Three messages before we get started. If you’re a tech entrepreneur, don’t you have unique legal needs that the average lawyer can’t help you with? That’s why you need Scott Edward Walker of Walker Corporate Law. If you read his articles on Venture Beat, you know he can help you with issues like raising money, or issuing stock options, or even deciding whether to form a corporation. Scott Edward Walker is the entrepreneur’s lawyer. See him at wallkercorporatelaw.com.
Do you remember when I interviewed Sarah Sutton Fell about how thousands of people paid for her job site? Look at the biggest point that she made. She said that she has a phone number on every page of her site because, and here’s a stat, 95% of the people who call end up buying. Most people, though, don’t call her. But seeing a real number increases their confidence in her and they buy. So try this, go to grasshopper.com, and get a phone number that will make your company sound professional, add it to your site, and see what happens. Grasshopper.com
Remember Patrick Buckley, who I interviewed? He came up with an idea for an iPad case. He built a store to sell it and in a few months he generated about a million dollars in sales. The platform he used is shopify. If you have an idea to sell anything, set up your store on shopify.com because shopify stores are designed to increase sales. Plus shopify makes it easy to set up a beautiful store and manage it, shopify.com.
Here’s the program:
Hey, everyone, it’s Andrew Warner, founder of Mixergy.com. Home of the ambitious upstart. How does a bootstrapped entrepreneur hustle and build a profitable company? That’s what you’re going to find out today. Joining me is Jason Ross founder of JackThreads, a members only shopping club that he recently sold to Thrillist. Frankly, even the fact that he made his business into a members only club, I think is indication of how smart a marketer he is. You’ll hear all about that in this interview.
Andrew Warner: Jason, so good to have you on Mixergy.
Jason Ross: Thank you, thank you so much for opportunity. I’m very excited to be here.
Andrew: What did you sell your company to Thrillist for?
Jason: We actually did a cash/stock deal so the exact terms aren’t, it’s not public. We kind of shy away from sharing that but it was, it was great initial exit. Really, just in terms of finding a strategic partner to help JackThreads grow to the next level, Thrillist was the perfect fit. I’m very excited about, kind of, what we’ve seen since we’ve done the deal. That was in May 2010.
Andrew: And the company, I had that right in the intro, fully bootstrapped, you owned it 100%?
Jason: Yeah, yeah, fully bootstrapped.
Andrew: Wow.
Jason: It was, it was a wild ride. Excited to be here and, of course, cherish the journey, you know, that we went through to get to where we are today.
Andrew: I invited you here to find out about that journey and I’ve got so many little points that I want to bring up in this story. You said it was profitable, can you say how profitable it was before you sold the business?
Jason: Yeah, I mean I can’t really get into any financial numbers but we, actually, it’s interesting, we were profitable very early on, after we launched. You mention the word bootstrapping and our business, like that’s our story, every step of the way. It was just about finding ways to keep our costs low, keep our overhead low, and just focus on growing our top line revenue. Doing whatever we could creatively to make that happen without spending a lot of money. We actually were. We made money early on, it wasn’t a lot but it was enough for us to not have a high burn rate. As a team to say, we’re really on to something here, we just need to keep going and stay focused on our goals. This could turn into something really big. Month after month after month, it kept growing and growing. It was, it was an exciting time. We learned a lot along the way. Yeah, it’s been great.
Andrew: I mention in the intro that the fact that you made it into a members only club is an indication in my mind of smart marketing. Can you explain why that ‘s a marketing tactic?
Jason: Yeah, I think people, for one, it’s a marketing tactic for both of our customers. I’ve always explained to people that I feel like JackThreads, we have two customers right. We have the brands, whose product that we’re selling. Then of course we have the consumer, who’s buying those products. For the consumer, it’s just; it gives it an aura of exclusivity. The fact that you have to be a member to kind of find these coveted deals from the brands. For the brands, it gives them a more discreet solution, where they can control how their product is presented. They can, they have some sort of control over the brands they’re selling next to. It’s not, their discounted merchandise isn’t featured everywhere all over the internet. It’s behind a door. It’s behind a closed door where only members can see. It kind of really plays to the two customers that we went after when we started this.
Andrew: Here’s what I saw when I went to JackThreads.com. I saw essentially an email sign up form that was a longer form than most marketers and most conversion experts would advise you to create. You asked, I think, it was my age, I’m pretty sure my ZIP code was included, my first name and last name, and so on. I said, essentially what he’s doing is getting people to sign up to an email newsletter. If he said sign up to my email newsletter and made it look like an email newsletter registration, nobody would want to sign up. Because we’re not all excited to sign up for that but instead what he did was, he put a velvet rope around his home page. He said, ‘This is members only, you’re not signing up for email newsletter, you’re applying to get accepted.’ In my mind that felt a little bit more special.
Jason: Exactly, yeah.
Andrew: That is true, is it?
Jason: Absolutely.
Andrew: Talk about that.
Jason: Yeah, I think that just the fact that, for one when you get behind that door you know there’s a compelling reason to want to be a part of this club. I think by putting some sort of a timeline on, you know, when you sign up you’re not going to be a member right away. There’s a 24 to 48 hour waitlist. I think people kind of feel a little bit more special because of that. They know, they’re motivated to want to see what’s on the other side of that door. I think kind of those two things make it a little different than most ecommerce platforms. That’s why we’re able to get so many people to sign up.
Andrew: You see, that’s clever. I mean, that’s really clever. Then the other thing that I noticed about that is that if you’re advertising somewhere, like in your ads, well, the mentions you had on Thrillist, certainly in the TechCrunch article that I saw in preparation for this interview, you don’t just say, ‘Hey, go sign up for my newsletter.’ there either. You don’t just say go to my webpage. You say, I will get you to the front of line if you use this code. People on TechCrunch are seeing that and going around saying, ‘I want to get to the front of the line, I want to get access to the site.’ They’re much more eager to go sign up. Is that true?
Jason: That is true. You know what’s interesting, in, so the first year after we launched our business. We didn’t have a marketing budget. I mean, we didn’t spend any money on marketing but our strategy was, let’s go out; let’s find online websites, blogs, newsletters who are writing about the brands that we’re selling. Just let them know who we are. Let them know that we are selling those same products and those same brands at prices better than you can find anywhere else on the net. You’re readers are going to love you if you tell them about us. What we’ll do for you is we’ll give you a code, some sort of code or link that will allow your readers to skip the line, so they don’t have to wait to become a member. We found that to be very, very successful in the first year and that’s how we grew. We went from 0 members to 35,000 in year one alone without spending money on marketing. It was really using that strategy. We definitely, we’ve made the most of it.
Andrew: Members are people who get your email, how often?
Jason: Daily, daily, anytime a new sale starts.
Andrew: Daily? That’s huge.
Jason: Yeah, there’s an email that goes out at noon. You can opt out if you don’t want to receive it. We’ve actually found that there’s a lot of people that opt out of the email but they still shop reguraly on the site. They just don’t want to receive it.
Andrew: I see.
Jason: That’s how it works.
Andrew: I’m one of those signed up users. Dan Pott, who introduced us, said to ask you about your business card. What does your business card say?
Jason: It says ‘business development’ actually. I don’t know if that’s what he’s talking about, but yeah . . .
Andrew: Let’s get, you know what, I’m going to write business development but in relationship to front of the line or something, he said that I should ask you about that.
Jason: I don’t know what he’s referring to, actually. I know we have, so, I have a business card and then I also have, we’ve got promo cards. That has a link, that says like skip the line, and so . . .
Andrew: Oh, I see, okay, so when somebody meets you in person, are you handing those out? What happens with the promo card?
Jason: Yeah, yeah. I have those and then I have a regular business card too. It’s just a way, like our entire team has the skip the line cards. If we’re in New York or if we’re in Columbus and we see a guy who looks like he’d be interested in that dress, we can give that card and he can skip the line.
Andrew: Gotcha. Okay, so it’s not like you’re handing him a promotion so much as you’re handing him a gift.
Jason: Exactly.
Andrew: You met me in person. I’m getting you to the front of the line.
Jason: You’ve got it.
Andrew: This is so interesting. I’ve talked to so many people in the email newsletters space because I’ve seen how powerful it is but I haven’t seen anyone in the email newsletter space do what you, and admittedly others in your business do, which is create this sense of exclusivity. You’re not signing up to an email list that we’re begging you to join. You’re asking us to join our list. You’re asking us to market to you on a regular basis. That little distinction makes a world of difference in my eyes.
Jason: Yeah, it’s interesting because the experience starts out with the sense of exclusivity and once you’re inside the next piece of it is the sense of urgency in our sales format. Just because of the sale starts at noon and they last for 48 to 72 hours and once it’s gone, it’s over, you can’t buy. We’re kind of playing on those two things in our business model. It’s been very successful.
Andrew: Are you wearing anything now that was a special deal on the website?
Jason: Oh, pretty much everything.
Andrew: Everything, so let’s talk about your shirt, for example. Do you know what it costs on JackThreads and what it would cost if I were to go to a store and buy it at retail?
Jason: Yeah, absolutely. I mean a shirt like this, say it’s $80 at a retail store. It would be featured on JackThreads for $40 or less. Right there, 50% off, it’s great savings. It’s a brand name shirt. It’s interesting a lot of the products that we sell are hand picked by our buying team. They are well known brands who already have a following. We’re able to kind of partner with them, sell their stuff at half-price and it really works out well, so.
Andrew: All right. So, now let’s get down to . . .
Jason: That’s the shirt, I mean there’s a lot more. I’ve got a lot more going on but we don’t have to get into all of it. Literally, everything I’m wearing is from JackThreads.
Andrew: I just wanted to get a sense of how it worked. I wanted to communicate to my audience what this was about.
Jason: Yeah, sure, yup.
Andrew: I think seeing a physical product makes a bigger impression than sending them over to even a website or talking about the ideas behind the business. Seeing it has a lot of impact. So, where did you get the inspiration for the business?
Jason: I think, it’s kind of, I mean, I graduated Ohio State in 2003. I knew I wanted to be an entrepreneur. I started a company with a friend right out of school. We did that for two years. It was a sports marketing business. I won’t get into the details of what we did but what I will say is I learned a ton just about growing a company, running a company, and it was like entrepreneurship 101. You learn how important it is to be passionate about your idea. How important it is to be surrounded with a team of great people. How important it is to really research your market and understand your competitors and your profit model. All those things which we, like, didn’t really do. So, two years after that, I decided to walk away from that business. I wanted to pursue something that I was passionate about, that I really cared about. That a much high, like a high growth opportunity, a much bigger opportunity.
So, growing up I’ve always been a discount shopper and I’ve always been into just cool men’s clothing. Stuff that was different, a little more exclusive, harder to find, that not everybody had. Discount shopper and cool exclusive men’s clothing don’t really go together because it’s cool and exclusive for a reason. It’s not usually showing up at a discount store. I noticed that there was an industry, the street wear industry that was growing like crazy. I, you know, at some point those brands when they get to be a certain size they need an outlet partner. Somebody they can trust where they can take their previous season product and liquidate it to a trusted a retailer or online store, whoever it may be. Just realize, I couldn’t find that anywhere in the market. My thought was, if I could go out and figure out a way to create it. There’s got to be other guys like me who would love to take part in it. I mean, who doesn’t want like top tier men’s brands at half price? That’s a no brainer.
The hard part was going to be figuring like the brands were selling their close-out goods today and how to partner with them. Try to get them to like what we were doing. That was really the inspiration behind the JackThreads business model. I wrote the business plan in January 2006 with that idea in mind. Initially, I was thinking that guys aren’t shopping for clothing as much. When I first came up with the idea, I saw this business model in Europe called [Von Purvey] which is a private shopping club. I’m not sure if you’re familiar with that. It’s similar to what we do today but they do it in Europe and on a much bigger scale. I thought, it’s be really cool to bring that model to the US and target guys. Guys looking for cool, street wear, just cool exclusive clothing.
That was like the original idea. Then I went down this path of, well, guys are shopping as much and I want this to be high growth, I need to target woman. It’d be really cool to do woman. Target the concept to a female customer but that went against, again, went against something I was passionate. I don’t care about woman’s clothing. As I was going to trade shows and like talking to woman’s brands, I realized, like, I don’t know what I’m doing, I don’t care about any of this product I’m looking at. Something is wrong here. That quickely got me back to focusing on guys. That’s kind of how, that’s, that was like the beginning of the gensis of what JackThreads is today.
Andrew: How long did you pursue the female market before you decided to switch?
Jason: I want to say maybe six months.
Andrew: Okay.
Jason: Maybe six months, which is enough to go to a few trade shows. Come back, like, get on the phone a bunch and realize that something’s not right here. I’m not really passionate about this. Talk yourself in and out of continuing to go down that path. Then realizing, one day, like, I was, like, it’s just not me. During that six month period, I still learned a ton about the business model, which that same model was applied to JackThreads and applied to men. It wasn’t a waste of time but I had to completely focus my energy from looking at woman’s brands to men’s brands and kind of start all over in terms of getting in contact with different people and forming relationships in a different segment of the industry.
Andrew: Did you say that you built a business, that you wrote a business plan before you started?
Jason: I did, yeah, I did.
Andrew: Why?
Jason: Just because, I think in the first business we didn’t do that. I mentioned, you know, you have to be passionate about your idea and understand the market and the competitive landscape and the profit margins and all those things. We didn’t do that in our first business. A year in, two years in, that really hurt us because we got into something that as we were starting, we didn’t really know, we didn’t know anything about the industry that we were getting into. I think that set us back in a lot of ways. I wanted to make sure that I didn’t make those same mistakes again. A business plan just forces you, as an entrepreneur, to really think through the business that you’re starting. Understand who you’re going to be competing against. Understanding what it’s going to take to be successful. Understanding the kind of team that you’re going to need and then doing your best to back into all the costs that it’s going to take to get your business into a position that it looks like what another very successful company in your space looks like.
Andrew: Do you have an example of something that you realized as you were doing the business plan and understanding of the business that you got by going through that exercise?
Jason: I think, probably the biggest thing for us is just understanding how to negotiate an off-price fashion deal.
Andrew: Mm-hmm.
Jason: Like, I really sought out people in the industry that were in the off-price space, who were already buying close-out merchandise from brands. Initially, I thought our profit margin was going to be X. After having five interviews with key people in the industry that I just somehow was lucky enough to meet or persistent enough to find a way to get a meeting with them, I realized that that profit margin was much, much different. That just changes how you look at your business, right? Because you’re thinking you’re going to make X amount of money and you realize in reality it’s only going to be Y. It’s just very important to know those kinds of things; I think when you’re getting into something.
Andrew: Where’d the number in the business plan come from?
Jason: Just a guess, really.
Andrew: Ah, I see, okay.
Jason: Yeah, it was just a guess, so. . .
Andrew: Then once you started talking . . .
Jason: I talked to a lot of brands, originally, like, with the companies selling the product. Just in talking with them, kind of getting an idea of the kind of deals they were willing to offer. That was one side of it. That was kind of where my guess came from. Then when you talk to somebody in the industry who is actually buying from those brands, you realize that there’s a lot more room. . .
Andrew: Mm-hmm.
Jason: . . . to negotiate. There’s a lot of different ways you can structure the deals so you can get a better profit margin. Yeah, that’s, it all goes back to doing research.
Andrew: Okay, so, the six months that you spent investigating the female market were you building out your website at the same time or did you just go out and start talking?
Jason: We were, actually, yeah. We started building the website. I wrote the plan in January and the website; actually, in . . . I started looking for developers right away. Not really knowing what I was doing because I never built a website before, I’m not a technology guy. Kind of the interesting story about how we got started, I went to the Ohio State University, there’s a computer science department there. Got in touch with one of the professors and pitched him on allowing me to come in a sponsor a group in his class. Have their students build the JackThreads platform as their class project for the spring quarter. So this was in March or April of 2006. Went in and pitched them on that.
They brought me in and I kind of shared my story with the class and they accepted the pitch. Spring quarter, 2006, one of the, a class at Ohio State built the foundation for what is JackThreads today. They started the code and got as far as they could in ten weeks and they did it all for free. I’d meet with them once a week and kind of follow their progress and share with them. Like, how the business was supposed to operate so they could go in and create the code that allowed it to function that way. It was a great way to get things off the ground, not spend any money and just get a little bit of momentum behind the business. Again, I didn’t know what I was doing and the fact that that class opened their door to me, it was unbelievable.
Andrew: Why did they open their door to you? How’d you even know that that was possible?
Jason: Because I’d heard that Ohio State had done these kind of things in the past . . .
Andrew: Mm-hmm.
Jason: Again, in calling around, kind of staying touch with people that I had met when I went to school at Ohio State. Somebody tipped me off that that was an option, so I went in and met one of the professors. I had my business plan. It was something real that I actually was going to execute on and . . .
Andrew: I see.
Jason: . . . showed them that we were serious. I think that, by seeing that, they saw that this would be a great real world experience for their students. We kind of put the two together and it gave them great benefit. It gave me great benefit and that’s how we got started.
Andrew: Did you say that you had other developers before that were working on the site?
Jason: No, we did not, no.
Andrew: So, this was the first way, the first . . . sorry
Jason: What was that?
Andrew: The first way that you built out the site was with these students?
Jason: It was, yeah, yeah. I mean, I looked around but I didn’t find anybody that I felt comfortable with, so, this was a great way. I wasn’t paying any money. It was a great way to get it started and if things went wrong, it was like, well, no big deal. We’re not out thousands of dollars.
Andrew: Can you tell me, can you help me understand why you decided to move to the men’s market? I understand that the men’s market makes more sense because you’re passionate about it.
Jason: Yep.
Andrew: You’re pursuing a direction here, the female market is a direction that you picked for a reason because the money was there. You were already starting to go in that direction. You’re making contacts. It’s not easy to just stop and turn to different market. Especially after you’ve told students that this is the direction you’re going in . . .
Jason: Yep.
Andrew: . . . and you told potential business partners. How did you come to that decision and then how hard was it to make?
Jason: To be honest, it wasn’t hard at all. I mean . . .
Andrew: Really?
Jason: When you’re going down a road that you just don’t really care about. It’s scary, you’re not enjoying what you’re doing everyday. For me, I had made that mistake already in my first company and I wasn’t about to do it again. That’s why we kind of steered more towards something that I cared about and was passionate about. I think at the same time, nobody in fashion was focusing on guys in the space that we’re in. It seemed everybody was focusing on women. While there was a reason for that because women tend to shop more when it comes to clothing, there’s also a big market for guys who shop for clothing as well. I just started to, I knew I was passionate about that a lot more than I was with woman. I wanted to back that passion up with a lot of research that showed that guys were shopping online. That guys were shopping for clothing online and there was a big market for it. I just hit the road, went to some trade shows. Met with as many men’s fashion brands as I could and realized that, like, there’s a huge opportunity here that people are just not focusing on because they’re so caught up with what woman are doing. I wanted to be the guy that went out and made it happen. I knew if we could create this there were guys all over the country who could really benefit from it. That’s one of the coolest things today. If you go on our Twitter or Facebook, the emails that we get on a daily basis and the amount of members that we have, it’s that vision and dream has come true. People out there that are using JackThreads on a daily basis, love it. They’re getting all their favorite product. They’re saving a lot of money. It’s just exciting.
Andrew: All right. The idea came to you January or what year?
Jason: 2006.
Andrew: 2006.
Jason: Yep.
Andrew: You launched by the end of 2006?
Jason: No, we launched July 31st, 2008.
Andrew: Wow, okay, so what happened between January 2006 and July 2008?
Jason: Wow, a lot. A lot happened. So, I mentioned to you how we got the website started. There were really three things, okay. Money, figuring how to support myself and this business. There was the website, getting the website built. There was just getting enough brands to want to work with us and to want to sign on to this.
Andrew: Mm-hmm.
Jason: For money, for one, this was before the financial crisis hit. I had a rental property in Columbus and I went into the National City Bank with my business plan and I put my house up for collateral for a credit line.
Andrew: Mm-hmm.
Jason: I got a small business credit line which it was under $100,000. It wasn’t a lot of money but it was enough that I had a little bit of debt that I could use to my advantage to fund this thing. The other piece of it is, at first, I was, I just, I would work for my uncle. I would work at bars at night, doing whatever I could to have money come in. But, also having a schedule that allowed me to be free during the days, so I did that for a while.
I got so sick of that lifestyle that I reached out to a mentor of mine here in Columbus who put me in touch with. Actually it’s funny, there’s a multibillion dollar packaging company here in central Ohio that nobody knows about because they don’t sell consumer products. I got introduced to the president of that company. I met with him and shared with him what we had done in our sports marketing business.
It just so happens that they had the need for a consultant in their business that had similar experiences to what I had. After meeting with him multiple times and letting him know, I’m pursuing this company but I need a way to make money. We really hit it off. He offered me a position. He actually, he said two things to me. He said I want you to push this forward for us and guarantee me that you’re going to spend at least 20 hours a week on it. The second thing is I don’t want you to ever stop following your dreams. I want you to keep pursuing this business that you’re doing and just make it happen.
It was like the most unbelievable opportunity for me as an entrepreneur that wanted to make JackThreads a reality but also needed a way to make money. It was a great experience and opportunity. That’s how, in that two and a half year period, that’s how I was able to survive financially.
Andrew: If you have a $100,000 loan from the bank based on the value of your house, why do you need anymore money? Where does . . . why do you need more money?
Jason: Because it’s debt, that was debt, for me that’s a scary world.
Andrew: But you did get it, so, you’re saying you didn’t even want to use the debt? You just had it there?
Jason: Yeah, exactly. I didn’t use, like, a lot of it but . . .
Andrew: How much of it did you get into?
Jason: . . . I did, I wanted to at least have a way to make money so I could support myself. So, I could live, you know, and put food on the table and pay rent and that sort of thing. I didn’t want to use that for any of that.
Andrew: I see, so the rent . . .
Jason: Use it for what was necessary.
Andrew: . . . food, the everything that you needed to get by on day-to-day came from your bar job and then this 20 hour a week consulting job?
Jason: Yeah, and then just renting out rooms in my house, too.
Andrew: You rented out rooms in your house?
Jason: Yeah, so I’d live for free. I’d have this job to supplement, put food on the table, allow me to have a little bit of fun. The debt was there if we had a big business expense. That was there to cover it but I didn’t want any of that . . .
Andrew: What was your business expense? Did you have to buy product before you sold it? You’d have to take possession of it?
Jason: Oh, yeah, that kind of goes into the other two things. The product and then the website.
Andrew: Okay.
Jason: That’s the other parts of that two and half year journey.
Andrew: Now, two and a half years to build a website. I see the site, you can do the whole thing in WordPress essentially for free.
Jason: Right.
Andrew: Why did it cost so much and take so long to build out the website?
Jason: It didn’t really cost a lot. It didn’t cost a ton but it just took so long, I think because, I don’t have any better answer than I didn’t know what I was doing. You know, I had not a clue what I was doing. I never built a website before, never built an ecommerce platform. It started out with this Ohio State computer programming class. After that, I brought two of the students on from that class. They came on board and worked through the summer. They didn’t have a lot of experience so they could only get it so far. Then I was looking for two or three months, looking for a new developer. Finally found a guy in Atlanta who I got introduced through a friend. He did a great job for the next year on and off. The work was never being done constantly. It was like slowly progressing. I was not paying them a ton of money.
Andrew: Can you tell me more about that? The slow progress and maybe some of the set backs of building out the website? I think any of us who’ve had websites built with someone, by someone who’s not in our company, can identify with some of the issues that you had. Can you tell us about that?
Jason: Yeah, I mean, it’s just a challenging experience to go through for one. Going back to me, like, I didn’t know what I was doing. All I could do was tell them, ‘This is how I want it to function.’ They’d come back to me and say, ‘Well, I can make that happen in a month.’ Then a month comes and . . .
Andrew: Give me an example of what you wanted, what kind of functionality you had that took longer than you expected.
Jason: I don’t have any specific examples, really. I think just, like the way the site operates today.
Andrew: Mm-hmm.
Jason: Selling product, sales start at noon, new sales go up everyday at noon, all those things that kind of go into that. That’s really all we were building. I don’t have any, like, one specific example. I think every aspect of that functionality took longer than we thought it was going to take, so . . .
Andrew: Was there anything that you wanted to build that in retrospect was way too big for first version. Maybe that took too long?
Jason: There probably was but, again, I can’t really recall like any specific example of that. I’m sure there was, there were a ton of scenarios where I wanted to do ten things and then we only did one.
Andrew: Okay, I remember actually when I interviewed Ben from Thrillist and I asked him because he has a beautiful site. I said what did the first version look like? He made this face like he just ate an onion. Like he just bit right into it, this nasty. What was your first version like? Yeah, and, and . . .
Jason: If I could make that same face I would.
Andrew: Oh, really, okay, so describe it. What was it like in design and features?
Jason: It was, oh, my gosh, stupid simple. I mean, it was really, it was a product, one product being sold for 24 hours at a time. That like, I don’t know if you’re familiar with the (________) business model? (_________) .com where they’re selling one item for 24 hours and then there’s a new item that goes up. That’s what we were doing. It was stupid simple. It was a picture of an item, a description, a buy-it-now button and then a little bit of JackThreads branding at the top. The page, it was all white with a picture. It was very, like, minimal and just ugly and embarrassing. Like, when I see it now, compared ot the site we have today, it’s . . . I mean it was a start and it got us to where we are but, yeah, it’s embarrassing.
Andrew: The email piece, was that in it also? The registration?
Jason: Oh, yeah, it was. (________) was just an extension of what that page looked, so it was also very ugly. But it worked, it worked, I think there was a compelling reason for our audience to want to come to our site even though it looked the way it did. Because they were getting the brands that they liked at the prices that we were selling.
Andrew: Okay, what else did I want to ask you about? You launch, how do you get customers in the door? How do you get users?
Jason: That’s funny because on day one when we did launch after two and a half years, it was like, wow, this is really exciting – now what? We didn’t have any members. It goes back to what I explained earlier. We had brands that were working with us. Name brands that guys already wanted and there were blogs and magazines and newsletters out there that were already writing about these brands. For us, it was like we don’t have any money, we don’t have the marketing budget, how do we get creative in order to find users to come to our site? We just on the face, hammered these blogs and magazines with emails and said, ‘Hey, we’re JackThreads, this is what we’re doing. We’re selling all the products and brands you guys are writing about but at much better prices. Your readers should know about us and in return for that we’re going to allow your readers to ‘skip the line’, basically.’ A lot of people didn’t call back or return emails but the ones that did and wrote about us, we got a lot of traction. Thrillis was one of the early partners that featured us. They wrote about us three months into our business. That was kind of the first time that we saw the power of putting the JackThreads brand in front of their audience.
Andrew: Mm-hmm.
Jason: The goal was to find, like, 20 other Thrillists to write about us. We did that in the first year. It went from zero to 35,000 members.
Andrew: I guess I should explain Thrillist for people who don’t know what it is. It’s essentially an email newsletter that shows guys the cool things to do in their neighborhoods. Like, cool restaurants, cool clubs, cool clothing places . . .
Jason: Yep.
Andrew: . . . and that’s what it is. So, you told them about JackThreads, they said this is perfect for our audience, they featured you. How long, and that’s what got you customers.
Jason: Yeah.
Andrew: What about the brands? How did you get the brands be okay with you selling their stuff at a discount?
Jason: Yeah, that kind of goes back to the start phase, right? The first six months, focusing on women then decided to kind of change the whole path of the business. I guess the easiest way to explain it is, I found out that there are a lot of different trade shows. There are trade shows in New York and Las Vegas and Los Angeles where every six months, like, all the brands of fashion are located in one place. So, like, if you travel there, you have the ability to walk booth to booth. Meet with pretty much everybody in the industry in one trip.
I’ll never forget, I went to a show. The first one I ever went to, I bought a ticket on my credit line. Went up to New York City, I crashed on Dan Putts couch, stayed with a friend. Did it as cheap as I could, walked into this trade show for the first time. No experience, didn’t know anybody, it was like what you’d see on, what you’d think you’d see on a fashion trade show on TV. You know, it was like white mink carpets, the techno music playing, and everybody seemed to know each other. They were all dressed very well. I walked in, I almost walked right back out because I was so nervous. I was kind of intimidated. Just realized, I come all the way to New York, I’m never going to see these people again. I just, really, I went booth to booth at that show. I just started pitching my idea and people, for the most part, hadn’t really, they didn’t understand the concept. They had a lot of negative things to say. I got a lot of the same answers over and over again.
I came back to Columbus and realized, like, everybody, all these brands are telling me this. My business model, my plan, says this. So if I want to make this successful I’m going to need to take what our suppliers are telling us and create a model that kind of fits all these things that they’re telling me they want. That’s really what we did.
In the next six months, before the time, up until the next trade show, I was on the phone with a lot of different brands. Then by the time I went to the next show, I knew some people and pitched them on this new concept. Got more, instead of all the negative comments that I heard on the first trade show, I got a lot more positive feedback that time. I realized I was onto something. I even got a brand who said, ‘Hey, you build this, I’ll work with you.’ Over that two year start-up process, going to trade shows, being on the phones, tweaking the model so that it fit what these suppliers were telling us. We signed up six brands to start with us on day one. That was enough for us to launch.
Andrew: What kind of feedback were they giving you? Beyond the price, which apparently was higher than you expected. What else did they tell you that was different from what you expected?
Jason: I think it was just seeing how important it was for brands to be able to control who they’re selling next to. To be able to control how the product looks and, originally, we weren’t going to be a ‘members-only site.’ I realized how conscious these guys were about their image and selling their discount clothing online. I think in going to that first trade show and hearing all their feedback, that’s what really pushed me in the direction of, ‘How can I make this more exclusive so these brands would feel a little bit more comfortable?’ Then came this whole concept of private shopping club.
Andrew: Weren’t you bringing that idea though from the French company? Didn’t it exist there and you were bringing it here? So, why . . .
Jason: Yeah, it did. I think I saw that working and originally we weren’t going to do it that way but then the more I heard from these brands. We want discreet. We want to be able to control the message. We don’t want everybody to see our discount stuff on the internet. Then it was, like, okay, we’re thinking about private shopping club but in terms of getting customers. The fact that it was private seemed like it was going to be a lot harder to get people to want to come through that door but the more we heard the brands say that. It’s got to be this way.
Andrew: I see, okay, so even though you saw that it was private in France, you said, here, I’ll just put it online. I want it want it to be available to more people.
Jason: Yeah, yeah.
Andrew: Especially since I’m growing my business, I want to get as many customers in the door, I see. That’s one of the things that you adjusted. Price, exclusivity, what else did you adjust based on the feedback you got from brands at the show?
Jason: I think those were the key things.
Andrew: Those were the two things.
Jason: Then just realizing how important it was going to be, just presenting the product and how important the photography was going to be and the models, and the descriptions. I mean, it’s, at the end of the day, we were going to be an online fashion retailer. These brands, who had spent years building a following and an image, we were going to have recreate that same image. Present them in a very positive way on our site. That was going to allow us, when that brand looked at a sale that JackThreads was having and they felt comfortable. I could go then and use them as leverage, to say, ‘Hey, who else in the industry do you know that would be able to take part in this?’ The ones that we made really happy which was pretty much everybody, they would say I know these five other brands. They’d say, call so and so, call so and so, you know, here’s their emails, here’s their phone number. That’s how we, I think in the first year we want from six brands to close to 100. It was really just making the initial guys happy and leveraging those relationships to meet a lot of other brands and get a lot more participation.
Andrew: Then you had to buy the product before you offered it for sale. Take it in inventory, you said?
Jason: We did, yeah.
Andrew: And you, where’d you keep it at? Your home?
Jason: In my house, yeah, actually. All those room mates that I moved in, I kicked them all out. I moved into the smallest room in the house and our master bedroom was the warehouse for a while.
Andrew: So there was actual, there was shirts in there, there was shoes in there?
Jason: Everything, shirts, shoes, jackets, I mean it was like a clothing warehouse, yeah. It was crazy.
Andrew: Inventories kind of tough. How did you know that you could move enough of each size that you were buying?
Jason: I didn’t know. I mean, you don’t know, right?
Andrew: What happened when you over shoot?
Jason: Well, I was super conservative in the beginning. I’ll be honest, like we didn’t really overshoot a lot because I was so, so careful about not taking on too much product. Our goal then and our goal today is always it’s still the same, it’s to chase. It’s just to chase as opposed to being stuck with inventory, it’s always to be chasing after inventory. Because I don’t ever want to have our cash tied up in stock and then . . .
Andrew: I see so, you were okay with saying, ‘I’m not going buy enough of every size that . . . and we’ll sell before the end of the day but I would much rather sell out and have an increased sense of urgency in my customers for the future. Then undersell and have this stuff sitting in my house.’
Jason: Exactly, just because, I mean, the amount of money that we had to start this was so small. I didn’t have the luxury of being able to get stuck with a lot of inventory that wasn’t selling.
Andrew: $100,000 doesn’t seem like a small amount. How much were you spending on inventory in say the first month?
Jason: That’s, I really don’t have an answer, I know at one point we had $85,000 of debt. We had used that credit line up to $85,000 but . . .
Andrew: Roughly, how much of that was for inventory, would you say?
Jason: A lot of it, a lot of it.
Andrew: So, about 50, 60,000 was inventory?
Jason: I’d say at least that.
Andrew: So, anyone who was walking in your house, say a girl came over for dinner. Buddies hanging out with you, they’re seeing $60,000 worth of merchandise in your house?
Jason: Yes, yeah, it’s all upstairs in all the bedrooms. It, I have pictures of it. Like friends coming in to try on clothes, it was funny.
Andrew: That’s awesome. I gotta see it, is that online somewhere?
Jason: No, no, I have like, it’s not digital, I should probably scan it or something but, I’ll send it to you.
Andrew: Yeah, you’ve got have that up. That’s awesome. All right, so, you are now building up a membership base, you’re starting to sell to them. Who’s fulfilling the orders?
Jason: In the beginning, gosh, it’s funny to think back on this. In the beginning when the first orders came in I didn’t even have shipping supplies or anything. So, the first orders came and we’re like, okay, what do we do next? Didn’t have any shipping labels, didn’t have any packaging, and didn’t have any tape, any of that stuff. It’s crazy, I mean, I, the first three that came in on day one. I remember packaging them in like manila envelopes with the metal, you know, the envelopes where you fold them over and they have like the metal prong that you spread to the side? Yeah, exactly, we packaged the product in that. Hand wrote the users shipping address and their info on the package. We had to learn really fast. We went from fulfilling orders out of our house that way to having JackThreads boxes, tons of tape, thermal label printers. It was a very painful process getting from nothing to that point. We just kind of learned as we went. It got to the point where semi-trucks were showing up in my cul-de-sac because of the amount of product we were buying started to come on pallets. That’s when I was, like, this is getting out of control. We moved into a warehouse space like 20 minutes from my house shortly thereafter. That was kind of how we started growing.
Andrew: What did the neighbors say about having a truck in front of your place?
Jason: They were just laughing, like, what is going on, you know? Because I didn’t really tell them just because, I just didn’t, I didn’t want everybody to know that there was that amount of clothing in our house. You know, just in case. So, they didn’t really know what was going on. I don’t know what they were thinking. They were just laughing.
Andrew: At one point in our conversation, I noticed you went from I to we. What, I guess that means you starting hiring people. What period did you hire people?
Jason: Yeah, I don’t, I’ve always said ‘we.’ I think I just trained myself to say that so that when I was at a trade show it sounded like we were a bigger company. I don’t, I didn’t really hire anybody until right when we launched, right in July. It was the first hire that we made. Up until that point, it was . . .
Andrew: Who was that?
Jason: What’s that?
Andrew: Who was the first hire?
Jason: It was a web developer. It’s kind of a funny story. Over that two and a half year period, we went through a number of web developers. Finally got the site to a point where it was working because I hired a firm here in Columbus that was supposed to be, like, really well-known and did really great work. Of course, they were more expensive. They got our site to the point where it was ready to launch. On day one, it was, there were so many bugs. It wasn’t functioning properly. There were a lot of errors that were taking place. I got rid of them. I got an interviews with a student who just graduated from Ohio State. We met at a local panera. I was just sharing with him the story of JackThreads and where we were today. That I have this product that is ready to launch but it’s not working properly. He’s like, well, I can fix it. He had like a fairly inexpensive hourly rate. So, I’m like, well, I’ll give this guy a shoot. He came highly recommended. In two weeks, this kid, right out of Ohio State, fixes our entire tech platform. Gets the website working, no bugs, no problems. I’m like, what the heck is going on? I’m going to give this guy more work. He’s actually on board here today. He’s one of the leaders on our tech team. One of like the greatest guys to have around, yeah, he’s still with us.
Andrew: Is this Matt?
Jason: Yeah, yeah, yep.
Andrew: Okay, wow. I’m sure that the developers in my audience are wondering what you use to develop on. Do you know what platform, what software, what anything you used?
Jason: Yeah, it’s PHP is the language that we use. We use the Cake PHP framework, that’s as much as I know.
Andrew: I want to go back to the use of the word ‘we’. You mentioned earlier in the interview that you had your business cards say business development instead of founder and CEO. Talk about that?
Jason: Yeah, I mean, I don’t know if there’s a right or wrong way to share your title on a business card. I think for me, the fact that I was young. I didn’t really know what I was doing and I was kind of upfront when I meet with people. I’m going to make this happen but I don’t really know, I’m just going to figure it out. I don’t know I just thought by putting CEO on the card that people would look at it and not take it as seriously. Just because, like, I was a younger and wasn’t as experienced. So, I just put business development just so that it was little bit more ambiguous. That was just my strategy but, I don’t know if there’s a right or wrong answer there but that is just what I did.
Andrew: I feel like you did take the right direction because it does convey a bigger, it conveys a sense of size when you do that. On the opposite side, a lot of young entrepreneurs will have business cards printed out with the name CEO maybe CEO and Chairman and founder and as many titles as they can squeeze on that business card because they’re so proud they launched their business. They want to communicate size. What they don’t realize is they’re communicating the exact opposite. That they’re a one man shop and they’re too excited about being CEO to think about the impression they’re making.
Jason: I agree, I think for us, like I just wanted the work to speak for itself. It’s like, look we’ll go out and make this happen one day maybe in five or ten years I can say I’m a CEO, a real one.
[laughs]
Andrew: Earn the title instead of give it to you on day one.
Jason: Yeah, exactly.
Andrew: So, all your marketing, was it all coming from bloggers and sites like Thrillist?
Jason: In the first year it was. After year one, we started to pay for marketing. That’s when things really took off because we found that we could acquire members at a very low CPA. We could break even on those members within a very short period of time. Our ROI was there within a month or two months. We just kept increasing the budget. Every month, it got bigger and bigger and didn’t show any signs of slowing down. Yeah, things really took off when we figured that piece of the business out.
Andrew: No advertising at all gets you to 35,000 members. Then you start doing advertising, you said you bought on a CPA, a cost per acquisition basis. Did you back into the cost per acquisition or did you do any kind of affiliate type deals?
Jason: No, we, it was just through Google. We started with Google and then jumped onto Yahoo and Facebook and tried a number of things. I think at the end of the day, Google was our biggest source of paid traffic.
Andrew: What kind of keywords did you use at first. When you were just dipping your toe in?
Jason: That’s a good question. I think a lot of it was driven by the brands that we were selling. The lifestyle, the customer that we were catering to, and that was it, that was really it. I can recall keywords like famous, hip-hop artist names, famous musicians and bands that the customer we were selling to would probably be interested in. It was very successful. There were a number of examples like that.
Andrew: Okay.
Jason: I think that was the thought process that we went through in terms of how we were targeting different keywords.
Andrew: What were you paying per click at the time?
Jason: It was low, I shy away from sharing the exact number. It was very low.
Andrew: I mean just in the very beginning before you knew that you could go much higher. We’re talking about roughly, neighborhood.
Jason: A couple of bucks, you know.
Andrew: Oh, okay, so you were paying a couple of bucks per click before you even start.
Jason: Then they optimize, right, and it comes down, down, down, then you get it to a point where you’re able to achieve a return on your investment.
Andrew: All right, then you improve the conversion on your landing page?
Jason: Absolutely, I mean, I think that’s, internet marketing, what I’ve found and still find today, it’s just you constantly have to be tweaking and testing and changing. If you just put something out there, you’re going to pay for it. You need to put something out there, make sure you’re monitoring that, figuring out how the traffic is interacting with it. How you can improve it. That’s when you start to really see success. You can put a landing page up and it can convert a customer at $2 but you might be able to change a couple of buttons or change the content or change the picture and that conversion rate goes down significantly. You might cut your cost per acquisition in half just by doing that. It’s something that we learned early on.
Andrew: Can you give me an example? I’ve got a lot of fans in my audience of marketing and conversion. Any example of something that you did that adjusted your results, one way or the other?
Jason: I think landing pages were key for us.
Andrew: What’s a dramatic change that happened from something that you didn’t expect to be so dramatic?
Jason: For example, like, our first landing pages that we put out in the market had just pictures of the products we were selling and then a little bit of JackThreads branding. Trying to get the user who would come there a taste of what we were selling but it was converting at a level that allowed it to be profitable for us. We decided that we have these brands that we’re selling and they have a following. People, when they see the brand name, they recognize it so they trust it a little more. We put landing pages out there that featured instead of the product featured the logos of the brands that we were selling. It was unbelievable the change. When users would come to the site, instead of seeing a picture and seeing JackThreads, which they hadn’t really heard of, they saw brand names that they already knew. That they already wore. It was like, wow, the conversion rate was astronomically different, it was crazy.
Andrew: I love that, do you have one other one like that?
Jason: My gosh, there are probably 100 other ones like that but that’s the biggest one. I don’t know, we have a lot of them. I think you always have to be tweaking and changing and monitoring, that’s the message.
Andrew: Okay, all right. I know that that kind of information is proprietary, I won’t did any further. I will ask you though, how many email addresses did you have at the time of the sale to Thrillist?
Jason: We had close to 200,000.
Andrew: Get out of here!
Jason: Close to 200,000, yeah.
Andrew: Wow, that’s phenomenal.
Jason: Yeah.
Andrew: Who is that invests in Thrillist? Pilot invests in Thrillist . . .
Jason: Yes.
Andrew: . . . and a bunch of other email marketing companies. I’ve interviewed a few of their portfolio companies who are in the email space that sold for millions of dollars that didn’t even have 50,000 people on their list or 150,000 on their list. Somebody should go back in the data and make sure my information is correct but I do know this that getting to 200,000 is a lot. Those other companies that interviewed did not have 200,000.
Jason: Yeah.
Andrew: Your company must have been incredibly valuable.
Jason: Yeah, I think we were incredibly valuable. I’m not sure if this is the business you’re referring to, Pilot’s investments are typically media companies.
Andrew: Mm-hmm.
Jason: Not retail.
Andrew: That’s the other thing. All those email addresses of the companies that I was interviewing are for people who subscribe to get content and by they way, they’re also being exposed to advertising. Here they’re subscribing to get advertising essentially or subscribing to get a catalogue that’s distributed one page at a time to them. That’s way more profitable.
Jason: Yep.
Andrew: Is your company, was it worth north of $5 million?
Jason: It was, I mean, I never, I’ve never shared any of that data but it was, it was a multimillion dollar company.
Andrew: Okay, but you can’t say whether it was worth more than $5 million?
Jason: Yeah, I kind of shy away from saying that sort of thing.
Andrew: Okay, all right. Have you bought a yacht since the sale?
Jason: I have not bought a yacht. You know what, I haven’t changed my life at all. People ask me that all that time but I just, I don’t know, nothing has really changed for me in terms of like life choices or life style. I think, it will happen some day but, I’m just still so entrenched in the business and so involved and so excited about what we’re doing. I just don’t have time for it.
Andrew: Are you still in the house that you had with all the supplies and all the inventory in it?
Jason: It’s actually that house is rented out to a lovely young family. I was in a suburb of Columbus. I’m now downtown, right next to our office is where I live. My office, my gym, my house, is all within a mile of one another. It’s amazing. I travel about a week a month too.
Andrew: Sorry?
Jason: I travel to New York one week a month. I work out of our offices in Soho there.
Andrew: What city are you in right now?
Jason: Columbus, Ohio.
Andrew: Columbus, Ohio, so you’re still there?
Jason: Yeah, yep.
Andrew: Why Columbus, why didn’t you move to New York or somewhere else?
Jason: Ah, man, I mean, we started here. We made this business successful here. 75% of our team is here. Our fulfillment center, all the production that goes into our sales, our main office is here. We made it work. We built a fashion business from Ohio. I didn’t see any reason to change. I think there’s a lot of opportunity in New York and that’s why we opened an office up there. I’m able to go back and forth and work with those guys and we have our VP of Operations, who works and lives in New York.
Andrew: Mm-hmm.
Jason: Is able to kind of manage things on a day-to-day basis up there. It works out really well.
Andrew: I kept writing down, earlier in the conversation, why didn’t he give up. Then I kept underlining it so I could come back to it. Two years, you’re building the site, there isn’t a single customer, there isn’t enough traction for you even to be able to take your mother to the website and say look at what’s going on here. Why didn’t you give up during that period?
Jason: I think, in that first business that I explained, that I right out of school did a sports marketing company for two years and after that, I knew I wanted to be an entrepreneur. I looked at a ton of different ideas. I would constantly like pursue an idea for a couple weeks or a month, then I would just stop and go on the next one. I did that some many times that I was just so frustrated with just business and with myself. I’m like, I just need to find something that I really care about, that there’s a high growth opportunity. I need to stick with it. The first part of that was, like, finding the idea.
I spent all my time, fulltime, figuring out what the business was going to be. Once I picked it, I made a promise to myself. I said no matter what happens, no matter what, because I was so sick of quitting all these different ideas. I said no matter what happens. No matter what barriers you face, challenges, the promise to yourself is, never, ever, quitting is not an option. Make it happen because the idea that you pick is going to be picked because there’s a market that would support it. There’s a customer out there that would want. If you build it, it’s going to be successful, just don’t ever quit.
Anytime we ran into road blocks and there were days when I definitely wanted to throw in the towel. I was pulling my hair out. It was very frustrating in that two and half year period, I always went back to that promise. That’s what kept me going. I think the fact that it was an idea that I cared about and was passionate about. That also gets you through the tough times. We never quit and here we are.
Andrew: I’d ask Dan Putt, Dan Putt and I spent, instead of doing the pre-interview with you, I did a pre-interview with Dan Putt about you. He filled me in on the company and what it was about. At the end of the conversation, I said, ‘hey, Dan, why do you think he made it?’ He gave me a list of a few things here that I’d like to go over with you and get your feedback on.
First item is, he lives frugally. How frugally do you live?
Jason: Very.
Andrew: Give me an example.
Jason: I just mentioned, I mean I’ve been a discount shopper my entire life. I don’t know that’s just how my mom raised me. That’s just natural to me.
Andrew: What would you do that an ordinary person wouldn’t do?
Jason: I would go, when I was younger, like if I’d go to a clothing store to buy something. I’d go there at the beginning of the season. I’d figure out what I really liked. I waited two months until it was on the back sale rack. I did that for everything I bought. Everyone around me always noticed that. That’s funny, I had a friend of mine in high school, his father. His father would always make comments about, man, you really understand the importance of money. It’s smart, you’ll appreciate someday later on in life. I remember he, I was out one day and I came home in high school. I was looking on my car, there was a book sitting on the drivers seat of my car. It was this book, called, something about a millionaire next door – something along those lines.
Andrew: Mm-hmm.
Jason: The whole premise of the book was like the guy next door who’s a millionaire usually has a normal house, a normal life, lives frugally and it was from my friend’s father. He put that on my car with a little note inside, you’ll appreciate this one day. It’s just how I live my life. It’s natural and that’s how I was raised.
Andrew: I remember that book because it broke the expectation that millionaires were walking around with monocles and tops hats and having yachts. They’re ordinary people who just happen to not spend madly. Because of that, you wouldn’t know that they were millionaires and you wouldn’t try to model because you wouldn’t know that they achieved anything. They’re just living their lives quietly.
Here’s another thing that he said. He said, if there were only five things that I needed in business and I only had money for number four, how do I get everything else for free? That you’re really good at being resourceful on the things that aren’t critical and spending your money on the things that are. Can you give me an example of that?
Jason: Yeah, look at our first year with our marketing success in that first year. I mean, we had debt available to us day one. We could’ve immediately said, hey let’s go out and pay for marketing campaigns. We kind of looked as it as, we only have a little bit of money to spend and if that money’s gone and it doesn’t work, we’re in serious trouble. How can we be resourceful and go out and leverage that we built and the suppliers that we have on board to get a blog or magazine to write about us for free. We can have their readers come over and be our members. That’s probably one of the things I’m most proud of. We really didn’t spend a dollar. We went from zero to 35,000 members. You have a nice little business at 35,000 members. It’s not huge but it’s paying some bills. That was a, that was a cool experience.
Andrew: Two more, number three, supremely confident. Why are you confident? I asked Max Tucker this, this is a guy who is known for being confident. Who’s known for trying to score with woman every where. Somehow he got to be so confident. I want to ask you the same thing, how did you get there?
Jason: I don’t know. It’s funny, I don’t, yeah, I don’t have an answer for that. I don’t see myself as that way I guess. I know, I’m a confident person. I don’t see myself as supremely confident. You have to believe in yourself so that when you’re in a business meeting or you’re trying to sell somebody on this company that you’re trying to start from scratch. If you don’t believe in yourself, I think people can see that. It’s going to be much harder for you to break through and for doors to open.
Andrew: How do you believe in yourself when your website isn’t even up? Every kid in town has a website that’s up, when you haven’t made a sale yet. When you still don’t have any real evidence that there’s a basis for believing in yourself and having confidence? At that point is when you need it the most but it’s hardest to have. How do you do it at that point? How did you do it at that point?
Jason: I think for us, I did the research. Because of that first business experience that I went through, I didn’t write a business plan and I didn’t really prove that there was an opportunity. I did the research. I met with the right people. I proved to myself that if we build this thing, although it’s going to be very hard, there’s a major opportunity at the end of the tunnel here. I think it was knowing that I’ve done the research. I’ve met with the right people. Although I don’t really know what I’m doing, if I just find a way to make this thing happen. It’ll be big. People are going to want to participate. Customers are going to want to shop. Brands are going to want to work with us. I think it was just knowing that. That it wasn’t just like some idea I came up with and I was out pitching. I spent a lot of time researching it. I think it was that that allowed me to have the confidence to go in and the belief. To sit in front of somebody and say, pitch them on the model and get them to know that, like, okay, this kid’s serious. He’s going to make it happen. I want to work with him.
Andrew: Just having constant confidence, not in what you did so far, but for the vision for where you were going to go. That’s what gave you the ability to stand and be strong in conversations.
Jason: Yeah, and I think, like, it goes back to my parents too. My father, I always, I don’t mention him as much but he’s a West Point graduate. He was in the military, Special Forces. He’s an ultra-marathon runner. He runs like 100 mile races. Growing up and seeing that and being a part of it and participating in those races with him. You see anything is possible. A lot of it is up here, it’s mental, right? Just kind of being raised that way, being around that my whole life, it’s like, still today I feel like I can do anything. I feel, anything I set my mind to I know I can do it. I think that’s a part of it too.
Andrew: Here’s the last note that Dan Putt told me. He said, he could get anyone on the phone and call over and over until they say yes. How do you do that, that’s an incredible skill.
Jason: That’s just persistence. It’s being persistent but to the point where you’re not being annoying.
Andrew: How do you do that, what’s your tactic?
Jason: Gosh, I don’t know. I don’t know. I think, it depends on the person, the target, right?
Andrew: Mm-hmm.
Jason: Yeah, it’s being persistent with, it’s, I guess, giving them a compelling reason to want to talk back to me. With each person it’s always different but that was always the strategy. Being very persistent and giving them some sort of way to want to, to see that they relate to this conversation. That there’s value in them participating in it, I just think that’s what worked and being yourself. I think people see that and they respect that and they like it.
Andrew: Do you have an example? Do you have an example of someone who you turned around? Who said ‘no’ at first but you were able to show them a compelling reason to say ‘yes’ and then they said ‘yes’.
Jason: It happens everyday. You know, the biggest thing with our business with just be with the fashion brands. It’s like for two and a half years, six brands said yes but another 200 said no. It was just constantly staying on the phone with those guys. Constantly going to the trade shows and meeting with them. Every time I met with them, I would have more and more info to share. Show them how what we were doing would actually benefit them. It was valuable to them.
Andrew: I see and by more and more info, what kind of info would you give them that would persuade them?
Jason: Just like our membership is growing and we started with X brand that’s very similar to you guys. We were selling five units two months and now we’re selling 500. There’s a big opportunity here that we can work with you and you can see a lot of value. We can see a lot of value. I think it would be a great partnership, that kind of thing. It always goes back to showing them that there’s a reason and there’s value in wanting to speak with you or taking part in a conversation or work together in business.
Andrew: All right, finally, how about one action step that somebody who’s listening to us can take to improve the marketing of their business? One thing that they can do at the end of this call to market better?
Jason: That’s a tough question. I think for us, if we were going to, well, we just did this recently actually. It’s just really digging in and understanding your customer as much as you possibly can. We just made a big push in the last month or two with surveys and customer feedback to really understand who these guys are. How they live their life, all the different things they’d like to see with JackThreads. All the things they think are positive, they things they think are negative. Then taking all of that feedback and redefining the experience on your website so that it fits all those things that your customers are telling you. I think that’s super, super important. Always focusing on the guys, or girls, who are buying from you and making sure that the experience that you’re giving them is exactly what they want because I met with, it’s interesting. I met with Victoria’s Secret recently and one of the things that they were saying that kind of sparked my imagination was they’re finance team has done tons of research. They do research non-stop every year. They always come back to the same thing. When they take really great exceptional care of their high-volume spenders and high-volume shoppers, that’s when they make the most money. They’re constantly working with these guys. Setting up events with them, making them feel super special, doing surveys, really understanding how they interact with the Victoria’s Secret brand and that’s when they make the most money. When they make improvements based on all that feedback. That’s something that any business can do. A lot people kind of take that for granted and don’t focus on it. I think it’s very important.
Andrew: That keeps coming up over and over again in my interviews and I need to do even more of that even here on Mixergy. To understand what they’re looking for from these interviews.
Jason: Yeah.
Andrew: That’s great advice. JackThreads the logo, can we show people the logo that’s right behind. Let’s give them a clear shot at it. There it is. I love that logo. Who designed that for you?
Jason: That was a designer that early, early on in the process I came to know named Sean Deana, give him a little plug. He’s out there, I’m sure if you search him online. He’s the one who came up with that with the direction of myself and one other person. Yeah, it’s great and actually Jack is the name of my grandfather. On the other hand it also kind of signifies men, right? That was the genesis of the name to combine something that meant a lot to me and that signified we were selling to guys. Then threads, slang for clothing, cool clothing.
Andrew: It’s a great name. It’s a great logo. Everything that you guys have is so beautifully designed that I just want to go over to the site sometimes just for inspiration.
Jason: Love it.
Andrew: Just to say, ah, there’s an idea that I need to integrate. Sorry?
Jason: And to purchase products, right?
Andrew: And to purchase products, guys, please, check out JackThreads from my audience. If you purchase anything, would you please email me back and show me what you bought from them. I want to get a sense of what you guys are into on JackThreads and what you think of the site. If you don’t, come back and tell me why you didn’t. I’m really curious about your feedback on the site. Thanks for doing the interview, thank you.
Jason: Thanks, Andrew, it’s been great, man.
Andrew: I appreciate it Jason, bye everyone.
