Zero To $8M: How One Founder Built An Empire With No Employees, No Debt, And No BS

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Welcome to this edition of the Million Dollar Mastermind podcast. This is where we pick the brains of high achievers from all walks of life and get their hard earned real world insights on winning. I'm your host, Larry Wydell. Hello everyone. We're talking with Adam Calavet. And Adam, you're up in Montana today, is that right?

I am. Beautiful fall day in Montana.

You lived up there all along or are you new? Are you native or what?

I was born and raised in Flagstaff, Arizona. So I grew up in a, in a pretty similar climate and environment and started having kids and wanted to go back to that but didn't want to do it in Flagstaff. So we ended up in Montana.

And so the surrounding, you've got a lot more probably support around you now to run a business. A lot of people have moved into town, I would imagine.

There is a burgeoning early stage ecosystem in Bozeman, which is where I live specifically, which has been really, really great to see frankly. All of our development team for this new company I'm sure we'll get to at some point is actually here in Bozeman, which is pretty wild to be able to do that today.

Well, you've start, you've been through, we're going to dig into the different stages. But you started off founding a company, co founding a company called Bottle Keeper and pretty much ran that up to what, 8 million in sales in three years with no employees, investors or debt. Talk about that. How did that happen other than a lot of homework?

Yeah, I mean what that is the highlight. That was the first three years. We ran that company for nine years. So we got bigger than that and a little heavier than that before we got acquired. But why that happened the way it did came from the thing before that, which was out of college I went into a medical device company, not as a founder and we, it was a big heavy company. It was hard to operate. We had 80 people in multiple states and delivery vehicles and warehouses and just tons of stuff. It was difficult, it was heavy. It was a big heavy business. And we spun off in 2008 a health insurance tech component. And it was a handful of people in cubicles executing documents and it just printed money. It was, it got bigger from a revenue standpoint than the device company in its first 18 months of operation, which was a big aha moment in my entrepreneurial journey that efficiency matters and there are smarter ways to build businesses. So I sold my position in that in May of 13, which is right about the time the Bottle Keeper idea came around. It was my cousin's idea, drinking a beer on the beach out of a red solo cup. And honestly I just vowed to never do that again. I had scar tissue from the prior decade of running big heavy stuff. And so Bottle Keeper had a no employees guardrail which forced us to think and operate and execute differently.

Talk about how you got. Well, you had a major success early in your career. How did that happen before for it's one thing to say it was a heavy business, but I mean it was a business, a big business, successful business. So how'd you get yourself involved in that?

Going back a little further. I wanted to be a doctor since I was really young. I started having these weird dreams When I was 6, about 7 people on operating tables. So I had I and I dedicated, to be clear, I was still a kid, so I did a lot of kid things. But I dedicated a lot of my free time and study from really middle school, high school and certainly into college towards being a doctor. I spent huge amounts of time in operating rooms and I got nursing certifications and I, my degree was molecular and cellular biology, which is very heavy science and math. And about halfway through college decided I, I didn't want to be 35, starting life with half a million dollars in debt, which was the path that I was on. So I was, in essence, I was kind of growing up. And what I did was right out of college I took the risky route. I had offers, job offers coming out of college at big medical device companies with big salaries and bonuses and company cars and all like the amazing stuff that I would say probably, I mean anybody would love to have right out of college. And I did not do that. I turned those down and I went into an orthopedic device startup working out of an apartment and worked on commission only where I literally, I made $0 at the beginning. It was a draw against commission, 100% at risk. I went for that instead.

Orthopedic device?

Yeah.

And is this something used in surgery or something they wear or something?

It was mostly postoperative. Over the years we got into a number of different things that did include some surgical stuff, but it was, it started out as a post operative orthopedic device company. So if you have any surgery or an elbow or shoulder surgery, there's a bunch of stuff you're going to get. We supplied you with a lot of that stuff.

So you get out of college and you've had an awakening. You look down the road, it sounds like what I went through with architecture At Georgia Tech, unfortunately, let's say the light bulb went on, I guess, in the spring of the sophomore year, where the professor took the time before we started the semester to described the career path. And when he got to the point that of saying that you can't make any money, probably not going to make any money till you're about 40 years old, you're going to have to be leave, leave school and get a job being a draftsman at minimum wage for a minimum of three years before you begin to flunk your architectural board exams.

Yeah, it's quite similar. Mine was about sophomore, junior year in college. I was like, this doesn't sound that great anymore.

Within Same, same process, 20 minutes, I had a new major. And I think the words I said at the guidance office was, I knew I wasn't going to quit because I wasn't going to have that over my head the rest of my life because the implication is then you're not good enough. And it wasn't hard, it was just annoying. And so I think my words were, my mission was, what's the fastest way out of this hole?

Yeah, I'm sure they love hearing that.

Right. And so anyway, yeah, I went through a similar light bulb experience. It saves you a whole lot of time, doesn't it?

Yeah, A lot of pain and a lot of time and pain and suffering and in this case, money.

I did not realize a half a million dollars in debt that people go, plus your health. What? I've talked to a lot of doctors, a lot of successful doctors, and their health just goes right down the toilet. They gained 40 or 50 pounds.

Yeah. Stress does incredible things to our bodies. And when you combine the stress that goes with. Not just the schooling part, it's largely the stuff that happens after the schooling part.

Yeah.

Where you just work outrageous hours under difficult conditions for really long periods of time.

Yeah.

That does incredible things to your body.

Yeah. And so you're looking out there and you were thinking of more important than medicine, which had an obvious appeal to you. More important than that was actually having a life.

Yeah, it was it. It absolutely was. I mean, those. As you age and learn, your priorities change and shift. And I loved what I was studying, so I continued it and I finished it. And that has played a big role in my entrepreneurial journey. Because learning, learning math and science is by definition problem solving.

Right.

All calculus and organic chemistry and physics and algebra, all of it is. You start here and you need to get here. It's your job to fill the stuff in between. And that's what startups are, that's what entrepreneurship and problem solving is. I got to do a lot of that in a very technical place, which I think has, has been really helpful through my journey.

Well, the thing is that I don't know if that's addressed or brought up to kids going through college, but you do hear a lot of people say that in the educational system today. So many of the kids are, they're indoctrinated, they're educated, but their ability to do critical thinking and problem solving is pretty much non existent. And other than with mine, I put a degree of difficulty on there because early on I decided I was going to see what's the highest grade I could get with the least amount of study. And so that became my game. It's like two graduating fifth year seniors got a hold of me my first week at Georgia Tech and told me no one cares what your grades are when you get out. And I said, you've got to be kidding. They said, unless you're going to graduate.

School, it honestly doesn't matter.

Or they said, unless you're going to be a research scientist and you're just, you're too dumb for that.

Nice.

So I said if, if the degree is what matters, I. Let's, let's make a game out of it. And so I know that there's more to it than that, but the thing is that you were doing some critical thinking about your future. And so when you wound up with that job, how did you attack that job? You obviously came out of school and you had developed some strategies, life strategies, some approaches that served you well for getting off to a, a great start once you hit the business world. What do you think those were?

I think a big part of it and I can't honestly tell you where it comes from. There's not a defining moment in my life that I can point back at and say this is from that. But I was just always comfortable with risk. I was confident enough in my capacity to solve problems that I, I honestly just believed I would figure it out. No matter what the problem was, I would just figure it out. And I carry that through today. And now I have more experience to add into that sort of bucket. But that made a huge difference in, in going into, I mean I effectively went into a position at a brand, almost brand new. I was working out of an apartment, orthopedic device company and got handed the keys to sales and said here, go do like, go figure it out, go build it, do it. So I had to do it and then it, as it worked, new problems come up. And then we. I expanded that company from Arizona to California in 2008 and got to redo it again, restarted it in a garage, rebuilt it in Southern California and said, you just sort of get this like rinse and repeat of building and problem solving.

You first started in sales, but then you went into what, what was that? What did you have to figure? What do they.

Yeah, it's an interesting. It was an interesting. The way the company was set up was interesting. I would call it atypical. At minimum, it was family. There was a dad and two sons and there was one or two other people and that was the entirety of the company. So the sales part was I was the first outside salesperson to come in the company. So they literally just said, here's the keys, go drive the car as fast as you can. Drive the car. So over years I figured out how to do that and got really good at it. And then as the company grew and built up, all of that happened below me in a downline. So then I was responsible for a whole team of salespeople that I hired and I trained, which then converted to great. Now we're going to expand the company to, from Phoenix to Santa Monica, move to Santa Monica, rent a house and start this company in la. Like, great. So you go there, you move, you start it over by knocking on doors at doctor's offices and making appointments. And then you get enough, generate enough revenue. We've. There was no debt in the business or investors. It was all profitable and built on, on retained earnings. So you grow and you hire as fast as you can afford to grow and hire and rebuilt it again and ended up with a couple offices and a team of 15 or 20.

Where that's different or unique is that usually you would get out, you go to work for a big company, they would have training programs, number one, they would have training programs, they would teach you how to sell the systems, the procedures, the manuals. And it would have been, they would have been doing it for many, many years. So they would have it refined down and then they would also have territories that already developed. And you go out there and you work, they give you a territory, assign you, and early on maybe you traveled with somebody else and they would, you know, till you got. Got your feet wet and then you could go on your own. And then instead you show up and they say, go, go sell this stuff.

That was the world. It was a startup. I know my wife was in the other version of that, which was with big pharma and big medical companies that they did that, they'd go on a. Spend a week with somebody in Pennsylvania and do training seminars and do all the things and it was just different. And you was way more comfortable in the figure it out environment than I would have been in that structured environment.

Yeah. Much more freedom.

Yeah.

And so the thing is that how did you evolve in your ability? How did you learn the things you needed to know to recruit and train and manage other salespeople once you got overloaded and you needed to add some more people on, how did you move through that? Was that hard?

It was not. Well, yeah, sure, it was hard from the standpoint that it's all learning on the fly. And that can be painful sometimes.

Yeah.

I mean, look, frankly, you learn, and I still do to this day. I think everybody does. You learn from mistakes, you learn from breaking things. You don't often get to talk about the things that you break, but the reality is like, that's where education typically comes from. You build up scar tissue because you, you interview somebody and they seem amazing and then you bring them on and they're a completely different person. Like, so you learn that's. There's all sorts of learning experiences from that one thing. And then the more you do it, the better you get at it.

Yeah. And then of course, you have teams of people, you're managing managers. And distribution is a very complex build. Being able to build and run salesforce is a really elite skill. And you had to figure it out on the run.

I did, but it wasn't. We didn't get to the point where I was managing a huge team of salespeople. I would say that at the height of that, between Arizona and California, I was responsible for all of the California operations, which was a lot of people that weren't doing sales because we also had like service technicians, we had warehouse staff, we had a lot of other stuff. But from a purely sales perspective, it was probably a total of maybe 10 people. So it was managing one manager in Phoenix who was managing four or five people, and it was managing one manager in LA that was managing three people.

Yeah.

So it wasn't a massive. I mean, you know, it's. I, I have friends in other companies that have that distribution where they're at the top of a company with 40,000 people in it. I mean, that is mind blowing to me.

Yeah.

How. How that distribution, the management of that whole system takes place is incredible.

Talk about what you. What's your fond memory that you retained from that stage of your career and what are your non fond memories of that stage of your career?

Well, I can tell you that the fond is grossly outweighed by the not fond. Much of which is is just frankly based on the premise that that environment was a very intense lead by intimidation. Father and two incompetent sons and then some outside people, one of which was me. And they were not the people that money made them better. Let's just say they were the sprinkle money on it and they just continuously get worse and worse. So frankly I will get to the good part but the. I mean there was so much unnecessary challenge and I learned most of what I took from that from a leadership perspective around what not to do and how not to treat people and how not to behave.

That probably turned out to be a big blessing for you.

It totally did. It absolutely was a blessing. And and the on the positive to that is I got to the point which was a massive inflection point in my life where we literally, my wife and I drew a line in the sand and said if this specific thing doesn't happen by this date like plugs getting pulled and that didn't happen and we stuck to it and it forced a transition out of that and the sale of a position that led to a beautiful subsequent. Now it's been 15 years but that. That set the foundation for the decision making for the next 15 years which was a radical lifestyle change and profession change.

And how did you find that and how did you make that move?

The technicals of how I made the move were, were actually quite interesting. But the, I mean look, in reality we knew that we couldn't be in this position anymore. I had, I was a partner in a company that was involved in this system. I had a means to sell that position. I sold that position. That bought us time. We were young. My wife did really well in medical device. I got to put some money in the bank. We didn't have kids so we had a lot of flexibility and that gave me the opportunity to not need to go and jam like into another job or jam a startup into the world or do something. It gave me the time and flexibility to let something come up. And that's what ultimately happened with Bottle Keeper.

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Well, at the beginning, nothing. To be fair, I saw my cousin Matt invented this product again, like I mentioned, sitting on the beach drinking a red beer out of red Solo cup. And he's a little bit of a maniac and he wants his beer out of a Corona bottle in a specific temperature and he sees people using water bottles all over the place and just has idea, why can't I put a beer bottle inside of that? So he, he invents this product that is, it's like the bottom screws off and a beer bottle goes inside and you screw the base back on and it's insulated and it keeps a beer cold and glass protected and all that. And I didn't largely think, I thought it was a kitschy, interesting idea. I didn't think for a second that people would pay real money for it.

Yeah.

So he pushed me to get involved because I now had all this sudden free time and I, and I admittedly said no for a while. Yeah, it's like I don't think it's a thing. And then finally we were super close. He was the best man of my wedding before all that stuff and finally said, okay, fine, we'll, we'll test it. I'm going to prove to you that people are not going to pay real money for this. And we started to execute a strategy. I shot a video on the beach with our GoPro and put up a website and, and spent $500 on Google Analytics or Google AdWords and sent people the website to watch this video and said, do you want this? You know, short version? And enough people said yes. It was like, okay, that's fine, people are interested in it, but are they going to pay more than $7 for it? Because if they're not, it's not a company, it's a hobby. And so we used crowdfunding to get prove that people other than our aunts and uncles and moms and dads would swipe credit card to buy this product at a real price point before we spent any money building it. And it worked really well. I was like, oh geez, what experience.

Did you have with crowdfunding before that, zero.

I had no experience in any of this stuff. We were making it up as we go solving problems.

Who comes up with a crowd crowdfunding idea?

I did. I wanted to prove again. So if we step back, like, my brain is very data scientist.

Yeah.

Like, I think when solving problem, I think in the terms of a scientific method. Like, you create a hypothesis, you limit the variables, you go down this path. And I was deeply concerned that people would not spend real money on it. Okay, so how do we prove that? What's a test that we can run to test that hypothesis? And the best way I could figure out to do it. Crowdfunding was big at the time. Like, Kickstarter was massive. Indiegogo was big. And so I. The only way I could think of to get it to a mass audience that didn't know us. Like, they weren't attached to us, they didn't have the emotional connection to us was crowdfunding. And that was a really good way, and I still think it is today, a really good way to prove.

You get on crowdfunding, you learn how crowdfunding works. You learn how to put the pitch together and submit it, and money comes in. So how much money did you raise?

No, that's not. Money doesn't just come in. There's a lot of other stuff that goes into it than that. But it. It went for three months and we. We raised like 350% of our goal, which was like $18,000. Our position was, again, this was not a raise. This was not an expensive company to start. Matt and I each put in $10,000 total in the whole life of the company. So the point was, at $20 a unit, how many do we think we need to sell to complete strangers in order for this to be a thing worth pursuing?

Yeah.

And we figured that would be about $5,000 in sales. So we just wanted to see if we could sell $5,000 in sales to strangers. And we sold three times that. Yeah, but we had to do it. I mean, there was PR and press stuff that we had to, like, hack together and figure it out, because you can't just put it up on a website and hope people look at it.

And so to get to figure that part out, you just did your research, you looked at what other people had done and cobbled together your version of it.

Yeah, and leveraged connections. I knew somebody that was involved in a crowdfunding campaign or platform that was able to get us access to certain parts of their platform that we probably shouldn't have got access to and they did some PR things for us that led to exposure that happened over the course of a couple of months.

Fantastic. And so while you're doing this and unbeknownst to yourself, you're also continuing to expand your business skill set.

Yeah.

Problem solving and on the job. Problem solving and way to look at things, evaluate things, make contacts and so how did that explode? How did you really catch on from 15,000 in sales to where now you've got Z8 billion in three years. Kind of mind blowing really.

Yeah. Again, in hindsight is one of those like high level highlights. It is. It's totally mind blowing. How that happened was so if we can we use my guardrail once it started to move my deal was look Matt, well let's go do this. Obviously it makes sense to do this. The data is telling us it's worth doing. But I am not going to manage a person. We are not going to hire people. So we have to build the company in a way that that does not require us to hire people. He's like, great Fig. Yeah, okay, go do it. Like great. Here I go.

Why did you have this animosity about the idea of managing a person?

Because I had just come out of this like decade long, heavy, weighted, intense thing and I wanted to not do that again. I wanted, I and to myself I kind of wanted to see how much of a business could be built with not having a team. I would. This is in the time of like Tim Hours, Tim Ferriss's Four Hour Work Week, which is a kitschy title that he admittedly a B tested but. But there's a lot of good stuff in there. And I read that and it was. It's all about using automation to make things leaner and better. And it sounded incredible coming out of the experience that I had just left.

Yeah, yeah. As I point out from time to time, he's an incredible liar because even at when he was at college at Princeton they said he worked 24 hours a day.

I know. I mean he talks about that title like he literally testing titles and it worked perfectly because obviously the book did really well. But the concepts are not to limit your work to four hours.

The concept is valid because the thing is you get a salesman or salesperson and they're like I'm working all the time, morning and at night, this side, the other. Then you find out they actually had 30 minutes of face to face time with a prospect during the week. In their mind they're just going around the clock. I'm Just overwhelmed. So the four hour work week is a great. As a ballot concept. And so what amount of the time you're spending is actually useful or on point. So you go in there. And I had a similar experience in the sense we followed a lot of the same paths because I went out of Georgia Tech, I went into construction, and I'm a superintendent for residential home building. And So I built 100 houses in four years, which means 11 houses under construction in five different subdivisions at all time. Going, taking them through 25 different phases of construction. At that time in Atlanta, they'd had an apartment boom. So all of the good subcontractors went over to build apartments and we were left over with people who didn't know, had just got introduced to a hammer the day before or a trowel. And you had to build houses with these guys. And so at the end of four years of that, I got out of that and went in financial services. I said, I've got to get a more stable industry. And I stayed in sales too long. But it appealed to me because I did not want management.

Yeah, totally understand.

And I, I used to say when I get up in the morning, my feet hit the ground. My whole organization is, is rolling. I don't have to worry about anybody.

Yeah, company.

That was the phase you went through. But there comes a time where you got to say goodbye to that phase of your life before. What did you do? Build software? How did you automate your.

Yeah, so we. So the, the things to look back at that were notably lucky were the timing of when we wanted to do this. There was enough software that already existed that other people had built that would communicate with each other. Examples of that are like Shopify, an E Commerce platform. Anybody can pop up a Shopify store today. And in 2013, that was still mostly true. You could do it on WordPress with WooCommerce or whatever. And that's what. So again, I had. Because I didn't want to have people. That meant I had to do literally everything. So I had to build. These are all just puzzles. I had to solve the problems. I had to build a website, which means I had to write copy. I had to shoot images, I had to take make videos, I had to create email structure, I had to do customer service. I had to do our social media. I had to do our social media marketing, which means I had to do a whole nother set of creative for that. So I had to do. Learn how to do every single one of those positions, which was really important because by the time it started to move, which wasn't until the summer of 2014, so about eight, nine months later. And it, that was our first big inflection point happened when Facebook launched their video ad platform because it gave us the ability to show our product in action. And it just changed everything. We went from kind of making these numbers up, but we went from like $2,000 a month in sales to 20 to 40, to 80, to 150 to selling out a product. And that happened over and over and over for the next two years. We literally could not spend money fast enough advertising and we just literally, we didn't pay ourselves. We put every nickel back into the company because we had no fixed expenses or I mean our contribution margin, the amount of money that was being made per dollar earned was really high. And so we just reinvested and grew really fast as a result, which is how we got to 8 million in three years.

During that phase, Adam, what would you say, by the way, my oldest son's name is Adam.

No, make it easy.

But my brother's name is Alan. So that's why it started off with Alan. How did you find when you, since you're. You operate systematically, every time you had, you just went through a whole bunch of skills that you had to learn. And the great thing is that you did learn them and put you in a position to be able to supervise people who are doing those things for you down the road. But what was the most useful method or approach you took when it came time for learning a new skill? What would you say? Was it getting on YouTube and looking at videos, getting books, listening to podcasts? What was the most useful go to move to get you going to get, get those skills under your belt?

When you talk about the tactical skills, the blocking and tackling skills like building a website today, I mean, frankly then I just spent time doing it and I just. You just figure it out. Today I treat that differently because there's so much content. So my go to today when I have something I'm trying to figure out is I Google it and there's 15 people that have shot a YouTube video on exactly how to solve whatever that is. Whether it's some super technical code related thing in a system or it's how to pull the oil filter or the air filter out of your 2022, whatever car. Like someone has made a video for everything. That's the hands down the easiest thing at least for me to go and reference. When it's a tactical thing like that.

So you have this, you Set this record you're racing. And now talk about how you went forward from there to where you got onto shark tank in 2018 and then wound up selling. Selling out with a eight figure exit. So talk about that process where you wasn't just you anymore.

Yeah, you mentioned earlier that sort of transition phase. Everything can go to a certain point. And we reached that point in 2016, which was the $8 million year. Our business was very cyclical. We would be down in Q1, we'd crush Q2 because of father's Day in summer. We'd be down in Q3 and we would make half our revenue in the last six weeks of Q4. So we had these huge revenue swings. And at the end of 2016, I was so running customer service, was so overloaded with the customer service needs that came out of running that much revenue in Q4 that in Jan, this happened actually in December. I took a dry erase board and I wrote out all the things I was doing on it, like website copy, pictures, customer service, like all the stuff. And I just started circling things that I shouldn't be doing, things that I was bottlenecking the company and its capacity to grow by my bandwidth doing this thing and also for not having the right person in a role doing that thing. So we hired our first person, which was a customer service head of customer service. And she started in, in January of 2017. And she is. It was amazing. Absolutely incredible. So we continued to grow. Shark Tank reached out to us, a casting producer reached out to us. They saw a Facebook ad or something, I assume it was a Facebook ad in like 2015, I believe. And we went through. It would have made far more sense because in 2015 we did a million and a half in revenue or million eight, I think. But we couldn't get on because I was. The whole point of this premise of the business is that I wanted to be able to operate the company from anywhere in the world with an Internet connection. So my wife and I traveled a lot, like four or five, six months a year. We would be out of the country doing all the things that we weren't able to do for the prior 10 years. And we couldn't do that Shark Tank, because we were in Iceland and they wouldn't let me fly back just for the filming. That made him uncomfortable. I didn't know that in advance or obviously I would have planned differently. But so they pushed us to the next year. They pushed us to the next year because they had too many beer companies. And eventually we get on, but it's in 2018, when we're a much. I mean, we were a $10 million a year business at that point. So we went on the show, we had a team of four, maybe five, I think it was four. And we went on the show knowing that they were going to spend most of their time beating us up on why we didn't need to be there because we were an eight figure business that was profitable. And yeah, it was an epic experience though.

Yeah. And so trepidations going into it or were you excited to go in and tell your story?

Oh, we were absolutely pumped. Our risk or way that the risk pool for going on Shark Tank is they're going to make you look stupid. I don't care about that. That's an emotional response to a great business problem. So who cares? They're going to make the company look stupid. Who cares? You're small relative to the big scheme of things. Like, so what? The big risk is that you go. And there are two big risks. The first of the two risks for a company going on Shark Tank, if they don't have the systems in place to handle the traffic that they're going to get from airing on that show that can burn the company to the ground, that's the most dangerous risk of going on Shark Tank is if you just literally don't have the pieces in place to handle it. That was not an issue for us because we were big enough, our systems were incredible. We, that was not a problem to us. The risk was what happens is we film in June. You don't find out if you're going to air until 30 days before your episode. The episodes don't start airing until November. So that whole time you're supposed to be building up inventory, which is expensive. I mean, that's just cash sitting somewhere. And you don't know if your episode is going to air in November or if it's going to air next April or your episode might not air at all. And they hold that over your head when you go into the show of if you come on the show and you do a deal and then you kind of blow all the judges off, we are not going to air your episode. We tape more than we have room for. So how we mitigated that risk was we found out about a month before our taping that that we were going to have Alex Rodriguez as a guest judge. And we figured that if we could get Alex Rodriguez throwing a ball as part of our demo on national tv, there is a next to zero percent chance they are not Going to air that episode. So we rebuilt our whole pitch around, like, a carnival game that we made up and, like, built a little frame thing with bottle keepers lined up so we could have Alex Rodriguez get up on stage and throw a baseball at a lineup of bottle keepers to show that the glass didn't break. And that was us mitigating the risk against not airing on tv. And it worked. I mean, it turned out we did a great deal. We got what we asked for was a million dollars for 5% for both Mark and Lori. It was a really dynamic episode. The way they edited it was a really dynamic episode. Most of it was them just beating us up for being there. And they used the promo of Alex throwing the ball. It was like part of their promo reel, which is exactly what we thought would happen.

So that's fantastic. Now, who asked the worst questions for you?

Alex Rodriguez. It was wild. The stuff that came out of that guy's mouth. He just regurgitated what everybody else said in a less intelligent way. It was wild. I mean, it's fine. Like, he's not a professional investor. He's there to serve a role and a purpose. But, yeah, it was. He was a good baseball player.

So you found yourself, much like President Trump, trying to ask. Respond to a statement that Joe Biden made during the debate. It's like, I don't even know if he knows what he said.

I mean, it was an interesting experience. It's funny during the pitch, in hindsight, because you tape or episode taped for like, 55 minutes and there's no breaks. Like, you don't stop and redo. It's just intense chaos. Five people firing questions at you the whole time. And there were. It got to the point where some of the things he was asking, like, we were just ignoring him. We were just responding to everybody else. Like, you couldn't honestly even answer some of the questions. It was pretty funny. I mean, he was nice. It just. It was an odd.

Sure.

Position for him to be in.

Yeah. And so. And plus, he's probably a lot smarter right now, too. So with. With these exposures, he's. He's learning. He's on his learning curve, too.

Totally.

But so you leave there, you got the exposure, you got the PR, you're a hit. And was it a surprise that WinPoint Partners came along and wanted to acquire you?

So fast forward a couple of. A couple more years. That was 2018. We got acquired, and that deal closed in March of 2021. In early 2020, really, which is like the beginning of COVID Right, right. We, Matt and I got to the point where we just kind of got tired of running the business. The business changed. I'm really good at and enjoy the early creative hardcore problem solving. Coming up with creative solutions to problems in ways that people don't think and solving solving issues in unique ways. That's the part about business that I really enjoy. We got to the point in the, as we continued to grow that we were spending more of our time with attorneys because we had at that point we had 40 plus patents which we had to protect in all these places. And we were spending more time dealing with that kind of stuff and spending money on that kind of stuff that I really didn't like doing. So the fun in the business and it was harder to acquire customers at that point. And anybody that's. That's been an E Comm for the last 10 years knows exactly why, but just it's a much more difficult from a paid media landscape to acquire customers today. And certainly then, then it was the five or six years prior. So we had had potential acquirers come to us and kind of poke around that we just never really took seriously until then. And we started to listen to those. So we had a deal to acquire the company on the table. And I got connected to a banker, an investment banker that had a relationship at Windpoint and they had just acquired Arctic Outdoors, which is a much bigger outdoor. I mean they're. They sort of follow. They did. Now they're doing very different things, which is awesome to see, but they sort of followed YETI along. So this Windpoint had just acquired them and they were looking for other brands to put alongside Yeti and we were a good fit for that because we had this amazing patent portfolio. They could eventually make our own. Their versions of our products. We had a more premium brand than Arctic just by the nature of what Arctic was. Our margins were great. We had a great retail business that Arctic couldn't have because of the way the margins were structured. So we were able to. The beauty of that is we were able to work those two deals against each other to create a really quick transaction and a better outcome that resulted in it not having a bunch of drag along stuff that lasts forever. And we were out of the company by the end of the year, which was exactly what we wanted.

How do you come up with 40 patents for a gadget?

I don't know if we have enough.

Time, but I mean, you know, so.

The quick version that I'll caveat with, I am not an attorney, so Talk to, talk to your IP attorney.

It's almost like you're making money from how many patents you can have. It's like that seems like that became a game more than anything else.

It is, it is a game. You look at companies like a tool like Mac Tools. I don't know that they're this, but I imagine that they are. Those companies start with the single patent and what happens is when you file a, a utility patent, for example, when that patent issues, you don't close it, you file. I think it's called a continuation of process, a cip. And that continuation process leaves that patent open. And all IP attorneys out there are probably like rolling their eyes at me right now. But you leave the patent open and you get to amend the scope of that patent into another patent. So you get to take this thing that's really specific and you get to broaden it a little bit and that becomes a new patent. Then you get to broaden it a little bit more because you leave that one open and that becomes a new patent. So we had, and we had other products. Like we came out with a can product that had a number of patents in it. We had, we came out with two different versions of Bottle Keeper. One that was double walled, single walled, and we had some unique things with lids. But all of those things you leave open and then you get to amend the patent. And, and then at the end of the day, like we had a path. Windpoint won't do this, nor do I necessarily think they should. It's not what they do professionally. But our next step in that continuation process would have given us the ability to basically have patent coverage on any time you put a container into another metal container. And that all stems from all the way back to just the original Bottle Keeper product.

Wow.

So there is a, there is a huge strategy around executing patent prosecution, which is why if your listeners are ever considering patents, you cannot talk to your real estate attorney friend. You cannot talk to a general counsel about patents. You have to talk to a IP intellectual property specific attorney. It is extremely nuanced. And they are like doctors and attorneys and accountants. Some are really, really good, some are really, really bad. Use your references, because it does matter.

Yeah, great advice. And so you sell, when you sold the business, you sold the patents, is that right? They had access to the bat. So bad.

Yeah, I mean, we sold, we sold everything. So we sold all of the assets, the business, the brand. They continued on with the brand for a while. But yeah, the patent portfolio was certainly a massive value point. To them.

Well, we started off talking about you were running a business with heavy, you know, had a lot of moving parts, lots of things to keep up with. How long before you got involved with that, after you exited Bottle Keeper? That wasn't Bottle Keeper, was it?

No, no, no. Bottle Keeper was light. I mean even at the point of the acquisition, we only had four employees. Right.

So how did you get involved? It seems like a total career change type thing.

Were you from there to now? No. Well, yeah, it is, yeah. That's, that's the beauty of it. That's the stuff that I like. I mean from, from there to now.

Is what's the stage that you started off talking about? That was heavy. A lot of different moving parts, equipment.

That was the medical device. That was before Bottle Keeper. That was the. Yeah, exactly. Good clarification. That was in between college and Bottle Keeper, which was about 10 years, 11 years.

That was a good foundation. I mean, so that was quite a long period of time. Yeah, yeah, that was, that's pretty much your graduate degree in business. That's the way I looked at it.

Absolutely was.

And so now where did you get the idea? Is it Pentane Systems is what you, you're doing now and this is your idea?

Yeah.

And where did that come from?

It completely organic. I I from a wise man took some.

Were you on the beach again with your, your friend?

No, I was in Montana at that point in life. I took. So the, the transaction closed In March of 21 I part of the deal was I had to stay on as a CEO to oversee the transition.

Right.

Because they basically just combined our company into theirs. The brand stayed alive, the website stayed alive, but we had to convert all of our stuff into their stuff. So that was the end of the year. I took wise guidance from a very brilliant gentleman that had more gray hair than I to not just go start another company. Which of course is exactly what I wanted to do because I mean you, you grind at that like it's. If it sounds easy, I promise you it was not. It was phenomenally difficult until literally the very last day. Until the day that you're on the phone with 20 attorneys and they're talking in like the King's English saying, do we consent to this transaction? I I I It's the weirdest call you ever have. Until that call is over, it is insane. And then it's silent. Like that's hard to mentally process. And I mean that very like sincerely. I realized that this was a, this was a life changing transaction. It was A huge game changing thing. But it was phenomenally difficult from the beginning to that point. And that last six months, you have this thing while you're also trying to run a company. And that thing could blow up at any second. And you get three calls a day about why it might almost blow up. And you string this thing along until it finally closes and then it just goes completely silent. It is a feeling that I will never, ever forget to come out of such a positive experience. I literally, I remember driving, we were in LA at the time, driving by myself in the car in the silence and pulling up to a stop sign and literally just like bursting out in tears for no reason whatsoever. It was just such a mental roller coaster to just come stop.

Kind of a relief of stress, basically.

Just like, yeah, kind of. So I. Yeah, absolutely. So we fast forward. I take the time off, I get bored. I do some carpentry projects. I remodeled my kitchen, which you can't see on the video, but it looks really nice now. I get to the point where I want to go and start using my brain again. I go to companies that my wife and I had invested in and I asked them if I can help and they say, yes, please look under the hood. So I look under the hood and I quickly realized that they two companies, specifically one was a $20 million business. They were profitable. They had no idea how they actually made money. They knew how to drive revenue and they knew that they had expenses and they knew that revenue minus expenses at the end of the year equals net profit, if you have it. But. And that's true, that's 100% accurate. But if you understand the nuance of how to acquire a customer and the costs associated to acquiring customer, and the impact that fixed expenses versus variable expenses have on the business, you have all these levers that you get to pull that change, that net profit outcome. And they didn't understand those levers. We at Bottle Keeper deeply understood those levers. That's one of the big reasons we were able to grow as fast and as efficiently as we did through the whole life of the business. We built systems internally that gave us clarity into how to pull those levers, how to use ad spend, and at what marketing efficiency or return on ad spend it needed to be at to accomplish our net margin goals. How expenses, as we levered them up and down, impacted the business. The result of which is we were profitable every single year, except for one. So I rebuilt some of those systems in a much better, sexier way inside these companies, and it totally changed Them, that company increased their net margin by 50% the following year because they knew they now knew how to better leverage. In their case, it was advertising dollars.

Yeah.

So I then got paid as an advisor to help turn around an early stage ecom business. It was a $2 million business. They were losing a hundred thousand dollars a month and did the same thing. They had no idea how they were spending or making money, so built the systems and it completely changed their business. Three months later they were profitable. Now a year and a half later, they've grown 300% profitably and they're crushing. So pentane is that. Pentane is a system that uses math so you don't have to. It uses math built on the expenses in your company to tell you how to operate the business profitably.

Incredible. And so people sign up with you and then it's a matter of getting their information into pentane, I guess. And are you doing all of that?

So it is a. It's a traditional SaaS platform.

Okay.

So. So if someone can sign up on pentane.com and go and do that, and we have, it's coming out in the next three weeks, a revised onboarding process where they can do it themselves in 10 minutes they can have a fully functional system with all of their expense data in all of their revenue APIs from Shopify and Amazon, wherever they're collecting revenue, QuickBooks, all of their advertising APIs from Meta, Google, Amazon Ads, TikTok, all the things. And it takes all that data and it gives them a picture of what's happening in the company and then they get to enter their net margin goal and it tells them how to accomplish that.

Yeah. And so how long did it take you to get. Did the pentane, Was it like created organically in the process of solving the problem? Those first two companies that came to you and you said, let's just put this into a system because that's just.

The way.

You go about. The question I'm wondering is, couldn't you get at least a few patents out of this thing?

I got asked that question the other day by another very intelligent guy. And the answer is maybe technology is different than physical products. Yeah, physical products are largely black and white. There are some gray area in there depending on the types of patents and what you're trying to accomplish. Software and process are a little bit different. And how we build a moat in this business has to be different than how we built the moat with Bottle Keeper, which was very intellectual property heavy. So there, there May be as we get a little further along, but quite frankly, I'm not sure I want to spend the time and money going down that rabbit hole again when I have other ways that we can build some pretty strong moats.

Well, you're basically just a kid anyway, and you could get bored and decide you want to do it later. You know, I might.

I absolutely could. That could happen.

You could get that bull. Once you get that bull, you get him up on the wall. Yeah, but then you're going to say, I'm starting to get restless. So talk about you put yourself through the ringer. Various, you know, success in various situations, various parts of the country, various businesses. And now you've got essentially kind of a lone ranger type life where you kind of control things. Describe the payoff for putting your. Because you said it was hard, hard, hard, hard, hard. But you did not back off from it. But you saw it through. And this is what I like to bring out periodically, is entrepreneurs, if they know their success, even though the problems it's created, if you just hang in there, there is another side of the mountain and where you don't have to keep doing this forever. But the rewards for going through, paying the price, putting up with it, are astronomical, beyond what you can imagine while you're going through it. And so it helps to know that so you can. Emotionally, you might not accept it, but at least logically you could say, there's going to be a better day. This is going to lead to something wonderful that I can't even imagine right now. That's what you find out. For most people that paid a price to build a business, put up with it, of course it was a nightmare going through it. But then they come out and they say, I would have gone through it ten times had I known it was going to be this good on the other side. And so describe where you are right now in your life. Because I get the idea that things have. You've got things pretty well organized for yourself.

I would not say that I have things pretty well organized. I would say that. And maybe that's not fair. We live a very intentional life. The things that we have done in the last 15 years post medical were all done intentionally. I mean, they were not accidental. We didn't accidentally get into a situation where we could travel four, six months of the year while running a profitable business like that was. We did that on purpose. And I think that too often people end up in a position that they don't want to be in because intentional decisions weren't made and then they feel stuck and they can't get out of it. And the reality is you always have a choice. And the choices that you make whether to continue or do something different will dictate that outcome. And for, for me, I have always been really, at least for the last 15 years, very, very sensitive to that. So we are very intentional with the decisions that we make and how we do and build. And pentane will be the same to that. I mean, also, the more you do it, the more comfortable you get with it. Like, going through this version of startup is completely different than the last version of startup, which was different than the prior version of startup.

Right.

You get better at them. You get, they get easier to tolerate the ups and downs. The ups and downs get flatter. But to your point, which is a really, really important point, companies fail when people quit. Like, that's when they fail.

Yeah.

And I fully appreciate that everybody's circumstances are different and sometimes you may not have another option and then you have to. And you have to deal with that. But the reality is, is if you as an operator can do everything you possibly can to mitigate your risk, your downside risk, to let things play out over time, it's these tiny little tweaks and tiny little sort of evolutionary changes that happen in the business that you may not recognize. But you look back at a month from now or two months from now or six months from now. I mean, I'm doing it right now. Like, holy hell. I cannot believe how this got to this in that period of time. But when you're in the midst of doing it, it feels like it's a mountain you can climb. So you just, you just got to keep your head down, one foot at a time, Walk away From it for 20 minutes, sleep on it like nothing bad is going to happen in a good night of sleep, come back to it.

Well, and the thing is, just because you can't see how it could possibly work out today doesn't mean that you can't. That you won't see how it can work out tomorrow or this afternoon.

Absolutely.

Or it doesn't mean that somebody is not going to show up this afternoon with an idea or you'll hear something in the wind and like, oh, that didn't think of that. And then things change. But if you're not in the game, you can't capitalize on that, you know?

Absolutely true. You never know what's around the corner.

How long have you been writing for Inc magazine?

We were on Inc 5000 list in 2018 or 19. I wrote a couple articles, maybe one or two articles back then. I started writing for them again earlier this year. I should be writing a lot more. I'm supposed to be writing one article a month. I think I've written three in 11 months. So I need, I do need to write more. I've been focused so much on pentane, but I do really enjoy this chapter post. Bottle Keeper chapter of my life is really dedicated to helping other early stage founders solve problems that are complex or may at least they seem complex. And writing is a really good pen. Pentane is one of the ways to do that. Writing is another way to do that. Sort of share, share the war stories that help other people make decisions faster.

Is it rewarding for you to. I know, for name recognition, to build your brand and for the business and all of that that pay off. But is it satisfying writing for a magazine like that?

It's satisfying writing. I enjoy writing and frankly, it helps me organize my own thoughts.

There you go.

I wrote for Entrepreneur for a couple of years. I wrote 60 or 70 articles and I really enjoyed doing that. And that was an early bottle keeper, early mid bottle keeper stage. So I've been writing kind of like that for a while. I took some time off in between the things. But doing it at a publication just gives like I'm not going to do it on my personal blog and reach the people that Inc. Magazine is going to reach.

Right.

So it at least gives you the capacity to, to have more people see that content, benefit from the content. I'm not doing it for brand recognition, frankly. I don't.

I don't.

I'm a private person. I want to remain as much as I can a private person. That's why I'm largely off the socials and all those things. So it's really more just. It's a great avenue to get content to the people that. That might be able to use it.

When you and your wife traveled, where did you like going the most? Looking back on it, what. What was the most fun?

Where we went back to the most was Europe.

Yeah.

Spain, France, Italy were the. The highlights. Spent a bunch of time in Switzerland, Germany, Austria, all that stuff.

Yeah.

But where we traveled, that was probably the most impactful is Africa. And where you. We saw the most cultural difference was in Asia, namely in Cambodia, Japan. And that going to those places is just absolutely fascinating because it's so different. Europe's not that different. They speak a different language. Food's a little different. Their culture's older.

It's not that different that challenging. Those differences in culture and everything over in Cambodia and Pacific Rim.

I wouldn't say that I would call it challenging. I found it really interesting. You get to immerse yourself because of what we were doing. We were doing it for a month or so at a time. It wasn't like a. We were fortunate to not be in a position where we had to limit it to five, four days or five days. We got to see a lot and like really kind of dig into it. And it's just an opportunity to soak up another worldview and learn about Buddhism and visit. Visit temples and sit with monks and. And learn about. They have some, like most countries have some pretty troubling history. And that's a part of the story, too.

Yeah. Very interesting. Adam, it's been a lot of fun talking with you. Congratulations on a great career so far. I'm looking forward to seeing what happens with Pentane going forward. I like to give the guests, my guests, the last word. So do you have one last parting shot for the people that have stayed with us all the way through?

Yes. And I don't mean this in a conspiratorial context, unless you like going down that rabbit hole, but question everything. Just because someone tells you something needs to be done a certain way does not make it true. You, if you have an mba, that's great. You have the basis for what is mostly financial accounting, and that's helpful. But how you build a business is how you choose to build a business. You get to do it however you want, and then you have to listen to what the customer tells you. So I just, I believe deeply in that. Just because it's done a certain way doesn't make it right or wrong or a good fit for you. You get to go in and craft your own movie.

Yeah. Fantastic. Excellent finishing comments. Thanks so much, Adam. Good luck getting that elk. And you're a compound shooter or traditional longbow compound.

I haven't gotten to the recurve yet. That's next. Next in my Montana habits.

Okay, well, wish you the best and look forward to talking to you again down the road.

Likewise. Thanks, Larry.

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