Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy where I interview entrepreneurs about how they built their businesses. I do it for an audience of real entrepreneurs. I say that because you know what, most people are not real entrepreneurs. I think being a founder now is a cool thing to do and to be, and so people call themselves entrepreneurs, they want to be entrepreneurs. And the truth is, they’re not, they’re not. They don’t really care. What they want is to feel like if they want the outfit or the . . . There’s no outfit or business card exactly, so instead, what they want is to be around it and then they don’t do jack.
My audience, though on the other hand, is actual doers, people who really are trying something, who are building something, who aspire to something bigger. And that aspiration feels great and also can be a little bit tough to deal with. And so I do these interviews to find out from people who are doing things who are building impressive companies to learn from them so that we can pull ideas from them and build our companies based on what we’ve learned.
Today’s guest is Michael Jackness. He is a guy who gave up poker, prostitutes. I don’t know if you got anywhere near prostitutes. Had an opportunity to, we’ll talk about that.
Michael: I did live in Costa Rica for a while, so I was near them.
Andrew: Michael, when I asked you questions about that, you’re going to have an opportunity to either be like safe or to be open, safe or interesting, safe and memorable. I hope you can be. Michael instead decided he was going to get into e-commerce. E-commerce, which is exciting but at the same time so freaking dangerous because there’s someone out there who’s giant who’s really doing good business who can crush you, Amazon, and still you’re doing well. I want to find out how you’re doing so well. I want to find out exactly how well you’re doing.
And a lot of what I’m going to ask you about is going to be based on the companies that you run at Terran. And also you’ve documented it at EcomCrew. So Michael Jackness, for completeness, he is the founder of Terran. It’s an e-commerce conglomerate. They own a bunch of different e-commerce sites. They document their journey on ecomcrew.com so you can see how they’re building their businesses up, and we’re going to find out here what he did to build up his e-com company thanks to two phenomenal companies. The first will host your website right. It’s called HostGator. And the second will help you hire a great developer. It’s called Toptal.
Michael, right away I’m going to ask you your revenue. How much money are you making right now?
Michael: Well, revenue is different than how much we’re making, right? But revenue is $8 million. We’ll do about $8 million this year with our e-commerce company. And net is going to be somewhere between 10% and 12%.
Andrew: Okay. So you’re almost at $1 million profit.
Michael: Yeah.
Andrew: Okay. And last year, did you make a million . . . Well, you know what, let me ask you this. Were you able to put more than $1 million in the bank?
Michael: No.
Andrew: No?
Michael: That’s the great thing about e-commerce is that you never put money in the bank. You just keep on putting it into more inventory. And when I say a great thing, I’m being sarcastic, but no, it’s definitely been a grind. It’s been a learning experience because when we are affiliate marketers it was a totally different world. The money just came in and went right in the bank, but there’s . . .
Andrew: What’s the most you ever saw in the bank at one shot?
Michael: In my personal bank account I’ve had seven figures. So it’s just sitting there in cash. Just . . .
Andrew: What is that? 2 million, 3 million, 1 million.
Michael: Right around two, yeah.
Andrew: Right around two?
Michael: Yeah.
Andrew: And that means that you’ve had to plow in more than $2 million into this.
Michael: Yeah. Well, it was a long story, but I mean, this was back in 2008. We were in the middle of the online poker boom. The economy had just tanked. We had a bunch of cash. One of the things I did was I went and bought a house for cash, and then we eventually started buying domain names, which is how we got treadmill.com and how we got some of the other cool things like we have tactical.com, graphicdesign.com, onlinedegree.com, a bunch of other domain names that we had purchased. I bought all those. And so we divested from cash and into other investments but, I mean, it’s been a wild ride. At one point I did have a couple million dollars in cash sitting in the bank, which was interesting, that’s for sure.
Andrew: What do you mean by interesting? Take me to the high of it.
Michael: Well, I mean, it’s interesting from the point of I kind of grew up in the typical American dream or rat race of when you get more money, you want more things and when you get more things, you want more money and just keep on trying to go through this cycle and . . .
Andrew: You know what? What’s wrong with that cycle? I feel like that’s a fine cycle. When you run, you want to do more running. That’s fine. It’s a great cycle. I ran the other . . . Well, it’s been a while since I’ve run because I’ve hurt myself, but I cycled last weekend, 25 miles on Saturday and I said, “You know what? I want to do more.” So I went to 35. It doesn’t make me a bad person. What’s wrong with wanting to accumulate more? Talk about it openly. What happened in your [childhood 00:04:33]?
Michael: The thing that really changed me was when we lived in Costa Rica, and we had moved down there in 2006 . . .
Andrew: But this is later on in the story, right?
Michael: This was actually . . . This is in 2006, so . . .
Andrew: Let me take it slow. I want to go back to your childhood. So you’re saying . . .
Michael: Childhood, sure.
Andrew: You give me your sense of your childhood. I heard that your dad wasn’t around much, right?
Michael: Well, I mean, he was there, but he’s also an entrepreneur and I think that’s one of the downsides of being an entrepreneur. You mentioned that . . .
Andrew: What did he do?
Michael: He still does the same thing. He builds homes. He is like a custom home builder, cabinet builder.
Andrew: Okay.
Michael: He was at work a lot, and so, I mean, he was there, but he wasn’t necessarily present and . . .
Andrew: And did that bother you?
Michael: For sure, yeah.
Andrew: And what’s an example of the time that it . . .
Michael: It still bothers me.
Andrew: Really?
Michael: Yeah.
Andrew: It still bothers you that he doesn’t see you now or that in your childhood . . .
Michael: We see each other now. Like, go . . . We don’t live near each other anymore, but we talk to each other a lot more now and I can tell that he probably regrets a little bit and . . .
Andrew: Was it one like play or baseball game or something that he missed that . . .
Michael: No.
Andrew: No. It’s all of them.
Michael: I mean, he was just . . . Yeah, he just wasn’t . . . I mean, he just wasn’t there. He wasn’t home. He would come home at 9:00 at night, 10:00 at night seven days a week basically and saw very little of each other.
Andrew: Okay.
Michael: This is from middle school and high school years. And in elementary school he was around more. I have more fond memories of that but . . . I mean, I get it. Like, I think that when I was younger I didn’t get it. You mentioned something in the beginning, like, this is like a podcast for entrepreneurs and unless you’re like a real entrepreneur you don’t fully understand, like, what that means, and to use a poker term, you’re all in, right? I mean, a real entrepreneur is really all in your . . .
And it’s kind of almost a disease. I mean, your business kind of consumes you and it very often a lot of entrepreneurs struggle with work-life balance and relationships and these types of things. And my dad was no exception. I mean, he wasn’t he was off at the racetrack or drinking beers or doing things that society would like looked down upon. He was trying to make a living and pay the bills to make sure I had a roof over my head, and I get that more now, but I was definitely . . . I regretted the fact that he wasn’t around.
Andrew: And still when you were a kid, you were play acting and actually doing entrepreneurship.
Michael: For sure.
Andrew: What’s Discount Computer Consultants? How old were you when you started that?
Michael: I started that when I was 18. I did not go to college. I knew I wasn’t going to college pretty early on. I think because my parents weren’t around a lot, they weren’t asking questions of, “How are you doing in school?” making sure my homework was done, making sure that I was going to go to college. That never ever came up. And I don’t know if it’s an inherent trait or what it is that makes you kind of a street fighter and you know that you’re going to figure out a way to make money. And I was fortunate that I grew up in the ’80s mostly and in the early ’90s and when computers were like, just kind of coming to be and that was my hobby and also like, it was cool like to be playing video games on a computer, on a PC and that stuff at that time. So that became . . . I knew that I had a skill that a lot of people around me didn’t have and that they were willing to pay for, so that became my first business.
Andrew: Your first business was fixing people’s computers. I heard with $200 you bought yourself some business cards, you bought yourself a pager so that you could be [beeped 00:07:48] to fix people’s computers. You were off and running, didn’t go to college, then one of your clients hired you to do what, full time?
Michael: Yeah. One of my clients was . . . So first I started doing . . . When I first started the company I was doing just home computer stuff. And then at some point, I ran into a guy that had a consulting business doing corporate stuff. So I started kind of getting into some corporate stuff, and then eventually one of those companies offered me a job and I took the job.
Andrew: And you spent seven years there, and it seems like you might have been a little bit bored because you were playing poker on the side at the time.
Michael: Well, poker was a big thing back then. I mean, this was . . . I took the job in 1998, ’97, ’98. And I wasn’t bored the first five years because the company was growing really fast, and even though I was hired as the director of IT, I became the youngest executive at the company and I started getting in a bunch of other areas of the company and it was really fun. I really enjoyed my time there. I was getting paid very well, and I enjoyed my work immensely. And poker was just something that I did as a hobby. I was playing poker up in Atlantic City. I grew up in the Washington, D.C. area, so I was in Atlantic City. I was up there visiting my grandma and playing poker a lot there, playing online poker. I had tournaments in my house and eventually came across the fact that affiliate marketing was a thing and that became the next business.
Andrew: Because you were bored playing poker too because back then you can play one game at a time.
Michael: Right.
Andrew: I didn’t even realize it was a period there where you couldn’t have multiple games going at a time.
Michael: And this is like the very beginning of online poker. So, I mean, there was one window but now you can play like 12 tables at once, but back then, yeah, it was boring as hell.
Andrew: And it was incredibly popular, and they were constantly eager for more players. You saw they had a link to an affiliate program on their site, you hit the affiliate program link, you see that they pay a few bucks per person. What did they pay? You still remember?
Michael: I remember like was just . . . So I can’t really remember what I had for lunch yesterday, but some things you remember like really well. But the page said that “If you send us one to nine players a month, we’ll pay you $65 a player. And if you send us 10 or more, we’ll pay you 75.” And then when I had emailed them a month later asking them “Is what I’m doing okay? Is this against your terms of service? Are you okay with how I’m sending you players? And is there room to get paid any more?” They responded back, “We’re completely fine with what you’re doing. And if you send us 200 players or more per month, we’ll pay you $200 per player.”
Andrew: Whoa. And did you get to that level?
Michael: I did in the first month and we got to 1,000 actually.
Andrew: Because of what you did.
Michael: Yeah.
Andrew: Tell people how you got members.
Michael: So we created, as far as I know, was the very first like incentivize marketing to be done on the internet. And again, this is 2004 and my thought was . . . I’m a pretty introverted guy. I mean, I had a small group of close friends, so I wasn’t going to make a living out of getting just my friends to sign up. I was like, “How can I get hundreds or thousands of people to sign up?” I was like, “I’ll give away a set of poker chips if you sign up under my link.” So we incentivize them to use our link, and then I sent them poker chips in exchange and we made about 100 and . . . At the very beginning, we made about $110 per customer who signed up under that. And like I said, in the very first month, we did over 1,000.
Andrew: That’s unreal. How did you know that they really actually signed up? One of the problems with incentivizing a third-party offer was you couldn’t keep track of whether people really signed up or not.
Michael: So, because we had communicated with the room and made sure that it was okay to be doing that and I saw that being a problem in the very beginning, I asked them if they would verify for me. So the process was they would go sign up, they make a deposit and then they would email us and say that we did this, here’s my screen name and then I would email the poker room and asked them to verify that they did do that. And then pretty quickly they started sending like a daily update of a spreadsheet of all the people that were signing up under us so we can verify it ourselves so we would leave them alone.
Andrew: Oh, it’s fantastic. All right. Making a lot of money at the height. How much money did you bring in from that?
Michael: Yeah. I mean, we had a nine figure company at one point. It was pretty crazy. We were making profit . . .
Andrew: Wait. Nine figures? Over $100 million?
Michael: Oh, sorry. Eight figures. What the hell am I talking about?
Andrew: Eight figures. Over $10 million.
Michael: Yes, 10 million. Sorry. No, not 100 million. I’m losing track. I think maybe the cold medicine has got into my head.
Andrew: A lot of figures. But over $10 million coming into you and most you saw in the bank was 2 million.
Michael: Well, I had some partners and we also, don’t forget we had expenses. It wasn’t . . .
Andrew: Right. You had to buy ads to get people to come.
Michael: Yeah. And we were really aggressive with this, but . . . you asked how much I had in cash in the bank at one time. I mean, so that was cash. There was obviously other things we had going on. I mean, it was a crazy ride. I mean, to me, growing up relatively poor it was a ton of money and I had been fortunate that this was not the first time I had run into some money. So I was a pretty conservative and saved a lot more than everyone else around me. Most of the people . . . You’re talking about prostitutes, earlier there was that and drugs and . . .
Andrew: You saw that because, yeah, I’m looking at my notes you said, “You know what? It was spending ridiculous money prostitutes and treating people like less than. That’s what this online poker world was like.”
Michael: Yeah.
Andrew: Give me the most ridiculous over the top night if they were going to make it into a movie this is what they would put in the trailer.
Michael: Well, they did make a movie. The movie was highly inaccurate.
Andrew: What was the movie?
Michael: I think “Runner Runner” or whatever it was called.
Andrew: “Runner Runner”?
Michael: Yeah, I think that’s the name of it. It was like a Ben Affleck. I only watched it once. It was a long time ago but it was . . . It was loosely around this. But I saw someone drove a car into a pole just to show off one time that they could do the most ridiculous thing. That was . . .
Andrew: Oh, really? It was just, “Let me show you that I can burn money. I’m going to crash my car.” Here. “When a poor college students who cracks an online poker game goes bust, he arranges a face-to-face with the man he thinks created him, a sly offshore entrepreneur.” And this is based on that world. Ben Affleck movie.
Michael: That might not be the right movie then.
Andrew: Okay.
Michael: I thought that was what was called, but maybe it was . . .
Andrew: It could just be that IMDb has got a really crappy . . .
Michael: I think that might have been the movie, and it was based loosely on that whole Costa Rican Absolute Poker, Ultimate Bet scene, but maybe not. Maybe that’s why the movie didn’t seem like it was too accurate.
Andrew: Wait. Why did you end up in Costa Rica?
Michael: So we were living in Vegas, which was kind of the center of the poker world at the time.
Andrew: Because you were playing poker.
Michael: We were playing poker. Our business was about poker. We weren’t just like your typical affiliate. We had also created like a poker news organizations, so we were at the World Series every year and we were documenting poker. We were trying to build a legitimate business around . . .
Andrew: What was the website? I’m going to go on archive.org the business.
Michael: It’s still there. It’s Poker News Daily. We sold it to someone and they’re still running it to this day as far as I know.
Andrew: Okay.
Michael: Poker News Daily. Yeah. I think we had press passes for the World Series and we were there until the wee hours in the morning often and did a lot of interviews with players and we were pretty connected with that world.
Andrew: Okay. You had a lot of girlfriends.
Michael: I had one girlfriend, my wife. I was already married.
Andrew: And you didn’t get to experience any of this?
Michael: Well, I mean, it’s probably good because I think I’d be dead. I attended . . .
Andrew: Really? Jackie Martling from the Howard Stern Show basically said to me, “Don’t ask me that.” And I said, “Come on. You were dating other people. You were on the Howard Stern Show at its height.” He goes, “You know what? I didn’t, but if I did, I would lie to you about it.” And I go, “I think I get it.” Would you lie to me about it if you did? If you were sleeping around . . .
Michael: Probably. But I am actually being honest in this case that I have been 100% faithful to my wife.
Andrew: Doesn’t that suck? That doesn’t bother you? Like, you finally get this attention, this money, this lifestyle and you don’t get to be a part of it. You didn’t resent any part of it?
Michael: I did at the time. I’m not going to lie. Like, there was definitely a time when I did, but looking back at it, I really do believe I would be dead. I think I would have got sucked into it like everyone else. I think the thing that kept me from getting in a lot of trouble was because I was married and there was a lot of things I said no to and just didn’t go to prevent myself from being . . . It’s so easy to be sucked into it. Like, I don’t care what people say. I mean, like, when you’re around other people that are acting in a certain way, like, your peer group, it’s very difficult not to get sucked into that because, I mean, it’s like adult peer pressure.
And you see people dressing a certain way, wearing certain things, driving certain things, going to certain hotels or restaurants, and, I mean, you want to do the same thing and that feels good for a certain amount of time but that wears off very quickly. I mean, it’s like that dopamine hit becomes less and less every time. So, I think that I probably would have ended up doing drugs or other things that luckily I just didn’t get into. And I know that I’m compulsive and I would be like the best cocaine addict that’s ever been alive and . . .
Andrew: I’m compulsive too. I’m glad I don’t get into coke or drugs because I’m now into coffee to excess. It’s unreal.
Michael: Yeah.
Andrew: I started with soda, Dr. Pepper all of a sudden and I know I can’t stop it.
Michael: At least it’s diet. I saw the diet [inaudible 00:17:03]
Andrew: Sorry?
Michael: I said, at least it’s diet, right?
Andrew: Yeah.
Michael: It just looks like a diet case.
Andrew: And it’s no . . . That doesn’t help with anything.
Michael: No.
Andrew: But I find that life unless there’s a lot going on I find that it’s just too boring. Do you find that too? You seem like you’re okay with it now.
Michael: It’s interesting you said that because, yes, sometimes . . . Sometimes, yes, but I think that over those years of living in Costa Rica, seeing the way other people were acting, knowing now that they’re all broke and destitute, like, I mean, they have nothing because they just spent to excess. But also you’re around people that are making $600 a month that are working 12 hour day, 6 days a week and what I realized is they were just happier than me. And you don’t notice it for the first few months or even year necessarily, but after a while . . . I was down there, I wasn’t really happy with a lot of things, but these guys were like always smiling and super happy and I just eventually kind of put two and two together you realize it isn’t the money that necessarily is going to make . . . I mean, there’s definitely . . .
And I’ve read a lot of books about this now and talked to people about it. And there’s like this whole curve where like your money to a certain point like is a huge factor. I mean, if you can’t pay your electric bill, your mortgage, your car payments, whatever and that’s all you’re ever worrying about, then I’d be foolish to say that that isn’t a factor, but like after a certain point . . . And the number is different depending on where you live. Some people say $80,000, some people say up to $150,000 that there’s diminishing returns on your happiness to the money curve and I really believe that. Like, I think that that’s . . .
Andrew: I get that.
Michael: . . . very, very true.
Andrew: Well, I still think the more the better for me, but I get it. I understand it intellectually.
Michael: I’m not going to turn it away. I don’t have an endless pursuit for it anymore like I did before.
Andrew: Costa Rica, how’d you end up there?
Michael: Well, I mean, because I had an endless pursuit for money. Quite frankly, like I said, I mean, my objectives and everything in life were different then. And we move there to save on paying taxes was like one of the number one objectives. As a U.S. citizen you still have to pay taxes on worldwide income, but we set up a legal tax structure to get that down to about 11% as what we are paying. And so, I mean, completely legally. I mean we paid all the tax bills. This is something I tell the IRS if they were sitting in front of me right now that we did nothing that was . . .
Andrew: What’s the legal structure that allows you to only pay 11% taxes when you’re an American citizen?
Michael: Yep. So this is at the time. This does not exist anymore, but this was under the Bush tax cut era. If you remember back to the mid-2000s. So we had an Australian company that was . . . Australia is a treaty country to the United States for these tax treaties. And we also had a Panama company so that the Australian company, like, was just a holding company and we paid ourselves basically a salary that was right around with the exemption is. There’s about a hundred and something thousand dollars a year you can get paid per person. So my wife and I both took a salary and paid zero taxes on that exemption part. And that exemption still exists today. And then . . .
Andrew: Meaning, whenever you take as a salary up to a reasonable limit, you don’t have to pay any taxes on.
Michael: Well, the limit is very black and white and it changes every year, it goes up a little bit, but at the time I think it was like $88,500 if I remember correctly. I think now it’s about $100,000. So anyone who lives abroad that wasn’t like say a tax free jurisdiction and just as a for instance, up to the first $100,000’ish of income, there is no taxes, like, this still exist. You have to be what’s called a bonafide resident of another country, so I took time to establish that residency, but at first, let’s say, just roughly 100k of income there were no taxes.
And then the Australian company . . . And again, we were living abroad, fully living abroad. The entire company was abroad. We had no presence or business in the United States. We were not trying to discourage any of that. We weren’t allowed to visit the United States more than 35 days a year I believe was the total number to be able to qualify for that tax treatment. And then the company paid all of our distributions as a dividend, and back then dividends were taxed at 15%. So, by the time you add up our full blended income, it was around 11% taxable [income 00:21:14].
Andrew: Got it.
Michael: And we were able to do that because it was a foreign company operating outside the United States with all non-U.S. employees. We didn’t have U.S. customers and stuff like that. So that’s how we were able to do it at the time. I don’t think that exists . . .
Andrew: I keep telling Olivia, “Why am I living in San Francisco, one of the most highly tax cities in the world? What are we doing here?”
Michael: Yeah. I mean . . .
Andrew: We should go somewhere else.
Michael: So, I mean, I’ve been through that.
Andrew: I love that you went into detail on this. This is, I think, what separates Mixergy from other places. I want the detail. I think for most people is going to go over their heads, they’re going to get bored, they don’t care. I want that detail. I want to know that this is out there. And yes, today that may not be exactly the same option . . . that may not actually exist the same way, but I want us to know that there are options like that.
All right. Let me take a moment to talk about my first sponsor and then get back into the story. All right. My first sponsor is a company called Toptal. If you’re listening to me you’re a person who does not like to be limited. You want . . . Look at this. Look at what Michael’s been able to do with his life and you guys are going to hear even more. And doesn’t it suck when you have an idea and you say, “You know, we don’t have the technical resources for it. We don’t have the bandwidth. Our team is overtaxed.”
Well, you know what? It doesn’t have to be that way. We had that situation. What you do is you go to Toptal and you say, “Look, Toptal, I want you to impress me. Impress me. Here’s what I need. Here’s my problem. Here’s the way we work. Can you please find somebody to do this?” And if they don’t find the right person, you’re under no obligation. It’s not like you pay for a bunch of ads or you pay for recruiter. There’s none of that. You just call them up, you tell them what you’re looking for and yeah, they want to make sure that you’re a real business, not just someone who has a fantasy idea and is looking for someone to build it for you on the cheap.
But if that’s you, if you really have a real business, you have a real need for an individual to work full time or part time or a team of people to work together, there’s no better place to hire developers right now than at Toptal. So, just go to this URL where you’re going to get the deal that you’ve heard me say so much, you can probably repeat it with me.
Michael: Toptal.
Andrew: The URL is toptal.com/mixergy, T-O-P. Have you ever used that Michael?
Michael: I have not but I will definitely check it out.
Andrew: File it away, you’re going to be upset one time, someone’s going to say no to you and you’re going to say, “You know what? That guy, Andrew, pain in the ass but he was honest about all this other stuff. Let’s just try this Toptal thing and see if he’s full of it or not.” And then you’re going to go to toptal.com/mixergy. You’re probably going to forget the /mixergy. And when you do forget the /mixergy you’re going to miss out on the fact that they’re going to give you 80 hours of Toptal developer credit when you pay for 80 hours, you’re going to miss out on the fact that they’re going to give you this guarantee, but you still going to love them because they give you high-quality people. And for those of you who are listening to me, don’t miss out. Write it down, toptal.com/mixergy, toptal.com/mixergy.
All right. Let’s continue with the story. You are now in Costa Rica, saving money, doing this well. At some point does online poker things start to crash?
Michael: Mm-hmm. So it’s actually kind of crazy how things work out. We had bought the place that we were going to move to in like, June of 2006. I got married in August 2006. We came back from our honeymoon in September 2006 and went to a conference in Vegas, drove to Houston, flew to Costa Rica to move down there, and three days later the UIGA pass which is the Unlawful Internet Gaming Enforcement Act. So we were down there three days before like the crap hit the fan.
Andrew: And you know what? I have to give it to them that a lot of people who were gambling were becoming degenerates online gambling, and this one law really did stop it. You thought the internet can’t be stopped. It’s a worldwide thing. No, it can be stopped. You thought that, “Nah, let people do whatever they want.” And, you know, I’m “let people do whatever they want” type of person too, but I got to hand it to them, this thing worked, right?
Michael: It actually didn’t work.
Andrew: It didn’t work?
Michael: No.
Andrew: What was the law then that worked? What’s the one way . . . I saw my brother play poker all day long and then suddenly a law came down and he goes, “I can’t play it anymore.”
Michael: So the law . . . What ended up happening was it made it illegal for companies to process credit card payments is what the law . . . because I think they had to be careful about like what they made illegal or not because the World Trade Organization would like come down on them for blocking stuff that’s legal in another jurisdiction, which the WTO ultimately did come down on the United States for doing this. The United States in their infinite wisdom just like gave the WTO the middle finger because that’s what the United States does, they like to push their way around when they want to, but if they don’t listen to these types of rulings.
But what ended up happening was the publicly traded companies that were operating in the United States at the time, which were Party Poker and Pacific Poker, 888 and a couple others, they pulled out of the United States when the law passed because they were publicly traded in the UK and they couldn’t take a chance of operating in jurisdiction where it was no longer legal.
But these other companies, you know, Poker Stars, Absolute Poker, Ultimate Bet, Full Tilt Poker, etc. continued to operate in the United States for many more years past that. And the ultimate thing that brought them down was another big day and there’s a whole bunch of other things that happened in between, but the government eventually seized four of those companies’ assets and shut them down.
Andrew: Oh, okay. So it was the seizures that stopped them. All right. So you get back to the U.S., the Unlawful Internet Gambling Enforcement Act of 2006 comes down. How does it affect your business?
Michael: Well, we had just moved to Costa Rica at that time, so it affected our business immensely.
Andrew: Oh, I see. Okay. Costa Rica.
Michael: So, I mean, we were there from 2006 to 2009 and we moved into the Cayman Islands for a year and lived there for a year in 2010. And yeah, I mean, the business at that point, before UIG pass it was like this hockey stick growth and then it was just like you just take the hockey stick and flip it upside down. It was right kind of into the ground.
But some other . . . I mean, I don’t know how much you want to talk about this part of my life, but there was some other interesting things that kind of happened here where we did experienced some growth from a top line perspective, that’s when we were able to hit the eight figures but we had more expenses because we ended up doing was partnering with some people that were based in the United States at the time that there was so much uncertainty, they didn’t know how to operate their business anymore so they basically gave the business to us and we operated it and gave them a part of the revenue like indefinitely.
Andrew: What was the business?
Michael: Other poker affiliate stuff.
Andrew: And you were still able to do well with online affiliate? [inaudible 00:27:40]
Michael: We were because we were living in Costa Rica and we had a foreign company that was based in Australia, so we were able to move money around and do it legally because we weren’t based in the United States.
Andrew: And when you got back to the U.S. they didn’t stop you, they didn’t arrest you, none of that.
Michael: No, no, no. I mean, we never did anything illegal, like, even tip-toeing over the line because we weren’t operating an online poker room. We were an affiliate. We were advertisers for these rooms. We weren’t . . . The one thing that was illegal to do was to process financial institutions to enable people to do gaming payments. We weren’t . . .
Andrew: What got you to finally stop all that?
Michael: I had had enough by 2010. So I stepped aside. I still own part of the company for many years after that. I actually just got out of it this year finally. But from an operational standpoint and having anything to do with it in any way, shape or form, I walked away at the end of 2010.
Andrew: Because you just had enough.
Michael: I had enough. I mean, some of the stuff I was alluding to. I mean, mostly the people that . . . Yeah, you think of all the stereotypes that you would think of when you think of online gaming and those types of people like, that’s the majority of the people that were in the industry and I just did not enjoy being around those people. I didn’t want to . . . They were enablers for other things that I just didn’t want to be around and I left. We went back to the U.S. we bought an RV and RV’ed for two years.
Andrew: Just because you needed to get away.
Michael: Yeah, I just . . . Yeah. Basically, at the time I thought I would retire, but I realized . . .
Andrew: And did you have enough money to retire?
Michael: We did, yeah, yeah.
Andrew: You did. You know, that book, Ben Mezrich had his book about the guys who decided that they were going to get into online poker, they built a whole poker website. It’s called “Straight Flush.” That was a fascinating book. But I see what you’re talking about. When there’s unlimited money, you’re kind of getting out of the U.S., avoiding U.S. laws, you start to go to excess, and that’s what you . . .
Michael: Yeah. I mean, again, I wasn’t avoiding U.S. laws. I want to make sure that . . .
Andrew: Sorry. Not you.
Michael: I don’t want anybody in the government hearing this and thinking . . .
Andrew: But I feel like . . .
Michael: I was definitely not . . . There was never the reason we moved down there. We moved down there well before the UIGA and we had started making that process happen before that passed. We did not move down there because of any laws. We were moving down there for a favorable tax.
Andrew: I meant the people who are in the space, but I’m glad that you’re clear about that.
Michael: For sure. Yeah, yeah. The people that were around us, some of them ultimately who did go to jail, they were breaking the law and they knew it. And we knew they were breaking the law, but we weren’t. So it’s just that was their decision.
Andrew: When you were in the RV, is that when you got into domaining?
Michael: It is. Yeah. We came back, we had that cash. It was around. And my mind starts to wander pretty quickly. I think that’s, again, it’s a disease like anything else entrepreneurism. And I wanted to get into “more legitimate businesses” at that point, not that online poker wasn’t, it just that there was definitely like a negative connotation around what we’re doing, for sure. Even you just said it, like, I mean, people online were gambling a lot or like losing money, etc. and that you thought it wasn’t good. I mean, I don’t necessarily agree with that, but there’s a negative connotation around it that I just didn’t want to be associated with anymore. And that’s when we started buying these domain names.
Andrew: Graphicdesign.com, websitehosting.com, cuttingboard.com, wordpressthemes.com. You mentioned treadmill.com and onlinestores.com. You had all of those. What were you planning to do with them?
Michael: So it was part investment, just because I felt like .com, single word or two-word names that had a lot of exact match search volume were going to always be in demand. And I was definitely right about that. I definitely had the . . . Even it wasn’t really that big of a revelation. This is now 2010. I mean, the internet had been around for a long time. It wasn’t shocking, but these names are still since we bought them have continued to appreciate and become worth more. So we definitely made the right decision there.
As far as what I plan on doing with them, at the time when I first started buying them, I thought either (a) I would just buy them as investments or (b) turn them into some other type of affiliate type marketing website. What ended up happening after running treadmill.com for a few months as an affiliate website, I was on a hike one day and I started just kind of having some soul searching and I was like, “You know what? What I’m doing here is kind of like bottom feeding. I’m adding zero value to the world. I’m basically deceiving people, not necessarily amorally but like certainly where I’m not proud of it. They’re coming to my website. Like, there’s a thing content like review of a treadmill. The ones that’s ranked higher is probably the one that pays me more.”
The FTC eventually, end up coming down on all this years later because people were taking it too far, and I think that that was the right decision on their part honestly. But we were years ahead of this and I was like, “You know what? Like, instead of doing this, I want to run a legitimate business. I want to sell the treadmills.” And that’s when we got into e-commerce and . . .
Andrew: And it’s more sustainable. It’s the type of thing that you can pass on to someone else, you can sell it, you can build it up, have it run without you.
Michael: Exactly.
Andrew: Okay. So that’s where you were. And you said, “I’m going to start to sell treadmills.” So bought the treadmill companies.
Michael: Yeah, yeah. We like literally picked up the . . .
Andrew: And they said, “Thank you.”
Michael: I call the front desk.
Andrew: [inaudible 00:33:02] fails.
Michael: Yeah. I mean, I called the front desk. I asked for like, the VP of sales or like . . .
Andrew: And did you really? This is how you did it.
Michael: I swear to God, yeah.
Andrew: And they didn’t actually say, “Thank you.” What did they say instead?
Michael: Well, it was interesting you can try to draw a line down the middle of the industry. So you have one side of the industry that was pretty accepting of us and that was kind of the very commercialized commoditized treadmills, so like, the stuff you would find at Sports Authority or Walmart. The sub $1,500 really sub $1,000 treadmill market. And not only was I competing against Walmart and Sports Authority but also against the manufacturer themselves. But they were accepting of us.
The other side, the special team market, your $3,000 to $5,000 pieces of equipment, they were initially responsive to us but then eventually very quickly shut us down because there was a very legacy brick and mortar component to it where an individual store had a territory and they were pissed that we were potentially stealing their sales and they banded together and all those specialty retailers where all the money was to be made in this business told us thanks but no thanks which was crazy to me.
Andrew: And so they didn’t want you to sell. And I guess, I kind of understand it because it’s hard to get people to buy treadmills online, right?
Michael: It is and it isn’t. I mean, it definitely is. I . . .
Andrew: If they’re going to pick one online or offline, it seems like offline would still be the better one for them to bet on the . . .
Michael: You’d be surprised. I mean . . .
Andrew: Really?
Michael: Yeah. I mean, we sold over $1 million the stuff for the first year and we didn’t know what the hell we were even doing and we were . . .
Andrew: Just because of the domain because people would type in “treadmill.com”.
Michael: Yeah, yeah. Yeah, for sure. Yeah. It’s crazy. I know it sounds nuts.
Andrew: And then how much affiliate money were you making if they were typing in treadmill.com as an affiliate?
Michael: We weren’t doing it as an affiliate at that point, we were doing as a drop shipper, as an actual store. And the margins were thin. I mean, that was ultimately . . . When I started to understand the business because I really knew nothing about it. This is typical Mike Jackness and I’ll go into something to feed in all in without all knowledge. I just want to . . . I felt like I’ll out-hustle everyone else and do a better job that way, but it definitely backfired on me. Like, the stuff I was up against, these things were not solvable.
Andrew: What were you up against? That you weren’t able to get the right treadmills? Okay. What else?
Michael: Yeah. So, I mean, I would say it was a few things. Number one, I was competing against the Walmart’s and the Sports Authorities of the world and they didn’t listen to Matt pricing at all, but the manufacturers forced us to stay with Matt pricing. So we were at a pricing disadvantage. We had no control over the product. We were a drop shipper, so like, we would take an order for a treadmill and we would submit the order and find out later that it was out of stock, so we’d have egg on our face, had to go back to the customer and figure out a way to get around that.
We couldn’t dictate how quickly the thing got out the door and how quickly we got our tracking number. This is an age where people want a tracking number within one to two days, and that just wasn’t able to happen. It would get on the back of a tractor trailer truck. It was not going UPS because it was too heavy. And these people do not deliver on time. UPS is pretty damn reliable. FedEx is pretty reliable, but common carrier not so much. So it would show up . . . The guy would take a half a day off of work and no one would ever show up or call [inaudible 00:36:37]
Andrew: It’s awful.
Michael: It was horrible. And we’d get phone call. It’s like, “I demand that you pay me for my half a day at work,” and now I got to come back . . . And then, or the thing . . .
Andrew: You guys had the phone number at the top of your website back then too, so it was easy for them to track you down.
Michael: Yeah. We took the phone call. We took all the phone calls. It was awful. So, after two years of dealing with all that . . . And I tried everything. I mean, it’s crazy. I even we at one point had flown up to Logan, Utah which is where the majority of the stuff is made, looked at buying a warehouse across the street from where is made. Like, they were willing to drive the stuff across the street on a forklift and put it in our warehouse to where we would ship it so we can get it out quicker. I even looked at like creating our own shipping network and stuff to try to get stuff there on time, but like, the reality is that that’s just not possible. I can’t create a nationwide shipping network. That’s a billion-dollar problem. And at the end of the day, we just couldn’t solve it.
Andrew: And this was you and your friend, Michael Kupfer who now runs, what is it? Chicago Signs.
Michael: Yeah. He’s doing a bunch of other e-commerce stuff. And Grant, my buddy, Grant, also the three of us were the ones doing it at the time and eventually we kind of just all conceded with our tail between our legs that we weren’t going to solve these problems. And it was a business that was making money and generating revenue, but I wasn’t happy. I mean . . . And again, like, the money isn’t like the number one thing for me. So, I mean, when I . . . Because I was the one who was responsible taking the phone calls and when I realized that there wasn’t anything I could do to dictate like the people calling us being happy people, they were always going to be mad and it was out of my control to fix that, we threw the towel in.
Andrew: All right. Before we move on past it, one thing that worked for you especially well at treadmill.com that we can learn from if we’re selling anything online for doing e-commerce specifically.
Michael: I mean, I think the thing that I learned during that time was how to deal with good customer service, how to be empathetic and just make people happy as close it all costs as you get in the business. So you can’t just give them a free $1,000 treadmill. But the thing I really learned during those days was that I’ll throw another thing in there. You can’t make up like low margin or negative profitable sales with volume. You’re just making less money, more times making less money. So, I mean, like, what really was happening was like a lot of it was equating back to the whole like poker CPA days. I was like, “Oh, I’m selling this $2,000 treadmill even though it’s only 10 points of profit, I’m still making $200 and that’s the same as a poker CPA.” That’s literally how I was thinking.
Andrew: Oh, right. All this work to sell one treadmill and it’s just the equivalent of one guy signing up for a Poker Stars account.
Michael: Exactly, yeah. And then out of that, unlike in poker, now I had to take ads and infrastructure and credit card processing fee and all these other things like out of that and it just wasn’t feasible. It wasn’t really like the business that I thought it was going to be when I first got into it.
Andrew: Okay. Let me talk about my second sponsor and then we’ll get into how you actually started to find your mojo in e-commerce. My second sponsor is a company called HostGator. Let me ask you something. If someone’s listening to us and they want to sell something using . . . Or actually, if all I gave them was a WordPress hosted site on HostGator and they had nothing else, what would you suggest that they start off with?
Michael: It’s interesting. I used to work with HostGator a lot, so now we’re talking my language. Well, I used to own websitehosting.com which we talked about and HostGator was one of my best affiliates and I also had all my stuff hosted on HostGator. It’s a great platform because they’re really cheap and they can like launch WordPress websites like really quickly which is awesome.
Andrew: Yeah. And is there an idea for a WordPress website that you could imagine, if you were just starting out, if you were that 18-year-old kid not going to college, you decide, “You know what? All I got is the ability to publish online,” what would publish today in 2018?
Michael: It’s funny you’ve asked because I just had this conversation with one of my best friends last week in Vegas. I think . . . And I think I’m going to do this actually moving forward again because I used to do this at mikejackness.com but I kind of abandoned it. But I think if you document your life if you got something interesting going on, your personal hobbies and passions to others, will be interesting to other people have those same hobbies and passion whether it’s scuba diving or traveling or foodies or cooking or whatever it is.
Andrew: Just document your experience with whatever it is and then where’s the revenue coming from?
Michael: Well, I mean, traffic is revenue, right? So, I mean, in some cases if you’re blogging about how to save money for investing or something, that’s going to bring you more revenue down the road because that still pays more.
Andrew: Right.
Michael: If you’re blogging about your passion, it’ll always be effortless and never seem like work. And if you’re lucky enough to be able to layer that or mirror that over something that is on the scope of things that pays more because affiliate revenue is higher in certain categories. Credit cards, insurance, investing, online degrees and education.
Andrew: Where would you get the affiliate programs today? What’s a good spot for them?
Michael: Like Commission Junction has . . .
Andrew: Still cj.com, commissionjunction.com?
Michael: Yeah. They’re a good place to start looking. But just doing a search of . . . You’d be surprised. Like, I mean, if you’re in a niche that, whatever it is, whatever niche you’re in, you just start looking on their own websites and just look for the word affiliate on the bottom of their page, a lot of the companies have affiliate links around their website. So that’s just exactly how I got started with Party Poker. And I wish I did more of that and stuck with it, because what ends up happening just like everyone else, a lot of people are really into it for the first 6 to 12 months and they give up on it too soon. And it really takes two to three years of like, just constant pressure forever like really working on it, and that’s what we’ve done with EcomCrew, like, I really stuck at it with this over the last few years.
I mean, we had like 190 podcast episodes now and we’ve put hundreds of articles on EcomCrew. The first year we were talking to ourselves. You’re writing to yourself and talking to yourself until you hit that hockey stick growth, and I think that if you have a personal interest like I have with e-commerce and you’re talking about something that you live and breathe, other people will find that to be interesting.
Andrew: That’s good advice from a person who’s actually generated money, not somebody who’s a La Dee Da, go create and follow your . . . go create your love and follow your passion. You actually have a business sense and you’re still saying “Find that topic that you’re most excited about, document your experience with it, and then start looking for affiliate programs.” And I think affiliate programs are a great way to start because they let you test the water on selling something that isn’t directly related to you but related to your topic to see whether people are interested enough to buy it, and then if it works, then you could create your own version of it. So I can imagine somebody who’s into scuba diving might do an affiliate program for scuba event or for a course or for something, see if that works, then . . .
Michael: Or for travel, like, flights and hotels and things like that. You got to get to . . .
Andrew: That’s a really hard one to make money on, though.
Michael: It is tough.
Andrew: The affiliate commission is pretty low. You got to find a big better affiliate program. But searching for affiliate programs is still a good way to generate sales. Take your idea to hostgator.com/mixergy. They’ll give you a super low price. You’ll be tagged as a Mixergy person, which means they’re going to take especially good care of you because I know that we stand behind all of our listeners. HostGator.com/mixergy.
All right. Treadmills was not the answer. You went to a site called . . . Was it BizBuySell? I never even heard of them.
Michael: Yeah. They’re still around and still pretty big.
Andrew: What did you do with them?
Michael: So, when we sold treadmill.com in January 2015, we had one employee that was working for us at treadmill.com. And for any entrepreneurs out there listening, like, really good employees are hard to find. And I did not want to let this guy go. I felt like I can build another business around with him just because he was reliable and did a really good job and understood e-commerce at this point. And I understood e-commerce at this point and I wanted to do more with e-commerce.
So I had another whole set of criteria now at this point. Like, I learned all these mistakes of running treadmill.com, so now I wanted like small, light, easy to ship products that didn’t have a shelf life, that didn’t have a new model every year because it’s a pain in the ass. Like, you’d spend all this time and energy creating content, video content and picture content, we’d fly out to the manufactures and take all these videos and photos of the equipment and then 9 to 12 months later it was obsolete because they come up with a new model. So these are all the things that I took into consideration and I was looking for any other e-commerce business that kind of like fit these criteria and I found icewraps.com.
Andrew: And so you bought it for how much?
Michael: I bought it for 50,000.
Andrew: And they had sales and customer list, the whole thing . . .
Michael: Yeah. They’d been around for seven years.
Andrew: . . . but they weren’t doing well.
Michael: They were not doing well. They kind of run into the ground.
Andrew: What platform were they on?
Michael: At the time, they were on Yahoo Stores.
Andrew: Okay. So that’s a mistake. What other mistakes as you saw them did you noticed that they had that allowed you to straighten the company out?
Michael: Yeah, man. I think my hypothesis was that the platform was the biggest issue because I’m an SEO guy. I’ve been doing SEO for a long time. And I will look at like SEMrush or one of these types of tools and I saw their traffic just kind of going off the cliff and I was like, “You know what? If I get this thing off the Yahoo Stores and just redo the content, it should bounce back.” And it did and it ranked really well for a long time and then we switched from BigCommerce to Shopify. It’s going down over the last year, which is really frustrating.
Andrew: Yeah. I’m looking at it. It doesn’t have much traffic and that’s what it is.
Michael: Well, it doesn’t need a lot of traffic because it’s like highly motivated buyers. People are . . .
Andrew: It’s all search. 70% search, 30% direct according to SimilarWeb.
Michael: Yeah. And so I mean, like the things that we do get traffic for, the conversion rates is off the charts. But what ended up evolving was a big Amazon business like the sales that we have on icewraps.com now in comparison to that brand’s sales on Amazon.com.
Andrew: So, for a long time people were searching for ice wraps because they are runners, they are athletes, they need some ice. They buy it, you ship it to them. You personally would ship it or was it the drop . . .
Michael: Yeah.
Andrew: You would ship it out to them. SEO was what got traffic to the door. What else got customers?
Michael: Yeah. I mean, it was all search traffic, all organic search traffic.
Andrew: Did you do anything else, any interesting marketing or was it writing posts. It seems like you’re big on posting.
Michael: Yeah. I mean, we wrote articles about tennis elbow or should you use hot or cold therapy, things of this nature. But the vast majority of it was people typing in like wrist ice pack. We ranked number one at the time. Now we’re like number five’ish for a lot of the terms we . . . Like I said, we’re falling backwards which is frustrating.
Andrew: Here is one of the search terms that you guys are big for. “How long for knee . . . ” What is this? “How long for knee swelling to go down?”
Michael: Right.
Andrew: So that’s . . .
Michael: We did a content about that which definitely helps. But if you look for things like knee ice wrapper, wrist ice packer, shoulder ice wrap, those are other terms that we rank for. And the search volume in the traffic isn’t necessarily super high, but like the conversion rate is off the charts because it’s people that are looking to solve that problem like right now.
Andrew: Why do you think that switching to Shopify hurt you guys?
Michael: The one . . . Shopify and BigCommerce are both great platforms. There’s a long debate we can get into about both of these. It’s kind of like the beta and VHS wars of the ’80s, right? Back when videotape was a thing. Beta was better but VHS won. And I think that BigCommerce from a technical standpoint, it’s actually better in a lot of ways, but Shopify has won because they’re bigger and there’s a big ecosystem.
We had other businesses that we set up on Shopify and our company, now that we’re like an $8 million company with a bunch of employees. We wanted to standardize everything. And the reason specifically that Shopify isn’t as good as BigCommerce for SEO is because of their URL structure. So you go from having mywebsite.com/product to having mywebsite.com/shop/collection/product, so it makes it . . .
Andrew: I see. So I’m on one of the ice wraps. The URL is icewraps.com/collection/icewraps/products/ and then the name with hyphen.
Michael: Yeah. It’s ridiculous. I mean, it’s ridiculous.
Andrew: So it’s just not as good for SEO.
Michael: Yeah. Yeah.
Andrew: Okay. So you started with one. What was the next step once this thing worked? What else did you do?
Michael: So IceWraps turned into a seven-figure company within the first year. I mean, it did really well. But we started learning more there. You know, it’s like life’s a learning process and journey, so we had taken everything we learned from Treadmill, applied it to IceWraps, and then as we were in that world, we learned a couple more things. They were subtle. Number one, we didn’t want to sell other people’s products anymore. We wanted to sell our own. We wanted more control.
Number two, we wanted products that people were passionate about because word of mouth advertising with ice wraps is really tough. You’re not going to go, “Oh, my God, honey. I put this thing in the freezer and it got cold.” It’s not really that exciting. You don’t necessarily share your aches and pains with somebody else and how you solved that stuff. That’s kind of one of the things that’s just private amongst most people. But coloring as for instance is something people love to share. And I don’t get it because I don’t color, but people that are in the coloring as a hobby they love sharing their drawings and talking about their stuff and it did really well. It was also we’re riding a wave as well.
Andrew: What do you mean by coloring? Like . . .
Michael: Coloring books.
Andrew: Coloring books for adults.
Michael: Yeah. Coloring books for adults.
Andrew: That was becoming a really big thing, so you guys got ColorIt, that was your site?
Michael: Yeah, we bought colorit.com, created our own coloring books, our own gel pens, markers, pencils and use that passion angle and the fact that there was a Facebook audience that we can advertise those products to and built another seven-figure brand out of it.
Andrew: I’m going to col . . . A typo. Colorit.com. You guys hired someone to create the blank coloring books?
Michael: Yep.
Andrew: How did you know what to do since you’re not in the space?
Michael: I’m pretty resourceful. I mean, I looked at other stuff that was out there. And my thing . . . I took it back to the days when we were doing online poker and it was . . . I didn’t want to just copy everybody else, I wanted to create something that was new and unique. So I looked at . . . We spent many months looking at the industry and basically at the time everyone was making their books on the same process that you would make a Stephen King paperback novel on. Not the best paper or the size footprint of a book to make a coloring book out.
So I was like, “You know what? We’re going to make a book with a hardback cover that’s going to make it so people can color in their lap and protect their artwork. We’re going to print single-sided, so when you color it doesn’t ruin the backside of the page. We’re going to perforate the pages so you can take them out of the book and be able to gift them or frame them. We’re going to make a spiral binding so the book will lie flat and not constantly trying to close on itself when you’re coloring.” And all this stuff had never been done before. Now you look around and it’s all done. But we made a very unique and better product.
Andrew: And Michael, that’s a high level of empathy with the customer that you don’t personally relate to. I just spent an hour talking to Seth Godin about empathy and understanding customers and how tough that is and how most of the businesses won’t do it. You did it. How? Were you calling up people who are . . . When you say resourceful, walk me through that. What did you do? They told you this is the new product that you should be creating?
Michael: I mean, some of that stuff seemed obvious to me. I would say half of it was just like, obviously, like, it doesn’t make sense to have . . . Because I would buy the competitor’s book and look at it and be like, “This is dumb.” It’s like the stem paper and as soon as you take a marker to it, it bleeds right through four pages.
Andrew: Did you actually sit and draw?
Michael: Yeah, yeah.
Andrew: You did. You were filling it in.
Michael: I did. It’s embarrassing.
Andrew: I don’t see Michael Jackness is sitting in and actually filling . . .
Michael: Yeah, I know.
Andrew: But you did it.
Michael: I know. Yeah, I did.
Andrew: You colored in colored books, make sure you stayed inside the lines, the whole thing.
Michael: Yeah. Yeah, yeah. It was not my proudest moment.
Andrew: I think that’s fine. Actually, you know what? I have to tell you. I thought about because maybe it’s just a quiet thing for me to do, still my mind, give me something to focus on. I don’t doodle anymore, but I know that doodling used to help me think. I just don’t use paper. Okay. So you were doing it and you said, “All right, I start to see some of the problems.”
Michael: Yeah.
Andrew: And it’s not hard to frankly print out books, right?
Michael: No.
Andrew: You can do that easily.
Michael: Well, it was actually harder than you might think because . . . Well, it was for us. We knew nothing about printing at the time. So we couldn’t use any of the services that are out there, but there’s all these services like print on demand that make it really easy to create your own book and self-published but not with the spiral binding and not with a hardback cover and not with like special artists paper. So, like, these are all things that we had to go figure out and we had no idea how to do it. We literally started calling, again, calling the front desk of a printing press and trying to figure out how to make this happen. And we couldn’t do it with an example because it didn’t exist yet.
Andrew: You were doing it.
Michael: So my cousin is actually the face of the brand for ColorIt, and she was the one that was her responsibilities. So she was making those phone calls.
Andrew: And you guys own the business 50-50 or you hired her?
Michael: 75-25.
Andrew: 75-25. 75 for you.
Michael: Yep.
Andrew: All right. And so now you’re starting to get some traction, right?
Michael: Yeah. It was pretty fast. I mean, once we released it, we knew we had a hit. It actually became . . . The problem, like a lot of entrepreneurs have, it became not “Are we going to sell these?” it was “How the hell are we going to fill all these orders?”
Andrew: But how did you get people to come into your site?
Michael: Facebook ads.
Andrew: That’s it.
Michael: Yeah. Facebook ads.
Andrew: It wasn’t a lot of blogging. You did have some blogging. Amazing . . .
Michael: But not at the time. I mean, when we first launched it was all nothing was there. I mean, now the site does really well from an SEO standpoint. We rank on the first page for like gel pens even, I mean, which is a pretty competitive word. But at the time, it was a brand new site that had one book, so it was tough.
Andrew: Okay. And that’s when you finally started to get your mojo. Create your own products, own your destiny, have it on a site, get good at SEO, all the stuff that you knew was now starting to come in.
Michael: Exactly, yeah.
Andrew: At what point did you say we’re going to start to document this process?
Michael: Actually, during the IceWraps phase. I was a member . . . There’s a community called eCommerceFuel which anyone that’s listening is in e-commerce, I highly recommend checking them out. A guy named Andrew Youderian runs it. And I had found out about that somehow through like the grapevine of being on other forums or chat groups or whatever. And I joined that community and I realized pretty quickly that it was interesting because I felt like I was so far behind the curve and I had so much to learn, and I still do, for sure, and I did then, but like the technology component was something that I realized when I joined that forum that I was ahead of the curve on by quite a lot.
Andrew: What was the technology component that you were ahead of the curve on?
Michael: Being able to just run Shopify and design a store and conversion rate optimization and the search engine optimization part of it and the marketing, running Facebook ads.
Andrew: And people didn’t know all that.
Michael: No. Yeah, I mean, most people find that to be overwhelming. Here’s the thing that’s interesting about our business versus most e-commerce entrepreneurs. Most e-commerce entrepreneurs are coming to it from, “I’ve got this widget that I invented or that I’m really passionate about, or this is like a family business that we’ve had for years. And I know about these products but I know nothing about how to sell them online.”
And I came at it from a completely different angle. I came at it from a, I know how to do online marketing. I know online technology. I didn’t know how to do e-commerce at the very beginning, but that was a very small leap from other things I was doing and I was coming at it from a very analytical standpoint of, “This is what I want to sell for these following reasons.” And because of that I think that we had a leg up, and we still do. And so when I go to speak at events and things of that nature, I’m usually still talking about that component because most people I’ve realized find that part to be overwhelming where for me it just comes naturally.
And for me, because there’s always two sides of the coin, the thing that I struggle with is the products that we have because it was a very analytical thing and not a passion thing, it makes it difficult. Like, my passion is like making happy customers and being prideful at the products I make, but I don’t color. At the end of the day is not the same feeling that I had when I was dealing with online poker. You can understand, like, the idea that I lived and breathed online poker regardless. Every morning when I got up, I was going to go do that anyway, like, I own color. So it’s a different angle.
Andrew: I get it. All right. And so then how did you find the next product? Why didn’t you say “What am I into? I’m into podcasting. Let’s create a podcasting site. I’m into . . . ”
Michael: Yeah.
Andrew: You don’t think that way. You think about, “Where’s the big revenue? If I don’t love it, it’s fine as long as there’s a big group of people who do love it.” Am I right?
Michael: I mean, yes and no. I mean, the reason I didn’t get into some of the things that you just mentioned there. One of the things I struggle with in other parts of my entrepreneurial life is like, you want to get into everything. Like, you chase two rabbits, both will get away, it’s kind of like the saying. So I was like, “You know what? I need to stay focused on e-commerce. This is the thing that I’m doing and if I get off on one of these other tangents, it’s just going to be bad for everybody.” So, we’ve continued to focus on e-commerce in every way. So it’s, yes, we have more than one brand but like, the reason we got into more brands is because we ran out of products to sell for the other brands and we just . . . There’s only so many coloring products you can offer so we had to come up with another brand.
Andrew: What was the next brand?
Michael: The next one after that, we actually launched two basically at the same time Wild Baby and Tactical.com and has an e-commerce brand with it as well.
Andrew: So I thought Tactical was the biggest one before we talked, and then you set me straight when we were chatting. I said, “Look, I’m not seeing a lot of traffic for it. How can this be your biggest brand?” You said, “It’s not.” What is the biggest?
Michael: So, from $1 volume, it’s IceWraps. It’s basically like in order of how we started. So, like, IceWraps is the first, so it has the biggest volume by far, then ColorIt, another seven-figure brand, Wild Baby, definitely not a seven-figure brand yet and other is Tactical, but they will be.
Andrew: I get Tactical. I’ve actually thought . . . There’s a guy in my audience who probably doesn’t what me to mention his name. He doesn’t like attention. He’s doing really well with the . . . So what is it called? Not survive . . . Survivalist, the stuff for . . .
Michael: Survivalism. Like, prepping, homesteading.
Andrew: Yeah, for prepping. It’s shocking how many people believe the world is going to end or that the country is going to go through a big issue and they want to be prepared.
Michael: Yeah, prepping.
Andrew: It’s shocking how unprepared I am. I should be. I’m in San Francisco, earthquakes hit. But I get it. What I don’t understand then is Wild Baby. There’s so many sites for babies. How do you compete in that space, dude?
Michael: It’s tough and quite frankly it’s kind of the least interesting brand within our company now. These are some things that when we launched. We launched Wild Baby and Tactical at the same time. I wanted to float a couple trial balloons out there and see what would happen from a marketing perspective. The idea was the next brand that we really take all the way down the path and really focus on and we didn’t really know what that was going to be. We wanted it to have basically like an unlimited depth of SKUs, so like baby . . . You can do like an unlimited number of products the same thing with Tactical.
Andrew: Got it, because with coloring books, there’s only some of the products you could have, but when it comes to babies, there’s an infinite amount of stuff that you could get for babies.
Michael: Exactly.
Andrew: Like look at this. It’s on your site. I’m a dad. We’ve just gone through this period. So everything here makes sense to me. I never saw a striped kids Poncho. And the kid looks cute in it. It makes sense. I don’t know if I’d get my kid to wear but I like it a lot. So you’re saying, look, if you could get to the poncho level for toddlers who can barely stand up, there’s a big market here and that’s what you were going for.
Michael: And we also wanted to be able to take what we learned from ColorIt and apply that to the next thing. So, again, our direct Facebook audience you can advertise the people who have kids, you can sell them more than one thing, the kids have a tendency to continue to grow and need more clothes, more toys, whatever. But we are struggling with that brand, quite frankly. I mean, it’s been . . . It’s not the same response and success that we’ve gone on with Tactical, so we’re going to be building some . . .
Andrew: You don’t have kids, do you?
Michael: We do not have kids.
Andrew: Yeah, I get that sense from this that this is from someone who understands kids without actually having them.
Michael: Yep. It’s definitely a lot to that, right? I mean . . . But I understand the tactical . . .
Andrew: I don’t know why. There’s something that. There’s something that’s spot on and still . . . I don’t know.
Michael: But we do have someone that works with us that does have a kid. Julia is like our friend that lives in Guatemala. All this stuff is sourced down there because we were looking at fair trade products. But what we’ve determined after doing this now for a year kind of side by side is the older demographic is kind of what we’ve excelled at now, but the 45 plus people because they . . . I mean, this is going to sound awful, but it’s the truth. They fall for the marketing gimmicks easier, right? I mean, like a younger millennial sophisticated . . . they’re more sophisticated online. They don’t like really buy into like the giveaways or the contest or free plus shipping offers and all these things that’s . . .
Andrew: More jaded, more cynical, less willing to do this stuff. Yeah, that makes sense.
Michael: So we’ve struggled with the marketing tactics that we’ve had success with on Wild Baby because of that, and with Tactical because it’s typically an older audience, the same exact tactics that have brought us success with ColorIt have worked incredibly well with Tactical.
Andrew: Okay. I get that. How do you compete now in a world with Amazon when you’re doing e-commerce?
Michael: It’s tough.
Andrew: Part of it is you’re jumping onto Amazon, right?
Michael: Yeah, we do sell on Amazon.
Andrew: You’re selling on there.
Michael: But it’s funny.
Andrew: But I . . .
Michael: I’m sorry. Go ahead.
Andrew:No, you go ahead. I want to learn from you. I know what I know.
Michael: I was just . . . So, like, when we started in e-commerce we were 100% off Amazon and we’ve now turned it into this, like, 85% Amazon behemoth. Amazon continues to grow at a faster rate than anything that I can do off Amazon like no matter how hard I try. It’s good and bad. It’s good from the perspective of, to get sales on Amazon requires significant less staff and effort because the traffic is already there, like people are already looking for these products on Amazon. The downside is a very similar situation we have with online poker, we were ending up in this too many of our eggs are in one basket situation that makes me uncomfortable. So, like, that means at any moment Amazon could completely wipe our business out. Good, bad and different how that might happen, but it worries me.
Andrew: There’s lots of different ways, right?
Michael: Lots of ways.
Andrew: They take the thing that works best for you, turn it into house brand, stick a few people on it, and suddenly they’re selling it. They decide that this works so well. In fact, they don’t even have to decide anything. I’ve interviewed people who have software that helps other people find out what’s selling well on Amazon and then they just [inaudible 01:04:02]. I’ve interviewed some entrepreneurs who do well who say, “Please don’t reveal what products are doing well because people are going to go to Amazon, they hear my revenue and they’re going to copy me.” All that stuff. And so that’s where you are. How are you even producing that kind of net margin when you’re on Amazon where it’s super competitive?
Michael: I mean, they’re still very viable products. I mean, the net margins I don’t think they’re that great. But e-commerce . . . To be in the 10 to 15% range is pretty typical. You completely net all in net margin. I mean, that’s where things fall out. I mean, we don’t sell for less than that. We’re not going to race to the bottom. We make higher quality products. We don’t chase a race to the bottom with a quality thing. So, I mean, our products, in general, are four and a half stars and above and they rank well because we don’t get a lot of returns. There’s a lot of things that factor into Amazon’s algorithm. It’s a complicated process, but the business definitely works to the tune of $8 million in sales this year.
Andrew: You know what? Let’s get some advice for you for someone who’s in the audience. Let’s suppose there’s someone in my audience who’s selling fanny packs. Apparently, that’s the thing. Right? He’s selling on their own website . . .
Michael: I think everything is generational that comes back and . . . it goes and comes back and doesn’t comes back.
Andrew: And you know what? The truth is, I don’t like fanny packs. I don’t want to carry anything. But I’d love for them to come in because they’re so practical. Okay. So let’s . . . And frankly I’m not going to carry them even if they are practical. I want to be minimalist as little as possible.
Let’s suppose that’s the thing. Someone selling it on a Shopify store. Hard to get traffic, but fine, they’re doing okay. They’re selling on Amazon, that’s where they get most of their traffic, but it’s pretty competitive. They’re getting a little clever by creating different designs for their fanny packs. They’re selling more, but they’re not making huge, huge impact. They want more money. What would you recommend they do to get more attention for their site so they could sell and have more impact to sell on Amazon? Let’s take them as a proxy for other people who are in e-commerce in my audience.
Michael: Yeah, that’s a great question. Fanny pack is a challenging one because it might be something people aren’t very passionate about, right? So, I mean, the things that we’ve had success with are things that people would want to tell others about, and fanny packs is kind of like on that line because like, it is kind of a fashionable thing, so like they might kind of Instagram about it or tell their friends or people can visibly see that they’re wearing it.
So, if I was going to be getting into that niche, the first thing I would be mapping out is thinking about like who are the influencers and the players in that space and be looking at their products and looking at all the competitors, getting them in, fully understanding just like we did with coloring book like, “What can we do to improve the product in that space, like not just make the same thing over and over again?” Especially if there’s anything you can copyright, trademark or get some sort of IP edge in your favor. We’ve done that with a lot of the things that we’ve done especially for ColorIt.
Andrew: Beyond ColorIt, what are you able to lock in that way?
Michael: So all the designs immediately are copyrighted. Any of the pages.
Andrew: So, if I put a design on my fanny pack, that’s mine now.
Michael: Yes.
Andrew: I make sure I create my own, don’t just . . .
Michael: It’s interesting that you mentioned that. On clothing, this is like the one niche that that doesn’t apply to. So, if I make a t-shirt design, you can’t copyright that. I don’t know if that applies to a fanny pack or not, but it definitely does for a coloring book. But maybe it’s a patent on the clips that hold the strap together or the way that the zipper works. Maybe it’s like the zipper when you shut it like, somehow it can’t be open easily, so something like a thief can’t like open it and steal something out of it easily. Something that would differentiate yourself that you could apply some sort of design patents to or copyright or some . . .
You don’t have to talk to a lawyer, but like, make sure you understand something you can get some IP edge on, so it isn’t just easily copied. You’re still going to play whack a mole with people that are going to want to do it anyway, but if you can make something that’s different and better and people understand that and have value in that difference, you’re going to have a much better chance for success than if you just go to Alibaba and buy the same fanny pack that every . . . Because like, for the most part, most of the stuff that’s on Amazon is an exact copy of the other stuff that’s already on Amazon.
Andrew: And so when you do it, would you look at the other Amazon reviews for other fanny packs to see what people don’t like about it? Would you look to see what people are excited about? Would you call up customers or for you is it more about gut and instinct?
Michael: Looking at other reviews is like 100% of the part of the process that we go through. And when I was talking about like, how we knew how to improve coloring books, that was one of the things that I did do. I did look through . . . I read through hundreds if not thousands of reviews of a whole bunch of coloring books to see what people were complaining about.
Andrew: What were they complaining about?
Michael: The biggest stuff that we saw coming up over and over again was double-sided printing, was the spiral binding like the book not laying flat.
Andrew: Right.
Michael: And so those are the things that we decided to work on actually.
Andrew: Got it. It does make sense. You were sitting down, looking at Amazon, seeing what people are complaining about, finding a way to create a better version of it and selling. Are you running late? I know we’re going a little bit over our time.
Michael: I’m good enough that I didn’t realize we could take a break, but I am running . . . I don’t have the key to lock up. Can I have just one second to make sure that the . . .
Andrew: A key to lock up?
Michael: Yeah. I don’t have a key to my own office.
Andrew: Go ahead.
Michael: Let me just make sure. I can stay for longer. I just need to make sure . . .
Andrew: Okay. We won’t go much longer, but go ahead and do it.
Michael: It’s [inaudible 01:09:46]. Okay.
Andrew: Speaking of poker . . . Go ahead. No, you go ahead. I’ll just talk to the audience. We’re not editing anything out. I’m going to keep on going. I am doing poker. Now my kids are four and two. I used to do poker night here in San Francisco all the freaking time, in fact, even in Santa Monica. Now, the kids are a little bit older, they’re going to go to sleep and I’m doing poker tonight. I invited some people over. I ended up with 16 people in my house. That’s not the size poker game that I usually like to do. We’ll see how that happens.
I’ve been doing scotch tonight again, so if you guys are coming into town, let me know about scotch night. I’m doing it, inching my way towards it. I used to do it every single Thursday but I think I can’t get to that point. And for me, a lot of it is to just get to know people who are in San Francisco. I love that when I have a question about a guest I could ping somebody and get some feedback on them.
I didn’t do this with you, Michael, but I had a couple of questions about other guests. I love that I could find somebody in my network because I do poker here in San Francisco. I can ping them and say, “Hey, give me some insight into the guy. Give me some info about that guy. Tell me about how it’s working here and tell me about that.” It’s incredibly, incredibly helpful. So that’s why I was saying that I do poker here and tonight I’m doing poker in San Francisco.
Michael: Nice.
Andrew: Next week I’m doing poker again in my house. We’ll see [inaudible 01:10:59]
Michael: Don’t invite me to your game. It’d be a big mistake.
Andrew: You know what? I think you’d be bored.
Michael: I’m kidding. I’m kidding.
Andrew: I intently do it to bore people like you. I try to get my buy-ins to be $5 buy-ins, let the competitive spirit be the thing that keeps people engaged. But not so much that they get distracted. Where do you live?
Michael: San Diego.
Andrew: San Diego. All right. I’m not doing poker down there, but I’ll do scotch night over there later in a few months. Whenever I’m invited to an event, I do scotch night at the event. I get the biggest suite I can get, do scotch night. I’d love to see you.
Michael: I’d love to join you for that. That would be awesome.
Andrew: Yeah, there you go. We were talking about how you then started to read the Amazon reviews, look at the issues, create products, and then . . . Oh, I love that story. Tell me this. How much are you doing in the coloring business? How much in revenue?
Michael: It’s like going to be this year 2.5 to 3.
Andrew: And then that seems like a high-profit business.
Michael: It’s better than IceWraps, for sure. Yeah, we definitely . . .
Andrew: What’s the profit on that?
Michael: It’s probably on the higher like on the 15% edge versus the 10. I mean, IceWraps . . .
Andrew: Wow. I wouldn’t thought that would even be more because it’s just . . .
Michael: On the net profit. So we have a lot more . . . Well, I don’t know like how much it . . . It’s so hard to measure some of this marketing stuff, right? So, like, we put a lot more effort with ColorIt into marketing than we do with IceWraps.
Andrew: Okay.
Michael: IceWraps is very much more commoditized product and there’s not a lot we can improve. On the ColorIt side, we put more in the effort a marketing by sharing more user-generated content, creating more Facebook ads, writing more content. So we end up with expenses that are hard to measure directly but we kind of have a sense of the halo effect we get by writing some of that content. And some of it you keep doing this because you’re scared if we stopped doing it what the negative effect could like, down the road. I mean, like, what happens if we start . . .
We do this thing every week called Color It Live, which is a weekly Facebook Live that we’ve done for the last like two years. We’re at episode like 100 and something. What if we stopped doing that? There’s a couple hundred people that come every week. If we stopped doing that, like, how much is our sales go down? Like, how much does it hurt? Like, the core community of our members are probably the ones that are doing the word of mouth advertising for us on our behalf and they kind of just fade away. So there’s a lot of things that you can’t directly measure but you get a sense that they’re worth it, but there’s definitely an expense to doing that stuff. So, yeah, we could get our net margins up for sure in a short amount of time but then what’s like the long-term effect of that? Like, when and how does it affect the top line? It’s hard to know.
Andrew: Why are you doing the EcomCrew? You don’t look like a guy who needs attention. I need attention, that’s why I’m doing this.
Michael: Everyone loves attention, right?
Andrew: I don’t know. A lot of people don’t.
Michael: It’s definitely not the attention.
Andrew: A lot of people don’t have the hole in their heart that needs to be filled by other people paying attention to them.
Michael: I’m going to give you the honest answer that’s going to sound like BS because I know when I say this, it sounds like BS. But when I was doing online poker, the environment was you couldn’t tell anybody at any time about anything you were doing because they will just stab you in the back or steal your idea. Everybody was going after the exact same thing, the exact same term. Everybody wants to rank for online poker.
In e-commerce, it’s like these multi-trillion dollar behemoths of an industry. Even if somebody were to compete against me selling coloring books or ice packs or baby clothing or tactical gear, I’m never going to have 100% of any one of those niches. I don’t profess to even try to do that. And if you can listen to my advice and the only thing you’re going to do is, like, copy the product that I’m doing and try to compete with me, if I let you beat me, I feel like that’s my fault.
But the genuine thing is that like, I love helping people. Like, it’s the same reason I do a lot of other things on my own personal life to help people and do things. It’s a really gratifying feeling when someone walks up to me and says, like, “You’ve changed my life for the better. You’ve changed our business. You saved our business. You helped me quit my job and do something else.” It’s really flipping cool. And it doesn’t negatively impact me in any way, shape, or form in any business that I do. It’s a pretty unique spot to be able to do that and that’s why I do it like, wholeheartedly. It feels good. I mean, there’s a lot of science behind . . . It feels really good to help others. I mean, you hear that stuff a lot like a lot of these clichés sayings and it’s been true. It really has.
Andrew: Yeah. You do one-on-ones with people too who join your program. I don’t have much info about your program, but I’m doing some research now as we’re talking. And I could see that Andrew from eCommerceFuel vouches for you guys and you do one-on-one sessions and you’re teaching a lot. What’s the number one thing . . .
Michael: I have a pee tape on Andrew though, so that doesn’t really count.
Andrew: Oh, really? No, he’s probably okay with that. He would publish it. I had him on Mixergy. I thought it was really interesting that in his group he said, “I’m going to limit access to my group to people who earn a certain amount of money,” and then he just kept popping it, right?
Michael: Yeah.
Andrew: So, if you want to be in eCommerceFuel, you got to earn certain amount. For you guys there’s no minimum or maximum, right?
Michael: No. We haven’t capped it on either side.
Andrew: So the people who come in, there’s got to be one or two things that they all come in . . . mistakes that they come in making that you help them fix.
Michael: I mean, it’s . . .
Andrew: What are some of the easiest?
Michael: It’s a really, really wide range of stuff that we’ve helped people with. I mean, some people are coming in as complete neophytes and it’s like, “I’m just overwhelmed. Like, how do I . . . What label goes on? What part of like the product like on the product, the case, the palettes?” I mean, just getting started on Amazon can be . . .
Andrew: What goes on the palettes? They’re at that level.
Michael: There’s palette labels.
Andrew: And you’re helping with that.
Michael: Yeah, yeah. Well, and whatever questions people have, we help them, but that’s part of like subscription that we do.
Andrew: And manufacturing? Do you guys help them find the right place?
Michael: We do all that. Helping them pick a niche, helping them find the manufacturer, how to do inspections.
Andrew: You go inspect your factory?
Michael: We do.
Andrew: No, you inspect the product that comes in.
Michael: Well, I mean, we don’t actually do that for them. We just tell them “Here’s the company . . . ”
Andrew: No, I mean, your product. You’re actually going out there and like the baby equipment?
Michael: For sure. I personally don’t. We hired a company that goes and does that. Every order to get . . .
Andrew: And they go China and they look at the factory on your behalf, they make sure the things are good, and then you take possession of, say, the baby products?
Michael: We take possession after the inspection has been done and we approve the order. Yeah.
Andrew: Okay. And then you look at it. You actually have somebody go in and make sure that everything’s the way it’s supposed to be.
Michael: Correct. Yeah.
Andrew: All right. For anyone who wants to go check you out, it’s ecomcrew.com. It’s also Terran. What is Terran mean?
Michael: So Terran just it means human race or whatever. It’s also a race on StarCraft. I get asked if that’s where it came from originally. It is not. I wanted a short, one-word domain name to make our conglomerate, and it’s just cool to have with a T-E-R-R-A-N six letters. So, I mean, that doesn’t mean a lot.
Andrew: Terran.com. It just happens to have some meaning but for you it’s just a . . .
Michael: It’s just holding company. Like, no one ever goes there. The only time we ever really seen anybody there is when we’re hiring. We have like a little About Us page and make it look like a legitimate company even though we’re a complete shit show behind the scenes, but . . .
Andrew: Let me see. I get that. I looked you guys up on Glassdoor. I don’t think I thought to do that. I was really obsessed with your traffic. I was trying to get a sense of whether you guys are doing . . . I don’t know how to confirm your revenue. How can I con . . .
Michael: Well, I can send you my taxes.
Andrew: Done. Where are you going to send it?
Michael: I probably wouldn’t send my taxes. I probably would send my P&L. But we’re definitely going to hit 8 million this year.
Andrew: All right. Thanks so much for doing this interview and I want to thank the two sponsors who made this interview happen. The first is a company that will help you hire if there’s anything that you guys need. I’m telling you, Michael, it’s going to stick in your head. At some point, you’re going to go to them. Toptal, T-O-P-T-A-L. Toptal.com/mixergy. And for hosting . . . Almost everyone at this point knows HostGator. I don’t even know why they’re paying me, but they just re-up for next year, bought even more ads.
Michael: Awesome.
Andrew: So it must be doing well.
Michael: They’re really good.
Andrew: They really are good and I know they look at their numbers all the time and I know they see how long Mixergy people sticking around and they actually signing up or whatever. I’m glad they’re coming in. They and Toptal in for big, but Sachit who sells our ad said, “We do not want to be dependent on anyone big advertiser. Even if they want to buy more ads, we’re going to start to look for other advertisers,” and so he’s got a bunch of advertisers. I love that the dude is like super fired up.
He called me up yesterday, “Andrew, you got to hear all the sponsors. We got a bunch of them.” But Toptal and HostGator are coming in for the most because they’ve been doing so well. So, if you’re listening and you want some social proof, I guess I don’t have it. All I could have is, look, they’re not buying a bunch of ads from us unless it’s working for our audience. Toptal.com/mixergy. Michael, thanks. I’m glad that we got to meet each other.
Michael: Definitely. It was a pleasure, man. Thank you so much for having me on.
Andrew: You bet. Thanks. Bye, everyone.
