Launch & Scale: Finding Untapped Potential In Your Audience w/ Khierstyn Ross #FreedomFastLane

You can have the coolest Whiz Bang product ever. But if I don't immediately see that there is a group that wants it, or you've got an audience that wants it, I don't care. I mean, I don't. I. It doesn't catch my attention. Good ideas are plentiful, but demand is finite. Build a business. Invest the profits. I'm Ryan Daniel Moran and this is is Freedom Fastlane.

Hey, fastlaners. Today's episode is from the Launch and Scale podcast with Kirsten Ross. Kirsten helps entrepreneurs launch and scale successful physical products businesses using crowdfunding campaigns. To date, she has already helped raise more than $3 million. In this talk with Ryan Daniel Moran, they discuss how most people get it backwards instead of focusing on the product first. Ryan explains how you can discover your perfect audience to sell to and goes into his process for attracting untapped audience potential. Enjoy.

Hey, guys. Welcome to the Launch and Scale podcast. This is episode 11, what seems like my third attempt at trying to introduce this powerhouse of an entrepreneur, Ryan Daniel Moran. We just agreed to make this introduction awkward and we're just gonna. We're just gonna roll with it, guys. Most of you have been involved with or know of Ryan Daniel Moran and his work, and if you do not, be sure to go to capitalism.com he in the last 10 years got into Amazon, learned how to quickly see opportunity in physical product companies, build them up to multiple seven and eight figure brands, and now he's helping hundreds of entrepreneurs do that as well. And really, I can go on, but that is in a nutshell, essentially, if you are serious about building a physical product company and getting into the space and essentially building and flipping brands, Ryan's the guy to follow. So, Ryan, I'm just stoked to have you on the show.

Thanks, Kairos. I'm really excited to watch everything that you have put together. Has the nickname Kairos stuck yet? Is it official now?

Funny enough, it has been my nickname since I was 18.

Oh, I thought I coined it and now I'm just disappointed in myself.

No, actually my phone number ends with K. Ross because people are just like, you know what, I'm not gonna say your name because it's impossible to say.

I'm gonna. I like the story where I came up with it when we were in Austin together. I'm going to roll with that.

Sounds good. You know what, we'll just say, wow, Ryan, thank you so much for that nickname.

You're welcome. You're welcome. I'm glad it stuck.

K. Ross fam if you're listening on the podcast, be sure to subscribe and YouTube. Click subscribe and check out Ryan's channel as well.

Man, gosh. Where do we start?

Ryan and I go back a few years and I was thinking of what do I ask this guy that has so much experience and, and expertise in identifying opportunities with companies, quickly scaling them, quickly flipping them. And it's like at first I was like, you know what, I thought I would ask him about how to create a physical product company. And I'm like, no, everyone has asked him that. So what I actually wanted to do was to focus this interview on more the few things because you have your hands with really deep with sourcing new products, identifying new opportunities for products, scaling brands. I want to talk about a few things. I want to talk about the counterfeit problem in China. I also want to talk about how you handle sourcing from China, if you even do that anymore. And what are some systems that you have put in place with your clients as well as your own businesses to ensure that you're able to quickly scale to a point where you're, you're creating a great company that is built to sell.

Really, I'm ready. So I want to paint just a hair of context for a second because before I was in the product world, I was in the information publishing world. So I learned about video sales, letters, email marketing, search engine optimization, building audiences, some social media.

That was before. It was cool, if you will. Now I see it coming full circle again, where you have a lot of physical product people who are diversifying by building funnels and trying to build audiences. For me.

That'S where it starts.

A lot of, I think physical product people, especially Amazon people are spoiled. They're just completely spoiled by the gravy train of sales. You put a product up where there's a bunch of customers and you get into the river of sales and then you say, now the hell what? And for me, it all starts at the beginning stage. It's how are you building the audience and how are you actually marketing the business? So there's some things that I know you want to ask me that I'm going to go back to. Look, I look at this through the lens of a marketer. I look at this the lens of someone who is focused on scale, not someone who is focused on product development or. I have never been to China. I have. I don't consider myself the head of product. I'm the head of the company. And the head of the company is in charge of vision and Scale and direction and ensuring that the company never runs out of money. So just to set some context, my lens, my filter is to look at it from the lens of a marketer and as a CEO, not as an Amazon guy, not as a product person, not as a sourcer, but as the founder of a company. And I think in this crazy world of Internet businesses, we confuse a lot of different roles and like to call ourselves founders when really we have an expertise in one specific area.

So how much of your.

First off, how many businesses are you active in physical products? Like.

Two, three. I have ownership in five and I'm active in three.

Okay, so where a lot of, where a lot of your day to day may be spent overseeing as a founder and a marketer, essentially these physical products, how much of the early success of brands would you say is about picking the right product as opposed to being able to market, market it properly?

You know, I was, I was at sellercon a few weeks ago and someone said from stage, picking a product is the most important decision that you will make. And I laughed audibly. I mean, it's important what you sell is important, but it is not nearly as important as who you sell to. I mean, all we have to do is look at big conglomerates. If you look at toilet paper, there's a lot of different toilet paper brands. It is more about what is different about the toilet paper and how they're marketed than it is about should I sell toilet paper? And the idea of what product should I sell is like answering that question just opens up the next set of challenges that actually matter. So I think the choosing the right product might be 20% and how you market it, how you differentiate it, who you sell it to is the rest of it. Sometimes your product isn't even the problem, it's who you are marketing it to. And you are not the problem. It is who you think the customer is that is the problem. And switching those things can completely turn a business around.

Do you have a litmus test for identifying early stage? Like I don't know how much of the front lines you do anymore, but even people on your team that go out and identify new opportunity, do you have a litmus test for identifying the product versus audience and to see where that happy middle is, to see whether that's a good opportunity?

Yeah, so for me it's not happy middle, it's all audience. But because the audience will tell you what they demand from you, the audience will tell you what they want to buy. So I like to look at this as Sometimes as entrepreneurs, we got into this game for selfish reasons. I don't think we do many things that are selfless. So we get into this game because we want a different life, because we want to make more money, because we want more time. That's most entrepreneurs, especially Internet entrepreneurs in this world. So we're coming at it from the lens of what we're going to get out of it. And we never make the flip of in order to get what I want, we have to find out what other people want and give it to them. So we get stuck in this headspace and the headspace is what do I choose? That's a magical product. What's the magical formula that's going to get me the money? What's the best platform to launch where it's easy for me to do? And so we're looking at it like there is some pool over here that we have to plug into. And this is, I mean my community is mostly Amazon sellers. They're especially guilty of this. And I think there's a lot of, there's a lot of Kickstart Kickstarter launches that do this too. Is that like they just mimic what other people have launched and say, I guess there's money there. But they forget that if you want to build a company it is all about finding people and what people want. It's the same idea of we've all heard that it's seven times harder to get a new customer than it is to get a previous customer to buy from us again. And yet most physical product people just talk about new customers. They don't talk about follow up, they don't talk about backend, they don't talk about upsells, they don't talk about customer experience. They just talk about how do I rank, get reviews and get more front end customers. So they miss 80% of the scale that actually is possible. So I am looking all at audience, the way that I evaluate if something is going to hit at the beginning stages. Is there a pool of people who are demanding this or not? I am not looking at you can have the coolest Whiz Bang product ever, but if I don't immediately see that there is a group that wants it, or you've got an audience that wants it.

I don't care.

It doesn't catch my attention. Good ideas are plentiful, but demand is finite. So I'm looking at demand in the form of eyeballs and audience.

Only. And I'm not looking at product.

So you would say your sweet spot is existing Market. But then how do you. What is the, I guess, one thing or the strongest indicator that you have found that audience with that need? Like, is that Amazon reviews, for example? Or like, what is that platform that says there is a fit?

Yeah, it's an audience within your control. You do not control Amazon. You do not control Kickstarter. An audience within your control. An audience within your control is not Amazon. An audience within your control is not Shopify. An audience within your control is not Kickstarter. An audience within your control is an email list. It's a social media platform. It's people that you can contact on demand and they show up and they listen to you. That's an audience. That's where you can get feedback on product, on scale, on features. That's where it is. So tools like Amazon, Kickstarter, Shopify are great product research tools where you can look at differentiating factors and what people say, but it does not mean that when you go to market, you've got a group of people waiting to buy it. And I'm looking for that. I'm looking at how do we manufacture the line out the door at the Apple Store when there is a new launch. That's what I'm trying to. To identify. That's when I know I've got a good opportunity.

Perfect. And when you. I'm trying not to get too gritty here, but one example you use is your first product business, I think, was in the yoga space. So what came first, the audience or the product? Did you develop a Facebook group around the person being yogis, we'll say, and then figure out what they like and then bring a product to them? Or did you say, I'm gonna focus on a yoga mat and then build up the community?

Yeah, that's a great question. So this was 2013 and I basically invested in the yoga business and was mentoring my partner. And we chose that the first product was going to be a yoga mat. So it was product first. And as soon as we placed the order from China, the question was, okay, we've got six weeks. How do we, how do we storm the gates? Where is the audience going to be? And at the time, there was organic reach in Facebook pages. I think this was even before Facebook groups. And so we bought a minimal amount of traffic to a Facebook page and built up buzz to the point where we had people waiting in line to get that product. And so you can certainly, if you, if you've got the product and you're already taking sales or you've at least pre Launched it. Then your next step is to go, okay, I got to build a pool of eyeballs in order for me to have a pipeline of, of buyers from now until kingdom come. And so, so most people get stuck on the platform rather than manufacturing their own demand. You do that through marketing. You do not do that by optimizing for a channel. So there are two different approaches. But yes, you can always go back to step one and build up the audience so long as you know who that audience is and what they want. And we identify that by simply asking the question, who is the person who is buying this? Rather than what are people buying? So a quick example is I do, I do workshops at my house once in a while. And, and they're, and they're 10 grand. 5k up front. 5k when you make your first 100k. And my favorite thing is when people come back because I don't chase people down. It's like when I love it when people come back and like, I owe you 5k. Yes. It means it worked again. And I've got, I've got this one like this last week somebody contacted me and was like, I owe you 5k. And the reason this made me so happy is because he had this major brain gasm. When we were sitting in my war room downstairs. So we were sitting around this conference table and I watched him have this braingasm because he was selling just a commoditized product. Let's just say it was this vase here. Okay, so he sells lots and lots of vases. And we were working on, okay, identifying who your core customer is. And he's like, well, lots of people buy vases. I mean, people buy vases for weddings, people buy vases for decoration, people buy vases for funerals. I buy vases for a bunch of things. I don't even know what this is actually. Anyway, so I finally got him to see that if you pick one specific person, you go all in on that person, you can launch more products to that person and they will carry your product to the other audiences. And he had this. I watched his whole face change because he realized that he had been stuck selling product that rather than thinking about customers. Three months later, he had tripled his business. Three months later, he tripled his business. Not because he was selling more vases, but because now he had a person that he could advertise to, that he could do follow up products to, that he could custom tailor his marketing message for. And that created a multiplication effect that allowed him to scale that like that is Entrepreneurship and most of us are just trying to sell product.

Makes sense. And what I find a lot of the Kickstarter people that come to me to learn to launch a product is they always have the product first and then they find out I need to do a customer avatar and then I have to validate my assumptions about what the person wants, that they go back to the drawing board and realize my product is completely wrong.

Uh huh. That happens a lot, right?

My product is completely wrong. So I'm curious, like you back in 2013, you knew about the person, not the product. Did you have an episode in your business early on where you learned this the hard way through a failure?

Yeah, but I only saw it in the rearview mirror. So one of the companies that I built and sold, Sheer Strength, which was a sports nutrition company, did pre workouts and post workouts and stuff like that before. It was cool.

We came into the market with products that I would have considered really innovative for the time. And we've been copied 100 times since then, which is par for the course. But at the time we were pretty innovative in the marketplace place. And at some point I think it was really when we crossed maybe 3 to 5 million when we started to hit that, when we started to hit that peak of like 5 million bucks, that was when we, I think we went into defense mode for a bit. And defense mode to me means we started launching me too. Products that were a lot like everyone else rather than going in on what our customers really want. And we started looking at where the opportunity was rather than what our core audience really wanted. And what's funny is 8 out of 10 of those products bombed. But the ones where we were really proud of what we were doing and we knew that our customers wanted it, eventually they would always take hold. You might not have the come out of the gate at 100 sales a day, but you build up customer goodwill and reviews and word of mouth and repeat customers and that snowball builds and builds and builds. And so that churn and burn approach of looking where the opportunity is bit us in the face. And it took eating some humble pie to go back to that core customer and giving them what they want.

Yep, I get that. So you mentioned a couple things counterfeit, which I want to ask you. One of the I would consider it threats to E commerce right now is China ripping off products they see an opportunity, or not necessarily even China, but just product rip offs before Kickstarters even have a chance to really become a brand. Do you handle. Do you see this in Your business.

Honestly, I see it more.

I see it more from other entrepreneurs who are looking for short term opportunities, who are just looking at what other people are selling and selling that. The way that I handle this is kind of inspired by a question I asked Tom Bilyeu on stage at the Capitalism conference a couple years ago. And what I asked him was that a few years ago when Quest Bar launched in like 2011 or 12 or whatever it was, they were the first fiber based protein bar to hit the market. And so it was perfect for macros. And then came along everybody else and he said, I asked him, you know, how do you deal with this? And he said, when you launch a new product, you've got a window of opportunity. He said it was 18 months. On the Internet, sometimes it's a shorter lifespan, but he said you got 18 months to get ahead, to get your customers and to give them what they want. That's step one. Like or like, number one, you've got 18 months before people start to copy you, enjoy it and go all in on it. It's part of the game. Number two, innovate. Always, always innovate. And to me, that's our job as leaders and owners of companies, is to use that window of opportunity to go really deep in our businesses and then to continue to innovate. And if you think that no one is going to copy you, you're in the wrong game. If, if you are hoping, if you are sitting around and hoping that it's always going to be the same, if you think that nothing is going to change, if you think that no one is going to copy you, you're just in the wrong game, you're in the wrong business. And so I just kind of take it as par for the course. I know that's not what people like to hear, but I think that is just the reality of being in business.

Do you see?

Okay, so when I get people filling out intake forms to talk to me prior to engaging our services, a lot of people say, I don't want to share what I have with you in case you rip it off or I don't know when to start talking about my product. Pre launch? Yeah, pre launch. Because of someone ripping me off.

What are your thoughts? My thoughts with that are frankly, so like, if someone knocks you off, that's the highest honor for one. But second, I don't believe that it's a threat to be copied until you have something of substance. So like, what do you, what do you say to that?

Like, I get emails from people who want me to sign an NDA and I just write back. That's adorable. I mean, the fact that you think I have nothing better to do with my time than to copy you is. And by the way, I have a billionaire mentor friend who asked me to sign an NDA and I said no and, and we moved on. I mean I, I personally just don't like them because I like to be transparent about everything that I'm doing. I get, I get that you don't want to talk about it before going to market. That makes sense only for the reason of you want to build up buzz first.

I like to build a buzz by talking about what's coming. But plenty of people want to keep things quiet so they can have a proper pre launch period, but trying to protect it so that people can't copy you. Come on. The only people that are copying you are other really inferior entrepreneurs and marketers who are pursuing any new opportunity because they haven't found a foothold in the marketplace place yet.

I love that answer. That's cool. So. Right. I'd like to shift gears to talk more about systems at scale because one thing I find is product companies go through different stages. You have the launch phase where it's just about getting the demand, but then there's a scale phase which is actually building up to, building up for growth to something maybe of a long term vision to sell the company. And having systems are going to make sure that you don't cannibalize your company, that you're able to actually leverage certain things. The first thing I want to look at is systems for sourcing as a Kickstarter or a first time Amazon seller gets that first product to market and they want to get into sourcing and creating new product. What is.

A good system that you have for identifying good opportunities that your customers are asking for to get into that product number two or product number three.

My business partner before I exited my sports nutrition company, his name was Matt. And Matt and I would argue about what products to launch or we would argue this label should be blue. No, it should be red. No, it should be plaid. You know, we would, you know, you would argue about the dumbest things because you just thought you were right. And inevitably after an hour of going back and forth, one of us would like say the safe word or the safe phrase, which was let's just ask our customers. And so we would send out surveys, or we would post two images on social media, or we would call a few of our super fans. You know, God forbid We pick up the phone and call somebody. So, man, we think we're so smart as human beings. We just think that we have the best ideas and.

Real businesses pause, eat humble pie and ask. They ask the people who are writing the checks.

One of the people that I really admire is Dan Sullivan. And Dan Sullivan says, only test on check writers, only test on people who are in control of the money. And that's your customer. So my system for identifying the next opportunity is going to the customers and asking them. I like to go back to the idea of the hero's journey. The hero's journey is someone's on a call to adventure. They're overcoming obstacles on their way. They meet a mentor who helps them overcome their obstacles and then they return home a different person. We think that we're the hero, but our businesses are actually the mentor and our customer is the hero. It's our job to look at the obstacles that our customers are going to run into on their journey. To lose weight, to get fit, to raise a kid, to make money, whatever journey they're on. And our job is to give them the solutions in the form of products and services that help them overcome those. That's our job. And sometimes that means that we have to ask them, what are you struggling with? What if we developed would be amazing on your journey? That's my, that's my product research and sourcing system. Going in and asking, okay, and then.

Once you have the product, do you do something.

Like do you do a beta group or where you source 20 products and then you get feedback from a core group of people or how do you do the actual product development side with your customer?

Yeah, I have, we would just develop a minimal viable product, do it was often a few hundred and then sell them to our list, sell them on Kickstarter, give them away, get feedback and then do a proper going to market. I mentioned Tom Bilyeu before so he's fresh in my mind. They used to do this with, I think they called it Team Quest. So they had kind of an insiders group. They would send them product at cost so they paid for their costs. They'd get that feedback and then they go and do a proper launch. So I think having some sort of internal feedback group is, is helpful. But we always knew that we were going to go to market with the minimum viable and then we were going to innovate from there.

Gotcha. You mentioned Kickstarter. Kickstarter is great for product validation, but I like to see it being used as like best case best Self company where they took a product, they turned it and scaled it into a brand. Where do you think? One thing I've noticed is that there's.

It'S one thing to have a successful launch, but a lot of successful Kickstarters fail to make a successful brand after the fact that. Do you have an opinion as to why that could happen and why a case like best Self company becomes a company versus others go bankrupt or just stop functioning?

Yeah, a lot of Kickstarter entrepreneurs are thinking up to the goal, not through the goal. So they're thinking about what their raise is going to be or how much they're going to fund and they're not thinking through there of what the company is going to be. It was kind of like back in the olden days of Internet marketing. It was really popular to launch digital products and you get all your buddies to promote it and you do a big pre launch and then you'd open the doors, you'd make a million bucks and you'd go away and everyone thought you were rich and cool. The reality was always something different because the entrepreneur spent six months of their life building up this product, arranging their buddies to promote, getting everybody on the same page of when the dates were going to be. And you planned this huge product launch and you made after refunds, merchant fees, paying your affiliates advertising costs. You made a few hundred grand, you fulfilled the product for the next six months and then you went, the hell do I do now? So you. They were. But the reality was product launches were great to start a business. They were not so great as recurring revenue machines. So you have these people in this perpetual launch mode of a launch and burn, launch and burn, launch and burn. Never actually building a real business. So the solution is to think about if we're going to use Kickstarter as a tool, what are we hoping to kickstart? What are we hoping to fund long term? What is the business that we're building beyond the first hundred K that we raise, the first million bucks that we sell? Do we know what products 3, 4 and 5 are going to be? Do we know where the audiences that we're going to advertise to? Do we know where the pool of buyers is outside of Kickstarter? If you don't know, then you're going to run into the temptation to simply build up to the launch. You're going to build up to the launch and then you're going to be done. You're going to wonder, what do we do now? That's why so many people Fail at the end of something like that, or they just go back to launching product number two on Kickstarter. And so they're caught in this perpetual hamster wheel that they never really get out of.

I love that. Launch and burn. Pretty much what happens? Because they go back to Kickstarter because they've run out of money, and so they don't know any other funding method, so they just go back and back and back.

Yes, yes. And they never really go deep into what their customers want. And so, look, entrepreneurship's hard, guys. We think it's easy because we see so many people.

Supposedly killing it. We see the front end, we have no idea what's going on in the back end, what the team looks like, how much the person works, how stressed they are. Entrepreneurship's hard, and it requires you to be humble enough to go in and serve your customers, which, if you're going into this with a selfish aim of what do I get out of it? Is really, really hard for people to do.

I agree.

Well said. My last question is, is there anything else I should have asked you that I haven't?

Yes. So many things.

Oh, no. I'll be here for the next 34 hours.

So there's. There's one trend I want to talk about that I think more people need to be paying attention to, and it is the trend of partnering with audiences to launch product lines around them. Something very magical happened when Kylie Jenner launched her. Her line, which I think is called Kylie. Right. She's now the youngest billionaire in history. Lady Gaga just announced that she's doing a product line, and it's Amazon only.

The honest company with Brian Lee and Jessica Alba was built on PR around one audience, essentially. So there's a trend happening where there are all of these influencers, there are all these audiences, and you have. And you have a lot of entrepreneurs who are wondering, how do I build an audience? Meanwhile, there are all these audiences sitting underserved because they have no product line.

If you're a real entrepreneur, it's your job to look at where the resources are and bring them together. And there are a lot of eyeballs right now that are underserved because they have no product lines around them. I think it's the biggest opportunity that no one's talking about or pursuing. And it's basically my general thesis is you start with the audience and you scale and launch to that audience.

I think more people need to be paying attention to that trend, because I think it's going to be commonplace three to five years from now, I want.

To dig a little bit further into that piggybacking on someone else's audience or current audiences that are being underserved tactically. How would you do that? Let's just say, what is one audience that you feel is underserved right now?

Oh, well, that's interesting. That's an interesting question. When I think about an audience, I'm thinking about a centralized following around a person or a theme. So I'm looking at it in the sense of. Let's just take Stay at home moms as an example here. By and large, stay at home moms are still served by large organizations. Procter and Gamble, Unilever. We mentioned toilet paper before. There aren't a whole lot of small toilet paper companies or small CPG companies. What you have instead is you still have conglomerates going after this large pool of demographics. But if we break that into smaller audiences and you're looking at influencers, you're looking at groups, you're looking at these small pockets where people hang out. That, to me, is a sign of a group that I'm going to build a brand around. It's actually the singular question I'm asking when I'm launching a brand is where is the pool of attention within this very, very large demographic? So you asked what was a group that is underserved right now? I think that the trend is for groups to be broken into who they follow, where they hang out, and where the influence and where the attention is. So moms is broken into a whole bunch of different micro groups, whereas entrepreneurs are broken into a bunch of different micro groups. And we all want to follow and be served by people like us. And so that's why I think you can build multiple brands within the same audience. Because that audience wants to buy everything from people that are developing products that are just for them. So in that sense, all groups are kind of underserved. It's a matter of can you centralize enough attention around them in order to get them to buy from you? And are your products and your systems good enough to be able to continue to serve them?

Yeah. Awesome. I think that we're gonna end it here because we can go. We can literally go anywhere with this. But I really like how these conversations. I don't really come in with an agenda. I just like to see where they naturally go. And what I really love is you've covered a lot of great points on foundational things. On it's not about the product, it's about the person you're serving. And really how to go about doing that and how to utilize underserved markets to do that.

I mean, I think we always have to default to that. We always have to remember that the brands that we're serving are being supported by people. It's not about our product. It's not about what we're doing. It's about what other people want. And our job as entrepreneurs is to constantly be looking for resources that support that person on their journey. If we don't start there, then we have, we have ruined our thesis from the very get go.

And where Kickstarter is traditionally a platform where people sell first and then build. If you want to build a sustainable company as something that truly does scale past Kickstarter or even past your first product, you really have to take that conversation a lot further into who is that person? Not necessarily only through viability of being able to sell a product.

I think that is the only way that you launch and scale.

I love it. No, thanks for putting in the brand. That's what I'm here for, right? Awesome. All right, well, guys, Ryan, if people want to learn a little bit more about working with you and even the work that you put out into the world, where's a good place to send them?

Yeah, I mean, my business is capitalism.com I help entrepreneurs build businesses and invest the profits. My podcast is capitalism.com with Ryan Daniel Moran. So I don't make myself too hard to find. I do occasional workshops with entrepreneurs at my home. They're called eight figure exits. They're about building companies to exit. And you can find out more@capitalism.com 8 Love it.

All right, well, thanks again for sharing your wisdom and I'm sure I will see you soon at some point.

Thanks for having me. K. Ross.

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