The simplest $6M dollar idea

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Today’s guest is doing $6M ARR selling freaking air fresheners. Seriously, just a better replacement for those little trees that hang from the rearview mirror.

He says selling a fragrance over the internet is the world’s worse elevator pitch but I disagree. I want to find out how he did it.

Ryan Baylis is the founder of Drift, a scent based, home goods company.

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Ryan Baylis

Ryan Baylis

Drift

Ryan Baylis is the founder of Drift, a scent based, home goods company.

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Full Interview Transcript

Andrew: What the hell? Sorry to occur. You’re in salt lake city. Does that mean that I shouldn’t say the word hell. Okay.

Ryan: say whatever you can say,

Andrew: What the hell dude, you’re making $6 million annual recurring revenue selling, selling like the replacement to those fricking trees that the taxi drivers in New York had.

Ryan: Yeah, dude. It’s uh, It’s, it’s a terrible elevator pitch.

Andrew: It’s not a terrible elevator pitch. It’s an unbelievable elevator pitch. Someone’s going to think of you snowing us. Is this a lie, truthfully? That was going to be my first question. Number one, I use knowing that’s number two. Is this a lie? Number three? I can’t believe it. Why am I not doing it?

Ryan: Yeah, exactly.

Andrew: Can we just roll right into the interview right now included the whole setup that we got

Ryan: Absolutely.

Andrew: would be completely informal. This is Ryan Bayless. He is the founder of drift. I don’t know why you named the company drift, but I understand that the name change, what was it called before? It was like a very male

Ryan: Yeah, it was called, it was called gent sense before, so yeah, swap it out.

Andrew: Okay. And so for anyone listening, what they’ve got is these air fresheners that don’t look like. I don’t know, don’t look like the type of stuff that the New York city taxi drivers had, you know, what are those, those old trees that they would put on their rear view mirror? It doesn’t look like the thing your mom would like no offense mom, but my mom does love popery and plat in bags.

It doesn’t look like that. You’re too

Ryan: Oh, yeah, my mom, my mom’s got, like, I walked in her house the other day. I’m like, mom, we’ve got products. You can use that. Like, I’ll give you some testers, you know? And she’s like, nah, she got a little popery ball. It’s like, got like seashells and stuff. I’m like, honestly, it smells good. I’m like, should we truly

Andrew: predict you’re going to, I predict you’re going to do that because you started out with these little wooden bricks that looked gorgeous, gorgeous. They just, they look very, they had this cool sense to them, and then you’ve expanded from these pieces of wood that you can keep in your car or anywhere else to what, what are the other shapes that you’ve got right now?

Ryan: Yeah.

So we’ve got our wood product. Um, we’re about to launch a new one called stone. So it’s like, uh, it looks more like concrete, but still carries a scent on last a little bit longer. It’s a really cool material. It’s organic. You could technically compost it. Um, and then we’ve got a metal fresher that hooks on your vibe.

Um, and so that, one’s pretty similar to some of the other ones you’ve seen. We just wanted to make it look better. Um, the whole thesis on all this is that what, like what you were saying, the traditional car freshers are just bad. They look terrible. Like they’re just, they don’t match the aesthetic of your car and the sensor, just not up to par.

So, you know, we set out to kind of, to change that and make something.

Andrew: No doubt your thing looks way cooler. Nobody would even know was a scented thing. It just looks like a cool little knickknack that you’d keep around the car, by the way. Are you okay with me saying what your revenue was? We didn’t get your permission. We’re just like launching into the conversation.

Ryan: I, we’re cool. If you can just say like mid seven figures that school for, I don’t know, maybe, I don’t know if it’s, if it’s, if you want to say that. I

Andrew: I think you should give the exact

number. I think it’s you, you’re going to blow past it. Here’s why I think you’re going to build past it because. It’s not just that the thing looks beautiful. You, you would have had it a beautiful, but it would have been a sad little story

Ryan: Yeah, that’s fine.

Andrew: it. Nice little thing.

Here’s where, here’s where you guys are blowing up at drift. You decided to make it a subscription service, the nerve on you to go. You don’t just need one of these. You’re going to need one of these every month. If you want it from the beginning, you said you’d got to sign up for subscription. That is a gutsy fricking move.

Don’t you think?

Ryan: Oh, for sure. I think like, you know, even in the beginning, when we, we offered only subscriptions, we had people. Why are you doing that? Like you’re going to lose customers. It’s like, we know that we are, however, that reoccurring revenue is just, you know, is key for us. Um, and if you look at like, everyone’s trying to do it now, like you’re just trying to get on the subscription model.

I think there’s a lot of subscription fatigue. Um, but I think there are it’s around products that aren’t consumable, you know, like our product literally. We’ll stop working in a month. So, and we know that. So we want to, you know, it’s, it is a little bit of planned obsolescence, but at the same time, like you, you also want to swap the sand every month we do a send to the month program, keeps things novel and fun.

So yeah, I think there’s, there’s arguments for subscription and for us, it’s just, it’s absolutely crushed it for us.

Andrew: All right. Well, you’re saying though, is there is subscription fatigue, but you feel in the physical product space, it’s not the same in the consumable space. It’s not the same as it is for. I already signed up for Hulu, Netflix, masterclass, Mixergy premium, and all these other things. And the New York times and the Washington post.

And at the end, I’m done with all this content that I’m paying for. Got it. All right. Well, here’s the other thing. So I have to tell you you’re right. The, what is it called? The metal, the metal freshener. That’s the thing that goes on the, uh, the vent that looks a little cooler than the others, but it still looks similar to the others.

The one that had me was the piece of wood. I just thought that’s just looks so cool. I want to have it around. That makes me feel like more of a man makes me feel like more of somebody who’s working with his hands or I’ve got some kind of style too. But then I thought my car doesn’t smell and I’ve got two kids who are like in farm school and all this other stuff.

They should be smelling the car up. Maybe I’m not just not smelling the car is at it.

Ryan: I mean, you’re just, you’re just probably a clean person. So, but yeah, I mean, but like, why not? Why not have a little set in there? You know, people get in, you know, even your kids get in, they’ll be like, dang, it smells awesome in here.

Andrew: I don’t think I need this, Mel, unless something stinks or I want somebody to make out with me. And I think Olivia, oh, maybe actually that’s the one thing, keeping it from making out with

Ryan: Yeah, it

Andrew: She’s not wanting to kiss me.

Ryan: Yeah. It’s guys. You guys, you actually have a little tree under the seat, so

Andrew: kidding. Do you think you’ve got one of those smells? I used to read men’s health magazine when I was a kid, it was like, it was how to get abs, which I never got and then how to get women, which I never got. But one of the things that I remember was they’d have these silly articles about how here are the sense that women will love you more for.

Ryan: yeah.

Andrew: of them I think, was vanilla. No. It was like, even simpler than that. Men’s health was never getting that create a pheromone is like way too much. Do you think there’s one that that would make Olivia go? Why, why are we in bucket seats? Why don’t we have one of these old bench seats?

Ryan: You know, what’s funny is I feel like a lot of women. Um, and we saw this in the gen sense days that people would be like, Hey, my girlfriend stole this. I need to get a second one. Um, it was, it was always the more of a masculine leaning sense that we saw that, that women were liking more. And I don’t know if that’s just because you know, it, it feels.

You know, uh, leaning into that a little bit or whatever, but I don’t know. What’s funny too, is I like more floral sense, like, uh, I don’t and that’s one of the reasons we switched to drift. We don’t need to put people into buckets with this brand. Like let’s open it up and allow people to buy whatever sense they want.

And we don’t need to be a gendered brand. And we were cutting off 50% of our market. So like, why would we do that? You know? Um, so anyways, so I think like scent wise, like Yeah.

man, like our teak center. Super good. Uh, it’s one of my favorites or, uh, I don’t know. It depends on what she likes. That’s the thing that’s, what’s funny about it is like one size fits all thing.

It’s like, nah, that’s, what’s cool about scent is it’s all about branding your space and picking what You like, you know?

Andrew: You know what I, um, as I just read the story and we’re going to go through it in this interview, the thing that just keeps coming to mind. What else can be turned into a subscription. What you found was this thing that we completely ignored, that we hadn’t bought in a long time, and you not only started selling it online, but you turned it into a subscription.

Do you now look around and say, what else can I turn into a subscription? What are you thinking?

Ryan: Yeah, a hundred percent. I think once I, once I kind of started this with my co-founder, we started to look at like, not necessarily, even on just subscriptions, but just on products in general. Like, uh, we, how we operate is we take the con list and we work on those things, you know? So. We looked at all of the air fresheners that were out there.

And we said, you know, what are, what are so bad about these things that we want to change? And so that’s what we tried to take the con list and make it

Andrew: Well, wait, how did you even think of air freshener? And can you use the same, the same, the same approach to find something else in the world that should be turned into a subscription.

Ryan: Yeah. A hundred percent. I think he could, but yeah, for us, like, um, I’d bought a used car. I just got my first, like out of college, you know, regular paycheck job. I thought it was, I thought I was rich. I was making good money. Um, went out to buy a car. I bought a, it was a MAZDASPEED three. Not a sports car, but like any bite you feel like at school, you know, you’re like, oh, it’s sweet.

It’s fast. It’s got, it’s got six gears. You know,

Andrew: is it called them? I’m looking it up because I don’t know Jack about cars.

Ryan: Mazda.

speed, speed. Three it’s it’s like, I don’t know. It was fun. It was sporty. It wasn’t like a, I don’t know, I wasn’t buying a

Andrew: Oh, I see what you mean now. This is not a porch.

Okay. I okay. So you bought that for

Ryan: it’s, it’s it’s fast. And I bought a used one in, uh, It had a funk to it. Like the guy that had it before me, like, I don’t know what he did, but it just had a little funk to it now.

I know here I am. I’m like just, just out of college, like, oh, I want my car to smell good. I was, I was, uh, engaged at the time of like more my fiance to think that my car smells good. So, um, I couldn’t find anything besides the regular offering. And so I had this idea, I talked to a few friends about it and, um, I didn’t do anything with it.

I just kind of had it. And then a few years later I was with my co-founder. We were hiking with our wives and we were just talking about our day jobs and uh, we’re like, it’s cool. Now, is there something else we could be doing that, you know, it was fun. And, um, he’s like, you got any good ideas and I’m like, I think I’ve got a bad idea.

Like I’ve got these, like we should sell air fresheners on the internet, you know, like it’s just like on paper. It really is not a great pitch. You’re like, well, how does, how do people smell it? You know, how do we, you know, Uh, how do we get it to them at the time, subscriptions were harder to facilitate.

It’s gotten way easier now.

Andrew: You mean the, the, in this infrastructure for charging and maintaining. Okay. All

Ryan: I like it at the time. It took a bunch of dev work. If you wanted to build it yourself. So, you know, off the shelf, we, there wasn’t a ton of options. I mean, there were, but they weren’t, they’re still aren’t great. But anyway, so we had this idea that within a couple of days, Christian had mocked up a he’d gone and got a membership at this woodworking shop in salt lake.

It’s called make salt lake. I know people pay a membership fee and they go make whatever they want Christians in there just like figuring out how to make these wood pieces. And, Uh, so he made a prototype and then we went to whole foods and bought a bunch of essential oils. And we’re like trying to mix them ourselves, come up with fragrances.

And, uh, I think our first one we bought my friend was involved in like a beard oil company. And so we bought one of their beard oils and just so the would ride in the beard oil and it smelled awesome And it worked and we’re

Andrew: you did it just in a, in a piece of wood, did it release a lot of scent all at once? And then the whole thing of operating was gone just as quickly.

Ryan: No, we played around with different types of wood and stuff. So we’ve, we’ve found that we used an aromatic Cedar. Um, it’s actually grown in the U S um, super sustainable, like, uh, in, in the U S uh, wood is, is very sustainable. We’ve been since like the twenties. Um, and, uh, yeah, it it worked. We. We have a decent, um, fragrance curve, if you want to call it that where it does fade slowly over time, obviously like heat and other factors play into that.

So, you know, if you’re in the south, it will probably evaporate quicker and you might need to switch it sooner. But, um, yeah, it’s, uh, it’s an interesting.

Andrew: you and your co-founder just messing around. And one of the reasons why you felt comfortable doing this, you told our producer, you know what? I actually worked at a SAS company doing their video production. And I kind of saw behind the scenes and I realized it’s, it’s not as elegant, not as tough, not as, not as out of reach as I thought it was.

What did you see that made you feel that way?

Ryan: Yeah. I feel like in entrepreneurship, like everyone kind of, I think it’s getting better now. I feel Like, everyone does kind of feel like they have the toolkit to like, go do what they want to do and start what they want. Um, but I felt like when I was there, I kind of just felt like looking around and like, I don’t feel like I’m not as smart as any of these people.

I mean, some of these people had like Harvard MBAs and I’m like, I think that’s cool. I don’t know that you, I don’t know that I couldn’t be doing what you’re doing.

Andrew: Like, what did you see that was so shot? I’ll tell you one thing I remember going to work for the first time in my life. Um, as an intern on wall street and the first day I was there, my boss ripped into her secretary first, not showing up on time since this happens all the time here. And I realized, oh, showing up on time is even a challenge for adults.

All right. Maybe they’re just regular people if they can’t show up on time enough. I think I could, I can master this game of business. What was it that, that you saw and said, I think this is difficult, but not nearly as difficult as I thought.

Ryan: Yeah.

I think like one thing I just learned and adulthood is like re like when you realized that your parents were winging it, you know, and that I think. You know, even in some of these buttoned up polished businesses that look awesome among on a PR release. You’re like behind the scenes. It’s not as like clear, cut, easy going as it seems, but everyone’s

making it work. Uh, I don’t know. I saw it. Uh,

hold on. That’s a good question. I think like I just saw regular people. You know, kind of mashing their way through a job. And I realized even with entrepreneurship or starting my own thing, but like, you know, I have the grit, I have that tenacity of like, you know, we can go push through something and figure it out.

And I’m glad I found a co-founder that has even more of that. And, um, I just figured that, like, I don’t need an MBA. I don’t need to go get a college education, like need to know how to even do spreadsheets or whatever. I can figure out how to do this. And I felt like from a marketing perspective, I already have this toolkit, a video and, um, social media that I know how to do that.

They’re like, you know the other part just seems like we’ll figure out the business part of it. And that’s why I did find, um, Christian? my co-founder, he’s a, he’s a spreadsheet guy. So, uh, I brought him in to kind of fill

Andrew: do you know Christian?

Ryan: Um, our wives are really good friends and so we, we, uh, we’d hung out a lot.

And then like, yeah, like I said, we were hiking and just on a, on a hike And just chatting, you know, like you do. And, um,

Andrew: And meanwhile, you’d been kicking around different business ideas. You’ve been shooting videos for people who’ve been on Kickstarter. So you’re kind of seeing all this and wondering what else is out there for you.

Ryan: Totally.

Andrew: Okay. And so then the next step is to how he starts making it. The next step is to get customers or is the next step to go on.

Ryan: Yeah. So next step was to go on Kickstarter. So we did a Kickstarter campaign, um, you know, internally we’ve always just said that like, oh, it was about testing pricing. Uh, I’d call it a failure. Like we didn’t, we didn’t push it very hard. We didn’t do a bunch of ads or anything. We kind of just put it out there and let it go. And yeah, we, I mean, we got, we got a couple hundred people to buy it, mostly our friends and family, but it ended up being the reason why we kept it going. Um, sorry,

Andrew: I take your time,

Ryan: Regan morning’s man. Um, so yeah, after we did the Kickstarter a couple, um, after we did the Kickstarter a couple months into it, we were having to fulfill all the orders ourselves and we were doing them out of our garage

Andrew: you know, before we, before we go into, after I’m looking at there’s something called kick tracks with a queue, you know, this site,

Ryan: Yeah.

Andrew: they track how people do. It says the project funded six project funded successfully, but it doesn’t seem like a success. And you’re saying it’s not 156 backers average pledge was for $48.

What was it that kept it from blowing up? Like some of the others that you’d seen.

Ryan: I think part of it is like it’s a little, like, again, it’s a little harder product to sell on the internet. I think we’ve actually figured out how to do it now, but I think. It’s just weird, right? Like when you, you, you, we had to figure out a way to sell to people. And we’ve, like I said, we’ve got some tricks, like showing the hand, holding the product in the car, works like a champ versus anything else.

Like you want to do, you want to tell people where it’s going and stuff. Um, but even then I think like, it seems innovative, but it’s also, you know, just a basic product. So, and again, I don’t think we put a bunch of effort into like blowing the Kickstarter up. Like we could have,

Andrew: Yeah. It seems like you weren’t good at marketing this stuff at the time.

Ryan: Yeah. I don’t know that we, like, when it went hard at it, it also was like a side hustle. And I think, you know, we put some effort into it, but I don’t think we’ve just put a ton into the Kickstarter. Um, so

Andrew: I will say this though, Ryan, the Kickstarter looks beautiful. You almost went overboard with some of the designs, I guess you were still hand-making each one of the, of the wooden blocks.

Ryan: Yeah. Yep.

Andrew: and so you were actually carving in, in beautiful font. The name of each sense, or the citrus had its own. Look, the Muscat, its own, uh, carving for the name.

Ryan: Yeah. Yeah. so Christian was, yeah. I mean, they weren’t, they were laser technically, but the pieces themselves, yeah. Christian was making them, you, know, each one had to be like sanded down. Like we’ve got video of how he was doing it. Like, it was it’s a, it was a wild process.

And I mean, he was doing it for the first eight months of the business.

He was making them by hand still.

Andrew: okay. And so a good thing, maybe that you didn’t get more orders. And so if you could find one thing to do differently or two things to do differently to, to grow the Kickstarter campaign, based on that experience, what would that be? Help us learn from you.

Ryan: Yeah on Kickstarter, you know, and I’ve seen, I’ve seen behind the scenes of a bunch of, uh, big, Uh, I used to work for a few backpack companies. I have a few friends that do backpacks in Utah. For some reason we have like seven backpack companies that do Kickstarters. They’re all friends though. Like they get along.

Um, so I’ve seen behind the scenes and the best way to do that stuff. Um, they, they have the product almost complete usually. So you’re not really getting in as early as you may think you are on a Kickstarter. Um, and then they also they’ll use one of these like backer camp or one of the bigger, um,

Andrew: Promotion

Ryan: Yeah. They’ll use one of the Kickstarter agencies. We didn’t do that at the time. We just didn’t wanna put the money up for it. Cause we just didn’t know. It was kind of like, we still wanted to test it a little

Andrew: And then what are the age you were really thinking about kickstart in the pure sense of Kickstarter. We’ve got this idea. If you buy it, you’ll show us that this makes sense, versus them saying this is going to be our way of getting a great launch. You’re going to do our launch campaign. They, you also told our producer, the friends that you had there were putting in hundreds of thousands of dollars into marketing on Kickstarter.

You were, you were putting nothing in, you’re kind of proud that you were bootstrapping it and being you were being authentic to the Kickstarter system. What would the company. Uh, that they hired, what are some of the marketing techniques that they used that worked?

Ryan: Yeah. I mean, mostly just social ads, so they’ll do that. And then a lot of them, what they’ll do is they share their lookalike audiences. So if you use. Maddox labs or backer camp or one of those guys they’ll use, they’ll take the email list from everybody and then make lookalikes off it. Which, I mean, who knows at this point, what any of that, if that’s working with, with the iOS updates, but, um, Yeah.

I, I did Kickstarter is, uh, you know, I think it’s still a great tool and, and it works, but I think it’s for it’s, it’s not as seed heavy as it, as it looks.

I think it’s very much more like, you know, later on stages of, of development, I think.

Andrew: Okay. All right. And so the campaign didn’t work and then you still, I don’t think if it bombed, it seems like in the end, because based on the numbers that I saw, it seemed like in the end you just came in and said, let’s just buy this to make sure that we hit our number.

Ryan: Yeah. Yeah.

We put in the last little bit, I honestly can’t remember what the check was, which was kind of, I mean, it’s annoying to have to do that cause you’re paying Kickstarter their fee on it, but, but it’s, you know, at least to say we had a successful Kickstarter, Um,

and

Andrew: that much. It was like, I mean the last two days, my guess is you probably put in $2,000 and the

Ryan: Have something like two or two or three grand.

Andrew: Yeah. That’s, that’s what I’m, that’s what I’m saying. Okay. So now you have to go make it, and you’re starting to talk about making it and shipping. It was also a thing that we’ll talk about, but let’s talk making it.

Ryan: Yeah. I mean, Christian was like down there, it.

makes all Lakey, he still had his, we still had our day jobs for almost a year into this thing. So, um, he was going in there at night making the wood pieces. Um, we were shipping them out of his house for a while

Andrew: You know, what could you get a little closer to the mic? I think you, you moved away. Yeah. Okay.

Ryan: So we were, we were shipping them out of, out of our houses and then, um, Yeah.

I mean, we were, it sucked, we were just doing it every night, bootstrapping it. And, um, I think both of us were, Uh, you know, probably not working as hard as we could have been at our day jobs. I think it was kind of like check the boxes and then, you know, start working on gen sense and yeah, I think we were, you

Andrew: about it all the time in love, but didn’t the market. Just tell you, dude, we don’t need this. We can’t smell it remotely. We’re not buying a who wants this then the market just tell you no.

Ryan: Yeah, except that we started, we started pushing it on social media and stuff, and it started to take off a little bit and we started to test ads and, you know, it’s probably the best time to run social ads was back then. And, um, you know, we had a really low acquisition cost. We were acquiring customers, customers pretty well.

Um, and so, yeah, we just kept kind of limping this thing along for awhile.

Andrew: Wow. Okay. And so he’s making it, you’re shipping it. And you did the thing that I did. I had this idea that I wanted to have beads sent out to people so that they fit in a fricking envelope. Let’s put in an envelope and mail it out to people. People will tell me that the envelopes came in empty. Like I cheated and I definitely didn’t cheat.

Thankfully they have enough of a relationship with my audience that when I sent it out. I came in blank. They didn’t get angry at me, but they said, it’s not in here. You know what? It turned out. Those standard, like first-class envelopes. They run them through a machine that has like, takes a U-turn. So that’s how they scan and read it.

And in that U-turn that they ran up the envelopes through our beads. We’re getting pushed to the corner of the envelope and then getting shot out at the post office. And we had no idea until we were told, Hey, you got to stop this. What, what happened when you were, you were also doing it saying, look, this these blocks fit in a standard envelope.

Let’s put it in and mail it.

Ryan: Yeah. So if you went back and looked at like our original, uh, uh, business plan, like the first Excel sheet shows it, us shipping each block at 47 cents, right? Like what? We’re just throwing it.

in a letter and mailing it out. What’s the big deal, Right.

We just didn’t know any better. So, you know, obviously the first month would come with its metal clip and a different packaging.

And then the refills like, Hey, we got great margins. We can ship this thing, you know, 50 cents. Um, we actually got away with that for probably three months whenever we had small numbers of shipments and we were kind of spreading them out. Um, but then once we, we shipped, um, we shipped a bunch once and all of a sudden, like the next day, Christian’s like, Hey, the whole bag came back.

The post office just dropped the off the whole bag. We dropped off, like, I don’t know what to do. And so we’re like, okay, now we would probably need to look at the shipping problem and start to sort it out. So, you know, we, we called around and started looking around at other subscription businesses to see, you know, what, what are the tricks?

How do we actually ship this thing? Um, and he, you found out the hard way, same as us. Um, and there’s, there are some tricks you can do. Through that, but, uh, it’s, it’s definitely a little bit of a janky process and not a ton of information on how to do it. And it’s still a little bit of a gray area.

Andrew: Wait. So what did you learn? How can you what’s the inexpensive, because this was basically going to break you. How much were you getting quoted? If you were just changed to what the standards solution was.

Ryan: Yeah. So if you ship a USBs parcel, like right now, I think. Two 70 to three 50, depending on how far it’s going or whatever. Um, which obviously is not going to work on a, on a, a dollar product, right? Like that’s going to eat

Andrew: were doing $8, no shipping in hand.

Ryan: right? Yep.

Andrew: I was just so little. Why didn’t you just say, well, we’ll go 15. If someone’s taken $8 out of their pocket, 15 is not that much more. We’ll charge 15. We’ll make a bigger margin. We’re done or we’ll do $8, but we’ll also say, look, it’s only $3 shipping people will accept $3 shipping.

Ryan: Yeah. And we, and we’ve looked at all sorts of options. We, we ultimately just are looking at the comparison, right. So if you’re going to go to, if you’re going to the gas station, pick up a little tree, you can get a three pack for four bucks, you know, so you’re, you’re basically a little over a dollar, a piece.

And so we’re competing with that and we don’t want it to be, you know, we already are eight times the cost. So do you want to, you know, go up any further than that? It’s a little bit tough to do that. Yeah. And we’re, we’re again, we’re playing with it a little bit and that’s, and that’s some of this new product stuff.

It’s, it’s, it’s keeping the value there too. So eight bucks has worked for us. Um, and, and we have found some tricks. I won’t go into some of them. Cause I think, we kind of consider some of that trade secret on, on what we do. You

Andrew: had a mail it out.

Ryan: yeah, you could go figure it out if you want it to there’s. Um, there’s some tricks around it though.

But a lot of, a lot of the companies we were looking at that are subscription. Yeah. All your big D to C players. If you order some of their stuff, you can figure out.

how they’re doing it. Um, but

Andrew: And that’s what you did, you and Christian said, we can’t figure this out on our own. It’s going to kill us. And literally would’ve taken you out of business. And so you started saying who out there is in a similar space doing subscription, selling things for low margins, and then you call them up. Did they just take your calls because you were in the business?

Ryan: No, no, we, yeah, no, we didn’t. We actually, we had to find. If I remember right. We’ve figured out, uh, one of the suppliers, like the third-party suppliers that were supplying, I don’t know, dollar shave club or somebody. Um, And we figured out their packaging guy basically, and he, he had all the tricks and

Andrew: And so you just get to that. So it’s calling around, they’re not taking your calls cause who the hell are you and why should they help you? And then. You found him, he, he gave you all this insight and things turned around. All right. Let me take a moment to talk about my, uh, first sponsor. And actually, I didn’t even get an okay from you.

I usually check in with my guests to see if it’s okay, but I think it’s all right. My first sponsor is HostGator. And what I’ve been doing in the HostGator ads is instead of talking a post Gator, because people can see, it just works on my site. If you need a website, hosted, hosted, HostGator will do it for you.

And if you use my URL, you get a low price. What I’ve been doing. Kind of brainstorming business ideas for people who are sitting on the margins, thinking I want to start something to run with. And so here’s one that I got for you. Ryan, tell me what you think of this. Actually, I had a guest, um, this guy, Mike, he came up with Soma water where he said, look, the Brita water filters are ugly and they really are ugly.

You feel like you’re, you’re get your, you feel like your, your grandmother’s house who has the plastic on her, on her, uh, couch. When you serve water at dinner party with a Brita water filter. He said, I’m going to make it look prettier. Now his thing did look prettier, but it was a little cumbersome, but fine.

And then he sold the filters on subscription. I still liked that business. What do you think of somebody saying, I like what Ryan’s doing with drift? I think I want to come up with my own thing. Look around their house. We all have these Britta things. None of us are replacing it often enough and we feel kind of, I feel kind of bad about it.

What am I gunking it up when I’m and I’m giving the water to my. What if we copied the, so my idea, we come back, I think Mike Del, when he did this, he was early and Tim Ferriss invested in it. Uh, they were early to this, to this subscription model, sending things out by mail and all that. What do you think if we copy that, come up with a nice looking picture.

How hard could that be? Mail it out to people and do subscription. I could probably take this fricking ugly Brita water filter. Say it’s free if you, if you subscribe for a year, my filters. All right. Tell me what you think of that idea, Ryan.

Ryan: I mean, I like it, but I don’t, I’m not going to cheat on Soma guy. I frickin I

Andrew: No, No, He sold the company. He

Ryan: Oh, nevermind. Then let’s do it, Yeah, screw

Andrew: right? Oh yeah. Yeah. I don’t mean to say like, let’s jump in. I think he was early he’s all right. Listen to me, people, whether it’s that idea or any one of these other ideas that you’ve heard me talk about in past, um, uh, past interviews, when it’s time for you to get a website and you need somebody to host it, go to hostgator.com/mixergy.

In fact, it’s not just for, you could sell products on it. You could, you could do content the way that I do with my podcast, but I’m going to interview a guy who. Bought dozens of websites, all contents Heights added more content to them, added SEO, and then was able to grow it into a, into a million dollar a year business.

When he first told me the idea, I said, it’s not going to work. He kept checking in with me and saying, Andrew, this idea that you thought was not going to work, it’s working. Here’s where I am. Here’s where I am. Here’s where I am. And then he finally said, I’m ready to do an interview about it. So I’m going to say.

Content to whether it’s any, one of the ideas that I’ve had here on Mixergy or one of your own. If you need a website you needed hosted, I highly recommend HostGator. They’re inexpensive. They just work. And they’ll scale with you. Yes. I know. I’m going to give you a URL to their least expensive package.

That’s why I think you should start, but no, they will scale with you. You can even do managed WordPress hosting, which is like the fancy hosting for WordPress sites. Anyway, I’m going to stop yapping already. Low prices, even lower. If you use my URL, host gator.com/mixergy host gator.com/mitch. All right.

You’re doing this whole thing now by yourself. No, uh, by yourselves, no, uh, no investors at what point? Well, how did the advertising go? You were just doing social ads and you were starting to figure it out.

Ryan: Yeah. I mean, I had a little bit of background in, in social and, um, mostly on the organic side, but the paid side, I kind of just started playing around with it and we figured it out and you know, like I said, Tricks with the, with how we, how we sold it. Cause it’s, there’s no scratch and sniff on, on Instagram, you know?

So we, we learned really quick that you have to explain the fragrances with a feeling or with, uh, showing the ingredients, but also making you like, what, what does that scent feel like? You know? And so we started to go into more of that where it’s like, Showing different kind of reels. Now, then now we’d go on rails.

But like I called them, sent reels of, you know, what would that scent feel like? And so we started doing that and then just showing the product like we are best performing ad back in the day was like a screen grab from the Kickstarter video. And it was just, um, our buddy Cody holding it up. He actually works for us now, which is hilarious.

Uh, that ad crushed, it made the business like literally I just pumped so much money into that ad.

Andrew: We’re talking about this.

Ryan: it just worked.

Andrew: So the way it works is it’s, it’s a block of wood with a magnet on the back. And then there’s the clip that you can put on your visor. And the thing I think that you’re talking about is it’s him holding up the block of wood about to connect it to the, to the visor. And that immediately says here’s where it goes.

Here’s how it’s going to look in your car. Right.

Ryan: Yup. Yup. And then we just kind of ran on the kind of better air freshener copy and, and talking about the sense, uh, you know, back then we could, we ran a carousel ad that was like that. The fragrances and people would buy in off the fragrances right off the bat. So it was really, really interesting and yeah, it worked.

Andrew: Dude, your, your tastes, your sense of design is unfricken believable. I noticed it in the watch that you’re wearing. I noticed it on your site. I don’t know. Are these photos you take yourself. I don’t even think they are. I think what you’re doing is you’re going out and finding photos that represent your vision for the product you add, uh, uh, your own, um, color correction to them.

Am I right? Like it has your sensibility, the images on your Instagram, the images that you use on your site.

Ryan: Yeah. Some of it, we do a lot of the curation and then, and then Yeah.

when we shoot our own stuff, we, we use, we use a couple of local photographers. I do a lot of our videos still. We have a couple of people that help us out too on that, but yeah, for the most part, um, you know, with that too, we, we try to curate like, uh, you know, there’s some sites we use that, you know, you can gather free stuff, but to your point.

Yeah. Like we just, we, we have a very specific style and, um, I think with the brand, especially with drift. Um, it is all about a feeling of that. And we’ve we want people to buy into that feeling. Um, Yeah, I think that’s one of our strong suits for sure.

Andrew: Yeah, I kind of want to live your life. I feel like your, I mean, life, any way that you’re communicating here, what you’re showing here on your Instagram page is I think a sense of style that Olivia and I can both agree on. It has the minimalism that I love and it has the old fashioned. Timeless feel that she’s looking for.

Ryan: I mean, I look at it. I like your backdrop there. You got it. Like

Andrew: So this is an Airbnb. No,

Ryan: regardless, but you’re, but you’re picking the Airbnb for the skin, but yeah, it’s

Andrew: no. This woman who got it. I do like this, the vibe of this Airbnb.

Ryan: Yeah.

It’s like a, you know, but that’s the style. I mean, you clearly picking those places because you have that style. And I think that’s part of our brand is we want people to buy into that. Um, you know, Yeah.

I also, also, it’s not even about what you have, it’s what you want. You know, I think for us drift, isn’t an aspirational brand and it’s like, you know, you might be driving a 98 Honda civic with the license plate rattling, but you want to feel like it’s a, you know, you know, a poor, so like, you know, drift hopefully helps escalate at least the experience within what you already have to a better place.

Andrew: Well, what was your process for experimenting with ads and not losing all your money? Competing with people were perfect at this.

Ryan: Yeah. I mean, we, we were always, um, I’ve always been conservative in our growth. We’ve never, we’ve never taken on full on VC money. We took on some investment. We can talk about that. Um, but we, yeah, we always tried to just play it really, really safe on the ad side. And, you know, we experiment, we, we still experiment with stuff and try to figure out what works best.

What’s funny. All of the best practices have never worked for us. Like people when I was running carousel ads, like why are you running carousel ads? They don’t work well. They work for me, you know? Or like single image ads. Why, why that photo looks like that? Honestly, it looks like shit. It’s it’s terrible.

It’s it’s I got I’ll

I

Andrew: I think you’re being hard on yourself. Um,

Ryan: The first one is bad

Andrew: because you’re saying I side, I think, I guess, what do you, what do you think is bad about it?

Ryan: It was just a screenshot from the Kickstarters, just like a grainy, terrible looking photo and it just crushed it. But the reason I think that worked was it felt more native to the platform when we were running these on Instagram and Facebook in the beginning.

Andrew: Um, it felt more like the type of thing that people would post themselves then, uh,

Ryan: Yeah, it didn’t, you weren’t scrolling it and you were like, oh, what’s this. Oh, okay. That’s cool. Oh, it’s an ad. I didn’t even notice. You know, and, and for us like the experimentation we’ve, we’ve tried all the platforms do Facebook and Instagram still work the best for us. Um, we were. Our retargeting doesn’t work that great.

We kind of feel like for eight bucks, you’re either buying it or you’re not, you know, it’s kind of a quick, quick turnaround, but, um, yeah, I mean, it. it was scary though, in the beginning, cause we were, we were, we were using the money that the business was generating to put it back into it, but you know, that’s, that’s where we hit the point where, Um,

we were like, you know, if we want this thing to go, we probably need some outside money.

Andrew: What was your turn rate in the early days?

Ryan: Um, it was actually pretty good. We’ve always been like, uh, you know, below what it like around industry standards. So like, you know, somewhere between three and 5%. So, um, it’s pretty good.

Andrew: Three and 5% is really low. That’s like software levels,

Ryan: Yeah. yeah.

And, and we, you know, we, we figured out ways to like, look at it, you know, you try to look at, we looked at short-term versus long-term too. You know, you obviously have people because of subscriptions and I do this, so I’m in the bad category of a terrible abuser of subscriptions where, you know, you’ll sign up, cancel, and then you basically use the discount as a one-time discount, you know?

And we see that a lot. Um, we actually track that though, like we know when a customer comes back, so,

Andrew: Meaning you give people a discount for the first one to get them in. So people will sign up and then cancel and sign up again for the discount.

Ryan: yeah, well, I’m saying we even just, we, we discount.

um, a subscription versus a one-time. We actually don’t have like a trial necessarily, but we, we do like it’s eight bucks if you bought the would buy or would on a subscription. Um, but like some of the other products we do, it’s like 10 or 12 for a one-time. So you get that, you get that discount.

If you just subscribe.

Andrew: So you were starting to tell me a little bit about your, um, about investor. At what point did you say we need to get outside money and then the way that you did it is, uh, it’s kind of painful, but we’ll talk about that. What point you say I need to raise money. What made

Ryan: Yes, we, uh, it’s just, when it came to growth, we were just like, Hey, look, we want to, we want to see if this thing we, we, we knew it had a little bit of legs. And so we’re like, Hey, we need some money for marketing. Um, it, What’s funny is we’re not capital intensive on, on product still. Like we don’t, our POS for a product are not massive and we’re basically just in time.

So it was just, just on marketing

Andrew: What’s PO PO is purchase order on product under the wood that you get on the, uh, essential oils and the metals now. And you’re still making it internal.

Ryan: Uh, we have a partner who does the wood. So the wood is the woods all made in the U S so we, we, we grown, cut and made. This is kinda how we say it. And then, uh, we saw some other stuff outside of the U S um, like the metal clips, those sorts of things. But, um, we’re actually working to try to get it back in the U S right now, because there’s 75 container ships sitting up the coast right now and

Andrew: Oh, really? That you can get why what’s what’s holding them up.

Ryan: Uh, just, I don’t know, just COVID stuff is just made mid ship. Shipping’s an absolute nightmare right now. So we’re trying to see if we can move some of it back to, to the U S or north America. Um, anyways, so yeah, we, we were like, you know, we need some more cash to, to be able to try and get this thing to go.

And so, um, what’s funny is we had that, we do this investment group. Um, Christian had worked with one of the guys I’d worked with another one. Separately. And they both had bought the products and were interested in possibly investing in the company. And, uh, but they didn’t know about it. They were independent of each other.

They’d bought the product and were using it. And so one day they were like, Hey, have you guys seen this Jensen’s product? And they were like, yeah, it’s pretty cool. We should chat with those guys. And so. So, yeah, Christine and I were like, Okay.

that’s cool. Let’s, let’s build a deck and, you know, see, see what the, what this entails.

Um, th the story is we basically made it two slides into the deck. And, um, to this day, we still never fully make it through our decks with those guys. I feel like it always turns into these awesome, just great conversations with these, these guys. And, um, they’re not like a real VC, they’re just kind of like a little syndicate.

They, they just invest in small stuff like us

Andrew: it like an angel list, syndicate.

Ryan: Yeah, they just, yeah, I don’t know that they actually like even listen or whatever, but like they just, there’s just four of them. Um, and they kind of just go invest with each other. And so,

Andrew: Ah, you know what? That’s an interesting way to do it. Do I know any of them?

Ryan: Uh, I dunno, they worked in baby before, so, um, it’s called like Baby. uh, baby stuff.

So they, yeah, so they had a company that? they sold to a, like a Japanese conglomerate and did pretty well. It

Andrew: of the

Ryan: it. was called, uh, it was called JJ Cole. It’s the original company Um, So yeah.

Andrew: what I heard was they ended up taking a bigger percentage than other than if you would have gone more traditional.

Ryan: Yeah. So I think like, you know, Christian, I’d never done a venture deal. Like I wish we would have read some books. I, they are not Sharkey. They were not doing anything wrong. And I actually don’t know. I don’t think it’s a bad deal, what we got. But I do think that we took on, I think what a lot of people do is they’ll take on more cash than they need to, um, because they think they’ll need it, but at what, in reality, what you should do, and this is my thesis.

So, you know, some MBA, some work and tell me I’m wrong, but I think you should take on. Just a little bit above what you need at the time to grow it, or, you know, whatever your plan is showing. And, and that makes sense, right? Because like, okay look, because what they did is they took a bigger chunk of it. It was tranched, but we had it so that, uh, they basically took a big share that, you know, ultimately we paid a higher cost for, because.

Um, you know, we could have, we could’ve given them smaller amounts at different levels that are worth more, you know what I mean.

Andrew: Yeah. I see what you

Ryan: know, I think in hindsight we would’ve done something like that a little bit better. I also, uh, I feel like since doing this, I’ve gotten to be a much better negotiator that no one’s first numbers ever their real number.

And, you know, I think we kind of bit pretty quick on it. Cause we’re like, you know, who knows what this opportunity is going to turn into. And so we just kind of went with it when, in reality,

Andrew: a full-time job?

Ryan: yeah. Yeah. we were both of us.

Andrew: And you’re kind of, it seems like you’re eager to get out of there. You couldn’t even talk about it really publicly because the job wouldn’t let you have a side hustle. So that means that you couldn’t tweet it. You couldn’t talk about it. You couldn’t be one of these people who’s saying I’m going to build in public.

None of that.

Ryan: Right. Yeah.

And I, I feel like I had built a, like, I wasn’t like an influencer by any means, like, but I, I definitely had a small following that I think I could have leveraged a little harder in the beginning. And, uh, Yeah.

I couldn’t do any of that. My job had a no freelance role. And so. Scraping it by and, uh, yeah, I mean, it’s, uh, w you know, without the investment, we, would’ve never, it’s like, I wouldn’t be talking right now.

Um, but Yeah. I mean, you learn lessons as you do this stuff and, um, never take anybody’s first number. And I still don’t do that now, like with suppliers, it’s always like, they’ll give you a number and you’re like, dude, I bet I can get 10 or 20% difference on this Jew. And just for fun, I’ll do It Cause like, what’s the worst, they’ll say, no, you’re not gonna offend my, you know, I’m not, I’m not being a jerk.

Be like, 75%, that number,

Andrew: It does become really fun to negotiate. I forget what movie it was was a catch me, if you can, where he saw his dad negotiate or be charming, I don’t know. But once you get into it, you start to negotiate with everyone I was on with T-Mobile the other day. Cause I wanted to see, should I get my phone through whatever discount offer that they have for my wife.

And then, um, And then before I hung up, I said, you know, can you do me a deal and lower my price on this in any way he goes, actually, we could take $5 off your apple. Watch a subscription though. Okay. Thank you. I just toss and stuff out. All right. So this is where you were. How, how much of the company did you have to give up a third?

Ryan: Um, yeah, we gave up. Yeah, roughly. And, uh, yeah. And so we, yeah, we did that and um, we got some cash to, to start to invest in marketing and that’s kind of when it started blowing up and it, it got, it got fun really, really fast. We, we started to grow it. We, we made our first hire right about that time. They were, I mean, we were literally shipping these seeds out of an office space, not like a warehouse or anything.

And like, I’m pretty sure we ruined the space just because our sense, like any space we move into. Fumigated. Um, and, uh, yeah, so we had our first hire and he was running our warehouse, shipping all the orders out for us. And then, you know, we were, we were coming in at night and helping and trying to grow it.

And then, um, having the investors on the board, they basically got to a point where the. It kind of put the guns to our head and said, you know, are you guys in or out? I think if, Uh, if we’re going to go for it and we think this is going to go, like you guys gotta go full time. And we were both making really good money, you know, like we had good, good day jobs and, uh, we just committed Christian went first.

Um, and then, uh, I went a couple months after him, so we kind of left, like made it so we could ease into it a little bit. Um, and, uh, yeah, it was, it was crazy.

Andrew: Let’s talk a little bit about, um, the you’re saying now there’s an infrastructure, enabling people to sell, sell products by subscription. What is that infrastructure? What are you using?

Ryan: Yeah, we’re on Shopify. And then we use a, we use a platform called recharge and it’s, um, we used to be on one called bold. It was Okay.

Um, they just, they aren’t built for how we need them. And so you know, if you want to go into like full service. You could build some things, but it was when we started pricing that out, it’s like quarter million dollars, you know, to build a, a full subscription suite.

We’re like, we’re not, we’re not VC backed, so we don’t have like money to burn. So we

Andrew: you do it in the early days, spreadsheets and stuff.

Ryan: No, we still, we used bold and it worked. We just kind of. Yeah, Bold.

was the one we used. It’s still around Bolden recharge, kind of a duke indoubt recharge is definitely the bigger one on Shopify right now.

Um, and it it’s, it’s gotten so much better than it used to be, But like, you know, we’d be in meetings with our investors and they’d be like, Hey, you guys should do this. This is like best practice for subscriptions. And we’re like, yeah, like that’s cool. Except the platform won’t allow us to do it you know?

And like we didn’t have developers or anything. So we were, we were trying to limp by with that. And you know, it still worked for us, but, you know, nowadays. Not nowadays. I, that sounds like it’s like, so like we’ve done this for 10 years, but, um,

Andrew: seem like it’s advanced. So what are some of the features that they would have that they wanted you to have that now are available?

Ryan: yeah. I mean, like just the simple stuff, like getting people to swap easily between cents or, you know, upgrading to, uh, uh, prepaying for a longer term, right? Like, so upgrade to a six or 12 month, right? Like we’ve all seen that. That’s the best way to

Andrew: And that’s easy for people to do on their own.

Ryan: Yeah, we’re getting, it’s getting better. Yeah, for sure.

So we’re, you know, we’re still working on a lot of that stuff. It’s not like totally perfect off the shelf, but, um, now, now we have better ways of facilitating it.

Andrew: Okay. All right. What about for keeping track of a shipping? What are you using for that?

Ryan: Uh we’ve used, we’ve used ship station from the beginning and we’re like an enterprise client because we’re shipping like 60,000 orders a month, you know? Um, but, uh, we’re actually migrating to a ship hero, I think right now to manage our warehouse. And So w what’s crazy is, you know, everybody’s always like, so yeah, who’s your three PL it’s like, we still own our own warehouse.

We still do all our own production, all our own fulfillment.

Andrew: I’ve interviewed three PL companies. The big advantage that they have is they have locations all over the country, which gets the product out to people fast. Why, why isn’t that a big thing for you?

Ryan: Yeah, that’s a good question. So we, um, because we do just-in-time so, uh, if you put an order today, we would PR that what piece would have probably been made either today or like yesterday. So we are, we are making them as they go out. And so we can’t really store inventory with someone. Um, And there’s reasons for that we do send to the month so we can kind of control the inventory a lot easier.

We don’t have any sort of like, Last inventory because of that, we don’t have like extras. We have to fire sell. We don’t, we don’t do that really.

Andrew: And you don’t have a situation where people are buying it and they’re hungry for it, right? This moment, I guess, not right.

Ryan: no. And they are when we ship pretty quick too. So if your first, your first order is usually delivered within three or four days of its shipping. So we’re not, you know, we don’t need the one to two day things necessarily. Um, and refills, you’re not at once your, after your first refill, then you’re on the same interval every time.

So it arrives pretty much the same time. It doesn’t really matter.

So.

Andrew: right. Okay. And so for paying people, what are you using using ripple Gusto?

Ryan: Uh, for of like, oh, uh, like backend stuff.

Andrew: for making sure that your tape, that you’re paying your people, rippling rippling is what we use.

Ryan: uh, we’re on quick, we just use. QuickBooks for everything still.

Andrew: for paying people to.

Ryan: yeah. Yeah. We do use our payroll.

Andrew: Okay. All right. I guess it’s got the thing I don’t like about it is I don’t think they do autumn, uh, automatic payment. Right? Don’t you have to go in and hit it or using

Ryan: Yeah, you do. Yeah. We have a bookkeeper too, but yeah, Christian still runs payroll. So we’re still, we’re still a small team.

Andrew: Oh, how big is the team?

Ryan: Uh, we have seven in our office. They kind of manage marketing operations, um, customer service. And then we have a 12 hour warehouse, which That’s that’s a little bit bigger of an operation, but.

Andrew: That’s not small, but okay. That’s a lot of people that keep track of too. And

Ryan: it’s not, it’s not too bad though. I still feel like we’re still pretty, pretty close. Pretty,

Andrew: are you enjoying the management part of the work?

Ryan: Uh, Yeah.

I mean, it’s fine. I think, I think it’s definitely got it’s. It’s it’s fun. It’s funny. I talked to Christian about this quite a bit. It’s like, I think you kind of long for the, the, the two person days, for some reasons, you know, sometimes I think that, like, I definitely love my team.

I don’t get me wrong. I like love it, but it creates, it is an entirely different program. The second you hire people. Um, and I think. Um, I like it. We wouldn’t be anywhere without the out the crew. And I think it facilitates a lot quicker movement on a lot of things, but I definitely think that, like, for me personally, I like, I’m a, I’m a doer, so my team will complain about all the time because I probably just will take stuff on that.

I’ve just, I’ll just do it, you know? Cause that’s just how I I’d rather just be scrappy and, and do it versus, you know, even, I feel like delegation sometimes tends to be. For me, it feels like it takes longer than it would just, just for me to just get it done. So,

Andrew: Yeah,

Ryan: so that’s my problem. It’s not, actually, it’s not, it’s not a problem with my team or management at all. it’s literally a

Andrew: it’s definitely a problem with you. I think one of the first things that my professor of my entrepreneurship professor in college gave us was the book. Um, what is it called? The E-Myth by Michael Gerber. He said, you’re going to know that you can do the job better and you’re not going to give it to someone else.

And then they’re, you’re finally going to do it when you’re exhausted and then they get it wrong and you’ll take it back on yourself and then you’ll be so busted that you won’t be able to grow the business, but I get it. I see your, I see, you’re kind of aware of, uh, of the issue.

Ryan: Yeah.

Andrew: What about this other. So COVID hates you create an air fresher for cars.

The one image that sells is that your friend putting the air freshener in his car, people stopped, people, stopped driving for a bit, and then they got back in crazy driving. What happened?

Ryan: Yeah. I mean, like initially. And I think if we all go back and remember, we all thought, oh, this is two weeks, you know, it’s like, I think everyone was like, oh, this is only going to be a minute. You know? So we’ll be okay. And so initially we were like, all right, we’ll just send everybody home. We’ll work remote for a couple of weeks. You know, figure out, figure out how to get through this thing. And then as it went on, it was all of a sudden like, okay, this is going to be here for a minute. Like it got a little scary. And we thought, you know, we modeled out kind of every possible scenario that the nuclear option of like what happened.

Everybody churns, like, what do we do? You know, how can we survive it? Like what, at what point do we keep the company alive? Like, what does life support even look like? We just gotta ran scenarios, just so we know I’d rather have a plan than just like, okay, now we have to figure it out. You know? So we were kind of pre, pre triaging the situation.

Luckily that didn’t happen. We had, you know, we definitely saw a little bit of churn, but we still grew, um, July, 2020 was one of our best months ever. Like we started to grow like crazy last year when kind of everybody started driving again and road trips started to become a thing again. Um, Yeah,

I mean, you definitely saw people getting rid of their second cars or like, Hey, I’m not commuting.

So this thing staying parked, so I don’t need a second air freshener, but I’m gonna keep the one in my main car, you know? So we saw a lot of. Um, but yeah, it didn’t kill us. It like, our turn was fine and, um, you know, we stalled out for probably two months, but then we were back to growing in June, July, August, and our holiday last year was the best holiday we’ve done ever.

And

Andrew: What’d you do with, uh, the warehouse people to keep them safe and distance and all that

Ryan: Yeah. I mean, we, we tried to follow the CDC protocols, like as best we could on, you know, w distancing everybody out a little bit. It was, it was terrifying now. Like any, anybody got a cold, it was like, okay, like, who are you around? Contract contact, trace and stuff And so, yeah, it was, it was scary for a bit.

We tried to keep, you know, we tried to minimize how many people were out there, just so we could minimize, you know, if there was a case that we could isolate it a little bit better. So, um, Yeah.

but it was, it was, uh, it was an adventure there for a hot minute, but it’s still it’s, it’s got these stupid ripple effects that are still just wild, You know, like our shipping, you know, our, our sourcing is just crazy right now and, you know, stuff that normally.

Oh, it’s so hard. It’s not even hard. It’s, it’s, it’s shipping, you know, if you need, we have, we have product is just like right now, we have literally, at this moment we have a container sitting on a ship that hasn’t been unloaded because someone tested positive on the boat. And then in the meantime, there’s like a huge backlog of boats and long beach right down.

And so we have products sitting out there that we can’t get to, you know? And so it’s crazy. It’s, it’s, it’s an adventure right now. If you’re trying to source product.

Andrew: What about for advertising? I’m hearing, um, that social and Facebook specifically is just not doing as well. If I see the lights turned off.

Ryan: It’s a motion

Andrew: Yeah.

Ryan: it didn’t move enough. Yeah, advertising for us. Um, the iOS 14 stuff, uh, we thought it might affect us a little bit. Um, one nice thing. Uh, we don’t do a ton of retargeting, so that doesn’t kill us too bad. Um, and to be honest, we found that like straight up broad targeting and I mean like broad, broad targeting has worked great for us.

And I would think it’s probably cause we have, uh, we’ve pumped a ton of data into Facebook. Right. Um, but that’s, that’s worked fine for us. We haven’t been. Uh, overly impacted. I will say we have noticed CPMs have gone up in the last year, just overall. Um, but Yeah.

for the most part, we, we haven’t been like overly negative, negatively impacted.

Andrew: Um, I’m trying to think of what else, what else we haven’t covered? I think, um, I think that’s basically it. I I’m, I’m looking also, I’m also hunting down to see where you’re getting your traffic and it seems like Jen sense is, is

Ryan: still driving traffic Yeah, it’s crazy. I honestly I’m honestly shocked. I was looking at it literally yesterday on, on Google analytics. It was, uh, it was, it was on the top. It was on the first page of like referrals. And I was like, how, you know? And it’s probably just search, but I need to go look at gen sense.

I need to look at The Google analytics from gen sense and see where people are coming from. But yeah,

Andrew: Yeah, you didn’t 3 0 1 8 or anything you just

Ryan: No, we just kept it up. Yeah. We just kept it up. Cause like, I don’t know. Maybe, maybe we resurrect something under that. Not under gen sense itself, but

Andrew: Here’s what else is sending you? Traffic? Get our poo.com. It apparently it’s your shipping soon emails should make you more money. So it’s the email that says we’re about to ship this. Do you want to add these items to your cart before we do?

Ryan: Yup. That thing crushes for us. Like if you’re using a, if you’re using a subscription platform, you should definitely be doing that stuff. Like, Uh your, your first instinct with subscriptions is don’t email the customer. Don’t remind them they have a subscription.

Andrew: So that they don’t cancel before the next thing comes up. Right.

Ryan: Exactly. Um, that’s kind of true.

However, that is also an opportunity for you to go get some LTV out of them. So we use our poo for that. So you can add more stuff to your bundles, um, and you know, we’re doing a lot more around that stuff. So a lot of the products you’ll start to see us come out with, um, are around that. Um, and we’re working on a bunch of home products as well, that are going to be super cool.

So.

Andrew: Yes. I feel like that’s the next thing that it’s nice to have it in the car. It might be more essential to have it in the bathroom. Obviously. That’s where people are buying sense anyway, but all these old fashioned sense, just look like something out of the grandmother’s house. Right? Those old cans.

There’ve been people who’ve done the, the here’s the way to get the poop, uh, to not smell. And that’s just so off-putting to go into someone’s house and they see that they’ve got the poop hurry thing. I don’t need my friends to see that you guys have good style. People like you in the car. They’re going to want you in the house.

That’s a natural next step for you.

Ryan: Yeah. So we’ve got, we’ve got the room sprays, which we’ve had forever, which are great for like those instances in the bathroom or something, you know, post, post work, you can get a little

spritz. Um, and then we’re, uh, today. I think it’ll go out in the next couple days, we’ll have Reed diffusers. Um, so it kind of just passive sending, um, we have candles that are coming too.

So, you know, we see it as we have these awesome fragrances that you know, our customer base has really come to love and we want to give them every opportunity to use them in their life. Not just, you know, while they’re commuting.

Andrew: Yeah, natural fit. And I’m trying to think what else. All right. I interviewed the Southern entrepreneur. I think he had his thing just completely went away, but he had this thing that would put essential oils into your shower, head, just drip them out so that you could, I wonder if that makes sense. Now today I’ve got to go back and see if he’s still, if he’s still in business, but now I’m thinking everything should be subscription.

If people are buying it over and over.

Ryan: Totally, you know, and it’s funny, it’s funny on the subscription thing with that too, is like, we talk about it a lot. There’s consumables like actually consumable where you’re like, you know, your drink brands. And those what’s funny about that is your consumption is different than my consumption. So there’s not a ton of like, there’s a little bit more variability in the interval in which you’d want to get a subscription for us, you know, it’s.

30 days, the thing dies, you know, it’s like pretty, we, we kind of not, that’s not always true. Like some people may want it stronger, so they’ll, they’ll want it sooner. But for the most part 30 day interval works perfect for us.

Andrew: I think that’s a problem with the, with the Brita showering. Also, you want to know that it’s gone down and that’s where everyone’s trying to figure out how can I, how can I trigger an alert to some system that says we are out of this thing? Maybe that’s the next big missing piece. Something that’s inexpensive that really knows we are out.

And right. 20 bucks would not be that much to invest in something like that for a Brita filter for something else or a Brita competitor.

Ryan: you’re starting to see it more. Um, Amazon took the technology. I can remember the coffee brand it’s called like endless or something. Um, bottomless, I don’t remember, but they, they basically, you took your coffee bag, set it on the scale and the scale was.

Andrew: that.

Ryan: Well, the listen, but not, not all the time.

You just leave it on the shell. And so when the coffee runs to a certain level, it’ll reorder it for you. And so it’s not like you have to like measure it yourself, but it just sits on it. Smart device. Mailed it. to you right when you

Andrew: it.

All right. That makes sense. As long as I don’t have to do it, it’s on my shelf. All right. That makes sense. I don’t know why I’m just saying no right away.

Ryan: Yeah, man. Geez. You’re

Andrew: dude. I’m here to teach you.

Ryan: Damn did not know what’s going on. Shark tank. Jeez, I’m flagged. Wait, it’s a good pitch here.

Andrew: All right. We started out so nicely to, no, we didn’t actually start out with,

Ryan: if these are hit me,

Andrew: Andrew going to, how amazing is this?

Ryan: uh, I think, I think that’s the way you’ll, you’ll start to see. This is my theory on a lot of this stuff. And we, as we look at more devices in the home, we are looking at smart, but I think people are sick of apps.

They’re sick of like, I don’t need an app to control some stupid device in my house that I literally turn on or off. Right.

I don’t need that. I want it to be smart in the sense that it knows how to refill itself. It gets me the stuff I need for it. Like tears, what you’re saying. I have an air filter now in my house.

That’s smart, which is cool. I rarely control it from my phone, but it’s telling me the filter life. So it’ll notify me when the filter needs to be swapped. That’s awesome. Like not, and it’s not time-based it’s literally telling me, Hey, there’s less air flow coming through this. Replace me, that stuff makes sense to me, you know, uh, your oil change.

It shouldn’t be based on mileage. It should be on like, is the oil dirty and does it need to be changed? You know, those sorts of things. I think we’ll start to see actually smarter and more efficient. And then, um, I’ll spend my dollars more efficiently versus like, you know, even for us, I think it would be cool if it’s like a scent, the scent, a scent sensor in the car.

That’s like, Hey, it’s starting to stink in here, fire up an order. And instead of it, you know, and we’re not going to do that every day. We’re not. Yeah. Sharkey about it, but you know, making sure that if somebody is on that, they get it when they want it.

Andrew: All right. That’s the big, last step of all this stuff, sensors that are small, don’t use a lot of electricity connect to wifi one time, and then you forget about them until in fact, not until you need to replace the battery, maybe until you’d need to replace the old sensor, because it’s so inexpensive.

All right. You’ve opened my eyes to a lot of different things right now. What we’ve got is anything that we’re buying on a regular basis, or frankly, I’m going to start anything that you look around on a regular basis should be, you should start thinking, is this a subscription? Is can I do what Ryan did with drift to this thing?

What else is out there? Number one, number two, the longterm players. How do we make sensors small enough that we put into everyday items that automatically will trigger that we need another one without having, uh, without having to interact with.

Ryan: Yeah.

Andrew: The website is drift.co. You must have paid a good penny for it.

Ryan: Uh, yeah, we actually, we somehow stumbled upon it when it opened up somebody lost it and

Andrew: Oh, so it was just a few bucks.

Ryan: Uh, no. Well, I don’t know. We, yeah, it was a debacle, but we, we ended up getting it and it wasn’t, it wasn’t crazy expensive. Um, but, uh, yeah, I’m sure drift.com really hates us. So the, the, uh, the, the messaging, the

Andrew: cancels, throwing things around the office, but how dare you?

Ryan: Ryan and Ryan and, Uh, Ryan and Christian over@drift.com. I’m sure. Getting tons of emails because they’re just one letter away from getting our emails. So now it’s uh,

Andrew: Uh, there are good people and I think if anything, they’re probably happy

Ryan: yeah, we should, we should probably use them as our, uh, our chat platform. Huh?

Andrew: No, they might be too confused and too upset by that, that people come to your site. Um, I don’t know. I think actually I do think that David’s got a good sense of humor about this stuff, but I do like the domain super simple.

It looks so elegant how small it is on my URL bar. It’s drift.co and I’m grateful to you for doing this interview and I’m thankful to HostGator for sponsoring for anyone who needs a website, go to hostgator.com/mixergy. Ryan. Thanks a lot, man.

Ryan: Yeah, thanks for having me.

Andrew: Thanks. Bye everyone.

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