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How he does $30 mil. / year with subscription boxes ( John Roman interview)

How he does $30 mil. / year with subscription boxes ( John Roman interview)

by Alex Fedotoff

2 years ago

So we’ve discussed so many things with John:
the launch of the subscription model
Fb advertising strategies he uses
struggles he’s gone through for the past 5 days
leveraging Facebook’s double standards
alternatives to Fb and how to use them - Snapchat, Google,

There’s so much more to that, you’ll love it! Check it out now

 Transcript from video: 

alright guys hello uh this is alex
veritov and today we have a very very
interesting guest
we have john roman so john is commerce
entrepreneur he led three acquisitions
he participated in two exits and uh his
current brand portfolio generates 30
million dollars annually so he's next
entrepreneur eight-figure entrepreneur
so i'm very excited to have john with us

thank you for joining us today yeah
thanks thanks for having me alice i'm
excited to be here
cool awesome and one of the projects
that you currently work with
you know check the all of the you know
the uh
the brands that you currently work with
working on so
this is the subscription box that you
guys are offering right
yeah so to the vast majority of
everything in our portfolio
is subscription-centric um so battlbox
was a brand we we started from scratch
back in 2015
and it's it's the main pillar it's the
the flagship if you will
and everything we've done since has been
you know based off
those learnings whether it's you know
through acquisition we've
acquired a few um decent sized brands
that are
in the subscription space and then we've
launched quite a few ourselves
launched some and sold them but um
you know really the our baseline of
knowledge comes from
from launching battlbox and you know
battlbox is
um a juggernaut at this point for us but
it's it's still about 90
subscription only 10 percent one time oh
really so 90
of all of the orders that you get like
subscription like people just subscribe
like stay with us yeah wow
how do you get to that to those
tremendous numbers right like normal
because i'm not very familiar but for me
it sounds like
wow the the in terms of the retention
and the lifetime value of that customer
this is pretty
like pretty crazy yeah no so so we're
definitely non-standard
when you look at the subscription box
you know mystery box subscriptions box
which you know the like you know the
people that started it the the birch
boxes with
with female makeup samples you know
they're what
og's look great who is kind of a round
still but not really i think they went
you know they went through
chapter 11 and got repurchased but you
know you look at all of those
and we are a little bit different in the
sense that
our average order value for a
subscription is over a hundred dollars
so our rpoo if you will is is over a
hundred dollars a user so
it's a more premium luxury subscription
it's like it's like 100 bucks on a
monthly basis people pay
yeah so our top and most popular
offering is the pro plus
which is 160 a month 160 a month plus
wow i see that it has axe in it
and so so the we have four different
tiers of battlbox the basic the
advanced the pro and the pro plus
and they they stack on top of each other
so if you get the pro plus you get
everything from the basic everything
from the advanced everything from the
and the pro plus is actually a knife of
the month if you will
or and you know knife or sharp tools so
traditionally knives but an occasional
you know occasionally something that
still kind of fits in that mold
wow this is awesome so what got you to
do like subscription model in the first
place you just seen the success you
evaluated the market
and like what got you into it or like
just attracted to the higher like
multiples because the multiples there
are probably
while you when you exit yeah so for me
it was it was probably
honestly a little bit closer to the
ladder but but the origin of battlbox
is is a very cool one so my my business
partner daniel
he's the one that came up with the idea
and the concept his uh fiance was
getting a birch box
in the mail right and he'd watch her
he'd watch her open it
he'd watch that excitement level on the
and you know he was like well i kind of
want that for myself
right so he you know he's uh he's an
avid outdoorsman and
he he jumped online he's trying to find
like a subscription box
for you know an outdoorsman a lover of
camping a lover of hiking a lover of
getting outside and getting into
adventures and
you couldn't find anything and this was
this was early january 2016
and um within very creative guys so
a few weeks he'd come up with a logo we
have a newer logo now but
it was our logo for several years and he
went to a platform that
we're also no longer on called crate joy
which is like a
very niche think of like almost like a
where it's a platform but it's
subscription box centric so it's
everything's a template makes it super
um you can throw a website and a concept
and an idea
within you know probably a couple hours
so he had quickly launched a site
in february of 2016. and um obviously
we've had a lot of revisions and
you know it's a completely different
animal than it is today but yeah it came
from a need of
him wanting something couldn't find it
so he said i'll do it for myself and it
turned out that
you know tens of thousands of people i
guess at this point
hundreds of thousands of people you know
wanted that's wanted the same thing
huh so that initial task so that your
partner launched like
did it like was it successful you
launched it on facebook or where did you
launch it initially
yeah so so out of the jump i would say
relative moderate success so in february
that first month in 2016
we had um i guess 2015. i apologize we
had 200 subscribers
the first month so it was facebook
facebook ads
you know none of us had a background in
facebook ad i came on board
and and joined um about three weeks
after launch
so we were coming towards the end of end
of february
um a combination of facebook and then
him jumping in like bulletin board
reddits if you will for like outdoorsmen
survival experts and saying hey
i'm you know i'm launching this box
check it out so there's a lot of like
gorilla old school like
feet on the street as well right and um
200 subs the first month the second one
the or was it like like or did you
expect them to kind of
turn into profit after a few months was
it profitable first months
yeah i mean so the interesting thing
about a subscription model
and this works obviously when you're
small when you're when you get to
a certain size it's it's not possible
anymore but
um you know with a subscription model
that first month is really proof of
because you're getting money from
everybody before you actually send them
send the first box out you're collecting
money for 30 days
so when you're talking about 200 of a
product you can quickly find 200 of a
product from a couple vendors
buy it with the money you've already
received money had to go on a credit
but it was momentary and um you know it
was quickly uh
paid off so there was never any debt
besides the first couple months
of just waiting for that first renewal
and then
we we all started working on facebook
ads in march
march we had a little over a thousand
subscriber sign ups wow and pretty
good like for such fresh new business
right that's pretty yeah
with us with us not being facebook
experts either facebook was a lot
different back then but still
and then uh month three we had a little
over 2 000
new signups and at that point it was it
was off to the races
i think so you would say it was almost
like instant hit 100 100
so i mean we did you know that first
year we did
we ended up doing four and a half
million in sales just to give you an
idea so it was very
definitely it was definitely a perfect
timing it was ebbs and flows of the
niche and e-commerce but it was
definitely a point to enter
and uh that in outdoor gear
was something that was trending as well
so it was kind of a perfect timing for
for a few different reasons that's
awesome so in terms of the um
obviously like things changed a lot and
then are you guys still advertising on
like you still like are you compliant
like survival is
kind of like some of the products are on
the island
yeah so it's a good question and it's a
weird story so we were
um when we started in 2015 that first
year on almost we were exclusively on
facebook right
um that was our only advertising 99 of
our traffic
came from facebook and i remember we
were this just plays to our ignorance of
not being experts at the time
we uh we're going into labor day weekend
so we're in september-ish and we're
planning to go into this weekend
we have some new ads that we're turning
on like we're
this we're expecting this to be our best
weekend we've ever had
and there's no reason why it shouldn't
be yeah and um 6 p.m
7 p.m friday evening all of our ads get
turned off
this is the first time this has happened
and our advertising
account gets canceled we we go from you
know top of the world
to zero traffic right because 99 of our
traffic is coming from facebook
we don't get back you know good luck
getting someone on from facebook on the
phone right yeah
that's a thing we're you know calling
everybody emailing everybody
trying to figure something out
we so we have a we we don't have it
anymore but at the time it was a
bulletin board for our customers and
like-minded individuals that were
outdoorsman and we had
you know thousands of people in there we
post on there hillmary
does anybody know anybody at facebook
one of our customers works at facebook
and he's in the department next door
to the team that does the manual
auditing of ads he walks over there
we're back on an hour later this is the
following wednesday
but at that point it was okay uh we're
back on but
this is this cannot happen again yeah so
our biggest effort at that point was
diversification as much as possible
so we went we went a mile wide on on
advertising and and we didn't we didn't
want anything to be
too much of a lead source we eventually
got kicked off facebook completely
oh really yeah we were banned for we
couldn't advertise at all
and we we ended up in uh
at the end of 2019 spending
quite a bit of money on a development
solution where
i'm using what we call microsites and
other domains and other facebook pages
that we were creating just for
we created a solution where if traffic
originated from
facebook or instagram they got a
completely different experience than a
normal customer
um oh you mean cloaking right i don't
know if that's the right term we were
doing things like
um the images would be completely
different we'd switch up copy
copy would be different it was just a
different a different experience if
if we could identify the the where the
traffic was coming from is that what
cloaking is i believe so yeah
okay you guys did it yeah i mean did
facebook catch up to that
yeah so we spend six figures a month on
facebook now
um we're we're in full compliance we're
doing exactly what they wanted us to do
we wanted it
they want to give a pg experience where
no knives nothing can be purchased yeah
i mean they wanted us to change the
business which wasn't an option
and it's definitely a double standard
right like we're never positioning and
our knives ever like that's just
something that exists but
we're not promoting it but you know
dick's sporting goods
spends a million with them a month they
sell guns no
yeah seriously but they're not
advertising the guns and we're not
advertising enough so it's a double
standard because if you're spending
you know seven figures within a month
they'll turn
they'll turn the their eyes yeah yeah
exactly so
yeah sometimes you see these as like how
is it even
possible these people are still you know
and i know some heavy advertisers like
doing you know nine figures a year
and if if i would try or you try like
selling the same product and say like
would get shut down like tomorrow good
new shop yeah wow so how do you guys
diversify so so you had those issues
with facebook what other platforms you
diversified to like how did you
yeah so we went anything you could think
of so
the all the logical stuff so you know
that first first year we weren't on
on google adwords now google ads
which which is mind-blowing that we
weren't on them but we didn't know any
better so we quickly got on google ads
google ads quickly became
our our number one source and then we
went on all the all the other social
channels so uh snapchat twitter
pinterest they they all have have their
um partner ecosystem went went deep on
um some some
like tv commercials didn't perform very
uh we do some print some print ads and
uh publications that are in
in the outdoor space but honestly that's
more of a
it's so difficult for tracking right and
it's it's more of a
let's just break yeah it's branding we
don't want to lose money on them
but if we're break even we know from a
branding perspective it's profitable
and then yeah we've at this point
all those things i mentioned are just
part of our
our wheelhouse and we try new stuff
we're um we're a little bit behind the
ball with it already being 2021
but we we launched on tick tock this
week finally so we're interested to see
how how tick-tock works it um definitely
seems to be a little bit of the wild
wild west
like snapchat was you know three four
years ago how do you approach
attribution like
you know using all of this channel do
you trust what platform says which
probably you know it's like overlapping
with each other you know facebook google
you know everyone says like attributes
that sail to their platform right we
approach that
yeah attribution has always been such a
if we took every if we took all the
platforms at face value
we'd be literally double the size we are
if you add up all everything they claim
together it's
twice the number we actually sold so
it's it's a challenge
what we do is we we definitely look at
on a siloed view which i know is not
some people look at it holistically and
look at the agenda
overall what is your blended cac we
still we still manage each platform
by its individual cat and what we've did
what we've done just
cross-referencing our data you know from
google analytics
from looker we we have a good a pretty
good grasp
on how much each platform lies you know
with facebook
we can typically say we know that they
take credit typically for 20
of the stuff that someone else is going
to take credit for as well
um so we bake those in those numbers in
in our cac it's a double-edged sword by
being conservative
you know our acceptable customer
acquisition cost levels
are probably much smaller than they can
and still be profitable but we know with
100 confidence
that if we hit you know this cac or
anything below
we know even with multiple people
attributing it we know that it's still
we have other channels like snapchat for
we're finally for the first time in a
few years
we've had success with it finally for
but for the first few years snapchat was
only successful for us for retargeting
other traffic that we sourced from
google or resource from facebook
or we sourced from somewhere else and it
was just mid funnel so mid finals you
know a little bit
having that different bucket you're able
to manage it a little bit different
because you're not trying to get the the
customer acquisition cost there per se
how is snapchat do you think that their
platform itself becomes better
they they just stimulate more data so
they can find buyers more efficiently or
that just like maybe what do you think
is was seeing the reason
i think i think it's all of that i mean
i think you know like three or four
years ago is exactly how tick tock is
now like it's just
you know they they get better through
their learnings and
you know snapchat prospecting was
their audiences just it was i don't want
to say a joke but it was just it just
wasn't very good
either data was not what it needed to be
and i think it's i think it's taken time
it's taken feedback you know it's funny
three years ago
i remember having a call a snapshot and
we're like like we can't keep spending
this because
there's just no return here and they're
like well you should look at snapchat is
it's just brand awareness spent
no no it's not like
yeah like great answer when the stats
suck but it was like
no and finally they through the years
they've changed their tune
and and now they understand like sure
that might work for a giant company that
doesn't care and isn't managing it
but we're we're still a small business
so we you know we're not spending unless
it's profitable
yeah it's just not we that's not not
what we do
um yeah so they finally their their
um prospecting is finally working out i
think it just
just took them some time just like tick
tock will i think
won't be where it needs to be by any
means for for a couple of years so we're
just experimenting on there now seeing
the good thing is like with you can
accidentally sometimes unlock something
like where you're getting where you are
getting a sick return
just because of uh their data and the
way they advertise works not being as
tight as it should be
as long as you can find something that
works a campaign and you can just scale
to an unbelievable point without seeing
diminishing returns but for the most
you know it's it's a lot of missing but
now now stamp's good for us
and uh we'll figure out what tick-tock
is like cool i want to talk about the
so you mentioned one of the things that
you mentioned like you guys have
acquired like two companies or a few
that kind of like became part of your
like your main kind of like company
yeah so we the first two
subscriptions we launched after battlbox
one was called barbecue box which was a
monthly subscription for uh
recipes rubs seasonings sauces
um and then the second one third one was
called spartan carton which was like a
subscription box for
fitness supplements workout gear etc we
launched both of those
and then we in in 2017 or
let's see i think 20 in 2018 we we
exited both of those you sold it to a
a company that had a bunch of e-commerce
and um you know we were at that point
on you know do we continue launching new
for both of those brands the fundamental
issue is
we couldn't get them big enough and uh
we were we were missing the mark with
our playbook of what to do
and it just what they weren't worth our
time so
we contemplated do we do we just try
this again and try to find another
battlbox another big win
or do we find a middle of the road
seven figure business that we know
we can just day one make a difference so
that was that was our focus
probably the biggest fig so we've done
it three times the biggest victory was
in the middle of 2019 we purchased a
monthly subscription called carnivore
club which is
monthly subscription artisanal meats
salamis prosciuttos things that would go
on a charcuterie board
and um you know carnivore club
was had been in business for seven years
they had been on
um dragon's den which is shark tank up
in canada they had gotten a deal
it had had success but it was it was
really kind of stagnant and growth
and we knew that just uh with
clear economies of scale where we knew
our shipping and our processing rates
and all that instantly we could affect
the even up pretty
exponentially we also knew with with our
marketing strategy that we could um
grow the business rather rather quickly
so with that one you don't have like
with carnivore club you wouldn't have
any of like facebook issues for instance
correct which was which was something
that we were
excited to jump in a brand that we can
advertise and not have to worry about
being turned off
so so yeah so you know they
they they were that and we've we took it
over in july
um 2019 and you know we did our
uh end of 2020 review uh last week and
we we've literally doubled the business
which is now you know a couple things
went our way
covet you know getting uh meat delivered
to your door
yeah i have to go to the grocery store
it's definitely something blue apron or
what's the name of that company right
like yeah blue apron so so there's
there's a lot of them and they're those
companies are massive
um you know some of them blue apron i
think has a billion dollar
company yeah but so we you know all of
meats are shelf stable so they don't
need the refrigeration
they don't need to be shipped in dry ice
which um
you know the managing of that from an
operation stand would be very very
like our storage you know we have air
conditioning and we keep it
you know temperature controlled but we
don't have it in in giant fridges that
could be
that would be costly so it's it's
slightly different than you know a blue
apron but uh
it works for sure that's awesome so so
how do you
how do you see it like in terms of this
so um
subscription business so one
subscription business so you
you're you're planning to build like a
portfolio of brands and then sell it as
a portfolio at a high multiple or
how do you or there's like inter
exchange between customers like if
customers buy
survival products they might buy the
meat or other way around like how do you
there's yeah so there's there's not
there's not a lot of
as much crossover as you would think but
there's definitely crossovers so
what our what our model is is having
all these portfolio brands that are all
very male centric and
you know battle for example is ninety
percent of the buyers are male
10 are females but out of that ten
sixty percent of them are buying it as a
gift for a male yeah it's a very very
very male centric
all the other brands are grenade soaps
another one very male-centric
going gear very male-centric carnivore
is a little bit different because
it's it's about a split of men and women
you know men
typically love salami love fatty meats
but women also love
to make charcuterie boards so it is it
is a nice
it's a nice mix but but what we do is we
we definitely share the data in between
the brands
and we have you know we have automations
where someone comes
in from one of from carnivore club or
someone comes in from battlbox
you know eventually depending on their
behavior um
to our newsletter and emails at some
our math makes a decision like they are
not going to buy
and when we know that they're not going
to buy for battlbox we start showcasing
showing them the other brands they'll
start getting email for the other brands
they'll start getting ads for the other
brands the goal is eventually to have
some product in the portfolio that every
mail wants to buy
and and just going through the list and
eventually we're going to get we're
going to get something where they're
getting like oh that's pretty cool i
want that
um so that's obviously the focus yeah i
you know i think when when you start
having all these brands
it definitely becomes attractive from
from a multiplier if there if there is
an exit right
um you know a company that does a couple
million dollars a year
that might get you know a smaller
all of a sudden because they're they're
in this big portfolio
it's it's completely fair that they
would all get the same multiplier
and uh the cool thing is that it's funny
because when we look at our team and
we're all talking
we kind of run we have the feel of an
agent we're an agency that does
everything because you know like
so walter hicks so he's been with us
for over four years at this point he
started in our warehouse
uh doing fulfillment he was in school
he did an internship a marketing
internship with us last year
came on board as our marketing
coordinator we've not just made him the
director of marketing
but he oversees marketing for for all of
our brands right
he's looking at uh him or his team is
looking at
the social calendar for every single
the the email series the campaigns for
every single brand we've everything
compartmentalized you know curtis curtis
is up in toronto
he was with carnivore club he had been
with carnivore club for four years
three years prior to you know joining us
so he's been there
close to five years now he runs amazon
for every single brand
so we have this like very agency feel
where we're all dealing with you know
four five six brands
but we're all doing what we're good at
in each one so it's
it also the day is never mundane because
you're looking at different brands and
taking our same high level strategy and
then making tweaks to it
to make it work for for each brand and
each message
it's it's interesting that's awesome so
what are typically the
the multipliers on like on subscription
um on subscription companies
let's say eight figures a 10 million
like in revenue
like subscription business what would be
like so you start looking at comparables
there's definitely a magic number when
you're when you're in nine figures
you start looking at you know some
multiple five max 5x 7x revenue right
like sometimes
yeah you like stupid that doesn't make
any sense
now i think you start talking about
eight figure businesses like us
you know depend depending on you know
depending on the profitability
depending on really the what the
acquirers plans are
where can they you know increase
efficiency where can they day one
make an impact on the bottom line i
would think you're seeing
um ebitda multipliers typically between
five and seven
x okay all right higher than like
businesses that they're like let's say
up to like five million revenue where
would be like two or three works yeah so
so our our acquisitions of the
of the small seven figures have
typically been
um two and a half to three yeah exactly
but it's it's one of those things you
know again when you hit that
like if we're able to ever hit that that
nine figure
it then it's a completely different ball
game then
but yeah i mean it's it's interesting
but you start looking at
either type of company private equity or
just very large
company that would that would buy a
portfolio like ours
and you know wow wow are you but it
might be x
and they might be paying five or seven x
at the end of the day with with their
they're making that money back in way
less time yeah they're still
they're still figuring out a way to get
you know to get back
uh their investment within two to three
just just like we look at you know the
the 3x multiplier
how can we with our efficiency make it
happen in two years
they're doing the same thing in ways
that we just we don't have the
the power to do right yeah that's very
like chile for example right that they
bought the business for like three
billion and then
they took it public for like 20 or like
did the valuation
you know the the market cap so who made
more money you know the founder or the
you know the company that
but yeah it's insane but then you look
at you look you look at those large
companies that are public and you look
at you look at their market cap you look
at you look at their uh their value in
to their revenue and you see a lot that
that are in that seven eight nine 10 11
where their value value there is is
pretty substantial uh it's a pretty
substantial multiplier of their revenue
which is interesting because then you
look at you know bad example here but
chewy being publicly traded right
let's say let's say they decided that
hey you know we want to
go to chile went public right
yeah so so let's say they they decided
that they want to start buying
e-commerce companies and be
ecommerce subscription experts to go in
addition with it right
you look at you know i almost kind of
just want to look up let's see their
i'm just curious because you know you
look at i guess i could pull it up at a
little time but
look at the revenue you look at what
what their market cap what they're worth
and it might be like 12x their revenue
right so they can buy they could buy us
for 6x and then day one
that 6x is now worth 12x yeah
they've already they've doubled day one
just by signing
so it's an interesting dynamic when you
start dealing with large companies
probably traded
that already have these very high
multipliers off their revenue in value
that it makes sense to go seven x
even up because not only can they
increase efficiency
to make the payback less but day one
it's worth double the price to them just
by them owning it for sauce
yeah definitely how is um how is your in
terms of
from the perspective of supply chain
with subscription model
how let's say because now you have like
four main packages how your kind of like
cost efficiency
as you increase the volume was this like
like decreasing in cost of goods and
services or
was it more like yeah so we so we really
um it's interesting so so our supply
um whole another story has been such a
nightmare these last few months
um just with you know we're really
feeling for the
for the first time um dealing with covid
just uh just simply because things are
staying in ports for weeks
yeah not coming in uh the process
you know were stuff that should have
been in our hands
you know 60 days ago are not here so
it's that that's a whole nother
story of just and then you know
container prices are
are up like 300 percent in the last two
that's a whole another deal but when you
going back to your question about
about supply chain um i mean there were
there were efficiencies the biggest
was when we got to the the unit amounts
and it was always dependent on different
brands and the type of thing we were
but when the manufacturer doesn't have
six thousand of something maybe five
four five thousand is like the magic
number but
you know for some it'll be a couple
thousand for some greater but when the
uh which is a brand name that everyone's
heard of sometimes doesn't have that on
on the shelf that means they need to go
into a production run
just for us so when they're going in a
production run
it definitely the margin starts to look
a lot better because they can then
piggyback that off
and and get their costs down more and
then the other the other big thing on
supply chain
when we started going to manufacturing
ourselves not
specifically ourselves with you know
finding partners and finding
manufacturers to build
specific stuff gear for us um
obviously when we did that first first
buying from a vendor that might have it
on stock
you start seeing really the the
economies of scale and the margins start
getting better and better would this
business make sense for like
manufacturing in the united states or no
so what we we try when possible to
manufacture in the us right like we
want to when we can and some stuff
um so grenade soap which is one of our
soap brands
cool cool bars of soap you can see it
back there that uh
you know they're they're shaped as a
grenade they
gives some great sense but we
manufacture that completely in the usa
grenade soap yeah grenade soap oh nice
is it on amazon we might i'm not sure i
i should know this but i don't know if
we do
grenade um oh where are they
wow that's nice to me so
you know for example for all these soaps
we we make them all in the us we have a
amazing soap partner we found in
and um you know we we were actually
last time i was in my i was in miami
last was
we were meeting a perfume company down
and they helped us come up with the
sense and then once we had that
in their lab they came up with a sense
you know we then
would send the recipe over to the the
soap maker in tennessee and they would
you know order large barrels of it but
yeah so
when we can but at the the reality is
for any products
i mean it's it's it's a sad reality that
the cost is typically too prohibitive to
have it made it made abated in the us of
right like you want to buy the us item
but do you really want to pay twice the
price people say they want to buy it but
they don't want to pay the twice the
price they want to
complain that something's why is it so
expensive well because it's made in the
united states right
um tina we're just not and we haven't
done ourselves any favor
becoming more competitive we're just not
competitive with a lot of manufacturing
it just
is what it is even with tariffs
we're still eons more expensive
i mean what have you seen have you seen
anything like that yeah this same
the same i mean those yeah those
products like
you know the cosmetics i mean those can
be manufactured
like in the united states and margins
are still like
but then yeah all other stuff that's
like requires heavy manufacturing it's
like most of the time
also we have some of our clients they
have the manufacturing in the united
states for like
apparel some custom
metal like fabrication you know those
kind of things like print on demand
so those type of things they they can be
more they can be worked out like
you know the mat is still good in the
united states but then other products
most of most of them still yeah the
products that have like
extreme high margins like apparel right
you can make it in the us of a because
there's already the margins are stupid
anyway right
it's a couple dollars for a shirt that's
selling for 30. so
it can it can cost 40 more to make it
and it still is still makes you know
tons of money and still has
amazing margins it's interesting cool so
how do you
guys you you take products from like
other brands let's say when you
when you compile the subscription boxes
you you take products from other brands
these are like your own private label
products that you just put together in
the box
um so so it's a it's a combination so we
have a couple in-house brands
uh sometimes just battlbox a few
others lord and field
sometimes we'll we'll do a grenade soap
co product in a battlbox
um and so we'll we'll manufacture those
but we actually go to a lot of you know
half the box
sometimes more is other brands we'll
just we'll just go to them
and you know some of them have have seen
and are familiar with battlbox some of
you have to explain like look
we're not a typical reseller like we're
not selling this product
we're including it in a box so we have
to educate on us
you know truly being a marketing engine
and you know we're not gonna we
can't pay wholesale rates like we need
to pay cost plus
because part of the the the value that
we give you get
you buy this 160 box but if you source
it all on your own it would be
three four hundred dollars sometimes so
you know that's part of our
part of our value add so we we can't pay
you know pay the normal wholesale rates
or we would lose money
so so it's interesting it's uh you know
as far as
as as the brands go though i mean a lot
of them have seen
so much so much value like it's it's
it's pretty cool when uh
when you get the emails from the company
like holy cal like we you know we
include this coupon code
in your box to buy more and everybody's
buying it
so it's it's interesting it's definitely
a fine a nice balance of some stuff we
but some stuff we go to go to big brands
and buy what's your
typically like how many months you know
the person you know stays with
like subscriptions it ranges by brand um
we're typically seeing
across all the brands typical is is
somewhere in the four to six month range
after that they typically fall off
i i never thought i would be like buying
subscription you know products but
i'm buying the athletic greens you know
the um supplements
and it's just like it's so convenient
try to have to think about it just like
comes into the you know comes into the
mailbox like every month
yeah i know that it's it's funny there's
so many things that like
are now subscriptions that you know we i
think covet just like how cove would
helped e-commerce
in general i think it helped it really
helped the subscription box
niche because there's so many things
that you're going to order over and over
again or you want over and over again
might as well just not have to worry
about getting buying them and they just
um you know amazon really they they
perfected this model with their
subscribe and save
yeah you know they figured it out now
ours is
different because it's a surprise and
it's different each month um
but you know if you're if you love
salamis and for sheetas and cured meats
that's good you want
you want it to be different each month
cool so slightly different topic like in
terms of hiring how do guys like
structure your team like to have
everyone like remote or
you have an office where you come
together yeah so we
so obviously we're pretty remote but
so we really we have everything kind of
in three three silos if you will
so there's come to my my own uh last
so daniel is the partner that came up
with the idea
so he has so they have an office and
it's about
it's in georgia it's about outside of
savannah about four hours south
of myself and in that office it's him
it's um our head of content a guy named
brandon curran
he's the one that's in all of our videos
um he's the funny one on our netflix
um he's there we have uh our cfo
lives about 30 minutes away so he'll
come in the office a couple times
we have another uh couple of guys there
but really that that place
the focus is content content uh
video content and then product
procurement uh gets right out of there
so they're testing the products they're
they're you know deciding what
type of purchase orders and on etc um
and then you go up about north two hours
and that's our warehouse so it's in
middle georgia
so we fulfill um everything ourselves
so we have you know that's that's our
largest of the two offices that's our
or out of our three offices that's our
largest um office just because there's
so many um employees that are packing
the boxes we all you know we obviously
um some leadership there are our co
another uh one of the the principles
um he runs that facility and then we
the guy that runs the warehouse team the
guy that runs inventory management
um jared who runs the the one-time shop
the marketplace and then you go all the
way north past me completely
up to toronto so we have an office in
toronto that
it was originally the carnivore club
office but um
you know we kept the office when when
joined us and um any of those guys
are are up there and you know max is up
there he focuses on
product procurement for all the meat
and then curtis is up there as well and
he focuses on amazon for all brands
so we do have some structured offices
you are back down to me
and my entire team is removed um
including myself
so you know we have people spread all
over uh
walter's actually in georgia as well but
you look over to luke luke um
heads up customer experience and
customer service
he's in tennessee and he was in indiana
before that so
it doesn't matter where he is in his
team all of our cs members
are completely remote too so you know
it could we we can't all be remote
because we need to shoot content
so that you know that office has to stay
in the warehouse can't be remote and up
to toronto i mean
they do some fulfillment out of there
too so they can't be removed so
any anybody that can be remote that's
not actually physically needed is
um so we're almost in a hybrid model if
you will
that's awesome so was it before recorded
or after they call it when you kind of
like adopt it like this
we were always in in a hybrid model i've
been remote
you know since since the beginning cool
what would be your main
like three pieces of advice you know
considering like all the mistakes
you probably made some mistakes along
this journey what would be your main
like three pieces of advice
to let's you know say entrepreneur who
is let's say at
six seven figure level he wants to scale
up to eight
and wants to build you know the valuable
business what would be your
main like three pieces of advice sure so
you know the we made the mistake when we
small seven figures but in in general
it's laughable and it's definitely the
biggest mistake we ever made is that we
dependent on a single lead source
to to someone that's doing that now
that has been fortunate in our case
lucky enough to get to seven figures on
a single source
like don't wait for it to stop working
right you don't want all your eggs in
one basket like
immediately always test off um
like some stuff you know has work that
we didn't think would
and then some stuff hasn't worked more
you know but test
everything try to diversify as much as
you can
on on resources and don't wait like
it's easy to say oh we'll look at that
one next month and just keep pushing it
try to try to spread yourself as wide as
try as many different advertising
avenues as you can and when you find
um and that's the second piece when you
find something
don't like slowly scale it scale it as
fast as you can
you know we made that mistake we were in
in 2015 we were acquiring
new subscribers for for five dollars a
why why didn't we why didn't we clear
out our bank account
max out every single credit card and
scale that as much as we could
we got 2 000 new customers our third
month we could have gotten 30 000
wow now you know now now we're we're
giving high fives
when we're acquiring a customer for for
a 20x that
not not even 20x i take it for a 10x set
um and it's just it's that that's
something that
now when we find a new lead source that
works we still
you know tick tock for example if we'll
do testing for the next couple months
but if we find something that works
that's profitable and we're confident
that the attribution's right on it
because the customer acquisition cost
makes sense
we are going to scale that 100 as fast
as we can
as fast as possible dump as much money
into it as possible
like there's no there's not any like
slow scaling
like um because you don't know when it's
gonna stop working you don't know
when they're gonna when that platform's
gonna make an algorithm change
and your campaign strategy isn't as
effective right
you've seen through the years so many
uh you know facebook's the worst at it
something is working just great and
we're getting like a
7x return on ad spend we're like this is
great and all of a sudden
something changes in that same campaign
that was getting a 7x getting a half
half a x and we're killing it and we're
like what happened
so i mean i think just going as fast as
and that goes into the third piece too
it's um
i i think entrepreneurs especially when
have other stuff going on they like to
talk and strategize and come up with the
sometimes they spend too much time on
and they it takes them six seven months
to execute
like get it half right get as much of it
as you can the bare minimum the mvp
get what you need to to start and and
and go and keep course correcting keep
getting better
keep aiming and um
yeah i think it's better to to jump
right away
and make those course corrections and
slight pivots
and changes and take those learnings in
six months of strategy to launch then
it's not doesn't work
and then and then what you're gonna then
make pivots i think
people in general sometimes are scared
to pull the trigger
it's not everything to be perfect in
reality it's never going to be perfect
ever so many of the things we've
launched look
so vastly different from what they are
today just because we find learnings
this isn't selling this we're not
getting acceptable customer acquisition
okay what's the problem we need to
change price point do we change
offering does the does the val value
proposition need to change
like let's start let's jump in if it
doesn't work let's try to fix it
and launch again and run ads again and
just keep going
um as opposed to six months of deciding
what the price point should be now
go and if you're wrong you can fix it um
that six months you could have lost your
opportunity right
such a good point um a lot of great
thank you so much john i know you're
busy man you guys are running multiple
and uh thank you so much for sharing
this insight so
how do people find you how do people
connect with you so
you can search search my name on
linkedin it comes up um
you guys can connect with john yeah i
have a
job as i say i have a of a blog
so i give random tidbits of insight
things we're seeing working things that
aren't working venting and frustration
as well
just just my blog but it's a lot of good
stuff there
awesome awesome yeah we'll share it also
in the comments
thank you thank you so much for jumping
on this guys thank you so much for
i hope you got a lot of value from me i
personally got a lot of you know
insights and a lot of perspective and
especially you know from the perspective
of you know the subscription business
as a whole because i thought it's like
it's kind of like oversaturated right
you know i i think there's like there is
a lot of opportunities the same way you
have found the opportunity for your
brand right like
you know in that space there's probably
opportunity for the subscription brand
like in
in different like areas in different
niches yeah
the opportunity is in the niche for sure
and then and all of ours have been
very been very niche it's just it's very
competitive so
niche is niche is the way to have
success cool thank you so much
john and thank you thank you
thanks so much have a good one thanks
for having me thank you
hey thank you so much for watching this
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