From $3K to $270M: How He Did It (and How You Can Too)

You can do it with virtually no money. If someone who has failed through life as many times as I have was able to figure it out, quite literally, everybody can figure it out. I remember like it was yesterday because you get that little Cha Ching sound on your Shopify and it is so addicting. Everyone in the world is doing a 7 out of 10. If you're 8 out of 10, you take the whole market. We did 15 million and then we did 90 the next year. And we were like, oh, we're going to be billionaires. We got into Costco, Target, Sam's Club, TJ Maxx, Kohl's. The world is giving you clues every single day on what you should be doing. It's up to you to really cancel out the noise and listen to those clues. It is so easy to make money working with other businesses and charging them a flat fee and just stacking those retainers up. My life took off when I started thinking about stacking up retainers.

What have you seen in your industry that could be an amazing business idea that people can execute on?

I have such a great one, and this is revolutionary because no one is really doing it just yet.

What would you do if your friend sat you down and said, I want to start a T shirt business? You'd probably call him an idiot. You probably tell them that's the most competitive industry on the planet with low margin and cutthroat competitors. You'd probably try to talk him out of it. Right? Well, that's exactly what my guest did today with his company, True Classic. He took a very small investment that basically anyone watching this could afford and turned it into a business doing $270 million a year without any venture funding. And he is the opposite of a gatekeeper. All of his secrets, all of his tactics, growth hacks, everything he lays bare on this episode. Also, he's got some really good business ideas for you. Please enjoy.

Music took up a decade of my life. I went to school for audio engineering, and so I thought that was going to be it because everyone told me, you're so good at music, you should do that for a living. And I just followed and went down that path. Went in debt, didn't work out, gave up, went into poker. Put another 10,000 hours into that, thinking it was going to be my future. Went broke, gave up on that. Then I went into digital marketing. And that's when my life started to take off for the better and I built an agency. Over a decade, another 10,000 hours. So between, you know, exercising the creative muscle with music and learning risk tolerance and how to bet on yourself through poker, and then learning digital marketing and building other people's businesses. It was kind of like the perfect third to third or third of DNA to really make true classic work. So the idea, originally I had a bunch of ideas, as most entrepreneurs do, and you just don't know what's going to hit. And so I had always been tinkering around with, like, the apparel industry is boring, it's archaic. No one's really crushing it. On the innovation side, I felt like men's clothing was underdoing it. I felt like the premium market was overpricing it. So I was just like, let me just focus my energy on one thing, the shirt, the T shirt for men. Let me just build the perfect shirt. Let me tighten it up on the shoulders and arms to accentuate the guy's body, make him look, you know, buffer than he really is. And then let me make a premium garment that isn't a hundred dollars a shirt, like some of the Nordstrom people that you go in there and see. And I also knew that, like, I had to solve a real problem, right? Which is, like, most people that I talk to that come to me nowadays, these, like, young entrepreneurs, they're like, I want to build a lifestyle brand. I want to do. And I'm like, buddy, solve a problem. Like, yeah, I know you, what you want to do, but, like, if you're not listening to the market and what they actually want from you, you're building it the wrong way. You're building something for you, not the market. Solve a problem in the market and your life will be a million times easier. Right? So I went into solving the premium over gouging problem, the fit problem, and then just the comfortability problem of just, like, building clothes that were all comfortable, not just a couple things, but, like, everything we make is wildly comfortable.

Yeah, because it's like, as a man your age, similar. Like, I buy a shirt and I just don't know how it's going to fit. Is it going to flame out at the bottom? Is it loose? And so when it comes to the problems you were trying to solve, was it more about the fitness, the. The comfortability or the price if you had to pick one?

If I had to pick the most important, it was the fit first and foremost. Because everything I would put on, I just felt pretty underwhelmed. And I remember asking my wife, like, why is everything in your side of the closet, like, perfectly made for you? Like, why is it all tailored? And why and what I found was that, like, I think they just thought that guys didn't care. And, you know, largely we don't for the the most part. I wanted to prove that thesis out, and I was like, look, if there's just a small group of guys that love true classic for what it is, I'm happy with that. I don't need this to be a billion dollar company. You know, I didn't anticipate it to get this large, but the TAM was much bigger than we realized, I think.

So now, did you go into this thinking, like, all right, men are struggling with X, y or Z problem, and then you put all these hundreds of ad creatives out there and you learn, wow, actually this problem is the one that they're clicking on. I thought that this problem was the biggest, but this is the one they're clicking on. So I want to make more ads like this. Did that ever happen?

That's exactly how it happened. So I tried everything. As most entrepreneurs do, you just like, you know, throw it against the wall and see if it sticks. And what I found very early on was the women would give us feedback in the reviews, and they would say, you know, I don't know what you guys are doing over there, but all of a sudden I spend $50, and my husband's got this air of confidence when he leaves the house. And that's when I made the connection that, like, oh, we're selling confidence. We're not just selling T shirts now. And when you make that kind of emotional connection with people, you are on to something unbelievable. Now it's bigger than shirts, right? And so what I started figuring out, because I'm a skinnier guy, I'm like, you know, 6 to 175. I float right around there. And yes, the shirt made me look better. But what I didn't anticipate was that for the bigger guys, the large, the XL, the 2XL, it made these guys look wildly better. Like, it made them look like they literally lost 10 pounds overnight just putting a shirt on.

And that wasn't even a problem you were trying to solve?

No, I was just trying to solve. Like, let me just have it look a little bit better for everybody. The skinny guys look a little bigger. The big guys look a little slimmer and so on and so on. And so once that popped, I was like, oh, we gotta go all in on this dad bod thing. And that's when it really started to explode. So I just leaned into what was working.

Well, I think the timing is also critical. Because in an age of social media like confidence has never been lower. If we could measure confidence in society, it is at an all time low. And you're coming in selling that with the same social media tools that are taking their confidence away. Right. So product market fit, Textbook definition right there, right?

Yep. And the product had to be great early on because the marketing really wasn't that great. It took me a while to get there. So to get to the, you know, a hundred million in two years that was on the backbone of just building unbelievable product market fit and having the product stand on its own. Because you know as well as anybody that without the retention in the repeat buy, there is no business. Essentially. It has to be great and that drives all the profitability because we are, you know, largely a, you know, break even on first customer acquisition company, as most startups are. You're just trying to get them to come back and either buy denim or underwear or long sleeves or whatever it is.

So in any business, retention is the name of the game. In your business. What does that look like? Are you after the first order, I imagine there's an email marketing sequence that. What? Yeah, what does that look like?

Well, first of all, before they even stop converting, before they even get to the checkout, we're already doing what's called a gift with purchase, which is tremendous for the business. And so what we do is we get them in other categories before they even check out. So, yes, you're going to buy T shirts, we're also going to throw in activewear, we're also going to throw in underwear because these are killer products and we know that. So when they get them for free, they're like. And they get them home, they're like, oh, wow, I wasn't even anticipating this. I thought they were a T shirt company, actually. They sell amazing joggers, they sell amazing underwear, and then they start getting into these other categories very quickly. So that's kind of the first component before they even literally convert.

That's not something. You probably just tested that, right? Or you heard of someone else doing it. You're like. So it's just like, that's like the slogan of this whole podcast is test everything except drugs. And this is what happens. Like how much has that one little hack and added to the value of your company? Like if you were to like include the retention improvement and all that.

Dude, it's everything. It's everything. As long as you are being thoughtful about the product that is going into their basket, as long as you're doing that thinking and through that, like. Because I could have just thrown anything in there. Right. But it wouldn't have made sense. I did it specifically. Well, number one, boost aov. That's like the obvious thing, right?

Like average order value.

Yeah. Because they get excited to see. See something for free. So they want to hit those thresholds. Because when you get to 100, you get free shipping, you get to 150, you get a free shirt, you get to 200, you get free underwear or whatever it is. And so it boosts AOV up because they want to keep hitting those tiers. So that's number one. That's the obvious thing. But the not so obvious thing is cross category and getting them into the newer markets. So once we figured that out, I think we figured that out around year three, and it was because I was. We launched activewear and it wasn't doing great right off the bat. And I was like, how can I get people into this category? And I'm like, well, I already have people converting. Why don't I just force them into these categories with free product? Like, let me just. It's that good of a product to where I know once they get it, they'll buy it. And that was their thinking.

Believe it or not, 67% of the people that watch my YouTube videos don't subscribe to me, and over 90% think that they're subscribed to me. So do me a quick favor and check that you're subscribed to me. If you're not, please do. It would mean a lot. Well, you just kind of gave me a new framework to think of. And it's like, you heard of a chicken salad chick? No. The restaurant chain? No. It's a franchise that sells chicken salad. That's it.

I love that.

And the franchisees do hundreds of thousands a year of net profit. It was founded by a woman. Incredible. Incredible startup story. Anyway, I'm relating what you just said to this because it's. The framework is. And I'm making this up on the spot. It might sound dumb. What if the side dish was the main dish? Right. That's it. So you were like, I have an E Commerce brand. We throw in free crap sometimes. And I'm ashamed to admit, a lot of times it's just the overstock crap or the stuff that's expiring or the stuff that we're going to throw away and liquidate.

Yeah.

And it's like, sure, let's give them some pickled okra, because these go bad in two months. Anyway, and that's like, that's the norm. And people kind of when we do that, we pat ourselves in the back, we're like, yeah, good. Hey, I'm doing what I learned about in that Facebook group. Oh, I'm pretty smart. And you're over here like, okay, what if that afterthought was, like, the whole strategy? What if we took something that was really good, like, based on our reviews, like a really good jogger or something, and gave it to him for free? And then we just wait and see. And we might lose $7 on that first order instead of $0.70, but let's just wait and see if it plays out. And then when it plays out, you're like, wow, I just added $10 million a year to my business. Right? Yeah.

Because you have to grow these other categories. I think that's like, we had to get beyond just T shirts. And. And still, even to this day, six years later, people, A lot of people only know us for the T shirts because it's what we've sold the most of. But you really have to get them in the other categories to make the. Allow the business to keep growing beyond T shirts.

Yeah. I mean, it's like, like Lululemon, any brand. Nike. Right. Like, what if Nike still showed sold shoes today? Right. They wouldn't be in the Fortune 500.

That's exactly right. You have to go above and beyond, and there's a lot there. Obviously, it's beyond marketing, but, like, you just have to continually provide real value for people in the form of product. And it can't just be like, what I normally see in these other brands is everything is an afterthought versus their first killer product that they crushed with. And that's something that Lulu's done really well. They came out with a leggings, and they were a legging company, but then they have a lot of other amazing products, which is rare. And that's how you get to Lulu's level. So what most companies do is they go, oh, that crushed. Now let's do just a bunch of other stuff, because we need to just keep boosting top line, and we need to do it. And then they don't put the same intentionality that they put into the original product into everything else. And that is a huge miss. I've seen that with a lot of the big brands, too, and they just cannot crack that nut. But you have to take that original DNA that you put there and spread it out. It has to really go into the same. And that's what we did, like, with denim, that's what we do with activewear. We took the same idea of problem solving and then started going category by category and saying, what are we solving in denim? What are we solving in underwear? And so on and so on.

Yeah. Instead of saying, what can we launch in denim? What can we launch? Like, how can we be opportunistic? You're saying, this is what she said originally. What problem are we solving? We have to solve a problem. I imagine there's been categories that you ask that question. You thought, you know, I don't. I don't really know what there's to solve right here. Let's just pass on this one. Right?

Yeah. I would say the. The one problem you're always really solving in apparel for us is that the premium market is still gouging everybody. So even if. Let's just say for. For argument's sake, that the denim doesn't solve the fit problem like it did for T shirts, at the very least, you can get, you know, page level or ag or rag and bone level denim for half the price. Like, that's a real problem. That's a problem that everyone's facing. They want the premium art, but they can't afford it. And so that is, in the absence of something like fit, we lean in heavily on, like, well, it's going to be the same fabric as the. The top guys, and you're going to get to pay literally a quarter or half the price, and that's a big win for the customer.

Okay, so what was the month and year when you first originally started?

So I started on the journey of, like, thinking about it in 2018, but it wasn't till late 2019 that I started it. It was like, August of 2019.

Okay. And was there, like, when you first started thinking about it, was there a triggering event, a conversation, something that you saw out there in the market that really. Because you probably. You're like me. You're an idea guy. You have a lot of ideas. What kept you on this one?

You know, ironically, and I've told this story a few times, my brother texted my mom not too long ago and reminded or reminded me of a story that I had told him when I was 19 about there was a store called Cariloha that sells these, like, really comfortable bamboo T shirts in Bahamas. And we used to go to Bahamas every year as a family. And I went in there when I was 19, and they didn't have my size and my color that I wanted. And I told my brother I was so pissed off. I was like, someday, and this is very entrepreneurial to say is just like, I'm going to build my own T shirt brand so that I always have my favorite T shirt. And he told my mom that story. And I looked back and I was like, oh, my God. I was. Even back then, I was thinking about this T shirt concept. Now, of course, I waited 20 years to execute on it because I had forgotten about it. But what it brought me back to was like, it was always there. It was always stewing in me. And so while I had a lot of other ideas, like I wanted to get into the have diamond business, I thought, what an amazing value for the customer in that business. Or there was a bunch of ideas. But the T shirt one just kept staring me in the face literally every day as I would go into the closet. And at a certain point, I'm really good at like, accepting what the world gives me kind of guy. Like, I just, I take in and I take it for more than face value. I always take it as like a sign that I'm. I need to be doing something.

Yeah.

I tell entrepreneurs too. I'm like, the world is giving you clues every single day on what you should be doing. It's up to you to really cancel out the noise and listen to those clues, whatever they are. But it's very difficult in the midst of our lives in the chaos to listen to those voices, that inner voice. So I just kept coming into the closet and feeling the same thing every day. And then finally, as I'm going on this journey of drop shipping like probably 2017 and just learning ecom because I didn't know where I was going to go product wise. I was selling a million different products on these drop shipping websites. And finally I asked my wife, I'm like, what if I just did T shirts? Like, I know that sounds so lame and like, incredibly commoditized, but like. And she was like, well, like, what are you going to do? What's your angle? And I just started kind of peppering her with the value, props and what I thought I could do. And at the time, she thought I was insane. It was just something that was really hitting me consistently. And I just finally decided to like, well, what am. It's going to cost me like a couple thousand dollars to try this. What's the big deal? I don't. It's not going to bury my life if it fails, you know, so I've.

Got a question about that. But I want to go back to dropshipping. What types of things were you drop shipping and how much success were you finding, if anything? Because drop shipping gets a bad rap. What I love about your story is that you started with drop shipping. And I tell people to try that sometimes because it's like you're not going to finish there.

Right?

Right. So one school, I was like, oh, dropshipping is over, oversaturated. It's dead. It's. And it's for sure a lot harder than it used to be.

Yeah.

But I give people advice like this to start little things like this because it, it gets them in the game and it gets them going.

Dude, it's the perfect training ground. I try to get. Like, I had two guys come into my office a couple days ago and they were like Harvard grads, like young guys, they just graduated and they wanted to sell clothing. And I'm like, trust me, you don't want to do this industry. What you should do is go on AliExpress and find some product and drop ship it and see if you can create winners out of that before you go on this journey. Right. And they were like, their mind was blown because they're thinking they're going burn, burn through all this cash. And like, this is like, how much do we spend on Facebook ads before we give up? And I'm just like, dude, you don't have to worry about any of that here. You just go straight to the manufacturer. They'll ship directly to the customer. You don't even have to be involved. So I just think it is. Listen, I am very thankful for my drop shipping journey because it taught me all the inner workings of e commerce. Taught me how to do customer service really well. It taught me operational, you know, logistics and know how on the supply chain side, it taught me marketing. It told me how to find winners and how to do customer research and how to care and how to really dig into the reviews and find those golden nuggets that means so much to the customer when you take it and you implement it into a product and you give them what they're actually wanting, not what you think they want. Big disconnect between the data speak. Yes, dude. And the data is all there for the taking. And I always, I always go back to Amazon when people are like, I have this idea. I'm like, have you validated on Amazon? And they're like, no. I'm like, dude, it's all sitting there for the taking. I don't know what you're waiting for. Even to this day when we want to do a Product. My product team, listen, they're like wildly successful apparel people in the industry for God knows how many years, right? And I'm like, have you looked at Amazon? They look at me like I'm insane. Because it's just. It's the drop shipper in me being like over customer centric and going like, guys, please just. I know WGSN trends tell you this or that or the industry this. Like, forget that, dude, go validate, please, on Amazon and come back to me with something really tangible and then I'll feel much better about investing into product. But to answer your question, yes, dude, drop shipping is the answer, in my opinion. And someday I'm going to get my kids drop shipping if they want to get into Ecom, because it teaches you everything you need to know. And it's. Listen to your point. It's not. You're not going to do millions of dollars necessarily, but it sets you up. You learn how to find winners, scale those winners on Facebook, and that's. Now you're on your way.

Yeah, it's a lot of surface area for building different skills that you'll need in any business, whether Ecom or not. What kind of products did you drop ship?

Oh, dude, everything. I. It was very much a, you know, just testing stuff. Yeah, it was like, like, I basically took the only two winners that I pulled out of a sea of, like, products on a website was the. These were really popular for a while. But the fidget spinner things, you.

I used to sell those too.

Yeah, yeah. So what drop shippers do really well is they go. They're like the Amazon. They're just like, let me throw everything in there. And then they start narrowing and narrowing. Narrowing. Right. So, like the fidget spinners kept winning for me, and so I took the fidget spinner and then I just made a whole website around fidget spinners. And that way you keep the focus and then you learn that that's how you do it. You just. That's the model, test everything, find your winners, scale the winners. Another one was like this backpack. It was like a tech backpack that had like a charger adapter thing into the side. You probably know from like doing like, it's a lot of the same stuff that everyone does, but it works and people love it. So, like, those were a couple of my early winners that I tested.

That's awesome. Yeah, I had this company that sold iPhone parts wholesale, and my iPhone repair shop customers were selling fidget spinners on the counter. So we would order them by the tens of thousands of dollars for like a dollar each, and then sell them for A$50 each, and then they would sell them at the counter for $5 each. Something like that. Yeah, but it was a good little business for a while.

Yeah.

Okay. All right, so you take $3,000. What are. What are first steps?

When you were talking earlier about, like, why T shirts? Why T shirts? This can really apply to anybody. So you have an idea? I think this thing could work. Right. What really got me to take the leap from idea to execution over that year was that the more research I did on the competition, the more confident I got. By the time I got to executing, I was like, this is going to be a billion dollar business. Like, I'm. This is going to be insane. I am going to come in thrashing and making huge impact into the market, out market everybody else. Like, I'll develop better product, I'll do better marketing. I'll do everything better. Across the board, it was like everyone was doing a 6 out of 10, and I was convinced I was going to do a 10 out of 10 across the board.

What were you learning that gave you that much confidence? Specifically?

Like, well, number one, the products just largely sucked and they were overcharging. So that was like the first morning, which is like, okay, everyone's gouging, so what. What do I do about that? So I had to go down the journey of, like, what do cogs look like? Like, what does it take to basically make a bamboo shirt for cheap? And then I very quickly realized that, like, I couldn't do bamboo because bamboo was hard to make. So I ended up going with, like, this 6040 cotton poly blend that was perfect. And so I could get that for like, a couple bucks essentially on cost. And I was like, how are these people getting away with charging? Because I could do the math of their product margin. And I'm just like, dude, they are just making too much margin here. Like, let me just take that margin away and see if I can build the business on the little margin I do have and give it back to the customer.

Well, you know what Jeff Bezos says about that? He says, your margin is my opportunity.

It's great.

So was that like the 8020 of your opportunity here was you found out where they were sourcing this. You had an agency background, so you roughly knew what their cost per acquisition was. On Facebook ads, you're like, all right, they're selling the shirt for $29. They're paying $3 for it. They're paying $3 to ship it they're paying $6 for a customer. These guys have 60% net margins. Yeah. Not even including the retention and reorder rate and subscription. What are we doing? This is a no brainer. Yeah.

And I knew that, like, once I started testing on Facebook, I was going to see what the Roas looked like. Like, was it one and a half to one? Was it three to one? Was it five to one? Like, I couldn't wait to get in there because I had already scaled up Facebook ads across these other tchotchke products and I knew what, like, good Roas looked like. So I was just like, let me get in there and see what happens. And sure enough, what I landed on was like my break. Even Roas was like somewhere like the 16 mark. And my super profitable ROAS was like 2 to 1. Like anything over 2 to 1. My days looked unbelievably profitable. That would always come from, like an ad hitting or something happening on Facebook. Like Facebook back then was wild too. Like, some data would crush. Other days they do an update and everything would tank. And I would like open up my dashboard and be like, oh my God, I'm gonna lose the business this month. Like, it would. It was. It was brutal.

But you just gotta keep, keep the faith, right? You have those bad days and your Roas gets cut in half.

Well, you also have to diversify because even to this day, you know, like the last couple years, we would spend 60, 70 million on Facebook ads a year. I mean, it's just mind blowing, Right? It's not until this year that we built a big enough brand through, you know, Costco and Target and all these big initiatives that we've done to be able to pull back on Facebook and not see the business take a hit. Because in the early days, you pull Facebook back, the whole business reels back and you're just like, wow, am I? If Facebook goes away, we're out of business. Like, diversifying sooner than later is incredibly important to the success of your brand.

Just so the. The viewer has an idea of Roas. Like, you're talking about spending $10 to acquire a customer that places a $20 order. And, you know, after you work out your cost of goods sold and all that, you're not really profitable. You're just hoping and praying that they come back and order more. Right. That would be a two to one Roas, right?

Correct. Yes.

Okay. Okay. So you start doing research. Are you like, ordering from potential competitors, Trying the quality and all that?

Yeah. You have to do a tremendous Amount of market research and then you have to go, well, they're underdoing it here and they're sucking at this and they're not doing good that. Like you have to just keep picking apart their deficiencies and then over indexing and being better than them at everything. Like I said in the early days of, before I started, it was the customer service. It was, it was like I would see the way they would interact through email and with their flows and I'm just like, God, they're missing it on literally everything. Like, there was nothing that I didn't think I could do better at on that side of the business.

So. Well, that's what happens in high margin businesses is you don't have to be creative, you don't have to try, you can be lazy. Right. Which creates the opportunity. Like, why do you think Amazon, it's a very low margin business on the retail side of things. They're amazing at customer support, they're amazing at all these things because it, they have to be constraints equal creativity. Right?

Right. And that's good news for anybody that's starting anything because everyone always goes, well. It's so commoditized. I'm like, dude, they're all underdoing it, guys. Like, just so you know, everyone in the world is doing a 7 out of 10. If you're 8 out of 10, you take the whole market over time. That is the punchline.

Okay, so I assume you start with Shopify. Yep. There was no.

You're ordering Shopify. Because I, even though I was a WordPress guy my whole life, I wanted no problems.

There's no second place. No to Shopify.

No.

So you're ordering samples from overseas. I imagine you find something that fits and no designs to start. Right. So you don't have to worry about design.

Even to this day. We don't do any designs.

Okay. Okay.

That was very different.

Yes.

I just wanted to be plain. Everything I wanted no logos, which is very counterintuitive. But it just goes to show that like, again, I was thinking about the customer. I'm like, does a customer really want a logo? I don't think they do.

I think it's important for any business owner to remember, like the customer doesn't care about you. You take up zero space in your customer's brain. Which means, like, probably email them more often than you think you should because they forgot about you. Right. Probably don't really worry so much if you have a mistake on your website because they don't care. They're not Thinking about you when it comes to putting logos on your website or on your shirts, like, they don't care about you. They just found you from a Facebook ad. Like, what does that add to you? Right? It's like, well, it's viral marketing. Because, no, they're not going to buy it. There's no viral marketing if they never buy the thing in the first place. Ironic.

Viral marketing is just creating amazing product, right? Yes, everyone. Yeah, everything's a hack. And it's like, dude, it goes back to, like, the basics. And it's so boring to go back to the basics. No one wants to hear that. They're just like, what? What is the Facebook hack that gets me to a billion? It's like making amazing product, buddy. Like, that's it. Do something amazing and the money follows. It's that simple.

Oh, all right. Okay. So you go to Shopify. How many skus. How many products do you start out with on day one?

One product, the T shirt, six colors.

How many different sizes?

Small through 2XL.

Okay. Did you end up adding to that 3 and 4X?

Yes.

We added my Buc EE's website. We sell up to 4X.

Yeah. It took us a while to get there. In hindsight, we probably should have done those inclusive sizes a little bit earlier. We also should have done a lot of things that relates to the T shirt, which were incredibly accretive to the business. Like doing the curved hem, which is, like, so obvious now. Doing the pima, incredibly obvious now. It's like, we should have done a lot. Like, I probably left 50 million or more on the table not doing the versions of those T shirts earlier. Right. Like, we tried to go, well, now we got to do polos, and now we got to do this and that and, like, all the other extensions of apparel. Going back to what we were saying about, like, lean into what works and then do all your iterations against that winner. Like fidget spinners, doing a smaller fidget, doing a bigger fidget, Doing like, like, all the iterations versus, like, let me come out with a net new product and then see what people think.

Yeah, I love that.

It's important.

Okay, so you start Facebook ads day one. Like, this business, you're not even launching without Facebook ads. Right. What do those first few days look like? How are you feeling? Because you've got that. The trough of disillusionment. Like, are you still hyped when you see those first numbers roll in?

Oh, yeah, dude. I remember, like, it was yesterday because you get that little cha ching sound on Your Shopify, and it is so addicting. And so the first couple days were slow. It took us a little while to start generating some sales, but within a couple weeks, dude, we were already doing, like. I remember, like, the first week we hit, like, an 800 day, and that was, like, blowing my mind.

First week?

Yeah, we couldn't believe it. I was also, like, being really aggressive on Facebook ads. Like, I wasn't scared to push. I think most people would have just kind of let it ride and build slowly, but I was in this, like, I got to go mindset.

Everyone wears a T shirt.

Mm. And, like, I was already coming from a place of, like, I had watched so many dropshippers scale aggressively. So I was like, let me test the upper limits of this now. If I push and I look tomorrow and roas is like, point two, I'll pull back. Right. Like, that's how I thought about it. So I was. I wasn't scared to, like, really push on the needle on ad spend because it was just working. And also, this was pre iOS 14 when where we lost all that customer data. So it was working even better back then. I don't know how. What it would have looked like, you know, post the data loss, but things were amazing in the early days of Facebook.

How many creatives did you start with that first month?

Not many, dude. I probably came up with 10 static ads. We didn't. We didn't even do video for, like, wow. I want to say six to eight months. It took me to do, like, a video ad shoot with, like, a couple models walking around, and it wasn't great. I look back at those ads, and they're so cringy. It was amazing I made any sales, to be honest. Like, we just. I had no idea what I was doing.

What did, like, the format of your first, like, big winning ad look like? Like a static. What was your offer? What did the picture look like?

The first static ad that crushed. And it kind of led me down this. This journey, which was, like, really highlighting the value prop and going back to, like, what problem are you solving? No wonder that. And I knew this from drop shipping, which is like, the ads that always crushed were the ones that were solving a problem very quickly in, like, probably 10, 15 seconds. You had to really do the full thing from start to finish. Like, if it was a kitchen appliance, you had to show the kitchen appliance doing the thing. And, like, like, oh, I can just, you know, disassemble an orange very quickly with this tool. And, like, you had to get that.

Across, you probably drop ship something like that, huh?

I did, dude. I did.

I knew it.

One of the popular products was like, yeah, like the. The thing you put in an orange and it squeezes out the juice or whatever. Like, there was so many of those kitchen products that crushed on drop shipping because they.

They demonstrate themselves so well. Right, dude.

And they saw.

That's the whole thing. Yes. Like, if a couch could demonstrate its value as well as, you know, an orange squeezer could, then couches would crush.

That's exactly right.

So you have such a good framework.

Show that journey to people. And the sooner you can do it, the better. Once I, like, figured out the three value props that we kind of live and die by, which is like just fit price and comfort, things started really going off in the right. Because then I was telling the right story to people. It wasn't just like, hey, I'm T shirt guy amongst a sea of other T shirt guys. It was like, oh, that's that T shirt that makes me look better. And it's like half the price as premium market. Like, I love that. So once people started catching on to that, it just took fire.

What was your daily ad budget that first week, first month. And I want to know how that scaled, how quickly that.

Yeah, I was. You know, I should go back and really look at the early days on Meta. But I do remember starting out at 100 a day. That was kind of like my starting point. And within a week, I had tripled it. I went from 100 to 150 to 200, 250 to 300 in like no time. Like a week, week and a half. I remember getting in my. My founders are like, this is going to get, like, really expensive, just so you know. And I'm like, I know. And plus, we didn't have all the math worked out yet. So even though. Because, you know, like, when you look at a roas, that's not really the true roas, that's the attributed roas from Facebook, which doesn't take into account your operational expenses and like all the other line items after your. You look at your P. L. So it was a little scary. Like, I didn't know.

You're not making money yet. You're not making a profit yet, right?

No, we were taking all the money and just putting it right back into Facebook ads. That's another really important point. And one thing I had an advantage of was that I didn't need to live off this business. I. I could just put every cent back into the Business. And that propelled its growth way above and beyond what it could have been had I been sucking money out early on.

Where was your income coming from? From your, your ads agency?

The agency, yeah, it was still. I had already hired out for like my position as CEO. Like I just, I handed it off and I let them run the agency. And even to this day, it's still alive despite SEO crumbling around us with Chad.

So how big was your agency at that point?

It was a little over a million a year. Yeah, it was a great business, dude. I always tell people to get into the service based business. It is so easy to make money working with other businesses and charging them a flat fee and just stacking those retainers up over years and years and years. And if you do great work, you're never going to lose them as clients in a sea of scam artists that are just constantly ripping people off in those industries. When you're the ones actually providing value, you never lose them. Or if you lose them, they come back after they get ripped off by somebody else and they realize, oh, the grass is not greener. I try to take a price cut, but I'd rather pay you more and get great service.

Were you charging like 1 to 5k a month or were you doing it like charging a percentage of ad spend?

I was charging 500 to 5 grand a month because it was mostly LA market. So even the 500s, I should have never started there. That was way too low. I would say my sweet spot was like 1500 to 3000amonth. And it was like a lot of lawyers and dentists and chiropractors and those industries where a customer is worth an insane amount of money for them to acquire.

Yeah. Would you agree that just starting at an ads agency today, just like you did back then, is still a big opportunity?

Enormous, dude. I think people just underestimate it and they don't know even where to start. But my life took off when I started thinking about stacking up retainers and how a little bit of like, I think for people that aren't comfortable in sales, you have got to figure that part out if you're going to be in that business because.

Or find a co founder that has.

It figured out or that a hundred percent. But like you need to be obsessed with sales because you need to know how to relate to people. You need to know how to listen, you need to know how to not oversell and just really sell the value you're going to bring them. Right. So that was an important skill that I was Lucky enough to learn young. My dad was a great salesman and I learned a lot from him growing up. And he always told me I should like do sales in some capacity. Ironically, like, here we are doing all these crazy numbers and I still do an immense amount of sales. I'm selling, you know, potential investors or acquirers or, or customers or you name it, like I'm still out here selling.

So also, when you have an ads agency, you have so much surface area for learning all the secret ins and outs and workings of what your customers are doing. I mean, you never even would have considered starting this business had you not had an agency.

No chance. Because I wouldn't have known how to not spend. Like, I wouldn't have known that Facebook was the answer. I really would have like probably spent money and just sprayed it all over the place and lost a bunch and then given up. But like going through the process of watching lawyers, dentists, chiropractors spend on the wrong things and seeing that and having that insight gave me such a huge competitive advantage because I was like, oh well, this is just a Facebook business.

I love how like you can, you can give opposite advice and both of them be true. Like you said you were looking at lab grown diamonds. I'm assuming one reason for that is because it's very high ticket, but it's very, it's a very high value. For the price that they're paying, you can use paid ads. So if you're a master at paid ads, why not pick something that's high ticket? So on one end of the spectrum it's like if you can really learn paid ads, find something high ticket. And on the other end of the spectrum, it's like if you can really learn paid ads, go to a commodity, something boring but huge and like over competitive, like apparel. Like you're going to win no matter what. Like, because the first principles are swapping your creative, like good customer service, good product, all this the boring stuff, right? It's true whether it's high or low ticket.

That's exactly right. And like, dude, to live through an era of where we even have the ability to run Facebook ads is unbelievable. Like, it really is. I could have not built true classic without Facebook ads. Like, it just. I have no problem saying that because that's the truth. Like we're really lucky to be alive in this ecosystem where we have these tools because, you know, 30, 40 years ago, they didn't exist. Dude, people were doing door to door and billboards and mailers and all this archaic crap that they had to do. So it's like, if you're not using Facebook ads, boy, are you missing out. And even now, how we talk about, you know, AI and all the implications of what that does for business, what an unbelievable time that we're all living through. Even at True classic. Dude, you'd be shocked at how much tech and AI we use with everything we do, because we're realizing that it just makes everything so incredibly efficient and better for everyone.

Yeah. All right, so first four months, you do a quarter million in revenue. What does your first year look like as far as revenue, profit, and, like, daily ad spend look like?

Roughly, Yeah, I would say so. We did 15 million the first year, and that's when we were like, wow, work. We're really on to something.

Oh, my gosh.

But it wasn't until the next year that we were like. Because I remember when we did 15 million, we're like, guys, someday we could sell this company for, like, 50 million. It would be insane. And then we did 90 the next year, and we were like, oh, we're going to be billionaires. This is going to be insane.

We're going to sell us for our. See where this is headed.

It's just then we started looking at, like, we're going to be Hanes. We're going to be like, you know, five, six million a year. And so it very quickly changed and it became our life. We just stopped everything we were doing after that first year.

There's so many inspiring things about this story, but one concept I've been obsessed with lately is that of, like, chasing product market fit. You were 37 when you started this. You'd done all kinds of random things, dropshipping all kinds of things. You could argue that a bunch of those different products that you drop ship were all kind of different businesses, right? I've started 75 businesses. But if people get stressed about, like, oh, shiny object syndrome, I need to stay focused on one business. Yada, yada, chase the product market fit. Chase the energy. Because if you look at someone like Mark Zuckerberg, he's been doing the same thing for 21 years, right? And on one hand, it's like, man, that guy is so focused. He's so driven. And on the other hand, it's like, he would be an idiot if he ever thought of taking his eye off the Facebook ball. Because Facebook has had product market fit from day one until today. He's not like, some, like, super driven. Like, of course, course, he's amazing. He's brilliant. He's driven and all that, but he doesn't have above average focus is what I'm saying. He just has, you know, product market fit, in my opinion is like being chased down the hill by a rock and those rockers, that rock is a customer and you just cannot even sleep because you're fulfilling orders. You have so much demand and it never lets up. Whereas most businesses, not that this is a bad thing, is you're pushing a rock up a hill and it's hard and it rolls back if you rest on your laurels and it's. But that's okay, right? But like when you just keep chasing product market fit and then once you find it, stay on it, you won't lose, right? So like with my content, I see product market fit every month. Like I just keep growing. And so like I would be dumb to stop doing content because it's there. I'm still doing other stuff, I'm still launching businesses. But if I ever found another business idea that kind of looked interesting, but I didn't know if I had product market fit yet and I said I'm quitting content to go all in on this, I'd be stupid. You did all these things for 15 years and then you pivoted and you've been doing the same thing for six because you still have product market fit, you still have that energy, you still have customers beating down your door.

Yeah, and I'm also just like obsessed with providing value and that just that journey kind of never ends. Now it comes in the form of like philanthropic initiatives that I'm obsessed with. Like this teacher initiative where I pay off all their wish lists or know the LA fires were here last year and I gave away like 6 million in inventory to people that lost everything. And now I'm finding ways to make impact in the world outside of just T shirts and apparel. And that's what really moves me. And doing things like this, like getting to talk to other like minded entrepreneurs and show them that you can do it with virtually no money, you can scale a big business. You don't even have to come from the apparel industry. You just got to be obsessed with what the customer wants and telling these, you know, stories to people to show them that like, listen, if someone who has failed through life as many times as I have was able to figure it out, quite literally everybody can figure it out because it was just came from an obsession with what does the market need? How can I fill that void? And then what do I got to do to scale that up?

Okay, so year one, I'm just going to go through your last six years. 15 mil, 90 million 150 million. 206 million 212 million, 270 million. And your profit per year, 2%, 4%, 5%, 8%, 8%, 16%. Yeah. So you doubled profit over the last year.

Yeah, this year is going to. And that's really because of wholesale. We got into Costco and Target and they and Sam's Club and TJ Maxx and Kohl's and a couple other ones. But profit margins are unbelievable in those environments because guess what, you're not paying to acquire a customer and you're not break even. You're suddenly just wildly profitable. And so this is a huge growth year. You do hit a saturation where you have to go beyond the digital world. Right. Like if they're not on social, how you gonna find them? Right? So you have to start thinking a little bit more grassroots. That's where the wholesale comes in. Because now people walk into Costco and they see us and they're like, oh yeah, I saw them online.

These guys are legit.

That's.

Oh, that's a whole new level of credibility too.

Dude. That was one thing we didn't anticipate. So we knew that yes, we were going to hack CAC in those environments and get them to buy because there's a big portion of people that just don't trust online, period. They just don't. Our generation, our younger guys, we all grew up in it, so we trust it. But like past our age, they're still in this weird limbo land of like, well, I don't. It's just marketing now. When they see you in Costco, it's almost like they just immediately check that box of like, well, Costco's done the work to vet these guys. This must be legit now. And so get that confirmation the second they walk in the door and it becomes a no brainer for them to purchase. And wildly successful in Costco. They are amazing partners. I love them to death. I'm always obsessing about like, what can I do for your, your, your Costco members? Like what are some thoughtful things I can create for them? Like I'm always looking to try to figure that out because I just appreciate what they've done for the business and where it goes.

It's interesting the perspective that you have going into Costco coming from E Commerce. Most people don't realize how hard E commerce can be and how like not free cash flow rich that it is. Right. Because you're putting Money into ads and inventory, and some of that inventory just dies. Right. But when you're going into Costco from that, you're like, I'm in heaven. This is luxurious. Whereas I've talked to other founders that went into Costco compared to other channels that they've been in, and they're like, dude, I don't make any money with Costco. I just don't make any money. But not only do you not have to pay to acquire a customer, you don't have to spend three to four dollars to ship a T shirt. You're spending, like, six cents to ship a pallet full of T shirts.

Yes. Not just that. Like, we're one of those products where, like, we're not a SaaS product. Like, you actually have to touch and feel it to understand all the marketing, because the marketing could just be the marketing in a lot of ways. So people are like, oh, I need to actually get my hands on it. Which is why when people say, like, well, why don't you do a Super bowl ad? It's like, dude, we're already getting, you know, 14 million impressions a day on our ads. I don't need more visibility. I need people to actually get the product in their hands so that when they touch, things go, oh, now I see why. And that's what happens in those environments like Costco. They see the stand, they walk over, they feel it. You watch them interact with the product, and then they immediately it all starts sinking in. So, like, I had this idea of, like, let me take the 10 million it would cost for a Super bowl ad and let me just spend 10 million on product and just give it away to every single person in the U.S. wouldn't that be such a better hack than let me just do a funny commercial? So, yeah, that's where I'm at.

Oh, man. Oh, there's so. This is so good.

So, Kale, by the way, going back to what you were saying about, like.

Difficult environments, so next summer, my family and I are doing something that's probably gonna sound completely insane. Do you remember ryan Trahan's epic 50 States in 50 Days challenge, where he raised millions of dollars for St. Jude? Well, I donated to that cause, and he shouted me out, telling his millions of subscribers. So now I'm fully committed, whether I like it or not. 50 businesses, 50 states, 50 days. And most, if not all of these businesses are going to need websites fast. And online is the perfect domain name for micro entrepreneurs. You see, the word online gets searched over 500 million times every month that is built in SEO power. Your domain is literally helping you rank higher. And the real kicker for me is is that finding meaningful.com names is nearly impossible. So when I'm launching 50 businesses in rapid fire, I need domains that actually make sense. Not something like bestpizza New York downtown dot com, just nypizza online. Clean, simple, memorable. I mean, look at this. TexasBarbecue.com, taken. But TexasBarbecue online available. That's the difference. And over three and a half million businesses trust it. Go get your perfect domain name before it's gone. Check out dot online today and get your first dot online domain name for only 99 cents with the link in the description.

We tried to scale retail and it is very difficult and for a couple reasons. So we have 16 stores now. We could have had over a hundred had we ramped at the level we were going to ramp originally because we were so bullish on it, because we were like, oh, well, they just got to get in their hands. They'll love it. What you don't anticipate is that if people don't know that you. It's like Old Navy. When you go to a mall, you know there's an Old Navy there, right? When you go to a mall now, you're not assuming there's a true classic there. So unless you are, like, have the best store visibility on the planet and you're right next to a Lulu or an Apple Store or somewhere where people are always going in and out, it is so tough to make that P L work inside of four walls. Plus how many people are going to walk by that sign, see us go, oh yeah, true classic, and then leave and then buy online three months later. Like, you're never going to attribute that sale that they bought online to the store, even though the store was the billboard that made it all come together for them.

Yeah.

So, like, you see this gap in the P L for retail and you're like, oh, we're just losing money. Like, this just isn't working on the surface. That's what you would say, right? And you take all the nuance of the advertising in those malls and if you would be able to put a multiplier or something, attribute something to that, it would all net out, plus some, and you would be scaling to the moon. So it's. Yeah, that's the hard part of retail. You almost have to just make a bet that, like, it's doing more work for you than you realize. Even if they're not walking in the store lift.

So there's Lyft. And it's hard to put a definition on Lyft, but you just, you know.

When you have to assume it on some level and then help that fill the gap. But like imagine scaling retail and then having it not net out on the PNL across like half your stores. What that looks like on the balance sheet. You're just like, oh my God, this is wildly unprofitable and like we should pull back. And so that's why retail is so difficult.

So when it comes to like just pouring money into Facebook ads, how did you grow the business without. Because you didn't raise any money right now? How did you bootstrap this? Because you got to pour money into inventory, into fulfillment. We're using a third party logistics provider or are you doing it yourself?

No, we were doing three pl from the get go. We knew like there was no way were going to be able to actually ourselves.

You probably have some 3PL horror stories, I imagine because I've owned a 3PL. It's hard.

No, it's it. Most of them have gone out of the business. The ones we use in the early years. No big surprise. Like software would like break and you would be like split shipping stuff accidentally. And if you know what split ships.

Are, like, I've done that.

You're paying double for every order. Talk about crushing your profitability on a nuanced software application. And you're just like, dude, what do I got to become a software developer to like figure out your software for you? It's just a nightmare. So.

So you've always had a 3 PL from day one till today?

Yeah, dude, we knew not to even mess around with that world. We were like, you know, let's just take that off our play from the get go. So here's some hacks that people can do to minimize cash. Number one, you have to have really solid retention plays to be able to supplement all the acquisition cash that you're burning. So that comes back to like klaviyo. Email flows, post purchase upsells and abandoned cart flows, welcome flows, optimizing the crap out of all of that. So that's number one that'll help you a lot on the cash front because you'll get those people back beyond that, what people need to really do. And I never see people talk about this stuff which is like negotiating is so incredibly important to the life of a business. Negotiating with your manufacturers, negotiating with banks and really telling the story of what it could become for them if they invest in you. So one thing we did really well early on. This goes back to, like, Matt, my kind of makeshift CFO partner, who was an amazing negotiator, and I was as well. And we would get on these calls with these manufacturers, and we would sign sell the dream of what True Classic could become for them. And through that dream, our ask was, give me 20,000 in credit. Right. Give me terms on that Credit. Give me 60 days. Give me 90 days, whatever it is. And, dude, that was a game changer, and that allowed us to not have to put more money in because the 3,000 went against. You know, 2,000 of it went against Facebook ads, and the other thousand went against actually building the shirt to make it great.

Yeah.

So we didn't actually have to put any money up for inventory, you know, because there's always MOQs on that stuff. So we. Otherwise, we would have had to put some significant money in, but we convinced them to bet on us. And, look, you have to have some sales skills. It goes back to negotiating. Like, it just. You got to find the right partner, too. Like, I bet you had we knocked on 10 doors, nine of them would have slammed in our face. But we found the one guy early on that was like, sure, I'll bet on you. And now the guy's making insane amounts of money off of us because he helped us in the early days. So that was a big one.

Volume negates luck.

Yes.

Right. The more bankers you talk to, whatever, the more, quote, lucky you got. It's a numbers game.

Me terms on that Credit. Give me 60 days. Give me 90 days, whatever it is. And, dude, that was a game changer, and that allowed us to not have to put more money in because the 3,000 went against, you know, 2,000 went against Facebook ads. The other thousand went against actually building the shirt to make it great.

Yeah.

So we didn't actually have to put any money up for inventory, you know, because there's always moqs on that stuff. So we. Otherwise, we would have had to put some significant money in, but we convinced them to bet on us, right? Absolutely.

And then, like, would you guys even be here today if you weren't, like, diligent about negotiating everything you could?

No, it's the whole thing, especially once you scale, because we are really tough in negotiations when it comes to SAS contracts and vendor contracts with three PLs and. And even COGS pricing with our manufacturers. If you don't scrutinize that and you look back after a year of what that could have cost you it's unbelievable, dude. I mean, we're probably saving the company. And look, you have to have some sales skills. It goes back to negotiating. Like, it just. You got to find the right partner too. Like, I bet you had we knocked on 10 doors, nine of them would have slammed in our face. But we found the one guy early on that was like, sure, I'll get. I'll bet on you. And now guys making excess of 40 to 50 million a year in fees and cogs. And I mean, if you really tallied it all up, it would be so, so astronomical. Even on the SaaS side, we're probably saving in the low millions a year in just pure negotiation. Just really telling them, look, if you do great work with True Classic, we're going to be your best case study of all time, right?

Yeah.

I'm going to get on a camera and if I really believe in the sass, I'm not just selling them that story. And it's like, it's actually amazing SaaS, then you deserve the world insane amounts of money off of us because he helped us in the early days. So that was a big one.

Volume negates luck.

Yes.

Right. The more bankers you talk to, whatever, the more, quote, lucky you got. It's a numbers game, right? Absolutely. And then like, would you guys even be here today if you weren't like, diligent about negotiating everything you could?

No, it's the whole thing, especially once you scale because we are really to know about it. And I will be your biggest fan and I will tell the world because I want, I want to send people down the right roads. Right. Like young business owners that want to learn this stuff. I really want to tell them the Shopify is the best platform in the world because it actually is.

Right.

And I will go to bat Shopify. And that goes for triple whale on analytics. That goes for after sale, on post purchase upsells. It goes for like all the really great pieces that we love. We really tell them that story. And of course they're going to buy in tough in negotiations when it comes to SAS contracts and vendor contracts with 3 PLs and even COGS pricing with our manufacturers. If you don't scrutinize that and you look back to that and give us a tremendous discount on the monthly retainer because they see the upside in what it means for their business.

Yeah, I mean, well, you said like, you're saving 40, 50 million a year on everything you've negotiated and that's about what your profit is. Yeah, exactly. Like, in a Commodity business. In a cutthroat, low margin business like this, you have to negotiate. I mean you've had single digit profit margins for most of your history.

Yes.

Right?

Yes.

And I'm sure you notice over time because I've noticed this. If I'm in the middle of like a super high growth business, my vendors.

Are back after a year of what that could have cost you. It's unbelievable, dude. I mean we're probably saving the company excess of 40 to 50 million a year in fees and cogs and I mean if you really tallied it all up, it would be so, so astronomical. Even on the SaaS side, we're probably saving in the low millions a year.

Gonna start to like get a little greedy and they're gonna rub their paws together and say we could come up a little on price. They're not gonna leave, they're not gonna leave us. Right. And if you're not on top of that, you won't catch it.

It should be going the other way.

Right.

Like you should be catching a break as you scale, not like getting taken advantage of. And plus like there's, listen, there's so much competition with that stuff that you can always go somewhere else. And they know that and you're in just pure negotiation, just really telling them, look, if you do great work with True Classic, so now where there's not a lot of competition at our scale is the volume. There's not like all these fact. We're going to be your best case study of all time, right?

Yeah.

I'm going to get on a camera and if I really believe in the sack or he's doing like unbelievable volume for everybody. So yeah, it does start to dwindle down. I'm not just selling them that story and it's like, it's actually amazing SaaS, then you deserve the world on towards the top. I will tell you that. Like I don't have as much room as I used to on cogs. Like it used to be wide open and now it's like, well, you know, we need hundreds of thousands of units in a particular style. There's only a couple manufacturers that can do that. And so we don't have as much leverage there as we used to.

Yeah, okay, let's say heaven forbid, wave a magic wand. Your business is gone. All of your experience is there. Your business is gone. You remember everything. You have three to $5,000. You have to create True Classic all over again. What do you do differently? What are your first five steps?

Well, the first thing I would do differently is go even more narrow on the expansion than I did. So what I was talking about earlier about like just really leaning into the T shirt and not thinking I had to do the polo or the other excess categories. We would have even gone even faster, if that's even possible. I would have also, if I could go back, I would have invested more time and energy in the creative. You know, I wasted, you know, a good amount of time on really average creative. And yes, we were able to do a lot, but that was really on the product. It wasn't the creative. Had I like found comedy early on, it would have gone even faster. And you know, I didn't find comedy till about a year and a half, you know, almost two years into the business. And then once I started leaning into that, it just like took over my life and now I can still do a ton of comedy.

We got to talk about comedy because that's the question I meant to ask you. Tell me about comedy in advertising and why it's so important.

Oh, man. You know what's funny is that when I started doing it, the reason I loved it so much was because I realized like, oh, remember how I always say, like, you got to be customer of centric and you got to provide value. This is the one part where you provide value in advertising outside of telling people about, to know about it. And I will be your biggest fan and I will tell the world because I want, I want to send people down the right roads. Right. Like young business owners that want to learn this stuff. I really want to tell them the Shopify is the best platform in the world because it actually is. Right? And I will go to Bat Shopify. And that goes for Whale on Analytics. That goes for after sale and post purchase upsells. It goes for like all the really great pieces that we love. We really tell them that story. And of course they're going to buy into that and give us a tremendous discount on the monthly retainer because they see the upside and what it means for their business.

Yeah, I mean, well, you said like you're saving 40, 50 million a year on everything you've negotiated and that's about what your profit is. Yeah, exactly. Like in a, in a commodity business, in a cutthroat, low margin business like this, you have to negotiate. I mean, you've had single digit profit margins for most of your history.

Yes, right, yes. Value, props. That's not, that's not a ton of value. That's just education. But like comedy, it's actually value because you're making them happy.

Like the Dollar Shave Club commercial.

Yeah, dude, you're, you're changing it from like I'm forcing you to watch this thing about my company to like let me create a skit that you're just gonna laugh at and you don't need to even buy my product. But if I make that connection with you and you remember me, someday it may make an impact and you may bias or you might see someone that knows the product and then you'll remember that story about the comedy ad and then you'll tell it and it'll help someone else buy or whatever it ends up going into. But dude, when I started thinking about like that is who we are on the advertising front, I became obsessed with finding the most funny guys I could to work with. A lot of that was the Greg Tube guys very early on who have been phenomenal. And I give them all the credit for really being our go to guys. And you know, I just have so much love for those guys. They've done such tremendous work for us over the years.

And I'm sure you notice over time because I've noticed this. If I'm in the middle of like a super high growth business, my vendors are going to start to like get a little greedy and they're going to rub their paws together and say we could come up a little on price. They're not going to leave, they're not going to lose.

And then Nicholas, our in house guy who did a lot of the comedy early on and we tried to do a lot of it ourself, but you got to find some people that are just hilarious and really do great stuff and then just lean into those guys. So even to this day we're creating tons of comedy at scale and it's still, it's just like, it's so much fun to make people laugh. And even when I meet people in the world, a lot of what they remember is just that thing leave us, right?

And if you're not on top of that, you won't catch it.

It should be going the other way, right? Like you should be catching a break as you scale, not like getting taken advantage of. And plus like there's, they're not like, oh yeah, you're that guy who makes a shirt. It's like you're that guy that made that funny ad about this thing. And because the comedy sticks with them forever, dude. And you, it's like, you know, when you watch a Super bowl ad, the ones that always are, the takeaways were the Funniest ones. And basically you forget about everything else. You think back to like early Bud Lights or whatever it is. It's like that is the equalizer, my man. That's the X factor. And if you can, it's really hard by the way to figure comedy out. People try to do it and listen, there's so much competition with that stuff that you can always go somewhere else. And they know that. And so now where there's not a lot of competition at our scale is the volume. There's not like all these fact. It's really hard to do, but once you crack it, it's as good as it gets.

What's been your best performing like comedic ad and what does that look like with regards to return on ad spend or roi?

Really hard to calculate return on ad spend and roi because what happens is that what you realize is that even if something's really funny, it's not Dr. It's not direct response necessarily. It is just funny. And that funny can have a long life cycle. It could be lift.

Yeah, once again you're just looking for lift, dude.

We have some people in our post purchase survey, by the way. Another incredibly factories doing like unbelievable volume for everybody. So like it does start to dwindle down towards the top. I will tell you that like I don't have as much room as I used to on cogs. Like it used to be wide open and now it's like, well, you know, we need hundreds of thousands of units in an important piece to this whole thing is obsessing about the post purchase survey to figure out where people are actually finding you and whether the money you're spending on marketing is netting out or not. If it's not showing up in the post purchase survey, guess what? It's not netting out. Like people used to say, like, oh, snap is like the new thing and we'd spend a bunch of money on snap and it would be like 0% of responses. It's like, well look, if it's working guys, it's going to show up in the sales. If not, shut it off. So now it's just like source of truth. Like I, I, I just look to my source of truth for literally everything. No, we were talking about return on ad spend and yeah, it goes back to just the lift. The best comedy that we've ever done was two videos. One of them was the very early Greg 2 video where the baby carriage goes out in the street and it's just like a really quick like if you go to the true classic Channel, you'll just. If you just sort by, like, highest views, you'll see.

I'm going to play this real quick. Let's see.

This is the one Gary Vee put in his book, by the way.

Jab, jab, right hook or something different.

No, the particular style. Only a couple manufacturers that can do that. And so we don't have as much leverage there as we used to.

Yeah, okay. Let's say, heaven forbid, wave a magic wand. Your business is gone. All of your experience is there. Your business is gone. You remember everything. You have three to $5,000. You have to create True Classic all over again. What do you do differently? What are your first five steps?

Well, the first thing I would do differently is go even more narrow on the expansion than I did. So day trading attention.

Oh, I haven't read that one. All right, let's do this.

Johnson, you're fired.

Why?

I was talking about earlier about, like, just really leaning into the T shirt and not thinking. I have. It's not you, it's your shirt. But it's casual Friday. Well, you've taken it too far. Look at Gypsum. He's wearing a True Classic tee. If it's a tight in all the right places, but leaves the purple, perfect amount of room in the front. God, I hate that guy. He looks so good in that shirt. He can basically do whatever the hell he wants around here. Jimson.

Yeah, boss?

You're a stud. Thanks, boss. True Classic is designed to enhance the male physique in all the right places. Right, Jimson? That's right, boss. I have strong arms, but also a little bit of a gut. But you wouldn't know because I wear True Classic that if you're a skinny guy, True Classic fits tighter. Had to do the Polo or the other excess categories. We would have even gone even faster, if that's even possible. I would have also, if I could go back, I would have invested more time and energy in the arms and accentuates your biceps. But how can Jimson afford premium T shirts? He's the worst salesman here. And I don't even think he can read Johnson. We all know Jimson can't read, but at least he knows that True Classic is completely affordable. And if you. If you buy right now, you can get 20% off your first order. I don't need to know how to read to know that over 200,000 people gave True Classic a five stars. Good job, Jimson.

That's right. Five stars.

Five stars. Let me try one on Johnson. I don't Know how I never noticed.

Before, but you're stunning.

I want a raise. Consider it done. But wait a minute. Are those creative? You know, I wasted, you know, a good amount of time on really average creative. And yes, we were able to do a lot, but that was really on the product. It wasn't the creative. Had I like found comedy early on, it would have gone even faster and you know, I didn't. True classic pants. That's right. I just got them off the website. And get this, they even have activewear, polos, long sleeve tees, fleeces, and even socks and underwear. Incredible. Jensen, why can't you be more like Johnson? Oh, what should I do? Paul, isn't it obvious? You need to go to the true classic website and buy all of those items right now.

Click. Click it.

Click it. Click it.

Click it. Now.

Click it. Click the link. Didn't find comedy till about a year and a half, you know, almost two years into the business. And then once I started leaning into that, it just like took over my life. And now I still do a ton of comedy.

We got to talk about comedy. Yeah, that's the question I meant to ask you. Tell me about comedy in advertising and why it's so important.

Oh, man.

Oh my gosh. So good. Oh my goodness, that is so good. I've never seen that breaking a little.

Bit of the third wall at the end.

So 35 million views. Was that organic or did you put paid behind that?

Well, it was both. The organic was probably a few, let me see, it was like probably 5 or 6 million if I remember correctly. And then the rest was propelled by spend. We just like pushed it into the. And that's how you know if it crushes an organic, you gotta amplify.

Okay, so like, I love that you've got some first principles, like just overtly funny comedic things, right? And then you break all the rules in some other ways, right? Like YouTube wants retention. They want you to get to the point as soon as possible and then to end the video, right? Then you've got like 30 seconds of awkwardly click it. Click it. Yeah, click it.

Like, you know what's funny is that when I started doing it, the reason I loved it so much was because I realized like, oh, remember how I always say, like, you gotta be customer eccentric and you gotta provide value. This is the one part where you provide value in advertising. Outside of telling people about value, props. That's not, that's not a ton of value. That's just education. But like comedy, it's actually value because you're making them happy.

Like the Dollar Shave Club commercial.

Yeah, dude, you're. You're changing it from, like, I'm forcing you to watch this thing about my company to, like, let me create a skit that you're just going to laugh at.

And the fact that it got millions of views despite that means that people stayed. They stood there and, like, felt weird in their body watching these two guys sit on each other's lap in an office environment. Like, oh, man. And I also love that it's not a lot of times you see funny ads and, like, you don't even catch that. It's an ad, like, until the end, right? That is overtly an ad from, like, second seven to the very end. Yes, Right. But you just keep watching. You just keep watching, which makes it so effective at actually selling.

And you don't need to even buy my product. But if I make that connection with you and you remember me, someday it may make an impact and you may buy us, or you might see someone that knows the product, and then you'll remember that story about the comedy ad and then you'll tell it and it'll help someone else buy or whatever it ends up going into. But, dude, when I started product and.

Not just making people laugh and remember you, right? That's like the holy grail. Like the Venn diagram, all of the circles overlapping in there. Did you use the Harmon Brothers for this? Because they're, like, the best at this type of stuff, aren't they?

No, dude, the Harmon Brothers are way too expensive. Are you kidding me?

This, like, 500 grand for that?

Isn't it more than that? It's ins. I wanted to use those guys early on, but that's why you have to go find your own guys. When I first found Greg and Nate, they were just making Tik Tok videos. They weren't working with, like, a bunch of other brands. And thinking about, like, that is who we are on the advertising front, I became obsessed with finding the most funny guys I could to work with. A lot of that was I found them and I'm like, why aren't you guys doing ads? This stuff could be great. And then I tested them and, like, their first ad with me and any brand they worked with, like, just crushed right off the gate. We were like, okay, we are on now. They work with everybody, which has been really great for their careers.

Are they very expensive?

They are now.

They weren't earlier, but they give me.

Listen, they're owners in the company, so they. Yeah, they've Earned it. They. They have ownership. They.

In your company?

Yeah, they still have.

That's awesome.

You know, they still give me, like, good pricing compared to everybody else. Like, they grandfather me and obviously because they're part owners. So they're amazing guys and I love them to death. They really have done great things for us.

Okay, so more people need to use comedy in their ads, Period, End of story. It's hard.

The Greg tube guys very early on who have been phenomenal, and I give them all the credit for really being our go to guys. And, you know, I just have so much love for those guys. They've done such tremendous work for us.

Over the years because you got to be comedic, you got to be creative, but it's worth it.

You're saying it's worth it if you can nail it. It. I would also just say, like, it's gonna take you a little while. Our first couple in house ads were not amazing. They were decent, but we just got better and better and better and better. And we learned from it too. We learned that, like, if you really break down that ad, one of the biggest components that you'll notice is that there's this reveal moment where it goes from wearing a schlubby looking T shirt to like this amazing T shirt. And that is wildly impactful. What we found is that in any comedy ad that we did, if we didn't include that transitional component, which is really very doctor that the ad really suffered on Roas, like, and then Nicholas, our in house guy, who did a lot of the comedy early on, and we tried to do a lot of it ourself, but you got to find some people that are just hilarious and really do great stuff and then just lean into those guys. So even to this day, we're creating tons of comedy at scale. And it's still. It's just like, it's so much. Just we were never able to scale it. And so you have to have that component. Another thing like that you'll notice in that ad is that he talks about a bunch of other product categories. So, you know, originally we would do a lot of ads just around the T shirt. And what I started realizing was, like, we have got to branch out. And a lot of what you'll see in that ad is my voice in the production phase going, guys, this has got to be bigger than T shirts. Like, we have to talk about the jeans. We have to talk about. And that's why you see them write that into the script when they talk about everything else. And it's so important that people know that we do other things. Otherwise, like, how are you going to grow the business?

I know this is impossible to answer accurately, but how many millions of dollars did that one video bring? True classic.

If you just had to fun to make people laugh. And even when I meet people in the world, a lot of what they remember is just that thing. They're not like, oh, yeah, you're that guy who makes a shirt. It's like, you're that guy that made that funny ad about this thing. And because the comedy sticks with them forever, dude. And you. Yeah, it's like, you know, when you watch a Super bowl ad, the ones that always are the takeaways were the funniest ones. And basically you forget about everything else.

You think? Yes.

My gosh. Probably tens of millions, I would say. It's hard to say, though, because it's one piece of the journey. In a broad journey, like, everyone always acts like you do one thing and you do one thing. It's like, no, it starts with, hey, how you doing? Nice to meet you. And then it ends with like, I'm gonna marry this woman because she's so amazing. And when I met her, I didn't realize. But like, in between all that is so much nuance in the journey. So, like, let's see. Let's say someone saw that ad, right? From there, they go back to their life and they're not thinking about anything. And then in two months later, they see a true classic ad, and then they make the connection and they go, oh, yeah, that's that thing. And then they go back to doing whatever they're doing. And then they walk into a target and then they see it. And now so back to like, early Bud Lights or whatever it is. It's like, that is the equalizer, my man. That's the X factor. And if you can, it's really hard, by the way, to figure comedy out. People try to do it and it's really hard to do, but once you crack it, it's as good as it gets.

What's been your best performing, like, comedic ad and what does that look like with regards to return on ad spend or ROI?

Really? Like, to say that one video created 10 million isn't really fair. It's like, yes, it was a cog in the wheel and it was part of the journey. Did it make an impact on getting their attention? A thousand percent. It's not like one to one necessarily.

Right. Well, it just so happens that person in your example, like, they buy all their shirts from Target. And that had to be true because if they saw you at Target, but they just don't buy shirts from Target, they're still going to keep walking.

Yes.

And you're going to have to get them on like your 17th touch touch point with them instead of your 9th touch with them. Right, exactly.

Really hard to calculate return on ad spend and roi because what happens is that what you realize is that even if something's really funny, it's not Dr. It's not direct response necessarily. It is just funny. And that funny can have a long life cycle. It could be. Yeah.

Once again, you're just looking for lift. Oh man.

It's a long life that we all live. And just because you made an impression to doesn't mean you made a sale. It is just one piece to the much larger picture. And that really is like why you need to just keep coming correct in all assets because you don't know where you're going to pick them up at and what part of the journey or the funnel.

Well, I think that your marriage analogy is so perfect because if you meet someone, you're attracted, you know, years later you, you get married. Oh, she's, they love me. She loved my personality. She loved my Riz. Well, she loved your back, dude.

We have some people in our post purchase survey, by the way, another incredibly background.

She loved, you know, how you hold the door open for her. She loved that you came from the same area.

Like important piece to this whole thing is obsessing about the post purchase survey to figure out where people are actually finding you and whether the money you're spending on marketing is netting out or not. If it's not showing up in the post purchase survey, guess what? It's not netting out. Like people used to say, like, oh, snap is like the new thing and we'd spend a month.

She loved that you did this when your tire, you know, popped on the side of the road. It's all of those things. It's not because you're fit or you go to the gym. It's hundreds and thousands of things and decades of compounding all paying off in that one moment. And they don't exist in a vacuum.

That's exactly right. Because the person you are today took a long time money on Snap and it would be like 0% of responses. It's like, well look, if it's working guys, it's going to show up in the sale to get there. They didn't see the upbringing, they didn't see how your parents treated you. They didn't see all the struggle you went with and how much you had to do to get here to be the person that you are. So it's that's the same way with product. Like it starts in one place and you didn't convert on day one. Big deal. You made a new if not shut it off. So now it's just like source of truth. Like I, I just look to my source of truth for literally everything. No, we were talking about return on ad spend and yeah, it goes back to just the lift. The best comedy that we've ever done was two videos. One of them was the very early Greg 2 video where Russian congratulations. Now just keep showing up for that customer until they do convert. And now you're really onto something.

Quick question. What if there were a private community out there of people that were building.

Businesses based the baby carriage goes out in the street and it's just like a really quick like if you go.

To the true classics on this podcast. Well, I just made it and it's only for business starters and business builders, it's called TK Owners and it's basically like having me and a hundred other business geniuses as your business partner. Also, there's going to be exclusive new trends, growth hacks, business ideas, and a database of everything I've ever talked about. You'll find thousands of startup case studies. You'll have weekly ask me anythings with me while I'll answer your questions directly. You can join now@tkowners.com link in the show notes. I'm curious. You've got a very unique insight. You've done a lot of things and we're going to have to do another episode where we talk about your poker days and your, your, your Vegas limo hack. I want to get into that on a future episode. But with your unique background, you know you've been distracted for a while. You've done the same thing for a while. What have you seen in your industry that could be an amazing business idea that people can execute on that maybe you're too focused on to go jump on? Like something in a vendor that you've into some software that you've used or maybe an apparel or a type of new apparel that's trending.

I have a great one. I have such a great one. And this is revolutionary because no one is really doing it just yet except a few companies. So like I told you early on that inventory bets are impossible. You essentially have to be a psychic to be in apparel because you just don't know how to Forecast and what the demand is going to look like and all that. So you have to just guess, right? The reason that these sheen and quinces of the world have these incredible valuations is not because they're just so great at making product. It's because they have figured out that they have solved supply chain and the demand and market is starting to unite, right? So what they've done is essentially, and there's a company we're talking to called Pull Portless. And instead of, you know, coming up with an idea for a product, spending hundreds of thousands of ideas guessing if it's gonna work, getting the inventory here like that process is months and months and months and so much cash tied up into an idea that you might not even channel. You'll just. If you just sort by like highest views, you'll see.

I'm gonna play this real quick. Let's see.

This is the one Gary Vee put in his book, by the way.

Jab, jab, right hook or something different.

No, the day trading attention.

Oh, I haven't read that one. All right, let's do this.

Johnson, you're fired. Why? It's not you, it's your shirt. But it's casual Friday. Well, you've taken it too far. Look at Gypsum. He's wearing a True Classic tee. It fits a tight in all the right places, but leaves the perfect amount of room in the front. God, I hate that guy. He looks so good in that shit. He can basically do whatever the hell he wants around here. Jimson.

Yeah, boss?

You're stud. Thanks, boss. True Classic is designed to enhance the male physique in all the right places. Right, Jimson? That's right, boss. I have strong arms, but also a little bit of a gut. But you wouldn't know because I wear True Classic that if you're a skinny guy, True Classic fits tight around. No is gonna work out what an insane business that we're in, right? What Portless has solved is your speed to market. So you can essentially do like a hundred units of one style. And this three pl is in China. So it goes from the manufacturer in China, they drive it to this 3 PL in China, and then it ships directly to the customer. So now instead of making these enormous bets and investing in a style that we don't know is going to win, I can make bets on small product categories and shirts and things like that on a very small run. Improve it out first on say 100 units. And if it, if I blow through 100 units in one day, well, I'm. I'm into a winner. Let me reinvest and then I can roll that out in a much larger unit size much later. So the arms and accentuates your biceps. But how can Jimson afford premium T shirts? He's the worst salesman here. And I don't even think he can can read Johnson. We all know gypsum can't read, but at least he knows that True Classic is completely affordable. And if you buy right now, you can get 20% off your first order. I don't need to know how to read to know that over 200,000 people gave True Classic a five stars. Good job, Jimson.

That's right. Five stars.

Five stars. Let me try one on Johnson. I don't know how I never noticed before, but you're stunning. I want a raise. Consider it done. But wait a minute.

Are those.

Now we're taking all the guesswork out of it and we're taking all the cash out of it as well. And Ted, True Classic pants. That's right. I just got them off the website. And get this. They even have activewear, polos, long sleeve. It's like it goes back to the drop shipping thing. Dude, this is drop shipping for what I'm doing now. These fleeces and even socks and underwear. Incredible. Jensen, why can't you be more like Johnson? Oh, what should I do? Isn't it obvious? You need to go to the Trail Classic website and buy all of those items right now. It's like it, it just, it mitigates all the risk and, and all the money. And this is how it's going to go in the future, by the way. Because I can already see that, like once people catch on to this, it won't make sense to go back to the old ways of how everyone's been doing apparel for the last 60, 70 years. This model will allow the customer to have more options. It'll hedge against all the other things that I said.

So.

What a game changer. Dude, I am so excited to test these guys out. We're gonna go through a test here in the next month or two. Click.

Click it.

Click it.

Click it.

Now click it. Click the link.

Oh my gosh. So good. Oh my goodness. That is so good. I've never seen that breaking a little.

Bit of the third wall at the end.

So 35 million views. Was that organic or did you put paid behind that?

Both. It was both. The organic was probably a. And see how it goes and start SK because we only roll out maybe a few styles a month. Few Let me see. It was like, probably 5 or 6 million, if I remember correctly. And then the rest was propelled by spend. We just, like, pushed it into the. And that's how you know, if it crushes on organic. You got it. We're going to start being able to do 10, 20, maybe 50 styles a month at 100 units per style.

Yeah.

And if it works, we just buy all the fabric and we scale it up and crush it.

Right.

But, like, dude, you're like a b.

Testing designs at scale.

Dude, what a model. This is what Quince does, by the way. I'm friends with the owners, some of the largest manufacturers in the world. Dude, you know how many style amplify.

Okay, so, like, I love that you've got some first principles, like just overtly funny comedic things. Right. And then you break all the rules in some other ways. Right. Like YouTube wants retention. They want you to get to the point as soon as possible and then to end the video. Right. Then.

This is gonna sound insane. You know how many styles Quince is rolling out on a daily basis? 8,000. 8,000 in a day. No big deal. Right? Like, when I heard that number, I looked at Ben, our CEO, and we were just like, what are we doing? Like, yeah, no wonder they have a $5 billion valuation. Like, what a model. So.

And because of new technology like this. So how can someone sitting at home take advantage of tech? You've got, like, 30 seconds of awkwardly click it. Click it. Yeah, click it. Like. And the fact that it got millions of views despite that means that people stayed. They stood there and, like, felt weird in their body watching these two guys sit on each other's lap in an office environment. Like, technology like that to launch something or to test something.

Well, I mean, you can test things now and, like, on a small scale, you can just do it through AliExpress. And you use Oberlo and connect that to your Shopify. And you can do it on a small scale there. But at a certain point, you will have to test into Portless and give them a shot. Now, they're going to have minimums, obviously, they're not going to take on every client. And you have to get to a certain scale to really pique their interest and make it work for their economics. Yeah. I would say from the.

Oh, man. And I also love that it's not a lot of times you see funny ads and, like, you don't even catch that.

It's an ad starting point. Dude, just do AliExpress. It's like, it's so Easy to go on there and ship product directly to people from. From that location.

Did you ever drop ship directly from China with True classic or did you just never.

Now the, the. So the portless transit time from purchase to landed with the customer is like six days. It's crazy. Yeah. This is not like we're gonna now have a 30 day wait time to get your product. We're talking six days, dude. You know how much now it's like five days in the US so we're adding a day with all this upside for the customer.

That's crazy.

It's exciting.

I heard of this kid in Atlanta who created this design. I'm sharing my screen right now here on the right. God is dope. And he went around Atlanta selling these for $5. Basically break even.

Yeah.

And his whole model was give these away for free. It's a great design. Like until the end. Right? That is overtly an ad from like second seven to the very end. Yes. It's polarizing. It sends a message. Then people go to his website, goddessdope.com and they start spending 20, $30 on t shirts with different designs. This is like his loss leader is viral marketing loss leader. What do you think about that strategy and is that, is that a good strategy?

I think is an amazing people copy that. No, dude, listen.

Right? But you just keep watching. You just keep watching. Which makes it so effective at actually selling product and not just making people laugh and remember you. Right. That's like the holy grail. Like the Venn diagram. All of the circles are overlapping in there. Did you use the Harmon brothers for this? Because they're like the best at this type of stuff.

This is what I always tell people when they ask about strategy as it relates to product. If you cannot feel comfortable about giving it away free, then you're. You don't have a great product. Right. Like if you feel like you have to charge people up front, then you need to go back to the drawing board. Essentially free to me. Oh dude, the Harmon Brothers are way too expensive. Are you kidding me?

This like 500 grand for that?

Isn't it more than that? It's ins. I wanted to use those guys early on, but that's why you have to go find your own. Is the ultimate gateway to getting customers to invest in you. Because you've broken down the barrier completely. You actually don't even have to make them. You don't have to charge them. Just give them something for free and let the net the rest net out on how much they like the Product.

Yeah.

And what a great message. I mean, how do you argue with that? You know, it's. Yeah, I think it's a great strategy.

Would you say the same advice to someone wanting to start an ad agency? Like, to get your first customer, do it for free, prove out the value, go from there.

If you're starting out and you have nothing, then yes. If you have proven it out, then no. Unless you have some unbelievable. Like, if I. So just to give you a little insight on the SEO agency, I'm. I'm pivoting away from it. I'm actually moving towards CRO, which Conversion Rate Optimization, because I'm such a freak about that with True Classic. And we've done so much incredible work there that I'm pivoting the whole agency towards that. And really the biggest reason is, like, you create immediate value, like overnight.

Do you charge a percentage of what you improve on the conversion?

Guys, When I first found Greg and Nate, they were just making TikTok videos. They weren't working with like a bunch of other brands. And I found them and I'm like, why aren't you guys doing ads? This stuff could be great. And then I tested them and like their first ad with me and any brand they worked with, like, just crushed right off the gate. And we were like, okay, we are on now. They work with everybody, which has been really great for their careers.

Are they very expensive?

They are. You could, you could do that model.

Or is that not what you're going to do?

No, I'm going to charge. Well, maybe in the future. Yeah, potentially. But in the beginning, I'm just going to charge a flat fee to use our services and, and basically, you know, you could charge 5, 10, 15, 20,000amonth, but you're creating overnight impact. It's unbelievable. You know, you go to like a product page and if you redesign that thing and it converts at like half a point better. Now, they weren't early years, but they give me. Listen, they're owners in the company, so they. Yeah, they've earned it. They. They have ownership. They.

In your company.

Yeah. Better. You have just created such unbelievable value for that business that what is five grand to them when they're going to be making 100 grand more per month?

Yeah. So I think a key differentiator with starting any agency is not just impact, but. But provable, attributable impact. Right. Because if you have like a. Let's say you have like a marketing strategy agency and you're going to get on calls and say, I would do this and I would do that. And it's all kind of nebulous. It just doesn't work. Right. Or like fractional CFOs are exploding right now.

They still have.

That's awesome.

You know, they still give me like good pricing compared to everybody else. Like.

Right. Instead of hiring someone for 10 grand a month to be a CFO, you know, your, your business isn't really big enough. You could pay $2,500 a month for someone to be a fractional C, et cetera. Yeah. That sells so well because it's directly tied to value. You get your P and L, you get your balance sheet every month. That's what you need. Right. But the reason that like fractional coos aren't really a thing is because it's like how do you tie it to the value as closely as in finances or if you had like an email marketing agency. I took your opening click through rate from this to this. That was because of me. $3,500 a month, please. Right. If you, if you can't do that, you're going to be fighting up.

They grandfather me and obviously because they're part owners. So they're amazing guys and I love them to death. They really have done great things for us.

Okay, so more people need to use comedy in their ads, period, End of story. It's hard because you got to be comedic, you got to be creative, but it's worth it.

You're saying it's worth it if you can nail it. It's. I would also just say like it's going to take you a little while. Our first couple in house ads were not amazing. They were decent, but we just got better and better and better and better.

And we learned from it too, the entire time.

So those are the ones you just named is exactly what I tell people to start. We learned that like if you really break down that ad, one of the biggest components that you'll notice is that there's this reveal moment where it goes from wearing a schlubby looking T shirt to like this amazing T shirt. And that is wildly impactful. What we found is that in any comedy ad that we did, if we didn't include that transitional component, which is really very doctor that the ad really suffered on roas, like if, like they want to go into the service business because having lived on the other side of this as a brand, I can tell you that the two most impactful service based industries to go into in the future, they will always have a life, no matter AI or Not is email marketing and CRO. Those two are to your point, incredible immediate impact. And it's like not even a conversation. There's no you don't have to prove anything. It's just like look at the numbers, look at the data. Is it better or worse or whatever. And those are the quick just we were never able to scale it. And so you have to have that component. Another thing like that you'll notice in that kiss to propelling you to the next level. You dial in your CRO, you dial in your email and it is incredible overnight impact and those agencies will just never lose. That's why SEO is so tough is because it takes ad is that he talks about a bunch of other product categories. So you know, originally we would do a lot of ads just around the T shirt. And what I started realizing was like we have got to branch out and a lot of what you'll see in that ad is forever. So like gone are the days of like, well, it's going to take you a year to see results. That's going to take you a week with CRO.

Yeah.

So congratulations, you're on to something now. And for people that want to know tactically what to use on the CRO front, it's the program we use is intelligence. My voice in the production phase going, guys, this has got to be bigger than T shirts. Like we have to talk about the and it is one of the best we've ever used. I love it. We use it every single day. We have tons of tests running and I'm going to use this platform with even my other agency still. Yeah, it's just the best We've tried a bunch of them. Intelligence rules.

Well, dude, one of my. One of my most favorite like pastimes is to log into our Klaviyo account and just start tinkering and just looking.

Messing with flow jeans we have to talk about and that's why you see them write that into the script when they talk about everything else. It's so important that people know that we do other things. Otherwise like how are you going to grow the business?

I know this is impossible to pose. One of my most popular newsletters of all time. I think it was called like how to quickest path to 20k a month. And it was basically join a Facebook group for E commerce business owners post and say, hey, I like Klaviyo. It's cool. I want to tinker. I want to improve your brand for free, 100% for free. Give me read only access to your Klaviyo account. Let me tinker around in there. I won't send anything before talking to you. In fact, I won't even have permission to send anything. Let me mess with your flows. Let me see if I can get your revenue per recipient up and then like answer accurately. But how many millions of dollars did that one video bring? True classic. If you just had to guess, my.

Gosh, probably tens of millions.

I would say get a couple free case studies. You're probably going to enjoy it, right? If you don't enjoy it, then find a different business. If you do, keep going.

It's hard to say though, because it's one piece of the journey in a.

Pretty soon you're gonna have people lined up to pay you $2,500 a month to improve their Klaviyo flows or to add new flows or cart abandonment or welcome email or Happy birthday you ordered a year ago. Like there's so many levers to pull inside Klaviyo. Or with CRO conversion rate optimization, like just start learning intelligence, geeking out. See if you can get their conversion rate from 3.1 to 3.15.

Yes.

That's interesting, right?

What you just a broad journey. Like everyone always acts like you do one thing and you do one thing. It's like no, it starts with hey, how you doing? Nice to meet you. And then it ends with like I'm gonna marry this woman. Said about that that process you just walked through. Yeah, I try to tell people this all the time because they every I get pitched to use these agencies like a million times a day and I tell them, I'm like dude, all you would have to do to get me to sign up like within 10 seconds is do a shred of pro bono work. Just do a shred. Just show me something of value and but no one wants to do that work, right? Everyone is just lead gen at scale. Let me just mass email every single business in the world and get them to sign up. Dude, the path to getting a true classic as for a huge retainer is doing exactly what you just said which is show improve your value and do a bunch of work up free. If you want all the money, do a little bit upfront and and really show us and dial in and go because how are we going to say no to that, right? Like if you actually do that work and you show us the value and you've already spent the time and energy, there's almost zero chance I can say to know and even to this day when I get people that Are like, hey, I have this actor or this athlete that wants to work with because she's so amazing. And when I met her, I didn't realize, but, like, in between all that is so much new. And I'm just like, okay. And then what? Like, you haven't done the work to tell me what that even means for True Classic. You're just saying, hey, I got this guy. Pay me this money. The end once in the.

Yeah.

So, like, let's see. Let's say someone saw that ad, right?

Right.

From there, they go back to their life, and they're not thinking about anything. And then two months later, they see a True Classic ad, and then they make the connection and they go, oh, yeah, that's that thing. And then they go back to doing whatever they're doing, and then they walk into a Target and then they see it. And now. So, like, to say that one video created 10 million isn't really fair. It's like, yes, it was a cog in the week. That does not work for me these days. I try to tell these agents, I'm like, you guys have got to speak. Spend time getting creative, coming up with a solution that works for us. What is on brand? What will work for our customers? Not just, hey, guy type price. Do it together. It's like, dude, I'm out of that land. From. From you.

Yeah.

Just so you know, now. Now they have to go way back to the drawing board. And they're like, well, forget True Classic. This is like, I have to do work. Like, I'm out of here. Like, on to the next brand. Even with, like, you know, we do like, these big partnerships now. Like, we're with the ufc, we. Or with the Clippers or with the Kings or with the Rams. Like, we're doing all these big sexy brand deals. And even with them originally, they would. And UFC has been an amazing partner, by the way. Like, I have no complaints. But, like, some of these other ones that I have worked with do, and it was part of the journey. Did it make an impact on getting their attention? A thousand percent. It's not like, 1, 2. They come with these proposals. That's like, you know, a million, two million bucks a year. We're going to put you on a. On the Jumbotron with your logo in the end.

Oh, my God.

To one necessarily.

Right. Well, it just so happens that person in your example, like, they buy all their shirts from Target, and that had to be true because if they saw you at Target, but they just don't buy shirts from Target. They're still going to keep walking.

Yes.

And you're going to have to get them on, like, your 17th touch touch point with them instead of your ninth touching with them. Right, Exactly. I've been pitched that before, too.

Are you talking about. Dude, like, unless you're taking little Johnny from the top of the rafters to courtside and making an impact, I don't want to hear it. So come back with your proposal.

Oh, man.

It's a long life that we all live. And just because you made an impression that is filled with thoughtfulness, let's show up for the fans, let's give them free product, let's create a moment for them, because that's what I'm trying to do. Like, if you don't come with impact, I don't want to hear it. Don't show me your sexy deck with big numbers and all these impressions. You're not going to win me over. Right. You come with thoughtfulness and initiatives and charity work and ways to show up for humans. Now I give it. And they leave those meetings like, like, so deflated. But I'll tell you, dude, when they come back to the table with those second and third proposals, they come correct because they know exactly what I'm looking for. And it's so different than all the other brands they work with because they're like, well, Bud Light just says, like, here's some money and then just do a thing. It's like, yeah, dude, we're not Bud Light. Like, we're. We're scrappy. A startup. Just so you know, like, we quantify our dollars. So, like, just don't go that route and you will get our business.

Oh, that's so good. Okay, so if we're talking, it doesn't.

Mean you made a sale. It is just one piece to the much larger picture. And that really is, like, why you agencies.

If you were to rank from most to least promising or from most demand, but lowest need to just keep coming.

Correct in all assets because you don't know where you're going to pick them up at and what part of the journey or the funnel.

Well, I think that your marriage analogy is so perfect because if you meet someone, you're attracted, you know, apply like the greatest asymmetric bets in starting a service business or an agency today where years later you. You get married. Oh, she. They love me. She loved my personality. She loved my Riz. Well, she loved your. Where would you rank them from? From best to worst?

Definitely CRO number one. Because even with email background, she Loved.

You know how you hold the door open for her. She loved that you came from the same area.

Like now I would put email number two but with email there is a bit of a ceiling where like the creativity like can just hit a bit of a limit. Even with us, like we've tried to.

Like the wealth, the lower ceiling.

Yeah, like the. Whereas like CRO, there's so many components to a website. Right. Like on email, it's literally just an email the end. And even with email, like we've done some amazing things with like Maverick AI. Do you know what Maverick AI is? It's like where I sat in a room and they recorded me and I went through every name in the English language for like two hours and I said like, hey Jennifer, Hey Derek. And then they piece it all together and I tell a story with saying their name off the rip so that you like capture them, right. It's so mad. They love it. So like that is taking email to the next, next level but like beyond that there's nothing left. It's like we've already done it at the highest level. So now with CRO though, I'm telling you dude, my in house guys come with a she.

Love that you did this when your tire, you know, popped on the side of the road. It's all of those things. It's not because you're fit Posal every.

Week and we sit there for like an hour and just riff on ideas and we come out with some of.

The most amazing or you go to the gym. It's hundreds and thousands of things and decades of compounding all paying off in.

That one moment stuff. And it just evolves and evolves and evolves and then the next week it's something else.

And in ne and they don't exist in a vacuum.

That's exactly right. Because the person you are today took a long time ever ends. Which means for an agency, you'll never run out of ideas. Like you'll just keep going to get there. They didn't see the upbringing, they didn't see how your parents treated you. They didn't see all the struggle you email. I've seen these agencies, they come in, they do good work for like a month or two and. And then after like six to eight months it's starting to like hit its limits already and they're out within a year. So like CRO, you get a good agency, dude, they're never leaving because upside is tremendous. So.

Oh dude, I have a headache. In a, in a good way. This has been really, really good.

I'm just happy to be here talking to you. And like minded entrepreneurs are. They're tough to find again. And even like you, walking through some of your examples shows me that you're thinking about things the right way. That is a rare quality and it's something I look for in people, even that we hire here. Like we go through homework assignments and like we get to see how their train of thought works. And I will tell you that what we've learned over six years of hiring hundreds and hundreds of people, that what works best here are entrepreneurs. And what we know about them is that they might not be here that long because they are going to go start their own thing and we're okay with that. But while we have them here, they think about things the right way. They think about the customer, they think about the journey, they think about thoughtfulness, they are scrappy. They're jack of all trades. Like, they're all the things you need for this business to work. Because that's who we are. Right? Like we're those guys. We're kind of like masters of none, jack of all trades. And we're dangerous at every little thing. But we're not specialists. Now you still need some specialists, like finance, for example. Like you need those. But I heavily index on the jack of all trades, guys just like yourself. If I were to find a guy like you that was in the working environment, like I would snatch him in a heartbeat because it's, it's a rare quality.

Well, I hope that brings people comfort to hear that because, you know, you get stressed out if you chase shiny objects and all these rabbits and you know, a little bit about Facebook ads, a little bit about copyrigh, a little bit about E commerce, like, lean into it. It doesn't make you unemployable. It makes you an even better employee if, if you decide to go that route or a better employer. Right. And over time, with all that surface area of little things that you've tested and tried, you're naturally going to find things that you love the most and then you will become a specialist accidentally on certain things within all of those trades.

Yeah. The other thing I would say, as it relates to that, if we're talking about employees, the one thing that makes the biggest difference in the world is identifying impact versus busy work and putting all your energy towards impact. Now people would say, well, yeah, but I got to get the work done. Yes. I'm just saying energy deployed needs to be 80, 20, 80% of your energy towards impactful things for the business, 20% to busy work and learn AI, lean AI agents. Find ways to get that busy work off your plate. Because if you want to go from intern to CEO, it will only be on impact. It will not be because you worked busier than the other busy bees in the company. It will because you identified something, you created opportunity. You found it, you did. You had the initiative and the insight to go after it and figure it out. That is true impact. And because of the thing that you found, it was wildly successful for the company. Company impact is so tough to understand though. When you come into a company, you have to listen to your leaders, you have to talk to the business owners, you have to learn what is impactful to the business. Like if you were to come in today and you would go, Ryan, what, what would work for True classic. What do you think I would say? I would say, dude, study CRO. I know you're in operations right now, but if you came out with a CRO win, you think I wouldn't credit you towards that and give you something out of that and excel you in the company? Like, I don't care where it comes from. It's just find a way to be impactful and you are really onto something as an employee.

I mean, just to just back of the napkin, let's say you, I imagine you have several million dollar days on your website, right? Dividing your annual sales by 365. Let's say you have a million dollar day three and a half percent conversion rate.

Yeah, we're averaging, you know, anywhere from on like a random day. It could be as low as like, you know, 250 days all the way up to, you know, Black Friday gets into like multimillion dollar days.

And then how many visitors per day on average are you getting?

It's somewhere between 100 to 150,000 a day.

Okay, so if you have 100,000 visitors a day, that's 3,500 orders at a three and a half percent conversion rate. If you find some intern that gets your conversion rate from 3.5 to 3.6, that's an extra hundred orders, right? Is that right?

No, it could, I think it would be a little bit more. But like I get where you're going with it, dude. If anything moves cvr, you are on your way. Like if I was a guy that knew nothing about that world and I had came up with an idea or I saw a post somewhere or I was surfing and I put it in that channel on Slack where all of us are and it did something, dude, you have just now become wildly valuable even outside of whatever you do in your particular role, like understanding impact as it relates to certain industries. And just putting an idea out there is so important. I mean, we have a channel in Slack called Ideas. And that can come. Inspiration can come from all sorts of different people in all sorts of different ways. And that really empowers people to just always be curious and learning and figuring things out and looking to what's next. And give us a nugget. And that nugget can turn into a mountain very quickly if it's great.

Even if you just give, like, the inkling of an idea that someone else turns into something real. Right. You're still the originator of the idea, and they're going to tie that to you.

That's what happened with the teacher initiative. It was one idea from, like, a social manager, and she was like, hey, we should, like, you know, it's the end of the school or beginning of the school year, and these people need help. And I was like, what is this? And I looked into it and, dude, I turned it into a mountain. I took that little nugget and I expanded on it and I blew it up into this big thing. Within a month, we're on, like, every newscast. I was spending hundreds of thousands of dollars on wishlists. And now I have this community of amazing teachers that support me and follow me, and they follow every move I make. And here I am every year spending all this money to help them. And it started from one little concept, from one person who was not that high up on the chain at all. But, dude, even in this conversation, her name is Tiffany. I give her credit in almost every podcast I'm on that they bring this up. I'm like, and I want to forever champion her and clap her up because she deserves it, dude. Yeah, she was there putting in the work, figuring out what people need and how to drive value to them.

You know what you very easily could have said, what most leaders would have said is, thanks, Tiffany. Super cool idea. We're just kind of focused on X, Y, or Z right now. Exactly. But that's the magic that happens when you see a thread and you pull on it. It's like, where will this go? Where will this go? Chasing shiny objects. Right?

And I'm obviously obsessed with impact. So the more I looked into it, I was just like, these poor teachers, dude, they have to spend their own money at these Title 1 schools. They have to spend their own money to get supplies for kids. I'm like, and I have three kids. I have three young kids. And I'm just like, I can't even imagine what that looks like. This is insane what they're going through. So it was like, how can I not show up for these guys?

Right? What's next for true classic public exit cash flow?

I definitely do not want to be in the public markets. I have a lot of friends that are in the public markets and what a life they live with all the stress. And I just. Dude, I am like, how do I de stress and make my life simpler and better and easier? I'm in that kind of part of my career. So I think what I'd like to do is potentially a big majority deal sometime next year or the following year. Because this business went through a huge growth year with wholesale. We're looking very attractive to investors. So I am in a place where I'm just like, let's either do like a, you know, a 40% or maybe a 60% if the price is right, and then I can go on and do these other things, like what we were talking about developing some sort of operator short school and just empowering entrepreneurs and helping them and teaching them, or some sort of a YouTube live show where people just come on. Similar to, like, the. I don't know if you've ever watched Gary Vee do his tea with Gary Vee, like, a version of that, because I would just. I would crush those environments where people just come on and hit me with questions and, like, I just give them a little bit, or I look at their website and I just start destroying their website and going, dude, you got to move this here. You got to do that. I could see something like that being great for people. So we'll see, though.

Oh, Ryan. Well, this was perfect. Even better than I had hoped, and I had high hopes. So where. Where do you want people to find you?

Basically, my name across all the socials. I'm sure we'll link it up somewhere. But Instagram, Twitter, LinkedIn. Yeah, it's just my name, Ryan Bartlett. Across basically everything, you know, I can definitely be found. I'm happy to answer questions for entrepreneurs. It's something I love even to this day. People are hitting me a lot, and I'm taking a lot of time because I wish I had that when I was younger. Like, I really wish I had somebody kind of guiding me in the right direction. It would have saved me a lot of time and energy and money, frankly. Yeah, I'm easy to find on social if you just got to search for my name.

Okay. And then trueclassictease.com. of course. Yeah.

Trueclassic.com I still haven't changed the URL.

Because I noticed that it redirects. Right.

I'm worried about the organic implications coming from the SEO world. I'm just like. I've seen so many disasters, and I'm just like, ah. I'll just. Yeah, it's fine.

All right. Well, thank you.

Yeah, man, it was fun.

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