Flux Footwear's Path To 20% Profit On Mid-8-Figure Revenue transcript

In just three years, Isaac Mertens has built Flux Footwear into a mid8 figure monster, running a 15 to 20% bottom line margin. That is a lot of profit for a brand growing really, really fast. And that's because Isaac's doing a lot of things really right. He's entirely self-funded, no external capital. And we talk in this episode all about how he got there. This is the second episode of my profit monsters series talking with operators like Isaac who have built eight figure plus businesses and who have done it profitably and can break down exactly how they got there and what you can learn from it.

So in this episode we're talking about negotiating terms with your suppliers. We're talking about offshoring talent. We're talking about really knowing your numbers and building a creative flywheel and really understanding deeply how meta ads work so you can use it to your advantage and not just letting other people do it for you. So you're going to like this conversation a lot. Let's get into it with Isaac Merins from Flux Footwear.

Isaac Merren, Flux Footwear, thank you so much for taking time to being on this podcast. Uh, Profit Monsters, I think I think this will be episode two of this series and uh just the first one was awesome and I think this is going to be a great conversation too because you are you just have a monster of a business happening at Flux Footwear. I was telling you I was aware of your brand before uh before we were talking because my wife was looking into buying some flush shoes and then um and then like we got like a post-pilot card like the day we started talking from you guys.

So it was fortuitous timing because we had already I'd already spoken around the brand alongside her a little bit. It is awesome, beautiful, beautiful brand. Like everything looks great. Tell people a little bit about Flux, how it was founded, what you guys do. uh and maybe give them a just like the quick timeline of sort of how you got to where you are now, which as I said in the intro, mid eight figures running at a 15 to 20% bottom line margin.

Yeah, great. Thanks, uh Andrew, good to be here. Excited to be chatting. Uh yeah, so Flex Footwear really started um seven years ago. Uh we entered uh we call it uh our false start uh five years ago right in the heart of COVID. Um, and then really I've been able to kind of be operating full force for uh just about three years um after just a lot of eb and flowing of in stock out of stock as I'm sure a lot of uh listeners have experienced during the heart of co but uh really the idea was how do we design and develop a brand and product uh that inspired natural movement um that got more people introduced into this idea and concept of of barefoot shoes.

Um, most shoes have an elevated uh heel which then uh correspondently misalign the entire body because we're we're just supposed to be in a natural state um and posture as well as um most shoes have narrower uh toe boxes. Ours have a wider toe box that allows your feet to play. Um, which again uh allows for proper uh coordination, posture um also helps with bunions um and then also naturally strengthenings your feet.

Uh another aspect that makes our shoes really really unique. Typically um in the barefoot shoe space, it's like really thin shoes. Um, of course we live in a world of concrete. Um, and we're walking um, on that and that's not what our joints and bodies are designed for. So, we do have more cushion than normal. Um, but what makes our shoes special is we have textured insoles. We have 100 individual nodes in our insoles that gives the same propriception as if you were barefoot.

Um, and what's special about that is when you're barefoot, uh, you're send your nerve engine nerve endings are sending, uh, messages to your brain, um, like if you oftentimes when you twist your ankle or turn your ankle, it's because you have a muted response. Um, I like to use analogy of ear muffs. Um, yes, you can hear things, but it's really muted. And that's the exact same thing that's happening with your feet um to the ground with super thick uh soul shoes.

And and like we solve that problem of cushion while still getting all the benefits of the propio perception of our textured insole. A lot of people say they feel like massaging it like a little massage on your feet. Uh which is kind of our secret sauce. And then they just look really nice. Um that's kind of another complaint that it just they felt weird. Um they felt different. uh banana, you know, or they looked like a clown shoes, right?

Or the toe shoes that just weren't super common or people didn't like to see wear them in public. So, uh yeah, that's that's kind of like the the problem we were solving with Flux and um saw just enormous growth with our runner um once we launched that in 2020 um and really allowed uh and that growth and then product market fit um for for the space. you had tailwinds there, right? Because the the you just mentioned two things that I think of as like uh as important in this uh which is the wide toe box which I hear more and more about all the time and the barefoot shoe sort of style in general.

Um did you launch knowing like I know both of those have been sort of um trending up. I I don't want to use the word trend in a in a negative way. I just mean like there's there sort of more awareness of those two ideas and shoes. Um I do you um did you launch with with like some sense that that was the movement of product? Because this immediately gets into something that I think is actionable which is just TAM. Like one of the reasons shoe brands work is because everybody wears shoes.

And so if you can if you can capture some subset of that, this is why there's a million blank t-shirt brands and why there's some of them are very big. This is why there's you know a million um activew wear brands, right? because everybody right now I'm wearing a Legends shirt that was sent to me by the fine people at Legends and you know just like just everybody wears that stuff all the time. So, um, so yeah, did you did you purposefully launch into the tailwinds of of those um of that sort of sub niche of um of footwear or or was that you know or was that just like you were you were already passionate about it and that was that like I guess what I'm asking is like how much was that a calculated business decision versus how much was that a your beliefs about shoes decision you know?

Yep. So some additional context I have no background in footwear. I am not like a shoe guru or sneaker head at all. Uh truly like really in essence like a businessman. Um so again, we can kind of go down the rabbit hole as deep as you want, but it wasn't. No, like I didn't go on Google Trends and and as wide toebox trending, frankly, five years ago it was not. Um but you're absolutely correct. It it has been quite a surprise actually in my opinion of the acceptance of white toe box.

No one would ever say that phrase, like no one knew what that was. And now I'm just hearing it more more commonplace. What the bet was was I was noticing this is like uh Whoop, um the HRV monitor. Um and then the one I have right here. Yep. Yep. Like that was getting really big. Uh AG1 was was more than just athletic. like it was getting into culture and kind of mommy bloggers were were talking about it and that was the bet that I was taking was this holistic wellness movement.

Um, and and I I had other different ideas of what we wanted to potentially capture this like idea of moving people into a more holistic natural um way, apparel brand, like a fitness uh app or also like similar to what Whoop was doing, but it was a little little bit more personalized. Um, and then yeah, I just I saw this space of uh in in the footwear. Um, none of the barefoot shoes I was like willing to wear outside of like my home gym.

Um, like there's got to be a problem. Uh, so that was the bet I I was wanting to take of just I saw this going in a certain way. Before this, I started a furniture company. Um, it was the industrial pipe and wood on Etsy. And again, I just saw that that again that was probably about 10 years ago now. that again I saw in like restaurants and just was really cool but didn't see it in in just um homes and I'm like hey let's build this and and uh it it just took off again now uh it isn't so popular anymore but yeah so trends can definitely you know be be a positive or negative but like for me I felt like the holistic what like doing it right and actually solving the problem in a long term.

I I you know I don't want to get too uh you know one-sided but just you know I think there's a lot of frustration on kind of the pharm pharmautical side of just like drugs that are not actually solving the problem. A lot of people and and for me that that's a bit of my story too is I've had some health concerns and and just was not finding solutions um to those with uh antibiotics and and then went to a little bit more holistic natural path and and was able to find remission.

Um, so similar. I just like that's that's where I think it's it's moving. So, yep. And then I I just pulled it up while we're talking here. So, I've just pulled up the Google trends for wide toe box and barefoot shoes. And it's funny the barefoot shoes. There's an earlier spike in 2011 that that was Vibram. Those were the toe shoes. Yes, I remember those. That's when that popped off. Yep. Yeah, I remember that moment.

But it's interesting to see wide toe box. Yeah. So, we started it in like the valley actually. Um. Yeah. Yeah. Yeah. Yeah. But but it's it's a good picture. I think I think I think Google Trends charts like this are like a really sort of sneaky business metric. Like people don't think about it enough because um there's one way of looking at all this stuff which is that as long as you have a reasonable margin, TAM is like the whole ball game.

Like it just makes all if you want to talk about like building a mid8 figure business as fast as you guys did it. Um it's just the case. And I think for a lot of founders, they don't really realize that like opportunity selection and product development are just like they're just like a ma I mean before you ever talk about an ad strategy, your P&L strategy, anything else like it's just a really really really big deal.

And um yeah, it it goes really far. So um I you know again whether or not you were fully trying to ride this wave or whatever, it's a really important part of it. Within that though, it does require good management. Um, and you guys have put up, like I said, like just really monster uh profit numbers while growing very fast. I mean, you got to mid eight figures in a few years basically. Um, right. You said 2021 you started.

We're just early. From 3 million to 14 million. Um, and then on up from there. Yeah. Um, and so you you you did that really fast. And um, and to do that at the profit level that you're doing it at is crazy. I mean it's really impressive. So I want to break that down a little bit. Um what if you could if you could sort of centrally talk about one core part of what you are great at as a leader and what you think has like driven your approach to being able to get the business there.

Do you do you think there's any central thing besid you know besides TAM which we just talked about a little bit like what like is there is there something in the way that you're actually managing the growth that you think is like most crucial to you? Yeah, I actually have a degree in accounting. Um I I went going to be an accountant. Um did not realize that in my opinion I think that is fund fundamentally the most important thing outside of uh being a DIY media buyer and self top media buyer um is it's it's the numbers.

Uh I I I don't know it sounds silly but I have this joke in my own head. It's you don't have a business unless you have a penny in your bank account. Um once it goes to zero, you no longer have a business anymore. Um and and it sounds funny and silly, but like I don't I don't feel like that's the reality that we were living in, frankly, in DDC era one or two. Like it was VC funded. Like you had money in the account because people gave it to you, not because the business was generating a positive return.

Uh and and so yeah, I mean as an accountant like it's black and white there there's no for it's like what's the the numbers say and and for me that's solely how we operated from day one completely bootstrapped um noh fundraising from outside capital or anything like that. So like we had to be profitable from day one or like have um the the the game plan of hey like this has to generate returns. um we don't have you know any outside and we never we didn't want to just we wanted to have full control of like our growth story and our growth track.

So that's that's Have you have you funded any of your I want to come back to that point in a second, but have just out of curiosity that level of growth, have you funded inventory scaling with debt? Zero. No. That's incredible. So, okay, excuse me. Let me correct it. At the very beginning, we got an SBA loan, but we paid that off within the first 10 months. But like from like the hyper uh growth and scale last years, we haven't.

Um, payment terms have been a really big part of that, but yeah, in just proper cash flow management and margins, but but yeah, we haven't. It's all right. So, let's dig in here. Let's dig in here because I think this is a really important part of the story. It's funny. My first episode I did was with Ben Perkins from Ann Callers from in this series. Ben has the opposite story. He was stacking MCA loans on on each other, got into a lot of trouble, survived it all, and is now running a really profitable, good, you know, earlier eight figureure business.

Um and so he he's got a lot of learning from that that I think was extremely helpful. But you have done the opposite here which I think is a really helpful thing. Um and which is to to to fund your growth internally. So you just said something really important in the beginning which is essentially like this whole thing is a giant numbers game, right? The the all of this is just a big math problem to solve in a lot of ways, right?

This of course it's oversimplified but there's a there's real truth to that basic idea. And then you immediately started talking about being able to fund to finance like 3x growth a couple times, you know, you know, in a couple years to where you're getting to the mid eight figures. Now, part of it is you're running very profitably, so it makes it easier to finance your growth when you're actually that profitable. But that doesn't solve the whole thing.

Like you still have to turn around and put that profit back into inventory growth if you're trying to grow that fast. Um, but as you are doing that, um, and part of that I assume is also that you've got some probably loyal customers and footwear. People are probably coming back and buying. It means your ad spend as a percentage of revenue I bet is pretty decent. Um well you haven't told me that but um it's my guess uh just in the way that that apparel businesses and footwear businesses work.

Um but but let's talk a little bit about sort of the way that you have managed that. So you talked about something right away which was um let's let's talk about the contribution mon side of things first. Okay. And then I actually want to talk about the actual cash cash management side. So um you say like knowing your numbers is really crucial. Um, the way I would think about the problem of knowing your numbers in a growing DDC business is through the lens of contribution margin.

So, how do you guys think about contribution margin? Maybe just define it for people really fast just uh really quick version of it is fine. Um, I well, I'll just tell you my definition. You tell me if it's the same one for you, okay? Because people have different ideas here. My definition is revenue uh minus um all cost of delivery. Basically, every variable cost associated with getting getting product to the customer minus ad spend associated with that.

Right? So um how much money do you have left over where the only costs left in your business are fixed costs like software people buildings any so yeah that's that's the way I'm thinking about I don't know if you think about that way um clarify that and then okay great and then tell me how you guys think about CM in the business yeah so for us I think it's important to mention uh because people talk a lot about this contribution margin percentage um and for us our northstar is 30% um our 30% contribution margin goal and And then also a consideration that's important is what's your total contribution margin dollar?

Like what is the total figure of contribution margin at the end um of the month? Because yes, maybe you you operate at a 40% contribution margin or we end at a 40% but that total dollar amount is let's just say in a worst case smaller than what your people costs are, your software costs, like what you need to run like the inside of the business. um then that's not a win. That that percentage needs to adjust based off the total.

And I think that's an also a really important consideration. Um in terms of just like growth in scale, um uh funny enough, we are recording this a day after the the tariff uh announcement that has just shaken the e-com world and and like us it is it's a very big consideration. we're we're directly impact um and and right now we're playing with the around with the idea of like do we raise prices um or or do we take the hits and and with with just uh the consumer that's really uh holding on to their dollars tightly.

Um yes, we could we could maintain proper margins and increase our costs. Um but then that to like we could cut a revenue in half and then that uh contribution dollar total would just be again slashed in half. It just it wouldn't be a sustainable number. Um or do we eat the costs and yes our contribution margin percentage takes a hit but are we able to counteract that with you know if other people are increasing prices but we're staying the same.

So I I that just I I think a good like tangible exercise of contribution margin as percentage is a northstar but the total dollar at the end of the month is also like an extremely important consideration of growth. Um, so and the percentage can be deceiving is what you're saying, right? Like and I want to be clear for us 30% is and it it sounds like oh you you should just know that it's taken like two years and frankly it's a number that is constantly it's like a science and an art thing like depending on where your business is different inputs like that number can go up and down.

Um, but it I mean it's taken two years to really massage and find like that nice middle ground of anything higher than 30%. Like we're we're leaving dollars on the table. Anything lower um like we're we're missing out on the IBIDA number and you know IBIDA is the value makes it too hard to grow and then you're right. Yeah. This episode of the show and the entire profit monsters series really is brought to you by my friends at Intelliggeems.

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That's like a really really big number. So, um you should be considering it too. Intelligjs.io. Get uh get 20% off your first three months with the code ferris 20. That's f a r i s20. Go check it out today. Yeah, especially if you're trying to selfund your growth. That makes sense. And you're thinking of CM specifically on new customer acquisition, right? Uh, no. Just like across the business. Across the business. Can you talk Okay.

Can you talk about that that in inference that I made a minute ago about sort of like new versus returning customer revenue? Because when you talk about scaling as fast as you have, one of the things I'm curious about is sort of how much of that revenue is new versus returning. Yeah, it it it's been a really interesting dynamic. Um, so I would say not until about 10 months ago. Um and let's just give context like within the first three years within the first three years span so you know first two years our returning customer rate was sub 10 10%.

Um like it was it was it was difficult um I mean again with footwear it's you know a sixmon typically a year for the mo most uh most people wear it out you know six to 12 months. Um now again we have enough of of you know we have hundreds of thousands of customers so now it's like a meaningful amount. Um so we are taking that into consideration. Now, what's really interesting is at the beginning we we were kind of living and dying by the our A and the R the the new customer efficiency.

Um because like that was the growth and and like because we couldn't rely at all really on making up any efficiency with that returning. Um however, now like we we've been able to balance that where it's almost a 50-50 split for us. Um new and returning customer revenue. Yes. new customer uh new customer. Yeah, that's that's really interesting in your in your business because I would think that the specific value proposition of a wide toe box um uh barefoot runner shoe would be the kind of it's not just like, oh, I think these shoes are cool and I like the brand.

There's actually a sort of like health consideration there to where once I find one of those that fits, I'm going to be pretty loyal to that because I really I can't just go buy a pair of Nikes that I think are cool. if if they're gonna like hurt my feet, you know? So, yeah. Yeah. I I I I wish I wish that was the case. Um but but really like it's footwear is definitely a fashion no matter what. And and Yeah. Yeah. We're a little ne unique like But if but if you're 5050 on new and returning customer revenue, you've grown that much, then you've clearly got some super customers who are love for sure.

For sure. We do. But it sounds like it sounds like what the challenge was in the early stages you're growing a whole bunch. So you're piling up a bunch of new customer revenue. Those people don't come back for six months or a year because of the life cycle of shoes. And so it takes a while for you to start realizing all the profitability that's going to come from those returning customers. Right. Is am I am I stating that correctly?

Yeah. Yeah. Yeah. And and I'll I'll attack on to that. It's frankly come at the perfect time too because during that first two years again there was just a lot of green grass for us and we were scooping up those at a very efficient uh efficient margins um and efficiency. However, now it's it's it's switched like it's very difficult um just in the landscape and uh for I think regardless of size um and scale like it just it's harder to acquire new customers and just the current landscape and meta and you know all all the variety of of issues and challenges.

Um so that that's just it's kind of been a really nice counterbalance for us where we were able to find a really efficient new customer. now it's a little bit more difficult and and we're able to make up a lot of that loss efficiency of new customer with the increased efficiency of returning um and and we've kind of settled in now of like finding the uh and expecting the the returning customers to come back. But like that's always the terrifying thing and why I just I don't ever recommend like as we're starting to see what's you know your 180 a day LTV your 60day you know it just I I never recommend you know a younger smaller brand to ever like think through um yeah expecting them to come back.

Yeah you definitely can't bank on it until it happens. Um do so let's actually talk about the inventory financing issue because I think this is a really important thing. So, you've stayed away from debt, which is a cost that you've kept off your books while also growing. It is almost as if one of the reasons that you guys are so profitable, is that you've kept that that as a constraint. And by keeping that as a constraint um that you're not going to finance with debt, it forces you into behaviors of handling different things profitably, right?

So, by doing that, one of the things you have to do, right, is negotiate is first of all, you have to run at a high margin. Secondly, you have to then also uh go negotiate with vendors and get deals that make sense for you. So, um talk to me about that a little bit. What how you mentioned right away that payment terms with manufacturers. Um you know, where are you guys at with that today versus maybe where you started and how did you get there?

Yeah, I think this is a really important uh topic. I I think a lot of times, especially on podcasts that I've heard, it's like, "Oh, yeah, just negotiate your terms. Like, get better terms, guys." Like, I'm sorry to burst the bubble. And maybe other people have different situations. It it took us five years. Like, it's it's not it's not an overnight thing. Why did it take five years? I have I have a guess, but tell me.

Right. Yeah. You have to build credit, right? Essentially, relational relational and actual credit. Yeah. Right. Yes. Yeah, exactly. And again, we're in the footwear space and and it's it's a little more involved than I think potentially other industries. Like you have very expensive mold costs. Um so what's really unique is you have very very little developmental costs. Like the factory will be sampling and developing product for free. like they don't charge you to develop um the product, but you have, you know, $50,000 in mold costs um for for the product.

So, like there is like investment up front um within footwear, but then there's high like staying um power for the factory. So, like they're willing to invest in you. Uh and and it is Yeah. It's it's continuing to pay on time. It's continuing to order, hitting forecasts. Again, we kind of have like quoteunquote easy mode in some sense, like we continue to grow and hit projections and like following through with increasing order volumes.

I I don't know what that looks like if we wouldn't continue to order more or continue to miss forecasts. Um I think that that's a different conversation. But what's equally interesting is um we were with smaller manufacturers and we became like a massive massive client. So obviously then you have a little bit more pull. Uh a year ago we just moved to the second largest manufacturer in the world actually and now we're the small guy.

Um, so we kind of had to start from zero in terms of our uh terms of uh payment and and to give some context like so wait why did you do that? Why did you get Yeah. Yeah. One quality um and then the second was just like pure quantity. We we were outgrowing them like their factory just was not enough. Um, so th those are the two considerations. Again, I'm not going to name names, but like the the big brands are being manufactured by by by our manufacturer.

So again, footf I'm sure difference or maybe the same as a lot of other industries, but it's there aren't a ton of massive players in the game. So it's you kind of like that's the pinnacle and you stay. And then also costing um they have more uh sway so they're able to get their supply uh the their materials cheaper and then we were able to get uh cost savings as well. Uh and you were able to do that at the same terms you had when you were the big fish in the small pond.

No. No. Yeah. Yeah. So we had we had to start over. Um, so for some expectation settings, it was brutal at the start. 50% deposit and then the final payment was due before the boat even left. Um, so like we had a we had that was like day one all up front. That was day one. Yep. Yep. So that was really tough. I mean again and this is during co so now you can get a boat in 30 days. I mean it was taken 60 90 days you know and we have hundreds of thousands of dollars.

So, um, we were able to get to 20% upfront to place the PO and then final payment 90 days, um, afterwards. And from my understanding, that's 90 days after good. Uh, after Xactory, so after the boat leaves. This episode is brought to you by my friends at More Staffing. More staffing is my chosen partner for offshoring e-commerce talent. I have been working with more staffing both as not only a podcast sponsor but in my business for the last like year and a half or something like that.

I was in the Philippines in January. I have come to know these people well and what I can tell you is the combination of deep e-commerce resumes and expertise. They were actually formed out of a US-based e-com e-commerce business uh Greg Kerry section 1119 where um a team of me of uh Filipino employees was doing incredible work for them and they got together and said how do we bring this to others not just like $5 an hour virtual assistants but like how do we bring highlevel talent um like actually Isaac and I talk about in this episode highlevel talent doing really high quality work to US-based businesses at a price that they can actually afford so they can grow and scale profitably.

Look, if you are serious about growing a profitable e-commerce business, I just don't know why you wouldn't considering offshoring talent. And the beauty of more staffing is they're a reliable staffing partner to get you access to the best talent in the Philippines across every part of your business so that you can do that there. I cannot recommend them highly enough. I really love working with them in my business. At this point, pretty much everything I touch in some way touches somebody in the Philippines, which in some way touches more staffing.

And so, uh, you should be working with more staffing. They're just really fantastic. Uh they'll even give you a one-year guarantee on any hire they make. So uh if that hire doesn't work out, they'll help you replace them for free within a year, which is a really awesome guarantee. It's way longer than most staffing agencies give you. Um and on top of that, they'll hire across any part of the organization. That's supply chain, customer service, operations, marketing, like just anywhere you can think of, they've got access to great talent, they will get to you.

Uh again, go up market. Don't just think about the $5 an hour virtual assistant. Think about better manager and uplevel positions. More staffing will get you access to them. morestaffing.coaf morestaffing.coaf. Just get on a call, see if it's right for you. Look at some resumes and see what's possible. I think it's probably going to be way bigger and better than what you think. Oh, man. Okay. So, that means that by the time it's delivered, you're actually you've got the inventory for 60 days and Yeah.

Yeah. So, that I mean that's see that that's like it's it's going to be really easy for people to miss how important that is in in like a 20% down payment is not that big of a deal. even if you're growing compared to and getting all of the rest of it on n net 90 terms you know net let's call it net 60 from when the from when the boat gets you know sort of uh unloads your stuff right um I mean that's that's a really really big deal for how you guys have been able to grow without debt um okay and so where are you guys at now can I ask yeah yeah right now uh again we were able to build enormous trust I mean we're talking spending millions of dollars with this manufacturer Um, and after a year we How did we start?

We were Yeah, I think we were similar. We were about We were 50% upfront and then 50% due before the boat. Um, left and then now we got to 30% upfront and then final payment 30 days Xactory. Uh, so really really helpful. Um, and and and to be clear, like, yeah, Andrew, you're nailing it. Like, this is absolutely essential and critical. I know that there's some there's other like inventory payment uh companies out there that can like delay terms or, you know, 60 90 days.

Top of mind, I can't think of them. But even at our size and scale, that 50% upfront and 50% before factory was not sustainable for us. it it like it was really really felt. So again, like yeah, and that what's tough is it's not a flip of a switch, but it truly is a massive unlock because even at our I mean, we're talking millions of dollars and and really healthy cash flow, it still was really tough on us um with those those terms and once we unlocked the current ones.

Yeah. I mean, there's two ways you can handle that as a brand, right? One of those is to is to generate debt and to and to look at that and and that is sort of so far as I can tell the Ben Perkins story that he told in the last one which is that he starts doing that because he's growing and it's going well. Um and he's he's acquiring customers profitably and and all you know and all that stuff but it's just doing it at thin margin trying to keep growing.

Um, yeah. Well, and yeah, it and it was it was challenging and and again, I think the constraint factor is a really big deal. Like the idea that you in your earlier stages had to be that much more profitable in your customer acquisition because you just didn't have because you just had you just had to you you needed the cash to do it. I just think that creates great habits for a brand to have to kind of live with that are going to be valuable in other ways, you know, and and um yeah, it's certainly not the other way to do it. people, you know, but the I think the real mistake for people is to try to grow and then to start taking on debt products with that they they don't really understand because that's the challenge that you have to be pretty sophisticated to financially to be able to work through sort of all of the implications of the of your approach to debt and the downstream effects of it and all that in a way that like for me like I'm starting a brand right now and um and it's a little thing on the side and I'm I'm just not very interested in funding it with debt because I just know that there's details with that that are going to be too challenging for me to work through with so much especially in the early stage of a business that are just going to be so uncertain.

And what I really like about what you're what you're saying is, you know, you you've got this time lag to the returning customer revenue, which is going to be the most profitable sort of trunch of your revenue. All of these things force you into behaviors that are really going to to lead towards building a profitable business. And what happens is that when you get that right and you've got a really good quality product, you you know the the tailwinds of the TAM hit now you've also got the operational side of things to where you know the the whole machine can really pump and you can get to the stage that you guys are at where you're growing plenty fast very healthy margins and even like you were telling me before we hit record even with your guys' with net margin still you're not putting a lot of money in your pocket yet you know because you if you're going to keep growing you've just got to turn that around to keep financing inventory growth and and all those things.

So, it's it's uh yeah, it's I think a really a really good case study and sort of how to think about this. And you know, I yeah, I could go on and on about why I think people sort of resist that path and why people want to grow faster and all that stuff, but I'll skip that for now. Just keep staying a little bit more tactical because I think this gets into the existential a little bit, but um but I do want to talk about levers like levers of impact a little bit as you guys have sort of carried that out.

So on top of the financing and all that, let's talk about um sort of what you think have been the real big needle movers and you guys growing um you I don't know if you want to start on the ad side or on the cog side or anything else like but you know what else do you see sort of as you kind of get past the sort of basic financial management into the real specific uh levers now um about sort of what has met led to your guys' growth.

I'd love to hear about it. Sure. Before we jump on, I just uh please I wanted to wrap that up because I said know your numbers, but I loved what you said about discipline. Um I think profitable growth isn't sexy. Um it's about the discipline. Um and and you helped me kind of realize that as we were talking on how impactful the terms are like little things like that. Um, frankly like is why and and also last point is additionally sure you can have those extended terms but that comes at a cost and then that comes at eating margin and then like it just it's a downstream effect um that sure it's delayed but it comes at a cost and then you have to acquire customers at even more efficient number.

So like is there really that much more benefit? Um, so anyways, like the discipline and and it's not sexy. Um, and again, numbers aren't sexy. Like being an accountant isn't sexy, you know, but like gosh dang it, that they're important. So, uh, yeah, moving on to to your question um, about the the levers. Um, it's definitely evolved and changed for us. Uh we went all in on meta about two years ago when I think a lot of people were trying to diversify.

Um it was when you know a little after iOS 14 or and in even during iOS 14 meta isn't working. We got to find other channels. Um and and that was my bread and butter and like we just went hard on that. We developed an in-house, I call it our creative flywheel. Um, and just got exceptionally good at knowing how to create one quality and two quantity of uh creative that just continue to feed meta. Um, so let's not move past that.

Let's let's stay there for a second. So you were a media buyer at CTC, right? So that's good. So you got training. You you you used the language disciple of Taylor Holiday earlier before you press record. Um, so that's awesome. That definitely puts you at an advantage and I think it's a really big deal and is one of the reasons I tell people all the time, including I will do an ad read for it on um on maybe on this episode, certainly on future episodes about admission and why I think people should go join that program and just like inhale it like it is like just inhale the content because if you can somehow get that way of thinking, it is the largest or second largest line item on your business.

It is the key to your growth for a lot of brands. like you've got to get great there and don't let anybody try to short circuit that. Um, but I want to talk about your creative flywheel because this is something everybody's talking about right now. The introduction of AI ads have been another part of this. Tell me what you can operationally about your creative flywheel and uh what you guys have done there. Uh maybe earlier when you when you kind of got the flywheel going and then what it looks like today.

I I would love to just like break that down so people understand what's your team look like? How do you measure the performance? I mean uh not how do you measure the performance, how do you measure the outputs of the team? like just talk us through that. There's just no way I'm going to get through this episode without making a plug for my friends at Admission. Admission, as Isaac mentioned in this episode, is the place to get the learning and the knowledge that you need to run your ad account with excellence.

It is too important to your business to not do that. You need to know uh what's going on with your Meta Ads account. Be able to handle things yourself. Get the knowledge you need to manage that spend efficiently, manage your agency efficiently. Whether you're doing it in-house or managing an agency, you should be joining admission and you should inhale the content. Like I said in this episode with Isaac, um it's just really valuable to know what's going on in your Meta Ads account and to be able to think about and connect that to everything else going on in a profitable e-commerce business. um more uh recently the most popular courses in admission which is what admission is.

It's a bunch of courses put together with access also to see common thread collectives incredible media buying and growth strategy talent uh mixed in together. Um admission most popular courses recently have been incrementality 101, the e-commerce pyramid of success, meta optimization best practices, how to set monthly revenue targets, maximizing video ad volume. Uh there's just like all kinds of stuff. Uh recently they dropped uh uh uh a course called when do I drop off a campa or when do I turn off a campaign like very clear tactical stuff like that.

My recommendation is that you join admission, soak up the material, do everything you can to learn it well and then use that to develop real perspective and point of view on how to manage your meta ad spend as well as possible. On top of that, if you sign up with my link, what you will actually get is uh not only uh all of the courses that I just mentioned and a whole bunch more and a monthly webinar with Taylor Holidayiday that's exclusive private to to admission members, but you also get access to CTC's media buying team where you can get coaching calls.

So, they will actually look at your ad account with you. Um you can get those coaching calls for $150 an hour going forward once you've joined admission, but you actually get the first one for free if you sign up through my link or if you sign up for a year of admission, you get four of them for free. So, go join admission uh your admission.co. Tell them I sent you and you'll get that free call. Just let let them know I sent you or follow the link in the description which will take you to my landing page.

Uh so you get that free coaching call. You're going to want that. You're going to use it. It's really awesome. Join admission. Get better at meta ads. Make more money. Absolutely. Yeah. And and it definitely has changed. It's it appropriate timing. Literally this week I I had a conversation with the team of like, hey, this is how we're revamping it. Um to unified flywheel. uh we called it the creative flywheel and we're moving it to the unified flywheel and I'll explain those.

So um yeah like really the idea around the creative flywheel again at my time at CTC the biggest issue was lack of creative um my hands are tied and they're expecting returns and they just keep giving me the exact same five pieces of content maybe in a different colored background you know whatever that is. Um and yeah like your hands are tied. um to just continuing to give meta the exact same piece of content. So really it was it was designed um for me inhouse was like the biggest aspect of just understanding the feedback loop and what was working and again I had background and expertise in it um versus kind of outsourcing it.

But yeah it was it was really about like seeding product and getting content in that capacity for mashups. Um finding UGC creators um and that was actually like a really big piece for me. I mean, I would stay up late at night and and just kind of go down rabbit holes of finding UGC creators um and then signing them and and uh be having them join us um for like long-term contracts if they worked. Uh so like that was a really big uh lever um that that allowed it.

Let's pause there really fast again. I just want to I want to drill in just a little. So when you say creator versus seating, are you thinking of creator and influencer seating versus creator as two different things? Yes. Yeah. Two different things. So yeah, this would just be like we're just seating product to, you know, like someone that we think fits our our demographic with with sometimes a serious runner and and so you're sending it to them, right?

Great. Yeah. And are you when you're doing that when you're doing that, are you asking them for anything or is it just sort of the kinship style send it out sort of palms down like Yeah. Yeah. That's So, sorry. I'm kind of I was talking about two two different things at the like two years ago when we first started there there like this was just to get content um one for like awareness and their own audience and then two like hey if it was something we could use that that was like a 10% like the majority of this was like we'd write scripts to a creator and then like literally outline shot forshot word for word to to create it.

However, moving into this more unified uh flywheel that I'm calling it, it's uh we're adjusting that it's it's very much we're seeding yes for like no expectations. Well, we're now developing internal systems to literally capture I mean we're receiving about five to 600 pieces of content a month. Um again, for clarity, that has taken years to build up to. So, don't just expect that to happen overnight. But this is why I'm this is why I'm stopping you and asking the specific questions cuz I I I know exactly what you mean which there there are so many solved problems between day one starting this and 500 pieces of creative per month.

So I was like okay let's talk about those. What are the what are the problems that got solved? Because again it's one of those it's like you said about people hearing the advice just go negotiate your terms. Well that's great but like what did you have to do to do it? Um so yeah so so that's why that's why I'm trying to get specific. So, so you got 10% seating influencers and then other creators, you were literally just writing them scripts, which is sort of different than what?

Yeah. And paying them. Okay. Yeah. And paying them. And talk about how much budget relative to your ad spend, how much budget were you guys were you paying them? Yeah, it was silly. It was It was nothing. I mean, it was maybe 4,000 a month or like I mean, we're talking less than a percent. Um, like we Yeah, we're really fortunate. I I think yeah I think we got like again the background expertise that I kind of had and knew came into a big big play.

So it's kind of like that unfair advantage. Um but but like agencies I mean like they're expensive like that's why we didn't do that. So also yeah I don't want to just give like hey just go and do this this is how it works. Like I we definitely have an unfair advantage in in that way. Probably it should have cost us like 20 to 30 grand. um which would have been a much yeah a pretty meaningfully uh impactful expense for us.

But but yeah like it also I like it was like it was hard like that was my dream of like seeding product getting gobs of content and then like mashing that into paid ad like ads for for for for paid media. But yeah it it just it took the team it took us buying into it. Yeah, it was hard. um to to be able to get us to a place of of like yeah, how do we get a system put in place um to just yeah seed and and frankly it's all not that good.

Like I think you're very much taking the lottery approach in that way because the lighting suck like you know like the UGC creator is like that's their job like they're great at that um versus just someone not even knowing where it's going to. So it it's a lottery approach but I I'll share this. This is very important. Within that seating uh program, there was uh this campaign that ditch your big brand. Uh I won't I won't say the names, but it was ditch your uh yeah, big big shoe brand. and and we ran that campaign uh because I just I I couldn't get that out of my head of just like I loved how they phrase I ditched I ditched my XYZ brand for Flux.

Um, and it wasn't that ad that I ran that I mean this is multi-million dollars in revenue that gener this this these ads for like six months uh to 10 months around this concept and idea that just from like getting seeding product and hearing what they have to say and how they're using it um impacted and influenced our our ad creative and strategy. So yeah, I think there's while yes, you not might not have gobs of creative at the start, you can be getting really insightful ideas and and yeah, just like that tagline, ditch your XYZ brand.

Yeah, it's actually kind of brand positioning. Like what what I hear in that answer is a little bit of like you got really clear about the kind of thing you wanted people to think about the shoe relative to everything else and really trying to draw a hard distinction. Yeah. By listen customers um you know. Yeah. So yeah, that was that was good. So yeah. Um do do you mind like is that helpful? Do you want to move into kind of like where we're at?

Yeah. Yeah. I just uh I do want to hear more about So how how was the team set up now and who what like what does the flywheel look like now? Yep. So, we have our VP of brand. Um, Kayla, again, like I I can't state highly enough like how impactful she has been in like really just again, she's actually an excter herself. Um, she started as a creative strategist and has elevated herself to our VP of brand and like really helped build this.

Uh, we have an in-house creative strategist, two editors, um, and then I have a position that I haven't really heard or seen of that I am stoked about. We're we're going to hopefully hire this person at the end of the week. It's a UGC coordinator. Um, and what this person is going to do is be solely responsible for uh we use archive. Uh, basically if you tag at Flux Footwear on your story, Instagram, Tik Tok, like uh anywhere we're able to have a library of it.

Um, so what her job is going to be doing is to be looking at every single piece of content that there is, whether it's from like a paid influencer, a seated um, partner, and then like capturing that and then sending it to her editors, creative strategists, creating um, like concepts of an unboxing or three reasons why. Um, and this person is just going to be the m the the mro of just organizing all these pieces of content to then be able to have our team um, find them.

And then we're also using an agency that's supplementing UGC creators like scripted UGC. It's so it's so interesting because that's the kind of thing that somebody would want to give to AI now because they be like that's not important. What I hear again in that answer is is this is the lifeblood of the business and so like we're going to put somebody great UGC is gold for us. It is a money printer. So we're going to dedicate resources to doing it.

Um I'm just curious as you have built those teams is it all um is all US based? Is it offshored? What how are you guys doing that? Yeah, we're yeah we're we're actually most of the team is is offshore. Um yeah uh there are employees but yeah they're they're offshore. Yeah. Yeah. I that makes that makes perfect sense to me and that might be a good place for us to jump into. There's more we can say about ads and I I just want to be conscious of that.

Um that there's other stuff too. Um is there anything on the opex side of the business and the way you think about people and costs and some of that stuff that has been really helpful for you? Yeah. Yeah. I'll kind of go back to the beginning a little bit. I I just I think there's a massive unfair advantage of like being self-taught. And you're not joking when it's like literally consuming and absorbing all the content on missions.

That's literally what I did. I watched every single piece of content looking in a mission. Yeah. Yeah. When I first started um and and like was self-taught, went and like was being a media buyer as I was building Flux. Um because that alone probably saved us $15 to $20,000 a month um by by me being able to fill those roles. And again, like you mean in a in saved agency costs? Yes. Y that's before you talk about before you talk about the wasted ad dollars from bad agency experiences and the lost time on growth.

I'm just I just want to just shove I mean I just there's so many people who reach out about oh can you look at my ad account? Can you do whatever. I'm just like guys there is I know it feels challenging but like you've got to get this knowledge yourself. It's too important for a growing DTOC business. It's too important. Get the knowledge yourself. It matters too much. Yeah. Again I h I have a lot of friends that are just starting out and I just I'm at this point now where I'm like where we've made it and we've seen it.

I've kind of taken this path. I don't know if there's another way to do it in this ch like yes, if you're an influencer and and like but we're just talking about paid ads and that's how like you're able to grow and you don't have that unfair advantage of a part an influencer that's a partner or some in or some organic ability to gain impressions. I just I frankly don't know how you do it if if you're going to be bootstrapped.

If you're funded, I think that's a different story. But yeah, I just I I think it's so challenging that anyone that's amazing uh like you, Andrew, like it's it's it's a highly sought after skill set. Um and and you're going to need to pay for that level of talent. And to make it through, especially just starting out, it's it's tough, man. Um that that was So you're saying you kept the spend in Do you guys still manage your spend in house?

Yeah. Yeah. We we we uh use a part David Herman is actually who we're partnered with. Um Sure. Cool. So, we we use him as a media buyer. So, like Yeah. Um kind of. Great. Yeah. But obviously you're going to be able to manage that relationship with a level of expertise. This is another thing that's underrated about this is when you've managed it yourself, you're much better at managing an agency partner. Well, yes. And that that kind of moving into that a little bit is like frankly that's what I kind of took it upon myself is to know enough in operations and customer service and every aspect of the business to be dangerous so that if you bring someone in you're not waiting a year to to like have it be materially impacting you to be like oh something must be going wrong versus you you actually know a little bit what you're talking about as well hiring um if it's an employee and or an agency um do you know enough what you're talking about what was really challenging we launched Amazon six months ago that that's an area that I I I had not really been been dangerous in at all and trust me I felt it we we failed at it same with wholesale like again this is hindsight's 2020 and and thankfully I just I kind of trust my intuition but the areas that I like heavily just sucked it up grinded figured ed it out.

We were able to move very quickly and and not have massive again and that's just going to hurt profitability in terms of speed, in terms of loss cost and just bleeding in areas that you wouldn't necessarily think of um versus like how much is your what's your COGS? Um like this is a very big hidden expense. And so anyways, yeah, I I I couldn't agree more with that in in terms of just like understanding agencies and and how to manage them well.

I think I know I I'm not a massive agency fan. Um but and even being you know working at an agency it's it's the people that are the X factor versus like the agency in in oftentimes but it's also equally important for the person to manage the agency well and understand and have accurate expectations because I felt that you know I'd have CMOs coming in having these ridiculous expectations you know I'm like I'm not a magician.

Um, so it's it's both and like you need you can't hold someone to these unrealistic expectations, but you also need to hold them to something that like is attainable. And if they're not, like they're not going to perform. Um, here this this is a really important thing that I I'm learning that if you're working with a freelancer or an agency and you've outgrown them, know that you are the one that is going to have to come to the table to move on.

I they are not going to fire themselves. they're not going to admit that, hey, I don't think like I'm the right person for this. Um, that has just been the biggest thing. Um, and and thankfully I've had like really good conversations and been able to navigate that really well. Um, like I just had a really interesting conversation and he's like, "Yeah, I kind of like am okay with this. Like I agree. Like I I don't think I can get you guys to the next level." Um, and I'm over here freaking out like man like how is he gonna react and this and but like he he w like of he would have just continued to do as best of job as he could but he he wasn't the guy to get you to that get us to the next level.

So, I just I I haven't ever heard that phrased or said. And I just I think that that that's a really important thing that you need to own that relationship whether it's not working out, whether like you're the problem, you know, um in some cases. But I like that's that's been massive in terms of again kind of tying back tying that back into the profitability aspect. um is yeah there there's massive costs to like opportunity where it's like you've sp and also a lot of these things take a long time influencer paid media you can't know if it's working in the first 30 days like oftent times it's three even six months especially with influencer it's it's six months at a minimum to know if like the program is working if it's your influence if it's the agency or if it's just your product that might not be working at this time and place And I mean that's cost and then also what could you have been doing in the last three to six months that that you're spending um with them.

So opportunity cost, right? Yeah. Opportunity cost um which which has a direct impact on profitability in in my point. No question. Yeah. No question. Um okay, we're getting really low on time, Isaac. I know we're actually a couple minutes over our recorded time. Thanks for staying on. Um do you um do I want to just make sure we hit any other big stuff. I have one specific question which is that you've offshored most of your team.

Do uh how conscious of a decision was that in your organizational structure? Was it like was that like part of the strategy? No. No. It's a nice to have. Um frankly I the the Taylor I forget who it was. I think it was maybe Taylor talking about how like your video editor should be your highest paid employee. Um, yeah, that was an old I frankly could not tailored. Yeah, I I frankly could not agree more. Um, again, not literally, and there's a lot of flack for that.

Um, but no, like they're just they're very good at what they do. And again, that like for the cost of of the output, it's it's really nice. Um but but yeah, like we we've we frankly found an agency, a video agency that like we really like um that we just have been able to like uh have their employees kind of transfer over um to to like an in in-house role when they're ready to like move on from agency. So that's just kind of been an opportunity that we've been able to execute on.

But um also I just I don't know a ton of like frankly onshore direct response editors um versus like I just I I feel like there's a ton of like very very talented offshore video editors that are are excellent in this area. Um so I'm not opposed to that. Say nothing of the rest of your business. I I yeah I I just think this is my experience with this offshoring is just like I don't know. I just find really talented people want to do that.

So, it's just like and and it's like it makes sense costwise for us. Like I mean the way I always put it is like part of the reason is if you offer a good wage overseas, you reach a higher end of the of the talent pool overseas. Whereas you have to spend so much money to reach the high end of the talent pool in the US. And so it's just sort of like assuming the talent pool exists at all and there's some variation in skill overseas like there is in the US, you can reach the top end of the talent pool so much easier overseas than you can at the US and financially.

And so you can get this really high talent while not killing your books, you know. And so what you're describing is just it fits every experience I have with with offshore employees. Yeah. And as I'm thinking about it, I know a lot of very large nine figure brands just kind of, you know, snooping on LinkedIn. They have a lot of offshore uh video editors, you know, on on their team. Absolutely. like I it is it's a really interesting dynamic uh specifically for direct response video editors and you know maybe even creative strategists but I think very specifically for video editors um it's an interesting opportunity.

Yeah. Um okay the other question I had is just like I mean you know this is a conversation I feel like we go for a couple hours but we're we're going to wrap it here and while we do I just want to make sure there's nothing I missed that you think has been like a really critical part of your success. So, when you think about your guys' success, is there anything else that you've done where you're like, "Hey, this this has been this has been another really important part of this that we haven't gotten to yet." Yeah.

Yeah. There there there's one last part. Um, and again, I think we're potentially unique in this area. So like you know I'd say this isn't always necessarily an actionable for like maybe pre uh product market fit slash like even at you know scaling um paid media is this ability to offset your rising CAC your paid CAC costs an investment of in organic um slashbrand I I I don't want to over like I think brand is is kind of a separate topic Um, and like I think you need to be big big big big uh before you really think about uh brand and like branded content, but organic I think that that's a really important lever specifically for footwear.

Um, I think we're just a little bit again unfair advantage in this in this way for footwear. It's a very natural product for people to recommend and share with their their friends similar like baby products. Um, we have a 2-year-old uh daughter, so my mom lo sorry um my wife loves recommending products to other moms. So, again, that's another industry. So, for us anyways, we've we've leveraged just organic and like seeding product and just having impressions um unmeasured impressions, just knowing we're going to give a product to someone that we know is a great product.

Hundreds of people, hundreds of thousands of people love the product. Um, so we naturally know they're going to talk about it whether in person or on social, but there's impressions um, for a cost of the shoe that is just unmatched in, you know, CPM comparison to to meta. Um, and that just again is this halo effect that has allowed us and we're investing even more into it, especially with I feel like it's a beating uh a dead horse of just rising ad costs.

But um there's other ways to mitigate that, but I think just from like a brand halo effect, that's that's something a lot of brands should be thinking about of like how do they seed, how do they think about this organic play? Um because not just from impression perspective like on the paid with the new meta algorithm um like it's it's considering organic impressions as a metric for success um within your paid paid ads.

So I think like that's a really important aspect of how can you manage and balance not just paid ads um and associated CA cost to that and and utilizing your you know just a cost of your COGS or your product and and trying to get um awareness and potential virality of you know like the standing and post you're saying basically. Yeah. So that's seating good quality influencers in your space who are who who fit your market and and see the posts they get.

I think it's a time I think that's a time-t tested like I can't I we I wish we could have a measurable like this is the lift this is um the result but a CP an impression is an impression and if you can get it at $2, you know, whatever like massively cheap like how can that not be a win? um irregardless of how quality if you want to call it that um of impression that it is it's it's a win. So that yeah that I think is just something I'm thinking more and more about especially it's just more difficult it is to win on meta is like how can you start thinking about it um and frankly like it has an impact um on on the profitability in like a longtail perspective.

Yeah, I think by I think that the challenge for that for a lot of people is that between the cogs, the shipping and then the time output involved and then the fact that the reach on a lot of posts and it's just not that big, right? Like um you know for a lot of influencers it's just they're not reaching that many people per post. And so they they look at that and they go okay well this is really expensive, really manual and it's not going to be the mass awareness thing like me where I can just blast it out to all these people.

Um I think I think maybe one way to frame this. Yeah, go ahead. Yeah, sorry. most important is that you're right 100%. If you keep that in the the silo of organic, but if you're able to also use that on the paid side within a paid, then you split that cost. Um so, so I couldn't agree more and that's where I think like getting and thinking creatively is like how can you use that somewhere else? What about on email? What about on your own um organic like whatever that is?

And again, I'm not going to sit here and and preach at y'all like footwear. We're we're really blessed in that. Like, right. Yeah. You're not going to be like, "Hey, this is deodorant that I use." You know? So, I I know we're blessed, but like I think that just that's definitely a consideration um of just thinking about it outside of paid, like how can you figure that out? Well, but the thing I was going to say is like it's also a very long-term consideration.

So, you just talked about reusing this reusing the prog the the content, but it's like it's also like like one one way I'd think about it is the CPM that that an advertiser pays me to advertise my podcast is like insanely high, right? It's insanely high, you know? It's like it's crazy. But because my reach is not that big, but the reason they do it is because my reach is so tight. It is the only people listening to or watching this episode of this podcast are people trying to grow profitable DDC businesses.

And so for certain advertisers who are trying to help people help operators do that, right? Like the ones that I've been mentioning in this show on the ad reads and we've taken breaks for that, right? They are tightly focused on that buyer and therefore like the that even though my reach isn't that big and it's a very manual process and we got to work out all these things, like it actually really works out great for my advertisers who advertise with me because what they end up with is a really perfectly like tightly tuned audience.

And I think doing that over time with the correct audience really pays off, right? So in your case, right, if you want to get runners who are serious enough about runners to have running to have some sense of the right kind of shoe and the the way that the toe box impacts their health, you know, and the way their body functions, like getting getting your product to the right influencers for that, even if it's not a massive reach, but getting the person following the right influencer and then over time hitting them and then having your meta ad stack on top of that, it really adds up over time.

And I think that's I think that's a really important point that you're making. Yeah, Isaac, go ahead. You finish your thought and then we'll wrap. One last point to that I think that's really important is like so we we have a a knit runner. Um it just think about casual everyday shoe, right? Go to the gym, go to coffee, uh any any use. Uh we're launching a more performance uh runner and trainer. Um, our target audience and goal would be to have every CrossFit owner in America wear our shoes, right?

And and so like I think it can be depending on your product. Like I think there's two different mindsets like for you Andrew like you I don't know what there's uh or the sponsors there's maybe 5,000 of us, right? um but for for um that they care about that's in in your audience. But like so I think that that's another interesting dynamic also of thinking about your products. Like some are hyperfocused and like if that's the case like I that's our goal.

Like I'll send 4,000 pairs of shoes to gym owners because like that is the exact demographic and that's a little easier versus like we're just kind of shooting from the hip of of of for our our nit. Like of course we have different segments. So yeah, like I think there's a lot of different strategies to your point um of of like how you can think about it from a seeding organic um perspective, but yeah, it's it's tough.

Like this wasn't something we were um heavily invested in from day one. Um again, we had the paid angle, but now it's almost like equal, if not a bigger impact because we're integrating it. And I think that's a kind of a cheat code is like how can you utilize it in more ways to then decrease your upfront risk and cost. Um then it becomes a lot like a lot less of a risk to like all you're talking about like it's hard.

It's manual. It's it's expensive for cogs on on some uh products. So yeah, makes perfect sense. Um Isaac, this has been a great conversation. Thanks so much for taking the time for um making this happen and for dealing with my bad scheduling last week when I canceled on you. Um I I appreciate so much. You should follow Isaac and his journey. He's on LinkedIn. The the exact um uh link for that is in the show notes of this episode.

Um so go check out Isaac Merins. Buy yourself a pair of shoes that are better for your feet from Flux Footwear. While you're at it, we can chalk up the CAC of your time on this episode to however many shoes you sell. Well, I don't know if you give people a URL or a discount code or something like that, you know, to figure it out. No, but but uh but yeah, uh thanks very much, Isaac. I appreciate it. Thanks, Andrew. All right.

Excellent conversation in the second episode of my Profit Monsters series with Isaac Merins. I loved this conversation. I hope you did, too. Um just actually an amazing story. Like that's just monster numbers that Flux is putting up. There's a whole bunch of reasons for it, and I'm glad we could get into it. Subscribe wherever you're watching or listening because I've got more of these coming. Nate Legos is coming soon. um and a bunch more after that.

I think this is going to be a really helpful series for a lot of people. Go back, listen to my episode, watch my episode with Ben Perkins um and and hear a different story. Like I mentioned in this episode, somebody who took on a bunch of debt and had to get his way out of it. Um there's just a lot to learn from each of these different operators and it's really great that they're on here being transparent. I'm really helped by it.

Follow up with Isaac. He said you can DM him on LinkedIn if you want to hear more from him and hear what he's doing. Um so go for that. LinkedIn not uh the LinkedIn URL is in the show notes for this episode, so go check that out. uh subscribe to uh this podcast, but also to my newsletter by going to ajfgrowth.com. Drop your email address either in the footer or in the popup there. That'll get you access to that. And uh and of course you can reach out to me on xanderjer.

See everything I'm doing at afgrowth.com. If you want to reach out to me uh personally, you can do that at podcastfgrowth.com. I'd love to hear from you. Thanks so much for watching, listening. I'll talk to you next time. [Music]