

And it also solves the other end, right? Like people get to the end of the month and it's like, that was actually a hassle to do that. I'd change any of my behaviors based on it. I don't know. And then the other end of it's like Mint, back before that got acquired. And I think the other one today is Monarch, which I like Monarch. Love Monarch. More money. It's helpful to see, but Monarch is not really a proactive platform, right? It's like, oh, I'm just getting information. I'll tell you how bad you're doing at it versus, hey, let me just fix it for you. Totally.

SPEAKER_02

What you wanted is a fix it for me solution. I really wonder whether, you know, with agents or the popularity of Mercury or the all the popular neobanks that are pretty product first. Yeah. And they're more programmable. I wonder if either somebody could build it on top of one of those banks or if they'll end up releasing something like this themselves.

SPEAKER_02

[SPEAKER_01] I think you get acquired. I think if you run this business, you're going to be acquired for 500 million to a billion in like two years. If you execute this right, like somebody out there listening right now, feel free to send me a DM when you do it. This idea, the infrastructure exists to be able to do this. If you execute it correctly, you are one, making a massive impact in millions of people's lives. And two, you will have a financial outcome.

SPEAKER_02

What would be cool is if in 12 months we have to say, hey, everyone, we did this podcast with Chad here. Here's what he said. And then we aired this clip that you just said. And then we're like, here's the update. Because this is fantastic. This is really cool. We do this segment all the time. This is a top tier idea. You have a couple of quotes that you sent us or philosophies. We always ask people...

SPEAKER_00

[SPEAKER_01] able to do this. If you execute it correctly, you are one, making a massive impact in millions of people's lives. And two, you will have a financial outcome. [SPEAKER_01] What would be cool is if in 12 months we have to say, hey, everyone, we did this podcast with Chad here. Here's what he said. And then we aired this clip that you just said. And then we're like, here's the update. Because this is fantastic. This is really cool. We do this segment all the time. This is a top tier idea.

SPEAKER_00

[SPEAKER_01] You have a couple of quotes that you sent us or philosophies. We always ask people what are the philosophies you live by that you think are not something everybody does or not everybody believes in? You said one of them that I like—you go access is everything. And you explained how you didn't have a ton of access early on, but you know, through Summit and Stanford, can you explain your access is everything philosophy?

SPEAKER_00

[SPEAKER_01] I think access and the privilege of having access in the world is something that when you don't have it, surround yourself with people who do and do good work for them and you will get access every time. And then when you do have it, the privilege I now have, I see it as your obligation, my obligation to give that back to others. [SPEAKER_01] So explain what you mean by access. What's the personal story where this resonates?

SPEAKER_00

[SPEAKER_01] I'm a dude named Chad. I worked in private equity. What you see today would not have existed without people leaning in and giving me access every time incrementally and me doing good work for them. If you go back, I was always curious on this because I think you get asked in those questionnaires, are you middle income, high income, low income? And I was aware of wealth, but if I looked at the income that my parents had and I have seven—there's seven of us kids, so six siblings—and our income, I think I was bottom middle class is how it was defined. And I'm not saying that from a standpoint of shame. I'm grateful to have lived in this area and seen these people. I think you can solve a lot by just giving awareness to kids about what's possible.

SPEAKER_00

[SPEAKER_01] It's the grasshopper moment. Once they know it's like, oh, now you can go get it.

SPEAKER_00

I was recruiting for the Big Three consulting—McKinsey, BCG, Bain—through a contact who put me in touch. I didn't get it, but I landed through another mentor this gig at Lazard. I did really good work, and Lazard's an investment bank in New York City, one of the top premier investment banks working on mergers and acquisitions. That mentor, I'm still close to him. I wouldn't have visited him without him. He gave me access and that access then landed me at Summit Partners. At Summit Partners, I did phenomenal work for them. I deployed—I literally invested 30% of that fund, a $5 billion fund. I invested that. I sourced the deals that made them the money. I did really good work. And there's this moment when I got into Stanford that I was like, oh man, should I feel bad? Because I know how this works. I only got in—yeah, I've had a ton of accomplishments. I had a 3.95 GPA. I've worked at great places, but it's white dude named Chad. Should I feel bad about this? I got into Stanford. And what I came to appreciate is no, I shouldn't feel bad knowing that the reason why I got in is because two people who are very close to the Stanford folks sent a text and a nice letter of recommendation for me. I shouldn't feel bad about that because they're not just doing that, right? They're doing that because I did good work for them. I made their lives easier. I earned their trust. So maybe I wasn't born into that access where my dad can send a text to Stanford and say, let my son in, but you can earn that by doing good work for the people who do have that access. And they're so eager to help you have that accomplishment. So that's how I think about access. And it's part of when I got asked recently, what's your legacy that you want to leave on the world? And I'm like, I'm 33 years old, but the way I think about it is I want to give that access that I've been granted or earned over the many years. And I want to ensure that more people have access to that who spend their lives working with me and putting in good work.

SPEAKER_00

You're awesome. You are so cool. I think when I was younger, I met this really successful guy named Scott Belsky, who was the chief product officer of Adobe and an amazing entrepreneur, maybe a billionaire. And he used this word with me that I never heard before. He said, I'm going to invest in you and you need to be a steward of my capital. And I was like, I don't know what is that word steward? I'd never heard of that. It's this idea that you need to be the vehicle that protects and passes on a little bit of greatness. That's how I interpreted it. And you are that person. My friend Austin Rief—do you know Austin Rief? He's one of the Morning Brew founders.

SPEAKER_00

So he started and sold the company for hundreds of millions of dollars when he was 30 years old. He was texting me about this new idea that he was working on or brainstorming. And I was like, do you think it's going to be successful? He goes, it can be successful if I want it to be. And I love that because what you and him both said something very similar. You have this similar mindset. But I find myself being around him and people like you and it's contagious.

SPEAKER_00

[SPEAKER_02] I've thought about whether my impact on the world is more narrowly focused on the people who spend thousands of hours with me working inside of Grids or if I should have more of an impact publicly trying to relay some of this message. It's hard though, to relay all of this, these experiences that I've had in a public forum that allows for millions to learn. But you're totally right, Sam. At the end of the day, why was I able to build what I built? It's because I knew it was possible, right? I saw it done many times by others. And if I ever had a question, I could—

SPEAKER_00

[SPEAKER_02] my impact on the world is more narrowly focused on the people who spend hours, thousands of hours with [SPEAKER_02] me working inside of grids or if I should have more of an impact publicly trying to relay some of this [SPEAKER_02] message. It's hard though, to relay all of these experiences that I've had in a public forum that allows for millions to learn, but you're totally right, Sam. At the end of the day, why was I able to build what I built? It's because I knew it was possible, right? I saw it done many, many times by others. And if I ever had a question, I could go ping those people. Network experiences, awareness of what's possible.

SPEAKER_00

[SPEAKER_02] I think there's maybe a different way to say what you just said. The way you just said it was kind of like, Hey, I was pretty fortunate that these things happened and I did my part, but they did their part. This happens a lot with entrepreneurs as we stumble and fumble

SPEAKER_00

our way to success. Then afterwards you can actually look back and realize, oh, it wasn't complete random. It wasn't complete chance. And in fact, you could recreate the conditions of success more reliably knowing what I know now. And so I would just point to three words that you just said. The first one is exposure. You really can't imagine what you've never seen. Your brain won't go anywhere if you don't have any exposure to things. I was talking about this with Ben, my business partner, about my kids. I said, my kids have never been exposed to so much in the world, right? We literally keep going to the same resorts. And I was like, they've never seen a third world country. They've never seen this. I started bringing them to just do adult stuff with me. Because I used to do kids stuff with my kids. And now what I realized is, let me just bring them along for life. And kids actually love it. They like doing laundry. They

SPEAKER_00

[SPEAKER_01] like cooking. They work out with me now in the gym every day. They like going with me to meetings. [SPEAKER_01] They actually kind of enjoy that because they're getting exposed to new stimulus that they've never really seen before. And even if they're five years old and they can't fully grasp it, there's some part of it that just breaks some fence that they had around what the world is. And it starts to poke holes and it lets new things in. Growing up, I didn't know any entrepreneurs. I didn't know anyone. In my entire family, my mom has nine siblings. My dad has four.

SPEAKER_00

[SPEAKER_01] Out of all of them, there were zero entrepreneurs. Every single one of them was an engineer, like typical Indian family. And so the highest calling was you get a good job. What's a good job? A six figure job that has health insurance. So that was all I knew. I was exposed to of what was possible. And then my senior year of college, I took a class called getting rich. [SPEAKER_01] And in the very first class, she brought in a speaker and there was a girl who started a t-shirt company. And then the next class, she brought in a guy who started his own hedge fund. And I just

SPEAKER_00

[SPEAKER_02] thought, I looked at them and I said, why are these guys having all the fun? This sounds awesome. [SPEAKER_02] Maybe I could do that. Instead, I was finally exposed to the thing when I was 21 years old and it [SPEAKER_02] changed the trajectory of my life. Had I not had the exposure, it literally would have just not happened.

SPEAKER_00

[SPEAKER_02] And so the first is exposure. How do you get yourself in a position to see new things or help other people see new things? The second is access. And the way I would put it for you is earned access. Because you said something very casual. You're like, I did good work for them. You know what? I bet if we peeled back, there probably is a lot there. I bet you over delivered. [SPEAKER_02] I bet you didn't get paid proportional to what you did and you didn't whine about it. These are my guesses. You tell me if that's true or not, but the access is earned through showing that you're

SPEAKER_00

somebody who deserves greater opportunities and greater access. And you sort of delay the payoff of those actions and you just have faith that I'm going to just kill it right now. And I trust that the ball will bounce my way over time and I don't need to immediately tit for tat measure what I'm getting versus what I'm putting in. Yeah. I think it's true. And frankly, I think, you know, I'm young, I'm 33 years old. [SPEAKER_02] I think about the impact I want to have on this world. I think it's that first one exposure. How

SPEAKER_00

[SPEAKER_02] can I facilitate exposure to everyone? Right? Young kids, how did they get exposure? Honestly, I think that's where my wife and I want to make an impact is making it possible through some effort in the next chapter of my life to ensure that the random kid who's six years old or ten years old in a place that would never get exposure to this, at least knows what's possible because they know it's possible. Maybe they'll go after it themselves over time. Hey, can I let me ask you a question that you might not feel comfortable answering when you're wired hundreds of millions of

SPEAKER_01

[SPEAKER_00] dollars. What do you decide to do with it? Where did you invest the money? And that includes like, did you decide to give any away? Yeah, TBD on it. But one of the hardest things I have is I've thought about my impact. It's the same as I don't even know if I'll invest [SPEAKER_00] in other companies and it's not because I don't believe it. It's like, what's the next best use of a

SPEAKER_01

[SPEAKER_00] dollar? It's going to take a lot to convince me that it's something other than what I can go after and do. And that doesn't mean it's always business profit centered. I don't always have to make money, but can I, Sam go out and make an impact on the world by taking my own funds and building something special out of it, right. That has an impact, whether it's mentorship, exposure or whatever it is. So TBD. I mean, as you know, when you receive money, you spend a lot of time thinking about deploying and you don't want to rush into anything, but I would expect that the more meaningful deployment of my capital is going to come through some personal effort in my life that I do to make an impact. So, well, first of all, can we let me ask a boring question.

SPEAKER_01

[SPEAKER_00] Where'd you invest it? The current money, where'd you invest? Is it just boring index funds? Is it there's a difference between signing and closing. So you have to go through anti-regulatory. So we've signed, but the closing happens as soon as it's been approved by government. So you don't have it yet. The money's not been wired yet, but the deal's fine.

SPEAKER_01

[SPEAKER_00] The more meaningful deployment of my capital is going to come through some personal effort in my life that I do to make an impact. So, well, first of all, can we let me ask a boring question. Where'd you invest it? The current money, where'd you invest? Is it just boring index funds? Is it—there's a difference between signing and closing. So you have to go through anti-regulatory. So we've signed, but the closing happens as soon as it's been approved by government. So you don't have it yet. The money's not been wired yet, but the deal's fine. I don't know what that. I've not had a deal. There's a large hole. Yeah. My first acquisition, they just Venmo'd me.

SPEAKER_01

Yeah. We've not dealt with the Department of Justice yet. So that's pretty cool. That's funny. Yeah. There's a crazy story. You know, the company AppLovin?

SPEAKER_01

Yeah. Yeah. Yeah. My co-founder was the co-founder of AppLovin at the time. So he's sitting next to me at the office and they signed this deal and I'm like, oh my God, you just sold. They sold the company for I think 1.2 or $2 billion. I forgot which, what the number was, but 1 or $2 billion. And I was like, wow, dude, you did it. You sold a company for a billion dollars, $2 billion. That's amazing. And I was like, should we go? Dinner's on you. What's up? He's like, dude, we haven't got the money. It's going to be months. He's like, if it's over—I forgot what the number is. 750 million, a billion dollars, whatever it is. Literally the government—you know, the way he put it was like, it's going to sit on Trump's desk until he stamps it.

SPEAKER_01

The crazy thing was they sold to a Chinese company. So there was actually a lot of risk. And so he didn't know this at the time. He thought, you know, it's over. Yeah. Well, nine months go by, almost a year goes by and the deal is still not approved, but they've been running the company. They've doubled revenue in that year.

SPEAKER_01

Yeah. And so instead of waiting for the approval, what they did was they went and renegotiated. They're like, hey, here's what the 2 billion gets you instead. And now it gets you 25% of the company instead of whatever, 85%. So they renegotiated the deal because the business had grown. So it was the best thing that ever happened. And so they took a minority investment, got some liquidity, kept growing the thing. It's now like it was a hundred billion dollar company in the last year. Right. So it went a hundred X since then. A quick Google. So I have an attempt to read all this. I believe it's $130 million is the threshold where the DOJ has to. Interesting.

SPEAKER_00

A $130 million? Yeah. You have to notify the DOJ and the FTC anything north of $133.9 million. Yeah. Dear DOJ, I'm rich. What do you notify them? There's an official form and then they're just reviewing it as they should to make sure that it's not bad for the consumer. Dude. That's cool. That's awesome.

SPEAKER_00

Well, dude, thanks for coming on, man. And congrats again on building something pretty epic. I remember when I saw the product, it just seemed like, oh, that's it. And the best products actually are simple like that, where the proposition is easy for the customer to understand. It makes sense in the world. It was almost hidden in plain sight, I feel in a way. And to your credit, you ran with that, you acted on it and you built something pretty incredible.

SPEAKER_00

Of course. Thank you for having me on. My hope is that three years from now, we're talking and you guys are like, geez, dude, we didn't realize there was that much ahead of you. We've got so much this team wants to do. And so eager to show the consumers what we've got for them. New products, new innovations, new fun, limited time offers. What's the best thing on that shelf I should buy? So have you tried the Hollypop? We've got some products here that are launching soon, but have you tried the Hollypop? No. That's actually really delicious. I've only ever had the original. I didn't even try anything else. I just got the original subscription. That's it.

SPEAKER_00

So yeah, you may know this, but we've got Grunz, which is the comprehensive nutrition greens, multivitamin fiber. We've got Nutrop's, which is a nootropics product. We've got Immune, which is almost like an immunity shot, like the two ounce bottles, but in gummy form. And then we've got Juiced, which is this one right here, which is a pre-anything energy product. So I mean, we've got 12 innovations in the pipeline. That's what I'm saying. We've done something so big, but we're maybe five miles into a marathon.

SPEAKER_00

Good man. Thank you so much for coming on. You have an open invite whenever you want. You're a wonderful guy. We're so happy for your success and it makes us feel good to promote you. So thank you for coming on. That's it. That's the pod. landing page. That was me, right? Like I was the guy that who built that landing page. We didn't use an agency. I think I even said that in the message. Cause you asked that was me from the beginning. And, you know, you, you see our buy box, it's that place where you do the add to cart, which seemed people ripped that over the last three years copying that buy box.

SPEAKER_00

And if they only knew that random dude named Chad, who's not like an e-comm expert, you know, broadly across DTC, I know quite a bit, but like I'm not an e-comm guy who builds these sites. The whole industry is mimicking this, this format. Yeah. It's really interesting to see that I think people need to test their own. And since then we found new formats that work, but talking about the team, we've got people across, we've got like three folks on the retention team who do the emails, uh, SMS, who set up all the flows that allow for our consumers to have a good experience. Um, so they're focused on after order one, what does that journey look like through order

SPEAKER_00

hundreds, right? We've got a large team doing paid. So creating ads, the actual creatives, we have probably four plus maybe five or six creative strategists who actually create the ads. And then we have people who design and do the video edits. And then we have the people who actually manage the ad accounts, right? There's probably four or five of those who actually like are looking at the analytics, evaluating, passing back to the creative strategist saying, here's what's working, iterate on that. We've got an e-com team that's absolutely dialed. The, the velocity coming out of the e-com now.

SPEAKER_00

So landing page designs, iterations on the cart, checkout, post purchase, like all of that good stuff. We're, we're constantly iterating on. I mean, it's so fun to see, right? Like it used to be me throwing up a quick website, um, against an ad angle. And now we've got like a full, um, infrastructure around it.

SPEAKER_01

Still, that's crazy. That just not seem like a lot of, that doesn't seem like a big operation for creating hundreds of millions of dollars of revenue and hundreds of ads.

SPEAKER_00

It, it doesn't require a lot. And I would tell people that they can do it themselves, right? You create a template in, you know, shout out to Replo is the platform that I used. And I think you can do hundreds of millions of, uh, revenue on Replo. Um, I think it's replo.app is the website and it's a Shopify plugin. I mean, it's such a good platform. You can just create a template. The only thing you need to swap out is like the headline, whether it says gut health or it talks about pick your other ad theme, substitute the like, uh, little blocks on the page with the new ad copy. It's like, it's not that hard.

SPEAKER_00

Like in a day you can create a completely new ad funnel that is going to have incremental performance against a sort of general landing page.

SPEAKER_01

That guy's got to clip that clip and make that an ad. Yeah. Get ready to see your face at a Replo ad.

SPEAKER_00

Look, and I have no problem. They don't charge. I mean, I've told them before, they don't charge enough. It, it, it, it's, it's stupid how much value you can get out of that. And I would say this about a lot of our platforms. They're just getting a shout out because it's relevant here.

SPEAKER_02

What do you see when you look at average marketing versus world-class marketing? What do you think if I'm somebody who's got a brand or a company and I have a landing page, I got ads, I'm doing all the things. He said, test creative. I'm testing creative. He said, test lane. I think I'm doing that. What are the most typically missing when you either advise a founder or you go look at somebody else's brand and you're like, oh man, they're just not doing this one thing. This, these two things well enough to really jump from average or good to great.

SPEAKER_00

Yeah. Have a better product is typically what it comes down to, which is like so unhelpful. Cause it's like, you got to cut your losses. But like a lot of the people who are trying to like find these hacks, they're doing it with like a, a mailed in product. Like some, they like didn't, we took a year to develop our product. It's custom blends.

SPEAKER_01

Well, how did you know that it worked? Because a lot of times when I take vitamins, I don't necessarily know if it's working. Did you like get your blood tested a bunch?

SPEAKER_00

This is the beauty of this industry is if you go to PubMed, are you familiar with PubMed?

SPEAKER_01

It's a public, it's a, where studies are, right?

SPEAKER_00

Yeah. All the studies are published there. I mean, if you put vitamin C in your product and there's thousands of studies about what vitamin C does. Sure. Maybe I don't know the precise outcomes of 120 person blind sample survey, placebo controlled trial. But like, I can pretty much guess what the outcomes are going to be based on the thousands of other published studies against vitamin C. So to answer your question, Sam, no, I didn't, prior to launching, I hadn't done those tests, but like I looked through thousands of articles to land on what I believed the, the right formulation would be for our product.

SPEAKER_00

And that's also what I tested with consumers pre-launch is what's your perception of, of this label? What's your perception of this many gummies, the size of gummy, this flavor of gummy, all of that stuff.

SPEAKER_02

Sam McLean What's on your ideas list, but you're not going to actually go do it. So you can, you can riff with us here of brainstorming other brands, other ideas that you think are interesting, may not, may or may not work, but interesting. Sam McLean

Yeah. And also you mentioned that you have a notion doc, if you, if you're comfortable. If you want to pull up your bank balance, we can also just do that. Sam McLean Tell you wiring instructions too. Sam McLean Here's what I'll say. One thing that I, that I disagree with is people say ideas aren't worth anything. Oh man, do I disagree. I think ideas are worth so much in the right hands and in my hands, they're in the right hands. I believe, and every founder should believe that about themselves. Sam McLean And so there's certain ideas I can't share. Cause I'm like, guys, like I legit have an idea that years from now, like I've still got a lot

SPEAKER_00

I want to do with Gruen's. Like, like actually there's a lot I want to do with this business. I'm not done here. But like years from now, I think there's an idea that no one else is going to be able to run it. There's a $10 billion business idea. And I'm, you should just say it now and we'll bleep it out. And we can react.

SPEAKER_01

Sam McLean Give us like a code word or something. Sam McLean We can at least give you credit for it. Sam McLean

SPEAKER_02

Hey, look, we're the wrong heads.

SPEAKER_01

When you see it, you'll know, you'll see it and you'll go, oh yeah, this is a bill.

This is a big business idea. Sam McLean So, and I don't think anybody's going to do that in the meantime, while I'm finishing my chapter here at Gruen's and doing what I set out to do. Okay. Well, what, what, what, what are some other ideas that if in the right hands are great, that, that aren't your hands? Sam McLean I had this idea one time. It has nothing to do with consumer. Sam McLean And I actually almost ran with it around the time I was starting Gruen's and I still think it's a good

SPEAKER_00

idea, but I'm not going to be the one to do it. So I'm happy to share it. Right now, there is no way to direct the money that you have coming in from like direct deposit. So that direct deposit hits your checking account. And then we've all got to have the willpower to decide, oh, put 10% in savings and put this against your bills and do this over here, blah, blah, blah. What if you become the, essentially the distribution layer of ACH transfers? So it hits this distribution layer. And before that person has to have the willpower to decide what they're going to do with it. And this is helpful for so

SPEAKER_00

many people in their lives, right? It gets wired out to the rent that they have. It gets wired out to their car payment. It gets wired out to blank over here, over here into their investment. And so what actually hits their account that they're spending against is 500 bucks for groceries or whatever it is. And the technology exists to do this, right? It hasn't been structured. I can't remember what platform allows for it, but there's a platform that can facilitate what I just described to you. So like this idea could be done tomorrow. That's a great idea. Even whether it's for consumer

SPEAKER_00

or for businesses, have you ever read the book Profit First? No. Somebody recommended on the podcast and they go, it was like the time when my girlfriend bought me the book, The Game, before I went to college and we were going to break up and it's like, you need to learn how to talk to girls. And I was like, oh, thank you. It was like, it was a gift, but it was also a message. And my friend told me about this book Profit First. I think it was a gift and a message. And the message was, hey, you're running this business and you've been doing it for years, but you're not pulling out any profits and you don't know where all the money's going. It's

SPEAKER_00

profitable on paper, but like you're not getting money out of this. And that's a very common business owner problem. And there's this book called Profit First, which has this philosophy, which is basically you preset the budget. So what most people do is they say, I have this much revenue, then they have all their expenses. And then it's kind of like, surprise, whatever's left over, that's your profit. And you're usually quite disappointed with that surprise. The better way what this guy advocates for is like, you just set a budget for your P and L. You say, oh, I'm going to spend 25% on OpEx. I'm going to, I need to reserve 20% for taxes. So I'm not

SPEAKER_00

stressed out every tax season. So I just want to put that. And you literally just create four separate accounts. You create a tax account, a checking account. So automatically 20% goes in there and that's waiting for, it's in a, like a money market account until tax season. You have your OpEx account. And so now your team has to run on a budget. It's like, this is how much you have to

SPEAKER_02

spend. You don't get to just spend whatever and keep eating out of profits. And you set a profit threshold where you say, I want to have 50% profit. So it basically pre-allocates to your, as every dollar comes in, 15 cents will go to the profit bucket, 25 cents will go to the OpEx bucket. And it's actually kind of a life-changing idea because it forces discipline. You think you're running pretty lean until you actually have a hard cap on expenses. And then you realize like, oh, actually there was way more fat I could trim. I actually could have been this profitable yesterday. I just, I let it be an output rather than an input. But, but unfortunately there's not an

SPEAKER_02

easy way to do this. A very, you have to like set up seven accounts with your bank and then you have to tell your accountant, Hey, keep doing these sweeps every two weeks. Have you guys heard of simple, do you guys remember simple? Uh, I loved simple. It was really cool. I don't, I think it's gone. It got it. It was one of the very first Silicon Valley, um, uh, banking. Neobanks. Yeah. Neobanks. And it was, I don't even think Neobank was a description. It's like the envelope system where you like put digitally money into different envelopes. Yeah. And like, I didn't, I didn't make a lot of money at the time. And I was like,

SPEAKER_02

but I want to like fly home to St. Louis to see my family. And so like, it's going to take me four months. And so I automatically, when it would come into my bank account, the way it would visualize it, it was still one bank account. It was like, well, this is, this is how much is left. You know, you have 350 bucks in your, uh, spending account, but you have, uh, another 400 in your vacation account. So like, don't touch that money. It was pretty cool. So, so Sam, the, here, here's what I love about this idea. And Sean, you're bringing up actually why I think this is even potentially more compelling for businesses, because if you're changing the way

SPEAKER_02

that the P&L works, I mean, venture capital firms want that because now there's more discipline around the money that they're giving. Totally. The, the small founders who are making 5 million a year who want to pull 500,000 out, they want it because now it's like, oh, well, I'm forcing myself into that discipline to pull 500,000 out every year. It's like, that's a huge use case that I wasn't thinking of. And in terms of personal, the problem with budgeting today is it's done. I grew up in a family where at the age of six, I was in Quicken and like, I had to take every receipt, scan it, type it in back in the, you know, Your mom and dad made you do that?

SPEAKER_02

My dad taught me budgeting. Yeah. That's awesome. And like, we were so against debt and everything else, but I like, it was awesome until there was an imbalance at the end of the month. And I had to go search for the 20 cents that was off. Is that like a Mormon thing? Because I've, I've, I think I've met a bunch of Mormon buddies who are very disciplined with their monthly budgeting. Yeah, it might be, honestly, it might be something that's, I mean, there's a lot of like financial discipline in general, but, but to put, put the headline on it, to me, what I love about this idea is it solves what I think sucked about the granularity of like wasting hours a month,

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a week on like typing in all my stuff. Right. And it also solves the other end, right? Like people, they get to the end of the month and it's like, that was actually a hassle to do that. I'd change any of my behaviors based on it. I don't know. And then the other end of it's like mint back before that got acquired or whatever. And I think the other one today is Monarch, which I like Monarch. Love Monarch. More money. It's like, it's helpful to see, but like Monarch is not really like a proactive platform, right? It's like, oh, I'm just like getting information. I'll tell you how bad you're doing at it versus, hey, let me just fix it for you. Totally.

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What you wanted to fix it for me solution. I really wonder whether, you know, with agents or, you know, you take the popularity of like Mercury or the kind of all the popular neobanks that are pretty product first. Yeah. And they're more programmable. I wonder if either somebody could build it on top of one of those banks

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or if they'll end up releasing something like this themselves. I think you get acquired. I think if you run this business, you're going to be acquired for 500 million to a billion in like two years. If you execute this right, like somebody out there listening right now, feel free to send me a DM when you do it. Like this, this idea, the infrastructure exists to be able to do this. If you execute it correctly, you are one, making a massive impact in millions of people's lives. And two, you will have a financial outcome. What would be cool is if in 12 months we have to say, hey, everyone, we did this podcast with Chad

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here. Here's what he said. And then we aired this clip that you just said. And then we're like, here's the update. Because this is, this is fantastic. This is really cool. We, we, we do this segment all the time. This is, this is a top tier idea. You, you have a couple of quotes that you sent us or like kind of philosophies. We always ask people,

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what are your, what are the philosophies you live by that you think are not,

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not something everybody does or not everybody believes in? You said one, one of them that I like, you go access is everything. And you explained how you didn't have a ton of access early on, but you know, through summit and Stanford, like how, can you explain your access is everything philosophy? Yeah. Um, I think access and the privilege of having access in the world is something that when you don't have it, surround yourself with people who do and do good work for them and you will get access every time. And then when you do have it, like the privilege I now have, I see it as your obligation, my obligation to give that back to others.

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So explain what you, what you mean by access. What's the personal story where, where this kind of resonates? Yeah. You know, like I'm a dude named Chad. I worked in private equity. What you see today would not have existed without people leaning in and giving me access every time incrementally and me doing good work for them. So like, if you go back, I mean, I was always curious on this because I think you get asked in those questionnaires, like, are you, are you middle income,

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high income, low income? And like, I was aware of sort of wealth, but if I looked at sort of the income that my parents had and I have seven, there's seven of us kids, so six siblings and our income, I think I was like bottom middle class is like how it was defined. And I'm not saying that from a standpoint of like a shame, like I'm grateful to have lived in this area and seen these people. Cause I think you can solve a lot by just giving awareness to kids about what's possible.

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It's like the grasshopper moment. Once they know it's like, oh, now you can go get it.

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So I get, um, I was recruiting for, uh, the big three consulting McKinsey, BCG, Bain, through a contact to, who put me in touch. I didn't get it, but I landed through another mentor, this, this gig at Lazard. I did really good work and Lazard's an investment bank. Um, so in New York city, one of the top premier investment banks working on mergers and acquisitions, that mentor, I'm still close to him. I wouldn't have visited him. Right. So he gave me access and that access then landed me at summit partners and summit partners. I did phenomenal work for them. I deployed, I literally invested like 30% of that fund, a $5 billion fund. Like I invested that. I sourced

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the deals that made them the money behind that. I did really good work. And there's this moment

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when I got into Stanford that I was like, oh man, like, should I feel bad? Because I know how this

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works. Like I only got in like, yeah, I've had a ton of accomplishments. I had a 3.95 GPA. I've worked at great places, but it's white dude named Chad. Like, should I feel bad about this? So they got into Stanford. And what I came to appreciate is like, no, I shouldn't feel bad knowing that the reason why I got in is because, you know, two people who are very close to the Stanford folks sent a text and a nice letter of recommendation for me. I shouldn't feel bad about that. Cause they're not just doing that, right? They're doing that because I did good work for them. I made their

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lives easier. I earned their trust. And so maybe I wasn't born into that access where my dad can send

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a text to Stanford and say, let my, let my son in, but you can earn that by doing good work for the people who do have that access. And they're, they're so eager to help you, um, have that sort of accomplishment. So that's how I think about access. And it's part of when, you know, I got asked

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recently, like, what's your legacy that you want to leave on the world? And I'm like, uh, you know, it's like 33 years old, but the way I think about it is like, I want to give that, that access that I've sort of like either been granted or earned over the last many years. And I, and I want to ensure that more people have access to that who, who spend their, their lives working with me and putting good work. Dude, you're, you're awesome. You are so cool. I think that, um, when I was younger, I met this really successful guy named Scott Belsky, who was, uh, the chief product officer of Adobe and, uh,

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an amazing entrepreneur, maybe a billion billionaire. And he used this word with me that I never heard before this idea he used, um, he said, I'm going to invest in you and you need to be a steward of my capital. And I was like, I don't know what is that word steward? I'd never heard of that. It's just like this idea that you need to be the vehicle that, that protects and passes on like a little bit of greatness. That's kind of how I interpreted it. And you are that person. So, my friend, Austin reef, do you know, Austin reef? He's the, uh, one of the morning brew. Yeah. So he started and sold the company for hundreds of millions of dollars when he was 30

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years old. He was texting me about this new idea that he was working on or brainstorming. And I was like, do you think it's going to be successful? He goes, it can be successful if I want it to be. And I love that because what you and him both said something very similar, you have this similar mindset, but I find myself being around him and people like you and it's contagious. Yeah. You know, and I've thought about whether I should be, I've, I've tried to figure out whether

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my impact on the world is more narrowly focused on the people who spend hours, thousands of hours with me working inside of grids or if I should have more of an impact publicly trying to relay some of this message. It's hard though, you know, like to relay all of this, um, these experiences that I've had in, in a public forum that allows for millions to, um, to learn, but you're totally right, Sam. Like at the end of the day, why, why was I able to build what I built? It's because I knew it was possible, right? Like I saw it done many, many times by others. And if I ever had a question, I could,

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I could go ping those people. And so network experiences, awareness of what's possible.

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I think there's a, maybe a different way to say what you just said, you know, the way you just said, it was kind of like, Hey, I got, I was pretty fortunate that these things happened and I did my part, but they did their part. This happens a lot with entrepreneurs as we sort of stumble and fumble

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our way to success. Then afterwards you can actually look back and realize like, oh, there, it wasn't complete random. It wasn't complete chance. And in fact, you could recreate the conditions of success more reliably knowing what I know now. And so I would just point to three words that you just said. The first one is exposure. You really can't imagine what you've never seen. Your brain won't go anywhere. Uh, if you don't have any exposure to things. I was talking about this with Ben, my business partner about my kids. I said, my kids have never been exposed to so much in the world, right? Like we literally keep going to the same resorts. And I was like,

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they've never seen a third world country. They've never seen this. I started bringing them to just do adult stuff with me. Cause I used to do kids stuff with my kids. And now what I realized is, let me just bring them along for life. And kids actually love it. They like doing laundry. They

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like cooking. They work out with me now in the gym every day. They like going with me to, to meetings. They like, you know, they actually kind of enjoy that because they're getting exposed to new stimulus that they've never really seen before. And even if they're five years old and they can't fully grok it, there's some part of it that just breaks some fence that they had around what the world is. And it starts to poke holes and it lets new things in. Growing up, I didn't know any entrepreneurs. I didn't know anyone. In my entire family, my mom has nine siblings. My dad has four. Out of all of them, there were zero entrepreneurs. Every single one of them was an engineer,

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like typical Indian family. And so the highest calling was you get a good job. What's a good job? A six figure job that has health insurance. So that was all I knew. I was all I was exposed to of what was possible. And then my senior year of college, I took a class called getting rich. And in the very first class, she brought in a speaker and there was a girl who started a t-shirt

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company. And then the next class, she brought in a guy who started his own hedge fund. And I just thought, I looked at them and I said, why are these guys having all the fun? This sounds awesome. Maybe I could do that. Instead, I was finally exposed to the thing, you know, when I was 21 years old and it changed the trajectory of my life. Had I not had the exposure, it literally would have just not happened. And so the first is exposure. How do you get yourself in a position to see new things or help other people see new things? The second is access. And then you, the way I would put it

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for you is earned access. Cause you said something very casual. You're like, I did good work for them. You know what? I bet if we peeled back, there probably is a lot there. I bet you over delivered. I bet you didn't get paid proportional to what you did and you didn't whine about it. These are my

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guesses. You tell me if that's true or not, but the access is earned through showing that you're somebody who deserves greater opportunities and greater access. And you sort of delay the payoff of those actions and you just have faith that I'm going to just, I'm going to kill it right now. And I trust that, you know, the ball will bounce my way over time and I don't need to immediately tit for tat measure what I'm getting versus what I'm putting in. Yeah. I think, I think it's true. And frankly, I think, you know, I'm young, I'm 33 years old.

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I think about the impact I want to have on this world. I think it's that first one exposure. How can I facilitate exposure to everyone? Right? Young, young kids, how did they get exposure that honestly, I think that's where my wife and I want to make an impact is making it possible through some, some

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effort in the next chapter of my life to ensure that the random kid who's six years old or 10 years old in a place that would never get exposure to this, at least knows what's possible because they know it's possible. Maybe they'll go after it themselves over time. Hey, can I, let me ask you a question that, um, you might not feel comfortable answering when you're wired hundreds of millions of dollars. What do you, what do you decide to do with it? Where did you invest the money? And that includes like, did you decide to give any away? Yeah, TBD on it. But I, one of the hardest things I

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have is I've thought about my, my impact. Like it's the same as, um, I don't even know if I'll invest in other companies and it's not because I don't believe it's like, what's the next best use of a dollar? It's gonna, it's gonna take a lot to convince me that it's something other than what I can go after and do. And that doesn't mean it's always business profit centered. Like I don't always have to make money, but like, can I, Sam go out and make, make an impact on the world by taking my own funds and building like something special out of it, right. That has an impact on whether it's mentorship,

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exposure or whatever it is. So TBD, I mean, as you know, when, when you receive money, you spend a lot of time thinking about deploying and you don't want to rush into anything, but, but I would expect that the more meaningful, um, deployment of my capital is going to come through some personal effort in my life that I do to, to make an impact. So, well, first of all, can we, let me ask a boring question. Where'd you invest it? The current money, where'd you invest? Is it just boring index funds? Is it, uh, you know, uh, there's a difference between signing and closing. So you have to go through

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anti-regulatory. Uh, so we've signed, but the closing happens as soon as it's been approved by government. So you don't have it yet. The money's not been wired yet, but the deal's fine. I don't know what that, I've not had a deal. There's a large hole. Yeah. My first acquisition, they just Venmo'd me.

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Yeah. We've not, I've not, I've not dealt with the, with the, uh, Department of Justice yet. So that's pretty cool. That's funny. Yeah. There's a crazy, there's a crazy story. You know, the company Applovin? Yeah. Yeah. Yeah. My, my co-founder was the co-founder of Applovin at the time. So he's sitting next to me at the office and they signed this deal and I'm like, oh my God, you just sold, they sold the company for I think 1.2 or $2 billion. I forgot which, what the number was, but 1 or $2 billion. And I was like, wow, dude, you did it. You sold a company for a billion dollars,

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$2 billion. That's amazing. And I was like, should we go dinner's on you? What's up? He's like, dude, we haven't got the money. It's going to be like months. He's like, if it's over, I forgot what the number is. 750 million, a billion dollars, whatever it is. Like literally like the government, you know, the way he put it was like, it's going to sit on Trump's desk until he stamps it. The crazy thing was they sold to a Chinese company. So there was actually a lot of risk. And so he didn't know this at the time he thought, you know, it's over. Yeah. Well, nine months go by, a year almost goes by and the deal is still not approved,

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but they've been running the company. They've doubled revenue in that year. Yeah. And so instead of waiting for the approval, what they did was they went and renegotiated. They're like, hey, here's what the 2 billion gets you instead. And now it gets you 25% of the company instead of whatever, 8,500%. So they renegotiated the deal because the business had grown. So it was the best thing that ever happened. And so they took a minority investment, got some liquidity. It kept growing the thing. It's now like, it was a hundred billion dollar company in the last year. Right. So it went a hundred X since then.

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A quick Google. So I have an attempt to read all this. I believe it's $130 million is the threshold where the DOJ has to. Interesting. A $130 million? Yeah. You have to notify the DOJ and the FTC anything north of $133.9 million. Yeah. Dear DOJ, I'm rich. What do you notify them? There's like an official form and then they, they're just reviewing it as they should to make sure that it's not bad for the consumer. Dude. That's cool. That's awesome. Well, dude, thanks for coming on, man. And congrats again on building something pretty epic. I remember when I saw the product, it just seemed like, oh, that's it. And the best products actually

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are simple like that, where the proposition is easy for the customer to understand. It makes sense in the world. It was almost like hidden in plain sight, I feel in a way. And to your credit, you ran with that, you acted on it and you built something pretty incredible. Of course. Thank you for having me on. My hope is that three years from now, we're talking and you guys are like, geez, dude, we didn't realize there was that much ahead of you. We've got so much this team wants to do. And so eager to show the consumers what we've got for them. New products, new innovations, new fun, limited time offers. What's the best thing on that shelf I should buy?

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Um, so have you tried the Hollypop? We've got some products here that are launching soon, but have you tried the Hollypop? No. That's actually really delicious. I've only ever had the original. I didn't even try anything else. I just got the original like subscription. That's it. So yeah, you may know this, but we've got Grunz, which is the comprehensive nutrition greens, multivitamin fiber. We've got Nutrop's, which is a Nootropics product. We've got Immune, which is like a, almost like an immunity shot, like the two ounce bottles, but in gummy form. And then we've got

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Juiced, which is this one right here, which is like a pre-anything energy product. So, I mean, we've got like 12 innovations in the pipeline. That's what I'm saying. Like, it's so exciting. We've, we've like done something so big, but like, we're like maybe five miles into a marathon. Good man. Thank you so much for coming on. You have an open invite whenever you want. You're, you're, you're a wonderful guy. We're, we're so happy for your success and it makes us feel good to promote you. So thank you for coming on. That's it. That's the pod.