How Jake Found The Perfect Products & Scaled To $1 Million

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Welcome Back to the capitalism.com podcast. I'm Ryan Daniel Moran and today we're going to be talking about choosing the perfect product. No matter how many times I talk about it, the most commonly asked question that I'm asked is what's a good product to sell? Or what's the first product that I should sell? So today I'm hanging out with one of our members, Jake Lovas. And Jake started his business after listening to the podcast and reading my book 12 months to 1 million. And he took his first product to $50,000 a month in sales. That's pretty darn good. It got my attention and I invested in his business through our fund, the capitalism.com fund. And after a few months of using that capital and using me as an advisor, he grew from $50,000 a month to over $200,000 a month in just a few months. So Jake comes on in front of our members inside the 1% and he's sharing why his product was so successful. And you're gonna notice something in this episode. You're gonna notice that what he did wasn't out of the ordinary. It wasn't crazy. It took a little bit of thought.

A little bit of research, and it.

Gave him the confidence to know that he had a million dollar product. If you combine what you learn in this episode, we with what we teach about building a brand, you've got something special. And that's what caught my attention about Jake too. He's good at thinking about what product to sell, but he's doing it within a container of building an amazing brand. You're gonna hear about that in this episode too. If after watching this you're thinking, I wanna do this. I wanna build my million dollar brand. That's what we help entrepreneurs do inside of the 1%. Which is where this episode was taken from a coaching class inside the 1%. You can start your road to $1 million@capitalismics.com 1. All right, let's go hang out with Jake. Good morning, Jake. How are you?

Good morning. How are you guys?

Great to see you, my friend, as always.

You too.

Your beard looks even more impeccable than usual.

Been letting it grow since Texas.

Good man, Good.

Justice. How much time did you get to spend with Jake when he was here in Austin?

Oh, I gotta, we sat next to each other at the dinner. I, I mean, by the way, had a blast. And like, Jake's just the man. Like, I, I know I've shared this with, with Jake, but during the, the fun meetup we had, we had all the people that we've invested in come up and share a little bit of where their brand's been since investment. And I heard him talk and I literally walked up to Ryan and I go, oh boy, he'd be a great coach in the 1%. Because he's just do. He just was like preaching about how he's just following the plan and how he's had this success. And so I just, I'm a huge fan of, of Jake.

He's the man. Me too. Well, Jake, why don't we start here? You were on the podcast that. We didn't know it was going to be a podcast episode. We were just doing a kickoff call because we had just invested in your business and we took that kickoff call and we made it a podcast. And it was very well received. But most of the audience, unless they're in the fund or the back room and they were there live, they didn't hear the update about what's happened in your business since we started working together just a few months ago. So give us the skinny on what's happened in your brand since that podcast aired.

All good things, honestly. Yeah, we had the meeting and then we got the funding, which was huge for the inventory constraints that I was having. So after the podcast was when we could really focus on quarter four how we wanted to. And I was speaking with Sam and we got the inventory in just in time, like two weeks before Black Friday or so. We were able to do that with the funding and just get like tens of thousands of units in and we just had a monstrous Q4. So it was. Yeah, it was really awesome. We were going from like 50k months there because we were like just constantly running out of inventory while simultaneously trying to scale the business. So there were some concerns, constraints and we solved them. And then yeah, December alone was like over a $200,000 month. So it was just. Couldn't be happier.

So you were doing $50,000 a month or so and running into that hamster wheel of just running out of stock, running out of stock, running out of stuff. We solved the one thing and then December comes around and you have a $200,000 month.

Yep, exactly.

Was there any more juju than that?

No, it was just in process. Just solved some problems here. So it was beautiful.

So what, how has, how have sales been since then? We just completed January. So what. What's gone on since.

Since Q4? Pretty good. As everybody probably knows, January, February are going to be like the slowest months of the year. But as far as slow goes, we're still on cruise control doing like 4, 500 a day or so. So getting over those 120k months, just being steady, so then that'll just pick back up throughout the year, especially over summer, into Q4 again.

So.

Yeah. And did you do a million dollars in sales last year or will this be your first million dollar year?

This would be the first total million dollar year. Last year we capped at about 850.

Okay, perfect. And. And half of that was Q4 right after we.

Yeah, massive, massive portion of that.

Yeah. So 50% of your sales came just after working together and having proper capital in place and proper structure and property inventory amounts in place. And now we get to kick ass from here.

Exactly. Yeah. We were anticipating maybe like 500,000 for the year and that was like a high goal. And then. Yeah, we blew it away after we were able to solve the problems. Yeah.

You're. You are engaged, correct?

Yeah, recently.

Okay. So what does your fiance feel about all this?

She seems to be very happy about it. I mean, she's a hard worker too. She's a school psychologist, so has some wild kids to handle. So she's working all the time too. So it's kind of like both of our personalities are like, just get to work. So she's, she's happy about everything.

Good. Justice. I know you wanted to bring Jake on to talk a little bit about, you know, he's coming on as a coach and getting a little bit more involved and is very open about his. What, what strategies have worked for him. So why don't you introduce him to the audience and kind of take it from here? Yeah.

You know, Jake, especially with us coming with the perfect product formula and me having so many conversations with the people in the 1%.

I.

When I heard you, I was like, we've got to have him interviewed on, on the podcast because they, they kind of needed to see how this guy went from like, hey, hearing about how you can do something, finding out the right product. Like, can you tell us a little bit about the beginning process of you, like, starting this brand, finding that product and then that, that investment in the product. How did you know it would work? How did you know it would sell? Can you share a little bit about that?

Sure. So I, I started back in early 2019 and I was still in school at the time. I went to school for mechanical engineering, which really doesn't mean anything for this building a product, I assure you. So don't let that deter you. But yeah, I was in school and I knew I wanted to go into business. I've been kind of geared towards that my whole life. And I was looking towards more of a product centric focus about what I need to do, what I need to create. And it really, when you just focus on something to sell somebody, it kind of stalls out. So it was like trying to pick the ideal customer. And I just kind of decided to pick myself. So I knew if I solved a problem that I had, I mean, other people would probably have it too. So at the time, I was working this job at a geotechnical engineering firm where I would have to drive around the city all day, like, hours in the truck. I was just realizing, like, how uncomfortable vehicle interiors really are to just drive around all day or even short distances. Like, there's a lot of annoyances. And one of those annoyances was like, would always have these big water bottles and I would just toss it on the passenger seat of my truck. And it's always when I was stuck in traffic and would slam the brakes and the thing would roll off onto the floor and then you couldn't reach it to take a drink. And I was just getting pretty annoyed with it. So I was like, okay, there's like the light bulb moment of like, okay, if I have this problem, I'm sure everybody else does too, because I would see the hydro flasks and the big bottles just everywhere all the time. So sure enough, like, that problem had already been sort of solved. Like, you'd go on Amazon and they would have these cup holder expanders that were just friction fit designs. And you could tell they were selling they had some decent, like, amount of reviews, but the reviews were not good. You could tell there was a hole in the market because the customers were still unsatisfied with the product. So I started looking at a lot of the reviews, seeing like, okay, everybody's having the same problem. Like, this cup holder expander just falls out of the cup holder. So. So I was like, okay, if I can solve that problem for around the same price point as these people are selling for, there's no reason they wouldn't buy mine instead. So kind of got to thinking and we came up with this guy was the first one. So it has this expandable base here. So as it comes out, it grabs your cup holder, fits a variety of them, holds it tight, don't have to worry about it anymore.

So I want to summarize. So far, you started with something that was annoying to you.

Yep.

And then you started looking at solutions, finding where those solutions were insufficient and you filled that gap, Correct?

Absolutely.

And I want to, I want to edify something you're saying here because.

Trevor Blake, an acquaintance of mine had, was not an entrepreneur until he was in his mid-40s, then had three nine figure exits over the course of his of 10 years. So from 45 to 55, had three nine figure exits from not being an entrepreneur. He said to me once, the secret in his mind to knowing that your product or your service is going to win is not if you are passionate about it, is not if you think there's a market for it, not if you think that it's going to be hot, but if the absence of it annoys you.

So very simply, his, his, his advice to entrepreneurs is you start with something that really annoys you and that's the seed of a good idea, that's the seed of a good product that is going to win. This just annoys me that I can't get X. That's when you know that you have a good idea. So I just want to edify that. Like people who wonder like what should my first product should be. Yeah, you, you just did it right. Started with something that annoys me.

Yeah.

And I want to, I want to hit on something. You said a few things. There's like so much stuff in there that I was like, oh gosh. But you, you kind of glossed over. You said, you know, if I just focus on the product, it just kind of stalls or what did you mean by like when you said that? What did you mean by that? Because I think that's something that a lot of people have a hard time understanding.

I think the best way to describe it is maybe an example of like someone who really gets into a very heavily Amazon centric business where they don't talk to the customers, they don't relate to the customers, they're kind of just looking for data points on the next thing to sell. And from my experience, most of the time that just ends up in a competition war and a price war to the bottom and you really don't know what problems to solve next. So you're constantly having to copy other and it just doesn't work out that way. I don't see that as a sustainable way to like build a good sellable business or a brand.

Jake, like you're preaching, I'm the one that talks with all the Amazon sellers that are trying to now create a brand. And I'm like, you have to adopt this mindset. You have to understand this mindset. It's a different mindset. It's not something you can solve. Just going to Jungle Scout and all these other places is like, you actually have to hit on this pain point. You have to think about this person. And so you also kind of glossed over the research you did, which I think is another thing that a lot of people gloss over is you went and read Amazon reviews. Is there anything else? Like, what were you trying to draw out of these Amazon reviews?

What.

Was there any other kind of market research that you, that you did that kind of gave you more confidence? That, like, yeah, this doesn't just suck for me. Like, this is. This is actually a kind of a universal pain point.

Yeah, I use some data, too. I just think it's. It's not the most important thing. But I, I wanted to make sure the reviews were essentially other people having the same issues that I were, just for a confidence standpoint of like, okay, this is a good problem to solve. And, yeah, a lot of times they will. So that, that was before I had the audience. So I was kind of looking for sources to kind of tell me, you know, like, what's the problem? What do these people want? Like, what can I solve for them? Type of thing. And it's ended up being the same problems that I was having. So it was just reassurance at the time. And now these days, as we're building our audience, I can kind of use the audience for that instead and just talk to them directly. So it's all just kind of, you know, that snowball effect of it gets easier as you go.

This is, this is so good. I want to kind of transition over to this other place that people have this huge, like, it's overwhelming to them. Approaching manufacturers, like, just talking to manufacturers. Can you tell us a little bit about that process? If you approaching manufacturers, having this idea, where do I go? All of that stuff, could you share.

With a unique product? Right. I mean, Jake, he's not white labeling. He's not white labeling a supplement or a food bar.

Yeah.

Like, there's. You. You were making tweaks to this. That, that is a huge mental barrier for a lot of people. It's like, I get that I could, I can grab a spatula from Alibaba, but talking about what I'm going to change to it, that's. That's definitely a mental hurdle. So I'm glad you asked that.

Justice.

Yeah.

Yeah.

I. It is much easier than you guys think if you've never done it before. I, I promise you, like, the. These manufacturers want to create the product because they want to make you money and they want to make money, so they're like, pretty easy to work with. I would say Alibaba is still a great source for my product. That this base portion, the expandable base, that wasn't anything new. They had those already for phone mounts and other things and cup holders. And I was just like, okay, you can just use this to better secure my product. So I really just combined two things that already existed. So when I did that, I just went on Alibaba, found a few manufacturers that were already selling those expandable bases, asked them some basic questions. Are you willing to work with me on a custom project? Can we do custom tooling? Can you help me with design if I need manufacturing processes, things like that? Every single one was very willing to help right off the bat. They'll do a lot of the design for you for free just to have your business. I really just vet them on best communication practices and things like that. Get a good feel for them, pick them, and yeah, good to go. They'll help you out the whole way.

So you said something, and I think that echoes something that I hear Ryan say all the time, which is like, hey, you're the hot girl at the dance. And you said something here that I think we forget when we approach manufacturers is like, we make them money. When we come with something that needs to be made. I think sometimes we look at it as like we're asking them, like, would you please work with me? Like, can you do this? When we're actually the person that's coming in, it's like, hey, without my idea, you don't have anything to manufacture, you don't have anything to create. And you get paid to create what's in my head. So I love that you just shared that. Was there anything that you did during the manufacturing process to build audience to like, this is another huge hurdle, which is like, what do I do while it's being manufactured? And so you're not just going out and getting a supplement that can just be, okay, we're manufacturing it. It'll be to you in. In two months. You have something that they have to work on, you have to go back and forth on. So what were you doing in between that time that they were like, making your product?

So at the time, I was building a very small list of people to drive to Amazon to get those initial reviews. Because as Ryan says, you don't need this massive list of people. You need a select amount to get those first five star reviews. And really get some traction and then it takes off. At the time when I created this one, I was more Amazon focused, so I didn't do a whole lot of the things I do now. But yeah, as you do it now, definitely everything Ryan lays out is literally the perfect plan. It's start building that community, start driving traffic to it, start talking about it. Just document the whole process. As you guys were talking about Damian, I was reading his post last night. Awesome stuff there. Document the whole business as you go. People love it. I, I love watching it. It's like, it's cool. You feel like you're a part of something. You're part of this inner exclusive circle to build this business and people just can't seem to get enough of that stuff. So if you get enough people there, you don't need as much traffic as you think to really get it to take off. Because once you plug yourself into the algorithms, they'll do the rest. You know, they'll say people want it and they'll present it to customers for you.

And Jake, I want to highlight something that's in your mindset about this, which is you have a specific person in mind, even though you're selling a cup holder, right. And, and, and, and that fries some people's brains, like selling a product that is a cup holder, but you've got a specific person in mind. And you've said, you said on the podcast you want that person to be like the white collar weather tech. And so how, how did you think about the person while you were so focused on getting the product made? How are you able to balance those two ideas?

So I, a big thing for me was actually kind of getting out of the building, they say, and actually like talking to the customers. So, yeah, crazy, right?

I can't believe you would do such a thing.

I know you're crazy, Dick, but it's a necessary step because, I mean, when I was launching the product, I even had the wrong idea about who I was going to sell it to because you get like these, you kind of pick maybe another company that's way up there and you kind of instinctively just try to plug yourself into the market and maybe you start copying them a bit, even if you do it like subconsciously. But what I realized is what all these other automotive companies were like, branding towards with these like blue collar, rugged male type things. It didn't really work for what I was doing because everybody I talked to that loved the product, they all had like a hydro flask or a yeti, and these were more like maybe urban, outdoor people, things like that. It was a lot more females involved and everything. So I was like, okay, this is like a really good blue ocean here that you could pursue. Like, this is a very underserved market and they're not spoken to very well with any current branding at all. So that alone just made me really pumped to go for it in that respect, as in, like, there's an opportunity here. And sure enough, yeah, there's tons of other products that these other companies are not thinking of because they're not thinking of that as their target customer.

So that was what convinced me to back your brand, was I think I said in the intro to our podcast, I don't normally invest in cup holders. You know, like, I don't like product businesses. I like brands. But you're a unique exception of you were thinking about the brand from the beginning. So would you. So that people can see the mindset behind it, would you share a little bit about the vision for the brand and what it will become beyond just this first product?

Sure, yeah. As Ryan said, I've been speaking about it as the white collar weathertech. So I'm going to stick with vehicle interior accessories for a while until it maybe makes sense to branch out from there. But for the near future, that's going to be fully the focus. And we're really just doing all products that center on organization and space utilization inside vehicles. So I really getting to know these customers, most have dogs, most have kids, they're living this family lifestyle. Sometimes road trip, maybe it's just a daily commute. They all seem to have the same frustrations. Vehicle interior is constantly dirty, gets dirty quickly. It's not organized. There's things everywhere. The kids are fussy because they don't have certain things within their reach. Like all of these pain points that I've been documenting along the way are essentially just a new product to help them solve these problems and make their lives easier.

Yeah.

Did you guys just see that ad? Did you guys just. That ad was just. This was. I just saw an advertisement right there, like a commercial. Just because he knows his person so clearly. He's like, I just saw this family going on a trip, putting their big cup holders. I already know, like, where they're at in the wealth bracket. Like, I can already see it. And there's so many people that come and go, like, hey, what kind of ad should I do? What can I do on the creative? He has so much of this because he's so clear on his who. And I'm I'm almost not even thinking about your product right now. I'm just, I'm. I'm like seeing this, which is powerful.

It's so great.

So I can, I'm like, yeah, I can see why Ryan backed. Because you're so clear and your, your products are just rolling out even, man, you know, there'd be some sweet. I could see it. It is the weather tech. Oh, my gosh. How do I invest? Is there any. This is.

I love that question. Justice.

The marketing becomes a lot easier too, when you understand it too, because you're talking about an ad hook. It's like, I understand the pain point immediately. So it's like just demonstrate the pain point to hook them in, and then your ads perform better too. So really, that foundation of getting to know them is just, it's very, very important.

So, Jake, I told you in our first call, I was like, hey, you know, this is a $5 million brand. Easy if you just do the work, right? And you were doing $50,000 a month when we started, right? And I was sitting there taking notes. You were going through your business, and I said, oh, this is you. You know, this is a $5 million brand. Like, if you just do it. And you were like, yeah, yeah. And I was like, no, like, it is. It's not like it could be, or you hope, like, this is a slam dunk $5 million brand if you continue to follow this plan. I was like, very direct with you. No, I need you to understand. You like, you got it. It's. This is done. Just keep doing the work. And you 80% believed me. But I think that conversation did shift something in your mind, because I saw the way you thought about things after that change, and then you have these rocket ship months. So my question is, where do you stand now in believing that this is a 5 to 10 million dollar business?

Yeah, you're exactly right. I was a little hesitant at first. Those big numbers were a little intimidating. But, yeah, at the moment, and really, really going over the vision, just every day, I fully see, I, I want to take it to minimum 10 million. And I think it's, yeah, very easily doable.

So I'll, I'll tell you just as an anecdote. I started working with Jason Franciosa a little bit closer when he was doing about 80,000amonth in sales. He was in this group going through, doing the grind, going through all of this. I think it took him a year and a half or two years to get to that $80,000 a month. And and when, when I said pretty much the same thing to him, which is like you're right on it. Like you're, you're right on it. And then he grew to like 120, 150. And I had one conversation with him, I remember on a Cap Inc. Call where I said, so Jason, let's just run some numbers. You're at 120, 150amonth.

If you double, you're in striking distance of a mid 7 figure high 7 figure exit. So the 8 figure exit isn't that far away. It's like if, if you just double and it might take you a year or two years to double. But when you are spitting off a million to a million and a half in ebitda, which is what he would pace at those numbers, you know, you're in striking distance. You can sell for 6, 7, 8 million bucks at that point. Now if all that happened is that, is that you double. So like the eight figure exit was like pretty close. Now of course he's, I think he did he just have a million dollar month? He just had some wicked milestone like he had like an 800,000month or something.

I bet.

Yeah. And that was, that was eight. Like we had that conversation 18 months ago. So he not only doubled, he, he like quadrupled so he could sell now for an eight figure exit. So when you, when you can see it that clearly, and I know a lot of you watching, just, you can't see that yet. I'm just pre paving for you. When you can see that and you start building toward it like it happens, it can happen really quickly. So Jake, in your case, I said to you, hey, this is a $5 million business. When you were at $50,000 a month, so you'd have to 10x but you doubled. No, sorry. You quadrupled month over month within a few months now you're still pacing more than a doubling of that pace that out another year we could have another double, which means we're already in striking distance of the 8 figure exit. Like you see how those numbers play out? Oh yeah.

I love how you break it down like that too. Amazing. So much easier to attack the goal. So much easier to think about. It's not so intimidating. And you're exactly right.

Like you're right on, like you're right on pace. And I tell people all the time, you're right on pace. We don't have to catch up here. We're right on pace. And I want to say this to all of you who have been in this game for, like, three years and you feel like you're behind, you're probably right on pace.

Yes.

And I mean this because you spent three years calibrating, learning, discovering, and when it lines up, it happens so fast. Fast. So you don't have to worry about being behind. Just know that when it lines up, it happens really fast, and you're in the process of lining it all up. Justice, do you want to go to Q and A?

I do want to go to Q and A. Before we do, I have one question, Jake.

Just for.

For a lot of people that have come in and they're at that phase where they're going, all right, I. I think I'm clear on my. Who. Like, I'm. I'm ready to pick my products. Like, what would you say to those people just that are coming in? They're. They're ready to go on their product, or maybe they. They have a product and they're working on, like, just growing it. Is there any, like, words of wisdom you want to share before we jump into Q and A for. For those people?

I'd say even for a mindset, inspiration, standpoint, you are so much closer than you think you are. Like, all you have to do is solve just one problem for a big audience, and you're there. If you get that hero product, everything else is just going to come tumbling down at the same time, and it's going to be extremely easy from that point forward. So you're in the tough phase, but it's going to get easier very quickly.

I'm so glad you said that. Piece of advice. You solve a problem for one person. For one person.

Yep. Always keep it in mind.

One person. That's the domino. Love it. Jake, I'm really excited for you, man. Like.

We'Re gonna do this thing, dude. Yes, we are.

Justice, could we close by you and Jake sharing a little bit about what that coaching process is going to look like? And Jake.

Yeah. So Jake and I spoke a couple weeks ago, and I was like, hey, man, I need you to do this. This call with me. You absolutely nailed it. I saw you at the fun, and I was like, by the way, there's a few things I want from you. He's like, what's up? I was like, look, our community needs an amazing coach. That's been where they've. They've. They've gone. And, like, everyone knows on this call, we've got the grind, we've got the growth, we've got the gold. And I go man, you'd be a wonderful growth coach. He's like, any way I can help, this is, I love this stuff. And so starting, starting this month, we're going to be, we're going to be having him and Chad as coaches in our, in our community to help you guys move forward. And that's, that's the amazing thing about this community is like we want to move you every step forward to creating your million dollar brand. That's, that's our heart. And Jake has followed our process and has absolutely nailed it and so I, I believe Jake is excited. He has, he has said he'd love to and so yeah, Jake, you can share whatever you'd like from that, but he's coming into coaching this community. It's going to be awesome.

No, I'm pumped. I think especially the product side of things. I'm really excited to talk to a lot of you guys and really find that first hero product and get it going. I think have some good tips to offer for some good quality cheap prototyping and getting things where you want to go.

Come on man. I love it.

We're excited as well. Jake, thanks for being here. Thanks for hanging out with us my friends. Thank you for tuning in. We're excited to go on this next six week journey with you of getting your product made, identified, getting samples, getting ready for sale and it's the first step of this year long process of.

Building million dollar businesses.

Good to see all of you, talk to you soon.

See you later guys.

If you've read my book, listened to the podcast, or watched any of my YouTube videos and you're asking yourself, where the heck do I start? Where do I begin my journey to my million dollar business? We got you today. My team and I just completed a new kickstart class called five days seven figures. This is the best on ramp class for any of you who are ready to begin your seven figure journey. In this five day class, you're going to choose your ideal market, what products to launch, come up with a plan to get each one of them to 25 sales a day and you'll know at the end of the class exactly what your business is going to be, how you're going to get it to a million, and exactly what your next steps are to get it off the ground. It's a five day class class, it costs 100 bucks. And when you're done, a member of my team will get on the phone with you and review your homework directly with you. When you're ready to start, go take the challenge@capitalism.com 5 that's the number 55 days 7 figures capitalism.com 5.

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