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The Andrew Faris Podcast · @andrewfarispodcast
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Opening (first 30 seconds)
Oh my goodness. Holy cow. This is a crazy conversation. It is going to get into places that you do not expect coming with Telmore and [music] Dave Stickland, the co-founders of Popsmith, a company that was within 2 weeks of dying. Tall's putting in millions of dollars. There's personal debt involved. There is drug use and alcohol use in the story you're about to see. And there is Oprah's favorite things in this story. It's just crazy. This is crazy. This episode went way longer than I had anticipated with either of these guys. And that's because they are very gracious with their time. There are some real low lows
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Oh my goodness. Holy cow. This is a crazy conversation. It is going to get into places that you do not expect coming with Telmore and [music] Dave Stickland, the co-founders of Popsmith, a company that was within 2 weeks of dying. Tall's putting in millions of dollars. There's personal debt involved. There is drug use and alcohol use in the story you're about to see. And there is Oprah's favorite things in this story.
It's just crazy. This is crazy. This episode went way longer than I had anticipated with either of these guys. And that's because they are very gracious with their time. There are some real low lows at the business level and the personal level in the story you are about to hear about PopSmith. And there are some really cool highs and how how they have come out of it personally and with the brand. Again, I'm not going to waste any more time here.
Uh Telmore, the CEO and co-founder of Popsmith and Dave Sticklin, the president and co-founder of Popsmith. Let's get into it with both of them right now. Gentlemen, thank you so much for doing this. Uh I you know I Dave I feel like I know you a little better than I than I have known Tal in the past. Tal and I became friends at at ECF Live, but Dave, you and I have known each other over the years. >> Um but I'm very grateful to have uh to have gotten time with you.
It actually sort of occurred to me that it's silly that we haven't done this earlier. So I'm grateful for your time. Um I want to start with just sort of introducing you both people who are listening. Um Dave, uh maybe you can start and just say hi, tell people what your role is in the company and how long you've been at it with TAL and all that kind of stuff. Yeah, you know, Tal and I have been together for over 12 years now, 13 years, and uh we've built a variety of different e-commerce companies.
I've held a lot of different uh positions in the organization, but with PopSmith, uh we went into this as partners. Um I oversee marketing and operations and uh yeah, that's what I do here. >> Awesome. And then Tal, um I would like to pick I would like to have you say the same half so people know kind of what your t role tends to be in the company. And then I would like you to immediately tell me how close Popsmith was to dying um and because it is crazy.
And then we'll we'll talk about the toll that took on you soon after uh but because it is insane and uh and is a remarkable story and you've got a lot to share with people. So tell tell me what you do and then maybe answer the second question. >> Yeah, sure. Um so first off, super grateful for this opportunity. Uh we don't Dave and I don't do interviews too often. when we get approached a lot, but you're a friend. Um, you've got a really great audience and we're really happy to uh, you know, share this cautionary uh, tale on what, you know, can and will go wrong um, and have an impact on the community, which is, you know, something that Dave and I care about very much. >> I appreciate you saying that.
I actually didn't know that you turned on a lot of interviews until right now. So, that that makes me feelful. That's awesome. >> We're Yeah, we're we're selective. We're heads down. you know, we're our our priority is the is the business and we both are very uh involved in in in various groups um you know, with e-commerce owners and we're happy to give back, but you know, it's crunch time right now. We need to it's all hands are on on deck with our company. >> Uh but anyway, yeah, I've been um I'm a virtual dinosaur in the e-commerce space.
I actually got started back in 2000 uh with the domain gumballs.com selling gumball machines and gumballs online. So way back in the day uh when uh paper click was a lot simpler and a lot cheaper um I uh started that before that I started a bubble gum machine vending route and that's how I got in the gumball and bubblegum space. Uh so bought the domain and I was a solarreneur for many years and after that I kind of like built off of that model of finding other niche products and and launching websites.
So, I got into gadgets. Um, I had wicker.com, chocolate.com. Um, I had a uh an early iteration of a popcorn business called Popcorn Machines Direct, where I was selling the big cabinet poppers. And it was um it was around 2012, I believe, is when I acquired the domain wicker.com. And that's when I hired Dave to come on board and run that that business. and he ultimately kind of transcended from that business to overseeing all my e-commerce businesses, uh, the gadget, the popcorn, a few others.
And then around 2020 is when we decided to divest ourselves of all of other e-commerce businesses, close them down, sell them off. We sold a business to Thrasio, um, and a few others so that we can go allin on, uh, on on popcorn. So Dave and I collectively have, you know, have many, many years in experience in the popcorn space. And it's something that we're personally out of everything that we sold, it was something that he and I shared a personal passion for around popcorn and the joy of being able to deliver a you know what, a popcorn popper and the uh emotive um and uh nostalgia component of of cooking and and uh eating popcorn.
Um, so we love the idea and uh we went all in on that and that was really uh you know we I mean if you want to jump right into disasters uh and >> I do I do like I said I'm a marketer uh so we got we got to get started. >> Let's let's get into it. Um, you know, so a as I said, I really had started as a solarpreneur and it's very easy and simple to run kind of a solopreneur operation and in this case, you know, I brought gave on as an equity partner and we decided to partner up and do this to together.
Um, and so I leaned on uh I put up a a lot of my own personal money. We we had no budgets, you know, like I I personally, neither Dave had built something. We had pie in the sky visions for what we wanted to build. Like we didn't just want to be an arbitrage business like what we had been doing for many years just buying and selling products online or on Amazon. We really wanted to build a brand and a brand that we we loved and we were committed to and hopefully a brand that will outlive us.
And neither of us had had done that before. And we were really quite naive on how much time and how much money it would take to build a real brand. And we really I mean you can see the poppers behind me for those of you that are that are looking at it. We we uh you know watching this on video. We really wanted to create something that was retro and modern and beautiful and timeless and really top quality. And so we ended up hiring uh one of the best industrial designers in the nation out of San Francisco, Branch Creative.
We hired an engineering firm. We hired a professional branding agency out of Portland. Um we made all of these hires and everything just took a lot longer than we anticipated and was a lot costlier. And one of the mistakes we made early on was we really didn't come up with a budget. And we had a preliminary budget, but we really had no idea. We didn't have any sort of buffer for how much it was actually going to cost to, you know, to launch this thing.
I personally put up uh 1.2 million of my own personal money that I had, you know, taken from uh other e-commerce that I I had sold. We have a very large network of friends and family. We did a a friends and family raise. Uh we raised 1.6 million. And then I also took a bank line of credit for 1.3 million that I was personally uh guaranteeing. And so when we launched the uh the business in October of 2023, we were sitting on almost a year's worth of inventory.
And again, we were very naive. We never really had a contingency plan for well, what happens if this is hard? What happens if advertising runs out of control? What happens if it becomes a lot harder to get attention and to convert? We never really thought through that. We just were of the mindset of we'll build something beautiful and they will come. And that's not at all what happened. >> We had sat in like a weiwork room.
We had sat in a wei work room and we came up with our dreams and like what do we got to do with this money? We had we had done the friends and family round. We had all this cash in the bank. We were spending money doing engineering and market branding and we kept telling ourselves that like success is 90 days away on all of that. We're going to finish this project in 90 days. and to it was always 90 days farther than that 90 days in reality.
It was always way it was there was always another hill over that hill. But in that moment it's like look we're going to finish the product in 90 days. Let's just hire some people now. Like when we're we're writing down we need to get the best the best dot dot dot, right? Like and so like what's our budget to hire a full-time marketing person for this brand that's never existed before? Well, then we need this full-time operations person for this brand that's never existed before.
And we came up with these massive expenses from go. Um, and we started with that. That's where we started >> and and agencies. I mean, it was just like the the monthly nut was just staggering, right? And so we launched in October of 2023. Meta was a lot harder and a lot more expensive than we uh had anticipated and we were drown all we had so much money almost seven figures in inventory, right? And so we started out of the gate.
We were spending north of 50% of our revenue on on Meta. And so we got through that first holiday season. And everything just kind of came at us. And I'm head of finance. Like everything came at us so quickly. And come January, I I remember giving Dave a call and I was like, "Bro, we've got two weeks of run. We were burning $100,000 a month and we had less than $50,000 in the bank. We had two weeks left before we were going to run out of money.
And it just it just hit both of us like a mat truck. We were just totally caught off guard. And it's such a scary, sobering experience when you just put in so much time, so much money into this massive thing that you've given this screaming baby that's really, really costly to to to manage and oversee and it is about to die, right? And the only way you have two choices. You can either let it die or you can double, triple, quadruple down and put more money in, which is what I ultimately decided to do because I had, you know, it's kind of like playing poker and like you've got a hand and it's not a made hand. you're putting more chips in the middle and more chips in the middle and we all in those situations have to make a decision like when do I fold this hand and you don't want to fold it because you love it and you really believe in it but it's the scariest moment ever where you just continue to kiss push money in the middle without any plan without any end in sight and so what I you know and I had to talk to my financial adviser because if this went to zero I was personally liable for almost $4 million not you know and and That doesn't even account for the friends and family money that we put in.
Like all these people that bet on me and Dave, like my mother invested, Dave's mother and father invested, like all of our friends, like our our reputations were on the line. And so it just it was not a good situ. It was a terrible terrible uh place. But, you know, I I I talked to my financial advisor and uh he said, "Look, like you if you want to put more money into this, fine, but we need to draw a line in the sand because if you don't draw a line and you don't say like this is my red zone, you don't go beyond this, like this could end up in financial ruin." >> And so, what I we were burning $100,000 a month and I just decided, you know what, I'm going to sell some personal stock, you know, from the S&P 500 and I'm going to extract $600,000.
And I called Dave and I said, "I am putting I'm lending the company another $600,000. We have we have $100,000 a month burn. We have six months to to write the ship and figure it out. If we end that six-month period and we are out of options, we're done." That's wild. I as I hear you tell the story of of having to go to friends and family and tell them your money's gone and the company's dead, you know. >> Sure. >> Yeah. that that I mean I I can feel right now in my gut like like I mean you know the way your emotions live in your body uh like I mean I can I can feel it as you're talking like and uh and for me that's like I mean the the personal cost is like whatever but like I mean you know obviously if $4 million is a huge amount of money but like that in some ways just sounds worse to me.
Dave, how did you respond when Tal told you that >> the writing was on the wall, right? Like even, you know, the the employees that we had hired, they were smart people, you know, and I would have, you know, I would have these conversations where it's like, how are we doing this, right? Like I'm look, you know, like we we we value transparency in our organization because we want everyone to win and we want under people to understand why.
And people are coming to me and going, "This isn't working. Like all this work we're doing, like it's underwater. Like we're, you know, like all this mar like my marketing person is saying that like we're not making any money doing any of this." And you know, this this assumption that like where's the money coming from? I got asked that several times. And like the reality was is that that's all sitting on tall shoulders, right?
Like this personal line of credit, all of this stuff. And I think sometimes employees forget that what's happening on the other side of the wall. they don't have a view of what the true financial picture of the business is and they're just head down continuing to go and it was really my first time kind of being on both sides of that wall that we were partners now and so trying to you know and trying to and that's the thing you know Tal compared it to poker but in reality we were going into meetings every single day with vendors and with engineers with uh meta buyers with all of these people who would say, "Trust me, success is coming.
Give me more. Trust trust me, success is coming. You need this. Trust me, you need to do this. You need to do $35,000 more work over here. You need one more round of consumer research. You need you need this. You need this. Like everything was 10 $15,000 or my system will work. Give me 90 more days." Right? And when we're not seeing results, like there was constant pressure to say you will miss the future success if you don't make this bet today.
And so not only are you up against this level of financial ruin and your pot committed, but there's all these people telling you that while your cards look like they're terrible, if you don't stay in this hand, you will lose everything, right? And so getting yourself out of that mindset and trusting yourself to get yourself out of that situation, which is ultimately what we had to do is we had to shut all those people off, tell everybody no and bet on ourselves is is where it was.
So when Tal came to me with that and Tal was just like falling, um we had to pick each other up and come up with a plan. And that's when it was just like, okay, yeah, what do we we have six months. What are we going to do? Be we don't have anyone now, right? Like then it was cut, cut, cut, cut, cut, cut, cut. And when you're at your lowest in that place, which both of us were personally on top of everything else, but like when you were when you were at your lowest, >> uh the idea of like now I'm going to take on, >> you know, two FTE amount of work and I'm going to do all of these things >> for maybe no real result, no guarantee that in six months anything's going to happen. >> The idea of wanting to do like to check in with each other and say, do we want to do that? like, okay, we have six months.
Do we want to? We want to do this work for six months and like hyping each other up to do that and like really trusting that we were both going to do it >> because it was going to be hard >> and and in such a such a we were both in such a fragile place. Yes. you know, like it's the the I can't overestimate enough the the mental mindset like the mindfuck of of just having your entire identity intertwined with a failing business in a really really public place where you have so much invested like it was we were both in our own ways mentally spiraling.
We were both dealing not only with business challenges but with with personal challenges at the same time. Like as I mentioned in in a previous talk, you know, it's like we all experience tsunamis in life, but when you're hit with five, you know, at at once both personally and professionally, like it the the mental um degrading that happens. And thank God we had each other. You know, that's where, you know, it's like there there are a lot of partnerships, both personal and professional, that don't work out for a variety of reasons.
But when you have a a good uh partner where you have value alignment, you trust in them, they can help to pick you up, you know, when when you have fallen. This is true both personally and professionally. And you know, I I I I would not have made it through had I not had Dave as a business partner and had I not had a close network of friends and family that I could rely on. And for the first time really in my life, I had turned to, you know, to Dave and I had turned to my friends and family in deep shame and said quite simply, I'm not doing well.
I I am I am not doing well. like I I can't make it through this day, you know, like I I all I can muster up the courage and the clarity to do is just go and take my dog for a walk over and over and over again. And there were many days that's all I could do, you know, I was just so mentally crumbling. And so it was really nice where Dave, you know, dealing with his own challenges both personally and professionally where I can communicate with that level of cander and he could step up and give me his broad shoulders and say, "Do your thing.
Take your time. I got this." you know, take take care of yourself and then come back, you know, and it was bits and steps that we were able to kind of like carry through, but it was hell. It was it was hell. You hear these guys talking about the bloat that was happening in the early stages of their business on the OPEX side of things. And one of the ways to solve that problem is to hire less. But another way to do it is to hire smarter.
And that is the bet that I am making in my business, both in my agency and the brand that I'm starting. And that's with my friends at More Staffing. More staffing is a staffing agency is based in the Philippines that helps you find the best Filipino talent and place them in your US-based e-commerce business. And they are uniquely good at doing this because they were born out of a US-based e-commerce business. They still are touching and working in US-based e-commerce businesses.
And so they know the demands, they know the needs so well. Um, and they will do everything that is required to help find incredible talent in the Philippines for your businesses. And that talent does exist. If you're still thinking about Filipino talent as $5 an hour virtual assistants, um, look, there may be use for that, I'm I'm certainly open to hiring junior level employees from the Philippines and all kinds of things.
I've had great success doing that as well. But the place you should really be looking is manager, director, even executive level talent for people who have deep resumes, know what they're doing because your dollars just go so much farther in the Phil Filipino talent market than they do in uh the US-based [music] market. It's really that simple. you can just get so much more quality for your buck because of the realities of global economics frankly and and so it's just an amazing thing.
So um uh what more staffing will help you do is recruit, train, coach, onboard all the things that are required to um have a successful hire in your business. They'll even give you a one-year guarantee on talent that you hire with them where uh where if you hire somebody and they don't work out, they don't make it in your company for a full year, they will help you replace that person for free. In the rare extra case that happens, uh I'm just a huge fan.
I'm I mean it it's the bet that I'm making. It's the way to keep your opex lean while providing uh or while leveraging incredible talent in your business. My life literally has been changed by um by uh intertwining my business so much in the Philippines. I think you should do it too. take a call just to see what's opport uh what's available to you. You don't have to go down there. Just look at some resumes, get some interviews and see like is this actually an opportunity for me?
I bet there's more opportunity there than you realize. Go check it out right now. Staffing.co. Okay. I I want to chase that thread down actually just a little bit more. And then in a little bit, I actually want to spend some some time talking about how you got out of it because I think it's it's a really important part of the story. So, I'm not just in it for the uh gory details here. I I think the gruesome details though are are helpful because what you're describing what both of you have described in this so far I think um highlights something that is I think people will mostly agree with and see but it's hard to sometimes actually put your finger on which is that every business problem in some ways is actually a personal problem as well you know or or maybe not everyone but like there's some there's this overlap of who I am as a human that comes into who I am as a professional and and the and we sometimes I think behave behave as if they're just these two different things, you know, professional me, human me, you know, and I kind of keep them separate, but actually often when we don't want to and sometimes in ways that we can't experience, they're actually colliding into each other.
In fact, there is no separation. It's just one thing. So, I want to get to that, but I actually want to clue in on something, Dave, that you said that I think is really interesting and is really relatable, which is this this notion that everybody's telling you how to give them more money to solve the problem and what to do about it. Um, and it sounds like what you came to was the decision that it didn't really matter if they were right because you were going to run out of money before you could say yes.
So, you just had to say no. But, uh, I I think I mean I'm a service provider, right? I think about this sometimes of like I like there's a responsibility when I take somebody's money. Not that I can guarantee results. Of course, I might make mistakes or something like that. I don't think that's the expectation, but that there's a there's a human on the other end of that business who is doing something. And if I just didn't lie to them to get their business or or push them too hard to to maintain the check coming into me, it's like it's exploitative, you know, it's it like could really be, you know, a problem.
So So anyway, I one of the things that's occurring to me is like people reach out to me all the time about like helping them with their business sort of at a low spend, a low ad spend. They'll be I'm spend $20,000 a month on Meta and can you take over my ad spend? And I always tell them the same thing, which is that before $50,000 a month in ad spend, you shouldn't bring on an agency. Um, and I tell them and and actually arguably later than that, but 50 is like the bare minimum to me.
And one of the reasons that I tell them that is because the margin profile doesn't work for an agency. So there's like part of it like so you're going to get bad service under $50,000 a month in spend because an agency cannot service you at that level of spend and you pay them in a way that makes sense. But actually there's another reason for it which is that if you don't develop some of those skills and convictions and point of view yourself not only for your metend but how that line item on your books actually and like how the total P&L of your business ought to look I always call like P&L design.
You you add it you need to design your P&L with clarity about how it is supposed to look. If you don't do that, if you don't go through that exercise, what's going to happen is exactly what happened to you, which is people are going to come to you and say, "Here's how you do it." And if you have no point of view against which to challenge their opinions, then you are going to have like you're going to be easy prey, you know, so to speak.
And I actually don't think most people probably meant poorly by it. I bet most people were trying their best to try and help you guys or whatever, right? But they're just trying to keep a check coming in as well at the same time. time and even if they're trying hard, it's like it's just so it's really hard to sort through all of that noise if you don't have point of view yourself about what the what good looks like and if you don't have some perspective, you know, if you don't have an argument when Andrew Ferrris comes along on a podcast and says like you got to run manual bids, you know, or whatever, uh then like, you know, maybe I'm right, maybe I'm wrong, but the thing is that you need to have a clear way of evaluating that claim as much as possible.
And I just don't know another way to do that besides to do it yourself for a little while. Um otherwise, you just are sort of a sitting duck for those kinds of things. So um so it's something I give people advice on all the time because otherwise it's so hard to sort through all the the endless onslaught of content and vendors and software companies and all those kinds of things who are trying to take that. It's it's a real real problem.
I think what happens what happens is you come to the provider. So like look, you know, like we come to, you know, like don't come to me unless if you're spending less than 50. But you come with the to the provider in our case where we're saying, look, you know, we've got this massive brand, guys. You don't understand. We're going to we're going to we're going to we're going to push past 50 in the first 30 days. What the [ __ ] are you talking about?
Like, excuse my language, but like, you know, we're going to get we're going to get to 300, 500, we're going to get to a million in spend. I want the I want the agency that can handle me at my best. Like, I want the person that's going to handle me when I'm there. I want I want the person working with the brand that can scale with me. I want to be there. >> And the reality is, and what what we learned in this and what no one said >> is you cannot cut the line.
So unless you are uh unless you're VC backed and you are ready to burn money with me for the next nine months maybe a year where you are not getting value from what you pay me and you're just comfortable with that because you love me so much you want to have a relationship for a year until you get to a place where I'm valuable to you then then great like let's do it. But if you cannot do that and you're not spending someone else's money, then I would suggest you just come to me when you're when you're ready and you go take your lumps and you you act like the brand you are because Meta doesn't work that way.
Meta is not going to let you Meta is not going to scale just because you aspire to scale. Meta is going to make you drive like this going to go on the road it's on and you will have to drive that road. It doesn't matter what your intentions are. And I don't think anyone said that to us and or made us believe. I don't think either of us either wanted to hear it either. Like neither of us would have believed you if you had said that to us in that moment.
We were we were delusional about what we thought we could do very quickly, right? Like the idea is, oh, we can we can we can scale this really quick. We can scale this really quick. And that's because, you know, you look at things you look at brands that are successful and you look at the success they're having today and you don't necessarily look back at before they were loud, right? the year or two before they were reaching traction with their signal of like what they're doing or they're loud about what's working.
You know, you they don't talk when they're doing all of the figuring stuff out for the first two years of inception, right? Like so I mean like that's the thing like you have to go into the dark for a while before you come out the side and no one gets to you do not get to go around that >> and to your point Andrew um and I I agree that's exactly what we did. we realized like we we have not earned the right to you know we are not at the level you really have to be humble and be like you know what we got to figure this [ __ ] out on our own and that's when you know Dave took it upon himself to start taking courses and Dave and I jumped into Canva and started making terrible ads on our own and it was really Dave that spirited this he was like look I you know the the agency opportunity will work once we're at a certain scale but right now I got to one of us has to figure this out so that we can have intelligent conversations and be able to push back like no no no you have this wrong.
So your your intuition was what we ultimately you know after spending hundreds of thousands of dollars what what we ultimately came to and it was the right decision. Ultimately we did hire somebody to help us with buying but now we have a person in the room and that's Dave who actually has like at least a a fundamental understanding of that platform so he could push back be like no no no no like this is not this is not working we got to go here.
That was that was an imperative step and that's hard, right? Because we don't want to do that. Like Dave doesn't want to be in the muck of of running ads and neither do I. Like we want to oversee teams, you know, and like grow like but you you have to you have to earn that opportunity and that means getting humble, getting in the mud, getting in the trenches, doing all the [ __ ] that you don't want to do but you have to do for the sake of your business survival. >> Yeah.
And every every business in our space that we look up to that's successful has roots in performance marketing. like you know like every one of them has some leadership that has touched or been in and is around and understands performance marketing and it was and I I truly believe the only way a brand is going to be successful seven figures to eight figures growing into nine is that the founders adopt performance marketing and meta as a core competency at the top of the pyramid.
And if because that is where fundamentally everything is happening and while I may not have a educated answer to your feelings about manual >> yeah sure of course >> you know whatever purchasing or bid caps or any of that >> you know can I get into ads manager and tell you you know if I have a bad week what I think isn't working and ask good questions. >> Yes. Could I have not done that two years ago? Absolutely. I would have had no idea what was going on.
I would have just looked at my overall rorowaz and said, 'W whoa, why is this bad? And let someone just give me whatever answer they wanted to give me. I would have not had an answer of like, why are you running this specific ad set with this price and this one specific ad is getting all of your spend. You have all of these different creatives in here that we both think are hot, getting no spend. Do some diversification here.
Turn this off for a week. Do some things here. Help me figure this out. Yeah, >> like I can have then we can talk about your tactics as a much smarter person than me about how to solve that problem versus having a broader conversation about why are my metrics topline metrics poor? And that to me is where I can tell the difference between a really smart operator and a person who is just fitting me into their system that they're just they're just they're just, you know, they have an SOP that they have some person in another country doing and they're not paying attention to my ad account, right? >> Yeah.
And uh and I mean that's so much of it. you just sort of hit it at the end there, which is the ability to evaluate what smart does and doesn't look like is is like a really really important skill and it it requires some uh some discipline knowledge, you know, at sort of a detailed level that I think you just have to have. Um, so even if it's not the deep as deep as the as the specialist that you've got, it's got to have some knowledge.
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They know you don't have time to waste doing this. It's a fast painless onboard. richpanel.com. Go check it out. Today, I want to talk a little bit about sort of the the personal darkness that you talked about as well and and how this uh went for you. And then um and then and then uh and and then I do want to talk a little more about sort of what what you guys have done to get out of the situation. But again, it's just I think there's going to be other people on this, especially around this time of year.
We're going to publish during the holidays. There's going to be people who are going to have who are having worse holiday seasons than they expected uh on on their business and it's going to and it's going to matter. So, um can you talk a little bit about sort of share as much as you want to share about sort of when you say you couldn't do anything but walk your dog a couple times a day? What was why was that? What was happening?
Yeah, I mean it was and look I'm happy to be candid because I think it's really important um you know as I shared in in a a talk in um the e-commerce community like it's um it can be very difficult being in these e-commerce communities when you're reading Signal on on X or you're reading on on message boards or or forums where people typically talk about the good things people typically talk about the wins and you have this this when you absorb all that information you yourself are struggling you develop this false narrative in your head that everybody is crushing except for me.
And that could be incredibly isolating. And I've been around long enough to be able to observe that in my own brain. And that's why it was very important for me to go out and to be very candid about just what kind of hell I experienced to let people know that whatever hell they're going through, they're certainly not alone. There are a lot of people struggling right now. This is a very, very difficult time. Um, and so yeah, for me, I mean, as I said, I had multiple tsunamis that hit me at once.
I had the threat of financial peril, you know, and this is something that I've worked I've been working, you know, as an entrepreneur since I was 12 years old, you know, and I've been building, you know, my personal wealth over the course of, you know, 20 20 plus years, 25 years. And then I made this colossally large bet and the prospect of losing all that and taking a serious setback financially uh just completely overwhelmed me.
I've never I've never made such a big bet. I'm not a I'm a riskaverse type of person even though I'm by your very nature you know as an entrepreneur a risk taker. So the the the the financial pressure was just like unfathomably large. Um I had that I had a you know an awesome business partner who was dealing with his own like health struggles and seeing him dealing with those challenges at the same time was also like really daunting and taxing and scary, right? because we did this together and like the thought of him being impacted both on the business side and personal side, you know, I I took that very personally and I I carried that um on on the you know also on the personal side I had um you know I was in a a relationship with a really wonderful woman.
Um it was she she was somebody that I was ready to uh to commit to and get married to and build a life. Um really really wonderful person, a very very strong fit, but happened to meet her at a time that was not optimal for her where she was getting out of a divorce and you know she didn't have the space or capacity to meet me at my level and she left um because that was you know what was right for her and that happened while all of you know my the rest of my life was was crumbling.
And again, this is a person that I was ready to build a life with, you know, and to have that person disappear in the middle of all this just added to, you know, to to the burden. And then I had my father I um, you know, who through a a a series of unfortunate circumstances ended up brewing his life that led to, you know, himself medicating with uh crystal meth and um and that led to a heart attack and a stroke. He was homeless.
He didn't have healthcare. So, I was also managing my father's healthcare. I put him into private boarding care at a cost of $6,000 per month. I was driving back and forth trying to tend to all of that. So all of that hit me at once and it was just it was just soul crushing and I didn't know I didn't know how to manage. I didn't know how to contain it. And so I ended up self-medicating myself turning to and I'm not a drug and alcohol guy.
I mean I you know I drink on occasion like I was I was binge drinking. I was drinking daily. Um I was taking drugs. I was taking uppers and downers to help me get through the day and then sleep at night. And for anybody that's done, you know, drugs at that level, like it's just a vicious cycle that does not end and end well. And I just I I barely um I I I barely recognize myself, you know, like my identity has always been a a successful, strong uh uh entrepreneur that is able to charge forward.
And I was just crumbling. And it was scary. It was scary for me to see. It was scary for my friends and family who knew me well to see. It was scary for my business partner to see like they hadn't they hadn't seen a version like that. And I think, you know, ironically, it was their fear that really kind of helped me towards a path to turning things around, you know, because I realized like um you know, when you build a life that's that that's an inner web of the most important people around you, you don't fully realize like how much of an impact you have on others.
And I can see it in my brother's eyes. I could see it in my in my close friend's eyes. like they were deeply scared. They needed me. It's not just that they wanted me and loved me and wanted me in their lives. They needed me in their lives. And the prospect of losing me, you know, to to drugs, alcohol, death, suicide, whatever, whatever it was, like, you know, I I I fast forwarded, you know, in my mind and thought like this would be this would be deeply tragic, not just for my own life, but for the lives of others if I if I don't make it through this.
And so um you know and that that also I think ties into um a degree of self-love which is something that I have personally struggled with the majority of my life. You know like I'm I'm a very kind person but I have been incredibly cruel to the most important person in my life which has been myself. You know driving myself ever so hard whipping myself when I don't do well enough. Um you know not feeling uh worthy of the time or attention of others. not feeling worthy of burdening myself with others.
And so, but I was in such a desperate place that I had no option but to turn to the people around me and just to say the simplest of things, which is like, I am not doing well and I need help. Right. >> And sorry, sorry, this a little emotion. Um, >> I don't think I don't think you need to apologize to >> um but it it it was it was really hard. It was really hard and you know but you realize that um you have to ultimately come in this place where you realize like I'm worthy of life.
I'm worthy of love and I will make it through and I will make it through one day at a time you know and you really have to take a step back and really start to when you are trying to push a boulder up a mountain and this is advice that I got from a friend in our community uh Bill Delisandre when I had a call with him. He is a friend and an investor. And I was deeply ashamed to make that call to a friend and investor to say like I am not doing well.
I [ __ ] this up. Like I am I am this business is going down and I am personally responsible. And he along with other friends who invested in me were so sweet. I did not have one investor say to me like where the [ __ ] is my money. Like don't ruin this. Don't lose my money. Every single one of them said to me, you know, I don't care if you lose the money. I'm I was a big boy. I made this bet. I know the odds are against you. like I care about you and um and we talked through it and he gave me really good advice.
He was like look like you're you're you know your mental challenges becoming a business liability. So before you focus on the business you've got to get your head on straight you know and you could do that by you know one of several things and we talked tactically about that and so what I came up with was number one like my brain was not operating well and so I got a referral from another entrepreneur to a psychiatrist which I'd never seen.
I've done plenty of therapy. I'd never done psychiatry. Um, and so she prescribed a uh an anxiety medication I started to take. And as she explained, she was like, "Look, your brain is overwhelmed right now. We need to build a shield, you know, to prevent you from spiraling so that you can get your brain course corrected and start focusing on the work." I did that. And as Bill said, you know, come up with a win the day journal like you are moving a boulder up a mountain and that's overwhelming.
You need to take it back. Like we particularly as men, we need to see forward momentum. We need to see progress. So I want you to come up with a journal and come up with three simple things where you will win that day. And they must be things that you can accomplish that day. And when you do that, you start to create a neural net in your brain about okay, I am making infantessimal progress, but I am making progress, right?
And so I did. And my journals in those early days were like really really basic [ __ ] Like I've had days where the three things I had was number one, pack a bag for a trip, you know? Number two, respond to one email to Costco. Like that was my work for the day. And then number three was like take your dog on an extra long walk, call mama, tell her you love her, right? Like that was how I won that day. And then exercise, like getting into your your body.
And that was also a real unlock. Like I was not eating well. I was 30 pounds overweight. And I thought, you know what? Like there's so much in my world that I don't have control over right now. I have control over my body. And so, you know, I got back in the gym. I clean up my diet. And it didn't happen quick, but in nine months, I lost 30 pounds of fat. I gained, you know, probably 10 pounds of muscle. I'm 12% body fat right now.
And like I had that, you know, I could >> I saw your abs. I saw the picture. [laughter] >> We could do it. We could go shirtless. Yeah. The we maybe the rest of this interview just No shirt. >> No, no, no. That's not happening. But >> put that on We'll put that on the thumbnail to make sure. [laughter] >> Definitely not happening. But, you know, it was it was very validating, you know, for me to be able to look in the mirror and see a sculpted body that I, you know, that I had direct control over.
And so it was a combination of the win the day journal, exercising, getting control over my body, and um and then getting the medication. Then I was like, "All right, now I'm in a now I'm in like a good mindset. It's time to get to [ __ ] work, right?" And like we were in a desperate place, and sometimes desperate times call for desperate measures. And like I don't advise people to take Hail Marys, but like Hail Marys is all I had, right?
So I was like, I just started tossing >> bombs. save the Hail Marys for a second cuz I I want to I want to get to those in a second. >> I'm sorry to interrupt you. Um actually, one of the things I loved about this is when I when I asked you if you'd come on the podcast, >> you said, "Well, yeah, but let's make sure Dave's on the call, too, because he was experiencing all of this both in the business and he was experiencing my personal stuff, right?" It's I don't So Dave, I'm just curious to hear you talk about not only uh what you're experiencing in the business, not only what you're experiencing with towel, but also I know you were going through I remember you tweeting about this your own stuff as well.
Um and uh and and so like I'm curious to hear you reflect on both of those at the same time. Sort of what was that like for you to be experiencing talent that way and then what was happening for you personally at the same time? >> When I was a kid, I had bone cancer and one of those things that happened as a result of that is I have a lot of metal in my body. I have a I have a a fake knee. I have a metal knee. And what happened the right before we launched Possmith is all of that metal started to fall apart.
And um I had been dealing with a lot of pain and I didn't know why. Um and so while all this was happening, all of that was falling apart. And then I started to have surgery to try to put myself back together. And then I got an infection and I almost lost my leg. Then in and out of the hospital. So Tal's like, "I can't come to I can't do this right now." And it's like, "Uh, okay." And like, you know, I'm like, you know, hooked up to an IV.
And you know, I mean, like, uh, and then like they had a hard time putting me back together. It took it took months of like plastic surgery to re basically rebuild me a leg um, uh, from different parts of my body. Um, it was a it was a it was an extensive, scary, long year for me. uh while we were going through all that. But I mean like I would say like um you know for everything I've been through like I think my greatest strength is uh you know is I I I'm Atlas I'll hold it together you know put it you know and like you know I'll hold the line.
If that means that I'm that means I'm, you know, on my laptop, you know, from Swedish hospital getting [ __ ] done because it needs to get done. That's what we need to do. That's what we need to do, you know. But it was also hard because I mean, we weren't making any money and that means I'm not making any money and like I didn't have a ton of exits, you know. This was my first time being a founder and like you know like making all of this work while you know leaning on my partner to be like you know who's asking me when are you guys going to start making money like when are we going to start you know we had we hadn't budgeted for a few years of no product market fit and we hadn't you know and like uh so I mean like we're being crunched financially on a personal side while dollars after dollars are going out for healthcare things I mean that all of that cost me tens of thousands of dollars to to rebuild >> and uh and then I got to go learn meta ads and I got to learn how to I have six months to put this business back together and basically compartmentalize my life around like you know how to how to how to live and how to work and then how to be there with my partner who it became like which towel am I getting you know every day would be who's going to be on this call is it going to be an up call is it going to be a down call.
Who do I need to be? Right? like it was never I you know like um there were days where I was it the best way I can describe it is I've been married before and I would say that I am married the longest person I've been married to longest in my life is Tel Moore >> and uh and just like in a marriage you the work to not carry resentment towards your partner starts on a personal level >> and like what you have to do to say to humanize a person to say I understand what this person is feeling and what this person is going through and I love this person and I want this person to succeed before you react to what that person is doing to you what the what that may make you feel in a moment to have perspective to like absorb what's happening not be resentful and then find ways to come back later and say hey man maybe in the future we Don't do it that way.
That hurt. Maybe in the future we can do something this way. I don't like how this feels. Can we do this better? And treat this person like a life partner and not just, you know, somebody that I'm going to hold a grudge against or like complain to my partner about. You know, it's not just, you know, a boss at work or, you know, someone you share a cubicle with. Like, this is your life partner that you are both tied to a outcome that is larger than yourselves. if you truly are building something and that really matters and so having grace you know having the same patience I have towards the business with someone who is dealing with a lot of things that some of which I don't understand in the moment some of which come out in like big vulnerable chunks like it'd be like two months of I don't know what's going on and then like there's vulnerability of like oh that explains what why this summer has been weird right like or whatever and like oh okay and then we can keep ing.
It was a crazy year, you know, but I but all of those tools that we built throughout the year and I think we focused on outcomes. I think we're both very outcome oriented. All of those tools serve us today. And it's just like any marriage where they say, you know, I asked my dad once, I was like, you know, have there ever been a time when you were upset with mom that you just want to leave her? And he said to me once, he was like, "Look, Dave, like 1986 to 1988 was just a terribly dark time." And I I was young at the time.
That blew my mind. How could you be unhappy with your partner for two years and not leave? But like he's like, "Look, we're good now." And I never understood that until this last year with Tall because it's the same way. It's like we can say, "Look, 2023 to 2024 was a dark time, but we're better for it now." That makes sense to me. I'm uh Patrick Kadoo uh the guy who built and sold supply razors. You guys probably both know Patrick.
Um he uh is coming into my agency as my business partner. We're figuring out our equity stuff. We've been trying to do some public conversation about how we're how we're sorting it all out, you know, because I I started age of growth myself. That's why it's my initials and the name and everything. Sorting it all out. I have a theory right now as we're having these conversations, you know, like we're talking to attorneys about like, you know, what's the smart clauses to put in to sort of protect everybody in the long term.
And I I'm really grateful for good attorneys who do a good job writing contracts and doing that stuff. It's a real service to businesses. Like I I don't view it as just a cost center. I view it as a real value ad. Um because that stuff matters. Um at the same time, it occurs to me that so many of those conversations are basically about building prenups into your business partnership. Um, and uh, and Patrick and I have been talking about this a little bit.
Um, I don't want to be polyiana polyianish, is that the right phrase? About um, about it and I do want to be smart about listening to good advice from people. You know, a business attorney like this has probably seen a lot of really bad business breakups and stuff like that. But it I've just realized how much that we also have to make a decision in advance that we are just going to move towards one another as best as we can. and not away from each other and that uh and that there is this human and personal element to this partnership where like we can try to protect ourselves from it breaking all we want but it it actually in that scenario it's probably going to be bloody uh you know even if we write a great contract and in fact the much better thing to do is to do everything we can to value the human relationship in such a way like essentially to cultivate the soil of the relationship between me and Patrick in such a way that it doesn't create a problem in the business as best as possible.
And of course, who knows what is going to happen to each of our individual lives aside from our connection to one another. But um but yeah, I've just I've just thought like so much of what you're saying there, Dave, I really relate to. I I uh actually in fact, I actually made the comparison to marriage in the conversation with Patrick about this just to say the same thing, which was like we just have to have grace for one another.
And in fact, I use that word as well, which you used in the conversation as well. Um because because that's it it's just apart from that, it's going to be very very very difficult to make this work. And I've seen really good businesses perform much worse than they should because partners could not sort that out before you even talk about the insanity of what you were dealing with tell between your family and and everything else you know.
So I think what you just said was extremely wise actually uh and the move towards one another both business and and marriage. In fact in fact at that same conference we were at uh somebody asked me they were just getting married and they said well what's your advice for marriage? I've married for 16 years and uh and I said it's all about grace. That's the answer. The answer is that it's all about grace. you have to you have to decide to keep moving towards one another even when it's really really hard and there's going to be times that are hard.
So >> well and I'm not a saint either, right? Like Cal had to have the same level of grace because there was a period where I was really mad. >> Yeah. >> I was really mad about everything that had happened about feeling left alone in the business like you know feeling like I was carrying something alone while I was dealing with my own stuff like do you not think I don't want to show up today? Do you think that like you know like you are giving your like >> you know like there was a there and there and Tal had to eat that like Tal had to eat that for a while and like not and just you know like Dave is mad and he I understand and we move you know and and just get through it.
So like it had to come from both of us at a >> well and that's bec and that's because that's because uh actually like and I'm sure Tal you've you've wrestled with this in your sort of recovery process and all that from everything but just that your actions have consequences and you can't actually behave like your actions don't have consequences. They do really damage people. I've I know cuz I've done it too, you know, like I'm I'm I'm in your shoes in this story, T.
Like I I've been down really bad pathways that have hurt people, you know, so I get it, you know, like and and so that's what I I think they've your your anger was probably the correct reaction to the story and that's probably something T had to go like, yeah, that's Yeah. >> Well, and that's and that's that's where the importance I think grace is just such the s such an accurate word. um you know like to be able to apply um and to give grace to the to the other person who might be lashing out and might be hurting because they're an imperfect human being just like you are like grace grace is equally important to give to oneself >> as it is to you know to the other person like I I have known you know it's a little bit different than the description that you're you know talking about with your perspective new business partner you know I had the the luxury Dave and I had the luxury of working together for many many like >> I didn't put I I was in control of all the you know the finances and the you know and the contract and I didn't put any out clauses you know like I you know I maybe I was oversimplistic but like I believed in him and I believed in us so I wasn't trying to strategize with my attorneys about like give me a hundred different outs that I can get out I can get my stock back you know if things go south like I you know I I was all in you know on this person who is like a good partner and a good person and he's not a perfect person and I'm not a perfect partner you know but like I knew that I wanted to I I believed in him I believed in us and I wanted to go allin so our contract was you know very very simple but I had the luxury of time you know to be able to you know the the relationship that we have forged has been for it may have started like a jagged rock but you know over years of having the ocean waves beating on it you know has turned into something that is round and soft in in many ways.
And not to suggest we don't have our oldies, not to suggest we don't have our fuckups and our blowups, but we have earned the right to give each other a lot of grace because we know where our hearts are at. >> We know where our intentions are and we know that we have each other's backs like any seasoned, you know, uh uh relationship, you know, is able to get on the other side of tenure. And I and I do want to say and I know we're we're getting close to time, but I mean I do want to say that like one of the one of the nice things about Tal taking the time to heal and be so open with his healing is while I was holding all those things together and I was going through my own stuff, Tal would bring me the healing solutions because I'm not very good at giving myself self space to heal if I'm holding everything together. >> So like having him say, "Hey, this is what's working for me.
Take a second and do this now." Right? Like, so, you know, I was behind, but now we're I think we're both on the same exact medication. You know, I think we're both I mean, like I've lost I've lost nearly 40 lbs in the last, you know, like five months. Like, >> you look good. I think I didn't notice. I should have called it out. Yeah. >> But I mean, like I needed someone to go like get right to give me the space to allow me to get right because if he's not right, where am I going to go, right? like I can't let go until you're okay.
And so like that was necessary uh that that space to heal himself is necessary for us to get the business together and give me space to also do my own healing even if that's later, right? Like and so I'm grateful for that and I'm grateful for that journey because it helps us both. >> Yeah. I I think that we have developed, you know, a a mutual admiration for our own special capabilities and our hearts and our minds. And again, that comes over time and really understanding, you know, how can you show up even if they, you know, even if they're, you know, another, you know, small stupid example of that when we have our weekly, you know, one-on- ones, you know, like it was really important for me to start those one-on- ones with like, how did you win the week?
Initially, I got push back from Dave like I don't want to talk about that, you know, like we got too much [ __ ] to do. It's like no no no it is really important because we could both be heavy and we could both be negative and that's not going to serve well you know so it's like I sometimes I have to remind myself to put on the cheerleader hat you know when he is feeling heavier because like I want to raise the energy and so it's important for us to start those meetings on a positive note like no you tell me how you won the week I don't care how big or small it is and I'll do the same like let's let's set the tone for the convers we'll get to the [ __ ] like we can't ignore the [ __ ] But like let's set the tone.
That's really important for us like psychologically. >> Yeah. I uh I also do want to just to back up a little to be clear that I'm not telling anybody to uh put out clauses or not put out clauses in your contracts. There's I think there's really good wisdom and understanding of both of those things. I'm not even sure what Patrick and I are going to do yet. We're trying to be conscious of it. So, uh anyway, just so that nobody m I misunderstood my >> No, no, no, no.
I you did not misunderstand. I think I and I almost hesitated to use the example because I I think some people will even look at it silly. If you want to be thinking better about how to uh operate your business with excellence and get more value out of every click that shows up on your site, if you want to be thinking carefully and critically about how to provide the maximum amount of value to your customer while maintaining the maximum amount of margin to you, you should do that with Intelliggeems, which allows you to test beyond the basics.
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So, um so again, something that that is is really really awesome. [music] Uh intelliggeems.io is the place to go uh to install intelligence is fast. You don't need a developer. Intellgeems.io. Use the code ferris 20 f a r i s 20 to get 20% off your first 3 months and get started with intelligence today. It's actually very important to me that we don't just have a story about sort of how things went wrong. But part actually the most amazing thing about this whole story is is what you guys did since then and in fact we've already gotten fairly tactical here I think in a sort of surprising way.
One of them is like the relationship towards one another and the conversation around grace. It's actually a very important part of the t I think like you know tactics is sort of a silly word for it but you you know what I mean like it's actually part of the way that you have a have a recovery there is you solve the relationship um uh uh medication was an important part of how you guys solved the business problems right um uh you know fitness and those kind of things an important part of how you solve the business problems in a real way and Bill Alessandro's advice I actually love that you called him out Bill uh was recently a client of mine until he had his exit and his uh his acquirer went elsewhere which is understandable um but uh he's a friend as well.
And so I just love getting to sort of publicly honor somebody who was a great person in a moment like that. I think it's great. Bill's awesome. Um but uh but let's actually now go from there um to um to the sort of business elements of it a little bit. So um here's my first question. Today, what percentage of of Popsmith's sales are DTOC versus other channels? >> I mean, it's almost entirely DTOC. We have a >> Okay. I thought you guys had some retail.
Is that not right? We we we do but I mean well so retail D TOC I mean on their their websites we we just got into uh so we're we're now in uh we're we're we're in four Costco William Sonoma and Kraton Barrel. Uh we're in Suratop stores this season. We're going to be getting into Kraton Barrel and um and William Sonoma stores next season and then >> you're online with them right now. >> Yeah, we are. Yeah. Yeah. >> Costco you're online or in store? >> Online. >> Online.
But the nice thing is is that they were wholesale purchases and not like you know drop shipper right one to one. So like for us growing the growing the business like getting a wholesale order for you know hundreds and hundreds and or thousands of units uh was is uh is a huge a huge lift for us when we're trying to make it work and scale the business. >> When Dave and I conceived of this idea and we dreamed of like what is our dream team you know bucket of retailers it is those four.
So we're like batting a thousand. how all those came about are really kind of bananas. I'm happy to share details on that, but like we got every retailer that we we wanted. Like we're not going to be a Walmart. We're not going to be in a lot of stores. We're not going to be in. Those are the four we wanted and those are the four we got. We thought it would take us five years. We did it in under two. >> So, how much uh how much does a PopSmith popper cost? >> It's $1.99 for the popper and then we sell the popcorn making kits that are an extra $20 like per kit.
So, $1.99 plus. I did want to call out that you guys talked about all the money you spent on um on like product design um and uh branding and actually one of the first things I noticed about PopSmith was how much higher quality the branding is than so much of what I see in our space. It really shows and I and it's you know I think we could say the payback period on that was very long to say nothing of painful. Um but you're not getting William Sonoma without that.
Like you're not getting barrel without that. We Yeah. >> And so it's big. It's a Well, it's money well spent in the long run. It's a big deal. >> Yeah. For for your audience, I want to make it very clear. I do not advise you to do what we did, which is spend stupid amounts of money. Yeah. >> On on beautiful brand. Again, we were so pie in the sky and we regretted the decision in the moment, right? But we spent so much money like the the video on the homepage for instance like it was that was me like I I was like I saw a commenter that you know frozen um hockey puck looking I and then this beautiful video on the homepage I told Dave like I want that well that video cost us $160,000 to shoot and it's a beautiful video but afterwards we were like we just spent $160,000 is something that we probably could have done for less than 10 grand that wouldn't have done you know would wouldn't have wouldn't have looked as polished but like we put so much time and effort effort and intentionality into creating like we wanted to come out of the gates looking like a hund00 million brand before we were a hund00 million brand now in the moment when we were drowning in finances we regretted making those decisions the irony is that I don't think that we would have gotten Kraton Barrel Sir William Soma Oprah's favorite things and Costco had we not done that work like we really we delivered a wow factor so it was an insane bet that again I would not advise most of the people that are listening to this or starting out to do, but the bet happened to pay off. >> Yeah, if you have the cash, do it.
But if you're just bootstrapping, not a good idea. >> Do not do it. >> Yeah, do not. >> And and what that reflects is a is is the P&L design kind of thing that I'm talking about where it's like it actually the key to doing almost anything like this is having a clear strategy for how the math works at some point and where and and some of that and and I think like you guys ended up with a certain place where that that worked.
But yeah, there's a whole there's like reasons I could imagine why a brand actually ought to do what what you just described and it would be related to how they raised and who they knew. Like if you had a friend who was a buyer at Costco and you had a really really clear way or if you had a whole bunch of history in retail and just knew that's what you had to do, there'd be a way to capitalize on that faster. It sounds like you guys kind of uh took had the Hail Marys that sort of cashed in on those kinds of things as well.
Go ahead, Tal. >> Yeah. No, I I think that the only way that I would advise it is make sure that you are well capitalized. Make sure that you go in with the assumption that you are going to burn for three years and then factor in the budget and make sure that you have enough money to do all the pie in the sky branding work and have a run rate for three years and survive. If you can do all that and you're going after a TAM where you know where where you can you can you know that that's that's that can justify that spend then do it.
Anything short of that, do not. I want to actually talk about how you did it. Uh so so aside from whether or not you should uh let's let's hit that because at the end of all of the personal problems and everything, there was still a revenue problem to solve. You put the $600,000 in, you six months. So let's start knocking off the do knocking down the dominoes here. What was the first big one to fall that allowed you to sort of see some turnaround happen? >> Yeah, I mean we really kind of took a a a twopronged kind of approach, right? like there is real blocking and tackling that can't be avoided.
And that was pretty much Dave's domain, right? So he took a step back and he was like, we got to figure out meta. We have to figure out email. We have to figure out landing page optimization because we're spending a lot of money for this awareness and we're not converting and we have to do it a lot more efficiently. Like you cannot all roads lead through meta. So he was really, you know, entrenched and really down in the trenches and figuring out all the blocking blocking and tackling to continue our revenue kind of like growing.
Now the other side of that is you also when you're a new brand and a new concept like the lift especially on such an expensive product with a high consideration phase like you need validation. You need uh you need influencers talking about it. You need to achieve a certain level of validation and ubiquity so that people can see it eight, nine, 10 times and be like, "All right, it seems like the whole worldwide web is engaging in this brand and trying and loving it.
I want one, too." Right? And so for us with a a higherend aspirational brand like we knew the retailers we needed to to to go into even if they didn't move the needle on on um on on revenue we needed that to validate the brand to be like hey we belong in the shelves of an espresso and a brevel and all the high-end cookware right and so while Dave was overseeing the you know blocking and tackling that's where kind of like my entrepreneurial instincts you know came out and I was like I got to throw some Hail Marys like I don't know and you know and again I am not advising this as a tactic like this is literally us are with our backs against the wall but like we need movement and so you know the first I think big break came for us came from Oprah like I you know she is the she is the OG influencer you know like what Oprah blesses matters to the world and we you know ironically we had in our original friends and family deck like we aspire to be on Oprah's favorite things Dave and I had no [ __ ] idea how to get in Oprah's favorite things right we had no clue and So what ended up happening >> that was as uh that was as unrealistic as the revenue projections you see >> as oh you [laughter] should have seen our pie chart for revenue for year two and three like it was ridiculous >> um but you know raising money is >> there is you need as founders a certain degree of delusion because like what we're doing is delusional like to create a successful brand is like really [ __ ] delusional and you need a certain level of delusion and that's something that I think I naturally feel a little more comfortable You're telling such an entrepreneur story.
I'm laughing so much at you telling the story because I don't have that instinct and it's just like as you I've known a couple people you've just I've just heard the stories of like we were running through the airport in China trying to hand our products to you know whatever and we were reaching out to this person and I just I direct phone called Brad Pitt you know and I was just like I just heard those stories from entrepreneur types and it's not me.
So I love it. So >> I I have no shame and it comes very instinctually. Dave is in a different place, you know? So, I was like, he's in the right place. Like, let me go after kind of pie in the sky [ __ ] and let's see what happens, right? Like, let's just let's just >> You need the yin and the yang. >> You do. Yeah. To a certain extent to a large. >> Absolutely. >> And so, when it came to Oprah, we were working with a um a PR girl who's lovely.
And, you know, I was talking to her about Oprah's favorite things. And she had she had gone through LinkedIn and she noticed that one of Oprah's like junior junior junior editors in her LinkedIn profile had popcorn fiend. That was all I needed. I was like, "All right, straight, you know, direct message." Message her and I told her about the brand and she got back to me within a couple weeks and she said, "Um, that looks really cool.
Can you ship me a popper?" So, I shipped her a popper. And then a couple weeks go by, uh, and then she messaged me again and said, "Hey, can you ship me another popper?" I said, "Sure." And so, shipped her another popper. Then a few weeks go by, she was like, "Hey, can you overnight me another Popper?" And at that point, I got a little suspicious like, "What's going on? You selling these eBay? Like, what's happening?" She said, "No, you happen to contact me at the perfect time.
Me and my team get 15,000 applicants every year for Oprah's favorite things. And then we narrow that list down and then we do a whole presentation in New York for Oprah herself and then she chooses about 100 products that make that year's list. We're doing that presentation tomorrow and we want to cook for Oprah in your popper. I was like, "Oh my god." You know, like I put my phone down a contact warehouse. We over we spent $400 overnight her popper and then like a week goes by crickets.
I don't hear anything. And then I contact my, you know, my my my my contact and I was like, "Hey, what, you know, what's going on? Like, did Oprah hate it? Like, what's happening?" She said, "Look, we haven't made anything official, but like Oprah loves your popper and you guys are in." Um, I put down my phone, I cried. Uh, you know, at that point, that was in like September of 2024. The list was coming out in November of 2024.
We were sitting on about seven months worth of inventory. And we had a two-eek gap where we ran out of money and I had to put another $40,000 to the business just to keep the lights on for the two weeks. Right. And so the list came out in November of uh 2024 and we sold out in how many weeks, Dave? >> Like three weeks. Like >> Yeah. Three weeks. Like we sold out. >> Seven months of inventory in three weeks. >> Seven months of inventory just to give you to in numbers for you.
Uh, Andrew, our uh cost of customer acquisition went from like $115 to uh 16 bucks. >> Yeah, it was like it was stupid. Our our our like just like >> But Dave, did you factor in the $400 for overnighting to [laughter] >> that go up a couple days? >> Yeah. >> So yeah, I would say, you know, that was, you know, by grace of God um that was just a a miracle. Now all of a sudden like we arrive and now now >> let me wait before you move on.
So I because let's just talk about how this actually uh works because so it's in Oprah's favorite things. Where is that housed? Where is Oprah's favorite things? Is it her show? Is it a publication? Where >> they do a they do a a TV show. They have a magazine. Like Oprah was on camera, you know, with all the products. She's like it's time for Oprah's favorite things and you know and the popper is like right in front of her.
And then we took like a snippet of that and you know and and you know we were like run Mena run Mena you know and so we you know we were on Good Morning America we were on all of a sudden we got because that's very newsworthy like all these publications follow Opera's favorite things. So USA Today >> you get everything you get New York Times you get all of the Wall Street Journal you get it all you know >> all this media like all of a sudden we got all this attention and we were able to use that recirculate that on Meta and that coincided with uh with Kraton Barrel and Lyn Silma.
The way that came about was again I I tried to find the buyers. I couldn't find and I've got a very very big network. I could not find the buyers for the life of me. And then I was like, you know what? [ __ ] it. I'm looking up the CEOs. And the CEOs happen to be our exact demographic. They are women in their 50s with children and clearly wealthy. And so I did my Google soouththing and I found addresses for both of those female CEOs.
I had I ordered really bougie paper and I had it printed in color with a Popsmith uh letter head and I hand wrote notes in and I put it in a bougie envelope and I shipped poppers to both CEOs and within a couple of months we heard from buying teams from both Kraton Barrel and William Sonoma and then I did the same thing with Sir Latab uh he's a uh a male CEO um and then we got into Sir Latab as well um and then Costco you know they had some like random I was googling, googling, googling and I found some like, you know, uh uh minority vendor inclusion application kind of thing and I filled it out, you know, and I I poured my heart out and not knowing who that was going to and the uh the head of houseware buyers was sifting through those applications.
She reached out and she asked us to send her a popper. We did. She she wrote back a few weeks later and said, "Oh my god, me and my husband are obsessed. We cook popcorn in your popper twice a week. like let's make a deal and we ended up making a deal and getting onto Costco.com and so all of that happened within a span of you know four four or five months and all that you know coincided with Dave course correcting on email and meta where we started to and that you know so all that media attention kind of helped and then we got into influencer str you know not influencer but like content creator strategy and he started getting better and better at that and so it all kind of like coalesed at the same time and and really helped it turn around.
We still had a money issue, right? And so we ended up doing a so we had our original friends and family raise and so we ended up doing a equity crowdfunding raise on on uh Start Engine which we'd never done before, but we had a good story. We had a good video, we had a good story, we had uh media and so we launched that and then we ended up raising over a million dollars on that. Um, we're likely going to do another raise in in the in the coming months, but you know, it all kind of coalesed where we were able to figure out efficiency, get the media attention, get in the right places, and start to find our footing, you know, on meta and and email. >> Yeah.
So, this has been a healing year, right? This has been a year of get right, >> and then next year like a lot of whatever we're whatever we do now is about growth. like next year becomes the the year of like making money and growing f you know which at year three like getting to profitability in year three I'm you know I'm I'm gonna tip our hat for that uh because sometimes that's not always achievable sometimes it takes a lot longer but I think we're going to be I think we're going to be a profitable business where we're both in that position where we get to kind of pick our pick our direction from there you know and I think when we started it was like you know rocket ship rocket ship we're going to we're going to take this thing to like $150 million and never look back and, you know, we're going to sell it and we're going to go, you know, live on private islands or whatever we're going to do.
You know, we're going to get get in and get out and, you know, VCs are going to make us a million trillion dollars. And now it's like, oh, we're going to build this nice little business and we're going to go at the speed we want to and if you know, we're going to we're going to be in control of it the whole time. And I think that we had the feeling of trying to build something we were out of control of and we never want to do that again. like that year from hell was kind of a box we built of of trying to scale out of our own control and I think now we're building in control of the business and I think we'll continue to do that um and then we can take smarter bets right we don't have to make every single bet in the book all at one time >> and I think another colossal mistake we made that a lot of founders make and and we you know we we fell victim to this as well is we all come out of the gates thinking I want to build a $100 million brand and we can look at examples of that we could look at ridge wallet we could look at carowway we can look at uh true classic and there are examples but it is really unfair and unrealistic to look at those brands and follow those playbooks because you are not looking at the years of in the trenches that got them to their current trajectory.
Their approach to marketing is fundamentally different than the approach to marketing that we should do at our level. their goals like maybe not all those examples but some of them are really were really well capitalized and we were not and the the temperature has changed when it comes to VC and private equity where a few years ago it was growth at all costs now it's show me the money more specifically show me the profit and a lot of those brands excuse me didn't necessarily achieve profitability until year five or year six or year seven we don't have that kind of runway so we took a step back we're like look we need our sanity and our health.
We're both in our 40s. We care about our lives. We have dependence. And so, we would rather build a business with a really good foundation and really good fundamentals where we can achieve profitability in year three, which we will, where now we have options. If we want to raise money and go harder, we can. If we want to go slower in our pace and just have a really beautiful, wonderful business that's spitting out healthy profit that can support more than support ourselves and our small team, so be it.
We want options. We do not want to have our backs against a wall where it is growth at all costs and our only option, our only savior is a VC to come in save the day. Like we want to be self-sustained. >> I want to talk a little bit about some of the specific tactics. I I'm tempted to go on a whole rant about that last part. Tal I'll just I'll leave it very quick which is to say I have come to think that reasonable expectations are a superpower for teams.
Uh superpower I think they are agree >> like at the actual level of business brand business things and reasonable could still be big. uh it actually could be reasonable to have very high expectations. If I was running a uh supplement business right now, um in the hydration space, I would have very high expectations. You know, I would I would I would assume that the whole point is that you can go really fast. Um so, um if I'm running a different kind of business, then I'm going to just recognize it's a different kind of deal.
So, the brand that I'm starting, I don't have those expectations for uh for that reason. >> For all of your listeners, I want them to hear me crystal clear. There is nothing wrong with a business that grows 20% per year or 30% per year. >> It's it's actually that's actually not true. That's a great business. It's not that there's nothing wrong with it. >> That it's a freaking great business. My one of my favorite clients that I deal with right now is just steadily putting plushing out like a couple million bucks a year at, you know, uh early eight figures.
And I I love it. they have figured out they they have plans for how to grow it faster and bigger at different times and they're thinking about it but their their expectations for how to get that done are not like just push harder on the meta machine. Um it's just it's I and I think and it's not just like I really admire it. I think it's a very very good business. Um and in fact even in a recent conversation I was trying to be the person in the room reminding them how good it is right now.
Don't go do something crazy, you know, because um because it's just otherwise you it's just so easy to get these crazy ideas. But I said I wasn't going to go on a rant, so I'm going to stop there. Um Dave Dave I want to actually hear about some of the tactics uh and or or whatever you think. So we talked about this, right? We're running around all over the place with all this meta stuff and whatever else. Tal's out here just swinging for bombs, just hitting just just only swinging for home runs on one side of the fence.
Okay, you Dave are over doing the blocking and tackling like you said with switch sports with this analogy, but here we go. Um so uh do you um can you talk a little bit about what helped you get Meta right? Um and I'm going to actually start with a very specific question. When the Oprah's first uh uh Oprah's favorite things video came out, you could run that as a meta ad. Yeah. >> Well, we did. >> Clip it and run it. >> We did. >> Yeah.
Yeah. Yeah. Before somebody told you to turn it off. Do you still >> I don't know about the word can, but we did. >> Yeah. Yeah. Yeah. Yeah. This is like everybody who's been mentioned on Rogan or a Shark Tank episode or whatever it is. Yeah. Okay. Great. That's the right move. Do you still run it right now as an app? >> No. >> Okay. Why not? >> Well, we did, but [laughter] yeah. No, but we have we have all over our website as seen in Oprah's favorite things.
We have the right to do >> the video is the video is a licensed video. >> Yeah. Yeah. Okay, great. Okay. And then um Okay, then let's talk about sort of what you did do and what has helped you actually get that right at the level of your just like >> Yeah. Look, I mean what I want to share is getting back to like spending $160,000 on that video. So, when I started when I started, we had all this like what I would consider brand top offunnel content.
We had this like sweet swanky amount of video and like I you know when I what I did was I hired a meta coach, someone who had done I was like I do not want you to run my uh account. I want you to teach me how to run my account. And the first thing is I like I got in motion or whatever and I like or foreplay and I loaded up all of these like ads I really loved. I'm like okay here it is. like I we're in espresso, we're this.
And like my coach was like, "Hold on. These are all like awareness campaigns. These are all like pretty pictures of product. These are all like whatever. You aren't this. You no, you know, this is just reminding people to buy what they already know they want to buy. No one has any idea who the heck you are. You aren't selling anything with this. Why do you want to do all this pretty stuff? Like none of this is ever going to work." And like I I went into this thinking, well, well, we're a big we're we're a premium big brand.
We want to do all this premium big good-looking high fancy stuff. It's like, no, no, no, no, no, no, no. You know, and like we're going to do performance marketing and like we're going to get down here and we're going to we're going to convert people into buyers. And that is the first thing I had to learn. I had to learn how to do ads that convert people into buyers. And for a person who loved brand, that was very hard to learn how to kind of divest from loving brand forward stuff and thinking that was going to be what sold us to actually getting into the weeds and learning how to do that.
And to be honest, like when we talk >> so simply moving that moving that style of creative, you're saying to to more sort of DR creator, lowerfi, that kind of stuff. I need to do the same kind of ads for a higher level brand that the Amazon dudes are doing that anybody else is doing that to be honest we had done like like so much of Popsmith was a reaction to 10 years of being a incremental 10 to 15% uh growth a year e-commerce business that we had run forever and we wanted to shoot for the moon right we wanted to be different but the re but to again you got to walk the road that's in front of you and to be different you have to be the same.
And so you got to go, you got to go convert and tell people with a face to the camera of why. We had to go find one good influencer, one good person to talk to the camera and say, "Why should you buy this?" And we put towel on camera and we had him shoot a video of why our product was better than the Worly Pop. And that became the winner video. like the the thing that did that anchored us going forward was a like kind of Stanley Tucci-esque here's here's the two products here's the difference here's why you should buy this and not this it had tinges of higher end right obviously but it was a face to camera brand comparison here's this here's this performance marketing ad everything was anchored to that and that and that is how we started and then it was you know like just scraping ing statics, you know, like I trying to do statics and like on my own trying to figure out things around that, right?
And then once we got a little like traction with small lookalike audiences, we primed up meta to like build enough to start moving into broad. Then it's like, okay, now we're going to move to bring in some influencers to do video. We're going to do a gifting. We did gifting for a while, run some terrible gifting unboxing because that's all we could afford is just like these whoever would take my product even if they were not my target market is just like some, you know, some 20some couple in their less than stellar apartment making popcorn.
Whatever. It's what I've got. I'm running in his ad. Put it mash it together. Like uh it didn't matter. I could not be precious about brand anymore. I had to be about whatever I could get to test to convert. if it converted it worked like you know let go of my preconceptions so that that's how it started and you just start stacking from there >> um and I would say that's helped us survive and when I say survive it's like less than stellar rorowaz less than stellar me you know like surv but not losing money anymore and be able to hold that for when sales come we can make money Q4 comes we can make money and just and hold the line every other time to like make sure we figure out and then and then it was email.
How do we convert all how do we stop giving away money up front? In the beginning, we were giving away like 20% like sign up now, get 20% off. It's like >> it's co it cost us so much to convert an ad right now. I cannot afford to give another 20%. We need to go find our target buyer who just wants to buy it right now. Yeah. Yeah, you know, so can't give it away until until cost per acquisition comes down. So maybe next year.
And now that we've gotten a little farther along, I can play around with a discount up front to to get the sale. But this 2025, I couldn't do that. So we we built the email list, get SMS back in place, and just keep stacking wins. And I and I I think you just got to start humble and you just got to do what works, right? um learn how to build adsets, learn how to build campaigns, and then start experimenting. And that's and that's how I did.
And then once it got too big for me, once I realized that I'm like, man, I'm spending four or five hours in here a day. Like, and I'm stressing out about what's going on in the ad account, I'm really worried about it. Like, then it's like, >> pay someone to stress out for you. >> This is beyond me now, right? This is beyond me. And now I need a at least a part-time person to come in and do this because I can I can navigate this with you, but I don't want to I don't want to sit here and upload ads anymore.
I don't want to think about which radio buttons I need to push to make sure this worked and I don't want to think about that anymore. I need to work on the rest of the brand. I need to put my energy into other things in marketing. Like marketing became more than just let's just get some ads to get some sales in the door, right? Like there was a while where it was just like every week we I knew I needed to make X number of dollars to just basically cover the burn of the business, right?
Like so if I could do that on my own, once I hit that number, then I could say, "Okay, I can pay someone a little more. They'll do incrementally better than me >> and I can get out of the way and go find a little more alpha like above that and know that that's what I'm working for." And really that that it changed for both of us. All our conversations about marketing came were entirely based in the 13week cash flow. Like it was like how much money did we make this week? >> How much how much how much do we need to make?
What does the me need to be? Like what you know what does everything need to be in order for us to pay the bills this month? We paid the bills or we didn't pay the bills like it's that is the and you know and to have to be accountable for that is something that an agency is not willing to do. So someone being accountable to that means it got built in a way that was beneficial to the business. And then anything built on top of that is still I still approach it that way even though I may not use those words with the person I'm working with that's working the account. >> Uh I think I could talk to you guys for another hour at least uh on this podcast.
You've already given me much more of your time than we all signed up for. This was uh this was um really gracious of you guys to do. Uh we've hit a lot of topics that I'm personally interested in. Everything from tactics and operations and uh and all that at the end here to sort of the human realities of this sort of thing, which frankly for me is the most interesting topic. Grateful for you guys sharing all of this.
I am mega rooting for PopSmith. I'm immediately looking around my list for who I can buy one for for Christmas this year. So um so and and before you even offer uh like a discount or something like that, real friends, real friends pay full price in e-commerce. So uh you know, I won't even wait for the BTM sale. So, it's uh it's just really fun to see the the where it's where it's uh uh gone and I'm I'm really glad to have done it.
So, thank you guys both. Um I'm I'm going to give it to you guys both for one rapid fire final question and it is is there any last thing that you just would want this audience to hear? And the answer could be no, but if there is something whether it's a super top of- mind tactic that's something tiny that's worked for you guys or a something preachier or anything in between, uh you know, uh any any very last thing you guys want to say before I sign us off?
Uh Dave, I'll start with you. >> Yeah, I think on the marketing side, I'll just say um if you if you are not at 10 or $15 million, then you should be ignoring impressions and top of funnel and you should be focusing on things that convert into sales all the time. And like it is great to listening. >> I'll put that number at 40. >> Sure, that sounds wonderful to me. But like I made the mistake of listening and look I love the guys as people and I think they built excellent businesses but you listen to the Connors and the Cody's and all of these people that have they talk about the their problems their problems are at the top of the funnel of growing their problems than everybody else >> reach and their their problems are reach because they have already fixed the problem of conversion at the bottom.
So if you have not fixed the problem of conversion at the bottom and you listen to people talk about reach is the problem then you will set your business up to fail and you will light a ton of money on fire. So do not take that advice for a brand that has not solved the bottom problem. The bottom is your problem forever forever and until like and and you just need to keep focusing on that. And if you get the opportunity to spend $10,000 on some banger awesome influencer that's going to do this great video for you that's going to feel like you're just like this amazing brand.
It's going to feel super cool to you. If you want to spend money on something that's cool, you just need to look in the mirror and say you're not cool because you haven't put that you take that $10,000 and put it in the bottom of the funnel right now because otherwise that money is wasted. So like just keep putting money into the bottom of the funnel until you get there. Even if it's not cool like otherwise it's just a birthday present to you.
Just don't do it. >> I don't even like the bottom of the funnel top of the funnel distinction for what meta is. I actually think the meta is meta conversion audiences are the top of the funnel in a real sense. But you know what I mean too many people I know top of like soft metrics of like awareness. I I Dave, I could I could not agree with you any more about what you just said and I I've told Cody Pluffer that directly.
He disagrees with the answer. >> I love those dudes and they're they're super cool, but they're building a different machine than I'm building, right? >> I couldn't agree more. Okay, so Dave's final finally his last word is you're not cool. All right, Tal, what's yours? >> Um, you know, I think I'll close this out with just going in the opposite end and just focusing on the personal side, which is be kind. Be kind. you know, be be uh approach your business and your life with a lot of grace and a lot of kindness.
Be kind to your partner. Uh be kind to your life partner. Be kind to the people around you who are trying to support you through your darkness because the the storm and the the the winter comes for us all. We just can't avoid that season. And so to lead with with empathy and kindness to the people around you and most importantly yourself, to be kind to yourself. You're gonna make mistakes. You're gonna get beaten up by life, by business, by your partner, by your marriage partner, whatever it is.
Like, remember to to give yourself a lot of grace and a lot of kindness because you're worth it. Really, really good. All right, guys. Thanks again so much for your time. I appreciate it so much. If you made it this long, you should go follow Dave and Tal on a couple of different places. Tal primarily on Instagram. Dave primarily on X. They can point you some other places from from there. The links for both of those are in the show notes or in the description on YouTube.
Um, I would love your comments on this episode as well. Uh, so if you have any thoughts about anything you've heard or seen here, please leave them in the comments. I certainly check them all. Um, and uh, you know, if there's something super super amazing or something like that, I'll even pass it along to you guys. So, thanks again, gentlemen. I appreciate your time so much. This is way beyond what I asked of you. So, thank you so much. >> No problem.
Have a good day. >> Man, that was a crazy episode. I I like I really really enjoyed that conversation. And I'm like, there's conversations I have with people where you just you I just walk away just being blown away. I mean, I really did not expect to go this long with them. Um, [music] and uh, and I couldn't be more grateful that I did. I hope you feel the same way. If you have any response to it again, like I said, leave a comment, follow both those guys on social, go buy a Popsmith uh, for somebody at the holidays this year.
And of course, email me podcastfgrowth.com. I'd love to hear from you. You go to afgrowth.com to see everything that I'm doing. If you do want to work with AF Growth at some point when we start taking on clients again, reach out to me. Let's get a conversation started so I know that you're in the pipeline at some point along the way. Big thanks to all my sponsors for this episode um who have been a huge um who make it possible for me to spend the time doing this kind of thing.
And so go check them out. All the links for those are in the show notes [music] uh as well. Uh thanks again for watching, for listening. Subscribe wherever you're doing that and I'll see you next time.
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