Dan McCormick Is Taking "Build In Public" To A Whole New Level transcript

[Music] hello and welcome to the Andrew Ferris podcast thanks so much for joining me for a great episode of the show with Dan McCormick from create creatine gummies you may know him as the author co-author of the weekly dose of optimism newsletter alongside his brother py I won't try to totally untangle exactly who writes what part of what from these guys but I subscribed to very few newsletters it's one of the ones I subscrib to and then in the midst of subscribing to that and getting some information about why the world is getting way better way faster than you possibly think because of tech on top of that Dan is the founder of creatine gummy brand that is growing very fast and Dan has built in public in a way that few people build in public in terms of the level of transparency people talk about building in public Dan is being very transparent about it on Twitter and therefore he's a great follow there so let's jump into how Dan has built create what he's attempting to do with it where it's trying to go and what has made it into a company that in the last month did over $500,000 in revenue is profitable and uh has a really big upside for all kinds of reasons I'm a Believer in the brand and what Dan is doing because you can just see it if you just understand at all what he's been talking about you can see exactly why the whole thing works and makes sense and surely will lead to millions and millions of dollars of huge outcomes for him and and his Partners so okay let's not delay anymore Dan McCormack is here and we will jump in Dan hello welcome welcome to the enderis podcast thanks for making time man Andrew happy to be here thank you for that kind intro yeah well it's a really interesting thing like did create for me like the first time I saw it I was like genius idea that's for sure going to work it was just like a sort of a no-brainer kind of concept to me once I saw it and especially because over time and maybe this is a good place to start I have refined my own sense of what I think makes the right elements of a good D Toc brand and a good D Toc opportunity and so I would actually like to start there with you so tell people what create is first and why they should be taking creatine specifically in the form of a delicious gummy I was actually already there with you on that point so that part was also easy for me to see but why that and then I'm really curious to hear you talk from the beginning about why you thought this made a good dto see opportunity for you and and what you saw in not only the product but in sort of how that could be something that fit specifically in the in the method or in the model of D Toc as much as that was in your consideration maybe it wasn't but yeah no it seems like you've read some of my tweets a lot of the thinking about why I wanted and and why I should start this company starts with like I think there was a really good dtoc opportunity here but taking a step back pre's a supplement that I've been taking since high school with many people uh for the first time I took it during freshman football I soon after freshman football realized you know I was about 58 160 pounds and no future playing Collegiate or professional sports are switched to running cross country track three seasons but for whatever reason stuff with creatine supplementation uh throughout my High School cross country track career they probably one of the few High School Runners actually taking cre te but I say this to say like it's a supplement I've been taking for 10 years always had a really positive experience with it never really exper experienced some of the negative side effects that at least like you'd hear about in the locker room right like kidney disease hair loss acne bloating all the things that people talk about when or at least they used to talk about when they talk about creatine I never experienced that and I wasn't your kind of poster boy creatin user right I wasn't a bodybuilder I wasn't a athlete that required huge muscles or you know super high levels of strength but again it was something I always really enjoyed fast forward you know about a decade decade and a half I've been in the e-commerce world for about five or six years working at these kind of high growth Venture back D Toc Brands away parade names that I think at some point have definitely been you know kind of top tier and and have kind of to some extent Fallen to the pressures of the DC game which is a super super hard game it's a tight Rock world no matter how much money or Venture you've raised and so that's my personal story like it's supplement that I've been taking forever really believed in never really understood kind of that NE negative stigma around it and so when I saw creatine I kind of like sniffed in the the air a little bit that creatine was about to have a moment new researchers coming out or existing research was starting to be popularized on podcasts like Andrew huberman petera Tim barish Joe Rogan like randomly creatine was suddenly being discussed on the top call like five podcasts in the world and that combined with kind of a bunch of other factors cause was causing creatine search volumes to Skyrocket in late 2021 early 2022 just around the time that I was looking to start a business and why I thought this was a good opportunity one the idea of like destigmatizing a compound or a medicine or a product like we've seen that Playbook and D Toc time and time again and creatine was just like so ripe for that there's so many misconceptions so many myths that can be easily reversed via research or better education or just more approachable branding so creatin as a compound was right for that but when I looked at kind of like the underlying business characteristics and also was I think a really good opportunity creatine is supplement you take every day it's a supplement you don't really want to churn on it off of so it had really sticky retention characteristics two it had a kind of a a core customer base of Fitness enthusiasts but it was otherwise really underpenetrated in the mass Market our belief was that creatine supplementation is something that can benefit a very high percentage of the population but only 2% of people took it today but that 2% of people really freaking love creatin and so you can kind of have that core user evangelize it to the rest of the the population three structurally high margin so supplements generally are relatively high margin products collecting more more of each dollar that you're selling is really one of the few ways that these D Toc businesses really work today like you you really need strong margins unless you're a super high volume business and then third uh or fourth rather you know I thought you could build a really strong Standalone dc.com business with this with subscriptions and repeat and just better Facebook ads than most cream brands were using but I thought there was a really natural transition to Omni channel so D to see Amazon you know 70% of supplement searches and conversions happen on Amazon today then beyond that retail brick and mortar you walk into a Whole Foods today it seems like 15 to 20% of the footprint is you know taken up by collagen collagen certainly had its moment I think if you compare collagen to creatine the science is definitely in favor of a compound like creatine and despite that there's not one gram of creatine in my local Whole Foods so I think there's that retail that brick mortar omn Channel opportunity kind of out there for the brand that's able to establish itself as the most credible in the space so that was kind of a mthf but that's how I I started great I mean so I think it's so helpful I mean you said it's mouthful but what I hear in that is Clarity you know it's just like veteran Clarity like you said you came from these other brands and probably could see what was happening economically in those businesses and what worked and what didn't work about DDC as a business model I've heard people sort of critique the idea recently of DC as a business model they say DC is a channel it's not a business model I get what they're saying but I also think it's it's kind of wrong like DC actually is it's probably semantics is what it really is but it's it actually does have some elements that work particularly and I think a couple of those are first of all the notion of an owned customer relationship which was the thing we all got really excited in the beginning of this it was like oh you own the relationship with your customer you know that is only helpful if you have a product that people are going to come back and buy multiple times and if it is that kind of product then it's very helpful and it's like it's like a massive advantage of the channel and this is where something like create makes a lot of sense because it's an obvious case for subscription what's more with create like because it's a certain number of things that you take it's very easy to subscribe to it and not have the friction of like how often should I set my subscription at like if I'm going to take you know two gummies a day or something like that and I get a 60 pack that lasts me for 30 days and I can just set my you know it's like very easy to kind of figure that thing out and so it has all the elements that make subscription a really valuable thing both great for the customer and great for the brand like it's it's it is you know the promise of subscription as being something where it's like I don't have to think about it it just charges my card and it shows up when I want it to that's great for certain things I subscribe to my coffee I subscribe to my creatine all of those kinds of things as soon as my current bag runs out I'll probably making the switch Dan just so you know but yeah the you know those kind of things really work and then I think the other element is like the ability to scale with well margin protection via going direct to consumer that is another great promise of D Toc and what everybody sort of didn't see coming there was that instead of the third party of a retail person or of a retailer right who's going to eat away at your margins the third party now is Zuck and Zuck eats away at your margins except that you can actually use that really really well just like you can use retail really really well for some things and so in youra in in the case of of a brand that has high margin and high LTV it is so ripe for the clear third party which is Zuck to be a great channel for you to acquire customers because because now you can spend a lot at uh breaking even CAC or whatever you know there's a lot of strategies you could approach with with how you set your CAC there but at the same time that customer is worth a lot of money to you long term and as high margin and you retain that margin and you don't have to go back to Zuck for the second purchase so it's like it's a really it's really really helpful for that and then third I think you can probably grow your team pretty lean and scale really really effectively which I think is is maybe the core value of of D we haven't talked about your team really so I don't actually know how lean it is right now but my guess is that as you have scaled you know I mean you you've shown over $500,000 in Revenue in September off of what did you do in January and you posted this chart somewhere but I don't have it in front of me January was 60k yeah okay great so you 10x the business right over the course of however many months in this year and I bet you didn't have to add many heads to do that like and that's because DDC just scales great and as you keep scaling it'll scale even better I think so you know I remember hearing a butcherbox interview where the the founder of CEO there was talking about it was like two or three million bucks in Revenue per head that he had hired and that's just like impossible in a lot of other businesses but it's because it's DC and so there's all of these elements of it mixed with what you're saying about the market and the demand side and the fact that creatine is the most supplement study supplement in the world and it and it just works like it's just good for you you should take it you know so it's it's it's sort of fascinating I that's on on basically everything you just said like okay all right well pick pick your favorite and go yeah yeah so D Toc as a business model thinking back to I guess 2017 2018 when I was at a away kind of like a gen One D high growth business there was so much focus on cutting out the middleman owning the customer customer relationship you know having a direct onetoone relationship with the the customer that was like you know we would make infographics around it showing like cutting out the middleman and all this stuff right and it turns out for someone like a way it actually doesn't matter right they're selling you at most two products a year at most I think on average a customer will buy 1.5 products a year and so so it really didn't matter that way on the own the customer What mattered was that at the time you know we could spend a ton of money on Facebook efficiently on a $250 product for $80 tax at that moment Arbitrage yeah and and that point is so crucial I'm sorry to cut you off that like I would now look it away and say it's a terrible DDC product like it's going to be heavy to ship and and you're not going to have a meaningful LTV and you you know have DC as a part of the business but it's never the way I would expect to grow a big version of a way you know yeah I mean I think if you look at a big version like away you're selling it everywhere like you just lean into the fact that it's like the nicest version of a commodity product that you can get and you can get that product on awaytravel.com you can get that product on Amazon you can get that product to select luggage retailers you can get that product anywhere it would be foolish today to try to run that just DC I'm not sure actually what they're doing yeah and then on the team front it's a little misleading it's like it's just me today full-time running create a kind of an army of agencies and consultants and Freelancers but like on a day-to-day basis I'm kind of the only person fully focused on our business almost everyone that I work with has other things that they do actually myself included as you alluded to in the intro and that that's the point like it I think you a lot of these channels you can scale without scaling internal head count you know even instead and that's one of the learnings of the last five years indeed see is that like you don't need huge floated teams to run Facebook ads right you probably need a good media buyer and you need like a bunch of diverse sources of creative which does not lend it well lend itself well to having an internal creative team it lends itself well to having Freelancers and creative agencies and people you're taking flyers on with like new content and so yeah to answer the question it's just needle time maybe that'll change but again like that doesn't mean it's just I'm the only person that is producing work for create it's just I'm the only person that is a fixed cost for the company I mean that point still is the same in that respect like I always think even some of the notion of agency or in- house like who cares like get the best people you can and try and make it scale effectively and your point is still right like you can manage a team of agencies and Freelancers like you said and and it and it can work really well and and those costs will all scale really well too I think they'll that there'll be some cap on how much you pay you work with kinship right I worked with kinship yeah and and to that point like could I go and find an individual person to like execute the cost cap strategy maybe but I'm not going to be saving much by bringing that person in the house and they're only going to have reps at one brand like part of the value of working with someone like kinship that LE they have a perspective on the world they see that perspective play out across like 50 brands or however many clients they have it's helpful that they can see what's happening across a bunch of different people even if there's like marginally less control over their day-to-day activities are marginally less control over like you know I don't have like one on with my media buyer three times a week right that's okay because you're essentially paying for the flexibility you're paying for the fact that they're seeing this strategy play out across dozens of other brand and it can apply those learnings to you yeah I think like it's a specialized knowledge set that is sincerely helped by putting all of their time and effort into a narrower range of focus than what you can do as a business owner right like so it's like the you know kinship and I think the same thing is true with with CTC where you know I came from and I'm still technically kind of a partner it's like those guys they've got a couple of strategic perspectives built based on the fact that they are in this Lane and they've built up the institutional knowledge on how to do a few things really really really well and that lends exceptionally well to like exactly what you've got right in I mean I think lean is almost too is not extreme enough of a word for one guy you know obviously like you said it's not quite fair to really call it one person but it's interesting I mean and I think you know a lot of people go and start DDC businesses now because like a fun product whatever but what the Reps give you over time that you've experienced is sort of the perspective on okay how the model really works relative to the product at the scale and and like you said right there's a demand capture opportunity there's no creatin and Whole Foods right now right so like there is potential growth on your ability to go Omni Channel at some point and I'm certainly Pro Omni channel in the right timing and the right sequencing for for a d Toc brand you know it's not really about like pure play D Toc or something but it's it's about what makes it a good way to launch you know and how to scale the business from there so okay let tell me about your goals what where are you trying to get create to how big is the opportunity what can you say about sort of where this is headed versus where it started and I'm sure that was somewhere in the consideration of of all of the things you just laid out about what made you start it the way you did yeah that's certainly changed over time you mentioned this in the top I have another thing that I do basically fulltime which is work at not boring not boring is a media and Venture business I write our weekly Friday newsletter weekly dose of optimism and support my brother pachy and a bunch of other kind of business and content and investing Endeavors and so when I left my last job to join there I am and was fully dedicated to doing that and kind of had this Insight that like hey I think there's a creatin opportunity here some good branding some like good distribution some smart ads I think I can build a really nice kind of like lifestyle cash flow business on the side as I do not boring like let's just get a product list on Amazon let's just run some like Facebook ads on cost caps whatever I'll pull a few thousand dollars out of this a month right in in a couple of months in the year or whatever true lifestyle business when I got deeper and deeper into it I was like actually I think this could be one of the bigger PPG brands in the world right now when you look at like the exits in health aoness supplements those are some of the better outside of potentially makeup some of the better cpg b2c whatever you want to call it businesses things like athletic greens things like metal proteins things like element which is not hasn't had an exit but is a huge business I was like oh wow we're sitting in this hot category I think we've kind of backed our way into being the hottest brand within this category I think this category is going to continue to grow and once it does not even just distribution expansion but potential product expansion a bunch of different opportunities so all that to say I think it changed from like hey let's just have a this kind of business that I'm not putting my name behind I'm not really talking about I'm pulling a few thousand dollars a month out of it to fund my lifestyle whatever into hey let's turn this into one of the more recognizable one of the more ambitious cpg brands of you know this early 2020s period yeah I think that what's very likely is that the goals will change again at some point I always think a question about goals is really a question about what you believe today more than it is about like where the actual longterm is but I love that like because exactly what you said right you start it with that sort of Lifestyle mentality and then you start to see as things Shape Up you get new information and suddenly your goals change I can see that too and I think there's a like I I I understand your optimism about it like it it makes it makes a lot of sense to me about yeah it's easy to imagine product expansion as part of that Etc do you have a number that you are trying to get to that you'll say if you if you do you don't have to say it but yeah no not really I think like the number will kind of follow the opportunity and I think the opportunity is pretty big whenever I talk to people that are you know a few years a few tens of millions of dollars ahead of me in Revenue they always like the number one piece of advice is just like stay focused they if you truly have product Market fit in one of these like cpg wellness products you're going to be shocked how much room you have to run before you like do you know aggressive product expansion or aggressive distribution expansion like like there is a ton of Runway in people that want to feel healthier have healthier lives feel better on a day-to-day basis and that's kind of what creatine does and so kind of just letting that play out for the next couple of years before you know anything too crazy when you when you say room to run before you do aggressive product expansion or or you saying that does that include aggressive product expansion and include aggressive Channel expansion so of course I'm always like wow I know how to make gummies I have a gummy manufacturer that's one of the best in the world why don't I take every freaking compound in the world that I think is stigmatized and could benefit from gummy affectation and get that out to Market I am tempted to do that every day I can name seven different compounds I want to put into gummies today and like start either extensions on or new brands on and like the focus is like no you have this gold mine with creatine there will always be the opportunity to put magnesium in a gummy right and potentially I'll do that but like stay as focused on you can as making the creatin gummy opportunity as big as it like see that opportunity out before you lose focus and like I feel like as Brands especially within supplements it's super enticing to do LTB expansion right you sell someone protein powder then you're selling them beef liver capsules and then you're selling them green juices right and that's certainly a business model but it's also a way to quickly commoditize yourself as a supplement seller and then you're fighting against the 50 other supplement platforms out there and that generally turns into a fight of who has the company with the best connections or the biggest celebrity endorsements or the exclusive deals with Eng huberman right and so how can we stay out of that battle and just focus almost singularly at least in the next you know x amount of months or years on seeing through that we are the creat gummy that people choose when they take a creat gummy super interesting I have a lot of questions about that but I've been struck by the dynamic you're talking about with athletic greens where it's really built around this core product and that's it you know and then I mean I don't I don't have any clue what the revenue makeup is I actually never even I don't even know if they make other products say you want but like that's the thing I think of and then heart and soil the same thing where it's like you know this delivery of specifically organ supplements and that's the that's the thing and you're right like so much in supplements is they go towards expansion of a whole bunch of other categories and I and you're and it is interesting too like part of it is even it's not even motivated entirely by LTV and revenue it's like I think partly people just see their customer could benefit from these things and they they want to help you know they like you need to be taking organ pills like it's good for you go do or whatever you know it's like it's a combination of of the two opportunities at the same time you know for some of these people so how do you maintain well I'll let you respond to that you look like you're going to say something go ahead yeah when when I think of ag1 and I'm I'm like guilty of this as well I think of that you know that Meme of like the distribution curve of it's like the Jedi and the dumb person in the middle it's like the person who trying to overe explain it I feel like on the two ends of that Meme distribution is ag1 just sells or athletic GRE just sells ag1 and in the middle of that like at the top of that Bell card the person trying to over complexify the situation it's like why isn't ag1 selling on Amazon there's such a huge Amazon opportunity why aren't they selling on Walmart couldn't they do like a protein shake and trying to over like add so much complexity to their business where it turns out that like almost everyone in the world can benefit from drinking a green juice and that's a huge opportunity and why put that at risk by selling like a million other things right yeah a worse opportunity yeah yeah and I think you're right this a really interesting comment that about like how much runway you have as part part of the issue here people I think do underestimate that there's just like a lot a lot more people than you think who are your customer and so just figuring out how to keep going and drilling into that as effectively as possible it's literally crazy and I know this is going to sound dumb to people listening but just like scroll through your customer names on a day and realize that you don't know one of those freaking people like you don't know not one of those people have you ever interacted with you're probably at closest like 3 degrees of separation away from there's just surprisingly a lot of people out there buying stuff online and so yeah I would say like Chase down capturing as many of those people rather than ere expanding yourself and of course like exceptions to the rule and all that but yeah yeah yeah I do think this is actually one of the problems with like like people like me which is people who are tweeting stuff about things they're seeing working and recording podcasts with people who are saying like did you see how much revenue I did organically without spending a single Dollar on meta and then also like people who are saying like you absolutely have to use cost controls and then here's exactly the Crea like there's actually too many ideas and and it sort of the industry of people trying to help you get better is actually sort of working against this and somebody sees a product development win massively change their business and then they're like oh you got to go develop more products too or you know and so it is it is part of the challenge of staying focused and I do think it's one of the most actually the commitment to lean Opex has a secondary it's almost an externality of it is that if you commit to lean Opex as core to your business model in D Toc it will force you to not do too many things which is which is its own value actually that you you you have to stay focused because you just have just committed to keeping your sgna pretty low and so there's some value there but yeah it I think it's a really helpful comment that you're making here which is like there's just a ton more space than you think by making your product better and better all the time to your core customer and making doing that one thing really really well and then just telling the world about it as effectively as possible with the marketing channels that you have I think I think you're right there's there's a lot of opportunity to doing that really well one additional piece on that is that like for most of these brands that hero product that core product is the acquisition product anyway so like the expansion is not an acquisition story it's not increasing the total size of potential customers it's potentially increasing LTV is H right like how many brands are actually really good at introducing that second like there's so many strategy decks where it's like hey we're going to introduce for us it would be like protein p right because if you take prein you also need to be taking protein powder and if we just convert 10% of our customers to protein powder that's another $200 of LTB it never works excuse my it never works in very few cases does it work if it's not like super super well executed and part of that's just that like meta picks the product that is going to drive conversion most efficiently and that's usually the product that people associate with your brand it's usually your her product so anyway so I have a client right now that is very likely going to need to bring some resources to its team on the supply chain and inventory forecasting management side of things and I'm going to tell you right now the very first place I'm going to tell them to look is into the Philippines with my friends at more Staffing I no longer understand why people don't do this there is incredible talent in the Philippines and if that's what you're looking for great talent to add to your business if that's what you're looking for then you should be looking in the Philippines because it will expand your access to incredibly eCommerce Talent just like you would find in other places right so if that's all you're trying to do you just want to find the best talent for your business go look in the Philippines like there's incredibly Ecommerce Talent there but there's another benefit to this which is that you will pay less for that Talent on a US basis and more for that talent in the Philippines which means more in the Philippines relative to other opportunities in the in the Philippines that means both sides of this equation win and also it means that you're going to attract the best quality of the talent pool in the Philippines because you will pay more than local options and so it is a win-win like I said across the board you should do that with Help from My Friends at more Staffing by going to more now.co to go do that more Staffing will help you recruit they will help you onboard they will do ongoing coaching and training for team members from the Philippines who speak incredible English and are willing to to work on your work hours and so yeah if those are concerns for you they should not be you should go pursue that Talent you should do it my friends at more Staffing who are really really good at this they've done this for e-commerce businesses that they started themselves their founder uh co-founder was in the US started running an e-commerce business added a bunch of talent from the Philippines learned how good it could be for his business how much of a win it was across the board found team members he loves working for and promoting and doing all the usual stuff with for a team it's just a giant win and there's no reason like I said you shouldn't start your search for great talent for your business in the Philippines with my friends at more Staffing go do it more now.co yeah it's really hard to escape the message that you first told people about you know like it actually like protein isn't the same as creatine and so like if you are a creatine brand it's going to be really hard to suddenly tell people like our protein's good too they I think they will experience it in most cases unless your brand is lots of stuff unless that's what the brand is people are going to experience it as a tack on product or as a secondary thing and not the thing you really care most about Etc you know and you're totally right like people the marketing you have put in the millions of dollars you've spent and the emails you've sent and all those things telling people about let's take your case your creatine you're creatine you're Crea you're Crea it actually did have some effect people did start to then form an opinion about what your brand is and so unless you really can use that as like a secondary like a secondary product as a true new acquisition tool which I have almost never never seen work then I just don't I don't see really how it's going to add a lot and by the other thing is it's a it's a brain drain like if you all the time you spend in developing that second or third product could be spent making your core product better and there's probably some limit to where how much better you can make your core product and and all that but it's it's also probably also farther out than people think you know there's some way in which you can if you think more about how to solve a customer's problem and less about how do I do LTV expansion by add another thing to get them to buy you know that second product is almost never coming from a place of true service to the customer it's almost always coming from a place of we want to expand LTV and therefore the products aren't as good and people can feel it yeah I fully agree right now and my mind on this could totally change like we're all Pats out here I could have this opinion on like no you need to have a core singular product and then next week like you know develop a new product and like be really excited about bringing it to Market and that that's part of the challenge so well and I think but I think that's what this exercise is which is like someone should listen to this part of the conversation and go wait a minute is that what I need to be doing and to sort of apply it to their business and then maybe they go no actually I do need to do product expansion you know like it's just it's like it's just a push on one side of your brain to go like am I sure this is the right use of my effort you know talk to me about your strategy how are you going to how are you going to build a big creatin business that is profitable and that is worth selling I've started that with going D Toc meta ads heavy cost caps that kind of approach this it's sort of between strategy and blurs the line between strategy and tactics a little bit but but when you think about getting to uh to making it the kind of business that you mentioned earlier where your goals have changed and you can see a really big opportunity what do you think the keys to doing that effectively are to get from point A to point B there yeah so I think there's kind of like macro and and micro in terms of what we can do so I think macro is like crew team's having a moment I don't see that moment going anywhere the opportunity the size of the pies is going to continuously increase seemingly every day there's new research coming out about its benefits and who it's right for right like I I think in five years everyone over 65 years old is going to be taking creatine virtually nobody today over 65 years old is like hey I'm going to I need my creatine today I think that's going to change and so that's kind of the macro like I think the opportunity the size of it is just going to be the demand curve ride that I think how we that successfully is we establish oursel as the most credible brand in the space and there's a two there's a couple ways to do that one is just from like a regulatory a third party certification a testing invest in all the things that it doesn't make sense for other brands to invest in because it's either a secondary product or they don't have the head start to be able to spend $50,000 on some like NSF for sport certification or something like that so kind of like dig the The Trenches via Certification testing kind of taking the ag1 approach on that front where it's like let's just do the things that these upstart brands are not willing to invest in that builds trust with customers and then I think just from um from like a a marketing perspective and like first mover Advantage we've all heard this like Facebook you well this is another thing applying big Tech strategy to DC Brands is is a dumb man's game but I'll just I'll just do it anyway please while you do this also compare yourself to Nike if you don't mind yeah yeah I'll compare myself to Nike and then I'll use Amazon strategy because they also sell online to one toone run my business perfect but like Facebook wasn't the first social social network Google wasn't the first search engine blah blah blah and something like consumer products it actually does help to have a first mover advantage to some extent right because they going to rate higher on search results you're going to have for example for us like there's tons of cre gummy copycats coming out right now that sucks kind of maybe it's potentially like a rising tide lifts off boats they'll be driving top of funnel and hopefully we'll capture it but like one a gummy brand right now probably gonna have a pretty tough time like an upstart creutin gummy brand probably gonna have a pretty tough time raising money the money needed to like make a pretty good go at it what you're like the fourth creatine gummy brand out there like I had a really tough time doing it is the first one right second like there's a brand that like sent me some guy sent me an email being like hey like thanks for for sharing in public like we're now coming after you we're launching in October this was back in like July it's like buddy and I mean this in the least in the most condescending way we're going to be doing in subscription Revenue like5 $20,000 more than you like on the day you la like good luck catching up we're just going to outspend you um and I like I don't mean that in a a a douchy way or anything just like the nature of these businesses that subscription revenue is super helpful in funding investment in the rest of the business and so yeah I think those two things like how do we dig kind of trenches around our credibility and trust with customers via things like certification regulation third party testing then two how do we kind of fill in those trenes with subscription Revenue with repe customer Revenue that allows us to continue to aggressively acquire customers yeah I I mean that's really helpful that's those answers were strategy answers not tactics answers mostly and I think that's the right kind of answer here because the tactics are going to change all the time depending on sort of what's hot and what works at a minute at at a moment you know tomorrow meta will make a change that makes cost caps a stupid Strate or tactic you know so today they made a change that that made cost camps actually potentially a not stupid Strat like I hope I hope ASC Plus on cost caps works I feel like there's entire cottage industry betting the farm on the fact that like ASC on cost caps is going to save their business me being one of them um but yeah we'll see yeah yeah well I mean but either way right that's emblematic of the kind of thing that that can change really fast but the strategy notion and I think I actually think the comment you're making about investing in certification stuff I mean I've been in the room for conversations about people with people going like 50 grand for that I don't know because because just can't you just can never justify that 50 Grand as something that's going to produce a two to one return in a month or something like that you know it's really hard to do that you have to be thinking about it from a longer term brand building kind of standpoint for that to make sense but from that perspective it does make sense it makes a lot of sense to go and do that and to and to set yourself aside I think I think it does I like the idea quite a bit of saying like we are going to do that I mean clearly to me in supplements part of the deal is that nobody actually knows what goes into this stuff and the way that you separate self is that you win trust from customers unique in unique ways that's the whole point of ag1 paying or athletic greens paying every single person alive to you know to rep their product and and get the people on your boards and all those kinds of things so it makes a lot of sense that trust is the barrier in supplements and so anything you can do to spend on that is going to set you up for the longer term I like that point a lot you look say something again about that yeah I mean like we've had to turn down those trust building initiatives or investment in the first year of the business because it doesn't make economic sense until it does right until you're trying to pull up the ladder but as you're like kind of building the ladder it doesn't make sense to take $50,000 and invest in like NSF but when you get to the point where you can afford it and you have NSF which means you can work with professional athletes and no other creatin gummy brand is going to be working with professional athletes it then is kind of like a compounding return on on that 50,000 that makes it seem like very very minimal and then on the like especially within supplements where IP protection is virtually impossible like what you're protecting is your brand what you're protecting is the trust that you built with the customer and so where other companies may be investing in you know trademark protection and formulation protection and all that it's like super hard to do and protect and and supplement so we've just taken the approach of let's take that money and a mess in building trust with customers yeah yeah I like it let ask you one other question where what got you from zero to here what's been the core besides the product being good the category being good can you just sort of Break Down The Journey a little bit you you've done this in a lot of tweets and you should definitely go follow Dan on Twitter to go get a sense of this you know you lot of tweets sort of outlining tactics and outlining very specific types of things but I'm curious when you think about the initial part of the journey uh you raised some money which is people have sort of mixed feelings about about in Ecom I think for a supplement brand with a long with a longer timeline to profitability and a profitable contribution margin makes all the sense in the world to have raised money so you can talk about that if you want as part of the strategy because you just gave me a big smile about that but there is a weird fetishization of bootstrapping I think but yeah what got you from from zero to to you know half million dollars in a month yeah certainly a weird black and white right like nothing is black and white and like the fact that you're a quote unquote bootstrap brand versus Adventure back brand like it's an oversimplification right do I think that like you need to be selling 30% of your company pre-revenue to some VC fund that has like misaligned incentives no I think that's you know potentially a bad treem rill to get on do I think there's something like overly unique about owning by boot trapping your your business like no I think that that's a really tough path and like probably lowers your probability of having a successful outcome down the line because like this especially for first time bounders especially for people like this is a grind right every day is a grind and so if you're not really able to pull any money out of the business for the first three years the chance that you're going to stick with it and not get distracted by other money-making opportunities not make it like a sideous so versus your main thing I think again just like lowers the probability of success more power to you if you're able to Own 100% your business but I think it probably makes things much harder in the beginning like I think raising a few yeah like a few hundred thousand dollars to like you know selling somewhere between five to 15% of your business in order to kind of find product Market fit and consumer to me seems to make sense but that I don't know maybe there's somebody that down product Market fit and could bootstrap it from day one more power to them but yeah so as you said raise a little bit of money to get the product to Market to build the brand initially I think kind of like some things that have gone right besides like the fact that it's just a daily get up and focus on creatin gummies every day seven days a week right like I I've said this before no one else was spending their Sunday nights like obsessing over creatin gummies and probably we shouldn't have too many people in the world doing that it's it's we probably only need like two to three but like that's what I do bearing that burden for the people that's bearing that yeah yeah right like I I think it's actually a pretty bad outcome for if like hundreds of really smart people are dedicating their time to Crea gummies yeah and so besides that kind of Daily Grind I think like you know meta has worked really well for us from a tactical point of view I think subscriptions being like a core focus of the business from day one and has been super helpful in getting from zero to like over 500k a month not necessarily yes because of the revenue but also just because that subscription Revenue has allowed us to continuously invest an acquisition I think just like picking I kind of view my job is like picking the right Partners right like I don't the way I set up the company I don't kind of focus my time on like how do I run the most efficient one-on ones with my team how do I like have a culture deck how do I run a really good like weekly meeting that's not how I spend my time it's like how do I spend my time prioritizing what the business needs and then going out and finding who the best-in-class partners are to fill that Gap and so I think like tactically it's just been you know building the distributed team of agencies operators Freelancers Etc over the past year that like now makes it seem like we have kind of a cohesive engine working yeah I think that those three things like meta just kind of being relatively efficient subscriptions and finding the right Partners to continuously take down pieces of the business that I think are driving it forward or should be driving the forward are the three things I got that's from zero to we are yeah really helpful perspective on that and I um I agree with all of it from what I see in businesses in your stage and and all that makes tons of sense okay my last question for you Dan is there any one or two things whatever basically that's floating to the top of your mind in terms of observations about DDC businesses right now you actually have sort of a series of of dumped thoughts and tweets that sort of do this very effectively seriously I've got one you know use email scrapers you're not Amazon test raising your prices charge for shipping Etc there's some of that kind of stuff so it could be that specific and tactical it could be a bigger picture but I'm just almost everybody I've been around who is spending all their time thinking about how to grow DDC businesses has something that is sort of floating to the top of their mind about about their business that is interesting and so I'm just curious sort of if there's anything like that for you right now that you're thinking about the most that's like oh this is eating up my mind share orating up but just floating to the top of your mind yeah I do that like Friday Ecom dump where I share all my semi controversial nothing in Ecom is that controversial right just within our small circles but so I I do that Friday Ecom dump I think what's top of mind for me just like October 10th 2023 is we seem to be having somewhat of uh Arbitrage moment in Tik Tok shops Tik Tok is prioritizing it they're boosting videos that are linking to shops you can then you know later on paid media on top of some that to performing content and get like ridiculous row as it's not something we've executed well to date but like these Arbitrage moments in e-commerce are kind of what build these Brands like if you go back to all the successful Brands it's like they had one thing that they really took advantage of hard and so I try my best to stay on top of when those moments arise and at least try to make a go at it I think we're kind of going through that with Tik Tok I'm not a huge fan of Tik Tok as a platform or a company or what they stand for but I think there's probably a marketing Arbitrage at like is at least worth expor and so yeah that's what I'm thinking about today October 10th today October 10th is exactly the spirit of the question it's like what just what is it today what who knows what it'll be tomorrow that's great okay great I I love that I've heard the same things I spend no money in the vein of focus I spend no money for my clients on Tik Tok uh because I don't I'm not I don't know what I'm doing so that's a helpful perspective for somebody who who does that so all right anything to promote everybody watching or listening to this absolutely should go subscribe to the not boring newsletter is that actually two subscriptions or one I don't know I have both but weekly dose of optimism is that its own newsletter no same subscription so Tuesdays you'll get like a 10,000 word essay from my brother on gondo what Fridays she'll get kind of a more concise kind of links and and bullets of new stories from the week but yeah just not boring doco you can subscribe you'll probably hear very little about creatin gummies and it's going to be weird that I'm writing it n it's excellent here's the thing everybody listening watching this the world is getting a lot better this is a hard time to say that because there's a lot of hard things going on in the world at the same time and yet and there's a lot of reasons to be optimistic about the world even alongside that and in a lot of ways it's very obvious that there's uh massive amounts of overcoming of disease and people being lifted out of poverty and all kinds of crazy stuff that's happening and is worth exploring and I subscribed to a couple newsletters that give you a view to this sort of thing one of them is the weekly do B from Dan and it's really good so go and subscribe to that it's free so you should do that and then I think it's free right am I paying for it and I didn't know it's free right no no completely free okay great I was going to have to go update my subscriptions okay so and then and then go check out go check out create and get some creatine gummies you should be taking creatine you should it's just clear at this point that you should be doing that so go subscribe to that and on top of that definitely follow Dan on Twitter He is building much more publicly than many people who say they're building publicly like I saw a recent tweet that is literally a month-by-month revenue charart from the brand so people for some reason feel really weird about sharing this sort of stuff publicly I I never know why like I it's it's like what are they afraid of I guess they're afraid of the the guy who DMS you and says thanks for sharing I'm getting into this business but whatever who cares dude more power to anyone that like can take my Revenue chart and then turn that into motivation to like care about creatin gummies 247 and like build a business more power yeah all the links for all those things of course are in the show notes and you should go follow them and go follow Dan and learn more Dan thanks so much for your time man I appreciate [Music] it all right thanks so much for watching for listening another episode of the show next week on the show I have some musings about agency pricing this is a conversation I see come up every couple weeks or so and probably every couple months get kicked around on Twitter and e-commerce feel a bunch of places and I have thoughts I've been on both sides of this equation I've been on the agency side a bunch I've been on the brand side a bunch and I feel feel like I have a good understanding of what the best model for agency pricing is for people running your ad accounts and I'm going to give it to you next week on the show so don't miss that do follow up in all the places that I mentioned with Dan of course they are all in the show notes this was a great conversation I thought I just want told him like you know I wanted to talk to him for 5 hours like I think I said and and it's because he's just a a smart guy you can just tell when somebody sort of gets it they have a real deep knowledge of all the elements of what it means to run a DDC business and that was definitely my sense of Dan who I don't know well but have followed for a little while on Twitter so I hope you enjoyed that episode as much as I did if you did would you pass that to somebody who also would enjoy it that is the number one way you could say thank you to me if you like my content I really appreciate it when you'll do that the number two way you can do that of course is to rate and review the show and wherever you are listening to or watching this that is a great help as well all the usual places are there for you to follow up with me also in the show notes you can reach out to me on Twitter at Andrew J Ferris you can also email me at at podcast a jf.com uh you know you know how to get a hold of me everything is at ajfc and you can go get that there thanks so much as always for watching and for listening as I said I really do appreciate it I really do try to deliver as much value as I can week in and week out on this show it matters a lot to me to do that so when I hear from you that that's been the case or when you give me feedback to make that better it means a lot thank you so much I will talk to you next [Music] time CL and [Music] I