From $500 Startup To $100m Exit w/ Moiz Ali

Hey, friends and neighbors, Ryan Daniel Moran here. Welcome back to the show. Today, I'm excited to be joined by my friend Moiz Ali. If you're not familiar with Moiz, he's been on our stage at our events in the past, and Moiz is the founder and former CEO of Native Deodorant. Native Deodorant was a company that he started with about $500. He grew it to a $100 million exit to Procter Gamble. Which he sold a couple of years ago. Moiz has several mentions in my upcoming book, which is called 12 Months to $1 Million. You can preorder it on Amazon right now. And Moiz is kind of the case study that a lot of us e-commerce folks look at as the pinnacle of success. He built a business in 2 years that had a 9-figure exit, and it changed the industry that he was a part of. He started with just a few hundred bucks. And it was a really exciting business that propelled his entire career forward. Obviously, you go from zero to $100 million in 2 years. Now, Moiz has shared his journey and his story on the stage, on our stage, and on the podcast before. So today I wanted to go under the hood a little bit deeper. I asked him about transitions between projects. I asked him about what the difference between running the business himself and after he ran it when it was owned by Procter Gamble. I asked him about his philosophy on hiring. I asked him how the heck he was able to take a business to a $100 million valuation in 2 years. And we talk a lot about what Moiz is doing next. Moiz just launched a podcast. It's called Exit Strategy. I have always thought that Moiz should talk more publicly about business because he is The guy in e-commerce that has achieved what most of us hope to achieve. I think he is the example that a lot of people turn to when they think about the type of success that they want. So I would encourage you to go subscribe to his podcast. It's called Exit Strategy, and I hope you enjoy this interview with Moiz Ali. It takes one free person to create change. This is the show for them. We are The creators of the free world. This is capitalism.com, and we are the 1%. Hey, Moiz, welcome to capitalism.com. Excited to hang out with you again.

Super excited to be here. Thanks for having me.

Yeah, Moiz, I mean, I've told you privately several times, I'm a big Moiz Ali fan. You're one of my favorite people that we've ever had at our events. And, you know, I saw on Instagram that you were starting a podcast and I, first of all, I wanted to ask why. You have had a 9-figure exit. You've been the CEO of a 9-figure business. You network with the boys and gals over at Procter Gamble. Why start a podcast?

For a couple of reasons. One, I really want to give back to the community that I've been a part of. I really love ecommerce. I love the people that are in it. I think I mentioned to you both on Twitter and when we had breakfast a few months ago that capitalism.com was actually my favorite conference that I've ever been to.

Thank you.

Felt like I was really with the tribe that I belong with. And so I feel like this is a way to give back to that tribe and to say thank you for all the support they've given me the last 5 years that I've been running Native. And then 2, I really want to have interesting conversations with other people like As I grew Native, I realized that there were so many different paths that people were taking growing their businesses. And I took the path that I thought was best for me. And it's very clear to me that other people have taken different paths and it's worked out phenomenally well for them. So one of the guys that we're going to interview is the CEO of Hims Hers. His name's Andrew. And, you know, one of the things that he tells me, or one of the things that he said is that he really shuns auction-based marketing. So he shuns Facebook advertising and Instagram advertising and Pinterest advertising and is looking to create his own type of marketing strategy that's proprietary to his business. And that's crazy. Like, that's the exact opposite strategy that I took at Native. And so I'm really curious as to— I mean, it's obviously working out for him. I'm really curious as to the details of that strategy. And, you know, I've tried to listen to him and to other people that we're going to be interviewing on other podcasts or read their interviews on Business Insider. And like, I feel like people aren't asking tough questions or detailed questions. And I want to get into that.

Well, I can't wait, Moiz. So I'm excited for this. You know, I'm interested to watch your own transformation right now because I feel like I'm at the tail end of one of my own transitions. And I know that you're famous for growing and selling Native, which was a great company. I'm actually wearing it right now. I smell great. So, but I know that if we turn back the clock a little bit, It wasn't your first company that you built and exited. So this is a track record of yours. And also, you have navigated this kind of transition before of having a big win and then figuring out, what do I do in the interim? And so I was wondering if we could go back in time a little bit and talk a little bit about the first company you built and sold and how you navigated that transition of having a big exit and then having the space to come up with the next great thing, which then became Native. Could we talk about that?

Yeah, sure. That's a great question and one that's like, you know, I think whenever you sell a company and sort of exit, leave yourself from that company, I mean, whenever you sell a company, it's a major milestone in your life and an incredible achievement. And so there's a lot of, you know, I was certainly proud and happy and confident about my abilities, but whenever you leave a company, and that's what I did when I sold my first business, it was called Caskers, You know, there's this period where you go from having all these people email you and rely on you and ask you about what they should be doing with their time. And, you know, if you can be helpful to all of a sudden the only person emailing you is J.Crew with a 40% off coupon every single day. And that really, like, you realize that, you know, your success and pride emanated from being an important person in this company. And when that's taken away from you, it's kind of, it's kind of sad. I think Peter Thiel has this thing where he's like, when he exited from PayPal, he was depressed for a couple of months because he's just like, what am I supposed to be doing with my life now?

Mm-hmm.

And so I felt like I was a little bit lost. And I think, like, you know, for me personally, I think I've realized that it takes being lost and being bored and sort of being frustrated with not doing anything productive before I can start something new. And so, like, today I'm a little bit more comfortable and I'm a little bit more Okay with being lost. But back then, I think I was like, oh my God, I had this great exit. But like, you know, I was in, you know, I think I was 29 years old. I was like, what am I supposed to do for the next 60 years of my life? I have no idea. And today I'm a little bit more like, okay, well, maybe I'm a little bit older. So I'm like, okay, I probably only have 35 more years. I'm a little bit more comfortable. And 2, I'm just more like, okay, I'm used to this space. I've been here before and something will happen that'll be good.

Yeah. So, the first business was— remind me. I know it was something in the liquor space. Would you remind me of that first business?

Yeah, sure. It was a flash sale site where we sold hard alcohol online. So, we curated all of these craft spirits that small distilleries were making across the United States and sold them online. And this was back in 2012, which really makes me a dinosaur in the e-commerce industry. But back then, Craft spirits weren't available at your local liquor store like they are today.

Got it. So, you built that up for I don't know how long and then you had an exit. How long was the gap between that exit and when you started Native?

So, we sold the business in October 2013. I stayed on probably for one more year. So, October 2014-ish is when I left and then started Native July 2015. Okay, so a year and a half from exit, maybe 8 months, 9 months from sale of last business or from exit of like me leaving last business.

Yeah, that makes sense. And I'm wondering for you, did you mention how you had to kind of take some downtime and get bored for that next great idea? At what point did the seed of Native enter in your brain during that downtime?

I think the seed of Native entered well before I even left or sold my first business. I think it entered when I was buying deodorant and unhappy with what I was purchasing, even in, you know, in 2010, 2011 when I was still an attorney. So even before I started my first business, I think the seed of actually starting a business, I was like, okay, I'm bored. This is a business that I like. I understand e-commerce. Let me start this business. If it fails, it fails. It'll take me 60 days to figure it out and then I'll move on from there. Um, so I think the original seed started back in probably 2010, 2011.

Oh, okay.

And then the first effort started in, you know, like me actually being like, okay, let's start this as a business was like July, you know, 3 weeks before we launched the business. It was a very short period of time between let's launch this as a business to actually starting the business.

That actually gives me some peace of mind because the way— the route I'm leading us down right now is, is I think we often fall into the fallacy that great ideas or great progress comes out of a lot of busyness. And right now, as we're recording this, we're in the middle of quarantine where there's not a whole lot going on. And I think that this is a great opportunity for those seeds to start to sprout because you and I both know that great ideas often come on the other side of boredom, come on the other side of taking time to relax and let those seeds start to plant. But I also really appreciate what you said about the fact that you had the idea for a good 3 years or so before Native ever sprouted any legs here because I have so many ideas that are floating around in my brain that I feel like I have to take action on right now. But the truth is sometimes they take some time to mature or gestate before they become reality. Has that been your experience?

Absolutely. Everyone thinks that Native was an overnight success story. It took 10 years to become the overnight success story it was. None of these things— very few people are like, I have an idea for a company, I'm going to start it in the next 30 days. Uh, it's going to be successful and I'm going to exit in a very short period of time as well. That rarely happens. Um, most of the time, you know, you need something percolating, you need some sort of epiphany, or you need some sort of, uh, life-changing moment to happen before you can do something. You know, the guys who started WhatsApp tried to apply for jobs at Facebook, uh, got rejected, and they're like, okay, let's just do our own thing.

That worked out for them. Yeah.

And that worked out phenomenally well for them.

No, help me understand something because What you just said was that Native took 10 years to be an overnight success story, but I also know you just said you started it within like 60 days of actually moving forward on it, and I know that you sold the thing in like 2 years after starting it. So, help me understand the difference there.

Sure. I guess like, you know, when I had the idea, you know, at the beginning of like in 2010, 2011, right? didn't do anything for a couple of reasons. One, I didn't think the time was like— one, didn't have the time in my own life to do it. I was an attorney. I had another business going on. And then finally I started it. And 2, I just didn't think the time was right. Like, marketing wasn't the way that it was, that it is today. Like, you know, Facebook ads and Google ads and Instagram ads and Pinterest ads just didn't exist the same way that they do today. And 2, I didn't think that the, like, the community or society was at the place where it wanted a natural deodorant and would allow that to become a successful company. I think today if you started Foursquare, it'd be far more successful than if you started it in 2010 because people are more addicted to their phones. They have better, better battery lives. They're more interested in communicating with their friends as to where they are in a certain location. Like, I think the timing of a business certainly needs to be right as well. And I think the timing was right, you know, actually in 2016, 2017 for a business like Native. And I didn't think it was right in 2010, even though the idea came back then.

Okay, so this makes sense. So sometimes 8 of those 10 years of becoming an overnight success story are preparation, or they are the market getting right, or there are other opportunities starting to sprout. When you say it took 10 years to be an overnight success story, it doesn't mean that you were actively pressing against something, you were doing other things. That's correct? You're saying?

Absolutely. That's absolutely right. Yeah, you're right. I think a lot, like, you know, There has to be a confluence of events. The market has to be ready, you have to be ready in terms of your life, and you sort of have to have the right start to give you some motivation to do it. And so like, all of those things have to come together in order to build a successful business.

From the outside, it does look like a lot of things came together for Native. It looks like a lot of things sprouted very quickly. So I'm wondering, in your mind, Did it feel as quick, as much of a meteoric rise, an exponential growth curve up as it looked like from the outside once you started the business?

Great. That's a great question. I think, yes, looking back on it, it certainly does look like that. Like when I look at our revenue trajectory, you know, in 2016, you know, January 2016, we had $50K in revenue. November 2016, we had $1 million in revenue. Within another year, we had tripled or quadrupled or quintupled that. So it was like a lot of growth. I think looking back on it, it looks like that. But like when you were operating the business on a day-to-day, day-to-day basis, you know, you're so in the weeds of making sure that your customers are happy, that your team is happy, that you're hiring the right people, that you have a pipeline of things that you want to build and that that pipeline is you know, being operated on successfully, that I think you, you know, you sort of don't appreciate the uniqueness of the moment. You know, like, there's this great line in the final episode of The Office where Andy Bernard says, I wish I knew it was the best of times. Yeah, yeah, exactly.

I wish somebody told me it was the good old days when I was still in them. Yes, love that line.

Yes, that's exactly the line. Yeah, that is the line. And like, you know, when you're running a business that's growing that quickly, You wish you realized how unique and special a moment it is, but in reality, you're just so heads down in your own business that you don't really get the chance to do that. That said, when you look— when we were trying to fundraise or when we were trying to do M&A and talk— when we were talking to acquirers or VC funds, it was really clear to me that like we had something special. I would show people our revenue chart and they'd be like, is this cumulative? Basically saying, is the December revenue the, you know, the revenue for your entire— the entire life of your business built into one pie, like built into one graph, built into one chart? And I was like, no, this is our monthly revenue. It's not cumulative revenue. And that happened multiple times. And I was like, wow, this must be a good business if that's what you think.

Yeah, it's so much fun to hear, hear you talk through it because, I mean, I've had an 8-figure exit. I've never had a 9-figure exit. But it was, it was similar where, you know, when we went to market, the private equity companies were like, how old are you guys? 28, 29. Like, and, and it felt so slow. of a process to us. And to the outside, it felt like such a, like such a crazy growth trajectory. I have one more.

Business felt slow for you? Like you're saying the business growth felt slow or like the M&A process?

And I remember I was talking with Tom Bilyeu here on the podcast once where I was like, you know, you built a billion-dollar company in 4 years. How did you do that, basically? And he's like, oh, it felt like it was so long. So it's just interesting that The difference in perception when we're in it versus what happens on the outside, which leads me to my last philosophical question, and then I'm gonna get into a few more tactical things with you, Moiz. In the ecommerce world, you are the pinnacle. Like, everybody wants to have their 9-figure exit in 2 years or whatever the timeline was. It sounds great. Makes for a great headline on a sales page, Moiz. Sure, sure. It does. Often puts you in a position where people are trying to reverse engineer whatever you did or whatever you figured out, which in my interpretation is the exact wrong thing for people to do if they want to have similar results. So my, my philosophical question for you is, how does someone who is a budding entrepreneur prepare themselves to have the idea or the breakthrough that gets them the big success that they're craving?

I think, I think there's 2 parts to that question. One is from an idea or breakthrough perspective. It's really like about personal— like, for me with Native, it was personal need. It was what, you know, what is missing in my life that I wish existed that is a problem that I think is scalable and that other people will have as well. And so for me, it was, okay, I'm buying Axe deodorant, and this is a deodorant that has a bunch of terrible ingredients on the back of it. I don't want to be putting this on my body for 24 hours a day, 7 days a week for the rest of my life. That doesn't sound good. It sounds like it's harmful to me. And so I think I'm going to make a product that is better, that uses safer ingredients or better ingredients or ingredients I understand. And so for me, it was a personal need. And then from a growth perspective, I think you're right. A lot of people are like, okay, great, how do we build this business like Moiz did? Or people have asked me that. And in reality, that's a bad question, or I don't really love that question. And I'll tell you why. It's because the way I built Native was right for me. It made it so that like it was a business that I wanted to run. It made me excited about the business. I wanted a really lean team. I didn't want to answer to third parties. I didn't want to do board meetings. And I wanted— like the business was really like, you know, under the radar until we sold the business. Like I didn't want a lot of publicity when we were trying to grow the business. And I think like, you know, that's very, that's very different from other types of entrepreneurs. You know, like, like Nick at Thrive and Andrew at Hims Hers have both raised hundreds of millions of dollars in VC funding. Their businesses are much larger. Their teams are much larger. You know, Nick has mentioned that he's growing, that he has an 800,000 square foot fulfillment facility or multiple facilities that accumulate to 800,000 square feet. Like, they're just very different businesses. And like, you should grow the business the way you want to grow the business and the way that you think is best for you, leveraging your abilities and leveraging your insecurities. And for me, I was afraid to fail like I imagine most other people are. I didn't want a very public failure. And so Native was under the radar until we sold the business.

Hmm.

And so I think that, like, you know, like, whenever people are like, okay, how did you do it? I'm like, this is how I did it. But you should do whatever is best for you and don't listen to me. Like, I don't know how to run your business. I don't know the type of person you are. I don't know if you have financial obligations because you've got a big family or if you were, you know, if you're Jeff Bezos's son and like, you know, money doesn't matter to you. Like, all of those things matter based on how you want to run your business. And so go run it the way you think you should run it. Have, like, confidence in yourself.

Yeah, amen to that. Thank you for saying that. Because it is so tempting to want to see exactly how someone got a result and then follow that same thing. But the truth is, you were following what felt right and best to you and your skill set and your people and your opportunity and your lifestyle and your desires. And that is a complete mismatch to everyone else. which is what made it unique. And so, I tell people the same thing, and I am always very hesitant to invest in or back an entrepreneur who has like the foolproof plan that is based on other people's models and other people's businesses.

Sure.

Because then I know that they don't have anything unique to the marketplace that is— and it's gonna have a hard time growing.

Sure, and they're not like tenacious. You need to accept the fact that people— look, your ideas will— some of your ideas will not work out. You'll fail, and you have to sort of regroup and come back and live on to fight another day. And if you're just sort of copying other people's businesses, I feel like you're gonna lack that tenacity.

Moiz, I want to ask you about hiring and team building, because I know that Native never had— at least when— but before you went to market, would you have like a team of 6?

When we— the first year of the business was just me. Then we— when we sold, we had 8 people. I left at the end of January. We had 19 people.

Okay. So, so when you exited, you had 8 people and you had, you know, this, this great exit, this amazingly healthy business with 8 people. How the heck did you do that? What, what, what is your approach to hiring?

Yeah.

Sorry, that's like asking why is the sky blue. How do you approach finding the right people for the right roles? Maybe that's a little more specific.

Yeah, that's a great question. I think that like, for us, we were slow to hire. And I'm not sure that was the best decision because we all had like so much work on our plate. And we could have probably grown the business more had we had more people. That said, I was constantly afraid of running out of money. And so I was like, look, we don't have— we haven't raised $25 million from Andreessen Horowitz. We could run out of money any day. And if that happens, I'm going to have to fire a bunch of people. And that doesn't sound like fun to me. And so I'm not going to hire a bunch of people unless I'm certain I can afford them. And so before we hired someone, I'm like, okay, will we be able to pay this person's salary for the next year, assuming the business collapses today? And that was sort of the way that I was thinking about it. And then we went out and we were like, you know, we gave people a lot of responsibility. And, you know, I'll give you an example. We hired that person who runs our customer service team. He used to work in customer service at like Fitbit. You know, she was like a temporary worker. They weren't promoting her to becoming like a full-time employee or something to that effect. So she joined Native because she wanted to be a full-time employee. She's absolutely fantastic. runs our customer service team, you know, more than a dozen people on that team, is incredibly devoted to the business. You know, people are slacking her at like 3:00 AM and she's responding even today.

Hmm.

And like, it's really spectacular. And the way that, like, we just gave her a lot of ownership. We're like, look, if you want this to be your career and you want to take charge, go take charge of this. And if you take charge of it and you're good and you're responsible and you have good judgment, We're gonna give you more and more responsibility. And she never shied away from that. Like every time we gave her more responsibility, she's like, great, I'm gonna do this. Or every time we had a new problem, she's like, Moiz, I'm gonna solve this problem. You don't have to worry about this. And like that was the case. And she was phenomenal, like just fantastic. And so like here was this person that like Fitbit wasn't appreciating who we appreciated a ton. And she just took on more and more responsibility and became this amazing member of the Native team. And so like, You know, I think that's the, that's the way I thought about growing people. I was like, give them a ton of responsibility and let them do their thing. Like, my bet is on this person. And if they can't, if they need help, I'm here. And if they can't do it, I have to step in. But otherwise, my bet is that this person can do it and doesn't need to be babysat. And more often than not, more often than not, it really worked out.

You said something really interesting in there, which was that you were often Worried about running out of money, which is a concern or a thought loop in a lot of entrepreneurs' minds when they are not backed by a pile of money. Can you tell me a little about navigating that? Because I never knew that about you because obviously, from the outside, looked like you had this great meteoric growth. Would you tell me a little bit about managing that fear?

Sure. I mean, like, I think with ecommerce businesses, You know, cash flow is always an issue. You're buying inventory. It depends. Like, you know, sometimes you get terms, sometimes you don't. Sometimes you're sending it to Amazon, sometimes you're sending it to retailers. Sometimes they want terms and all of a sudden you have all— like, you have a great business, but you have cash flow issues.

Yeah.

Native didn't generally have cash flow issues. Like, we were profitable and significantly profitable by the time we sold the business. We were generating $1 million in EBITDA a month. We had $10 million on the balance sheet. So at some point it did look like we had raised our own round of capital. But, you Moiz, actually through operating a good business. I think early on though, and part of the reason that we didn't hire our first employee for an entire year is I was like, look, I have no idea where this business is going. This— it does seem like there's a lot of growth here, but like that growth is young. And just like those M&A guys or those private equity guys were like, how old are you? How old is this business? It seemed like, like, you know, the business was old to you. It was like, you know, it was actually really young. And so I was like, this business could fail at any time. Sales could fall off of a cliff. And if that happens, I don't want to fire the person that just quit their job to work at Native. I want to make sure that I can pay their salary for a really long time in case we, in case we have a downturn. And so, you know, the way that we thought, that's the way I thought about it. So one was really cost conscious. I was like constantly fighting costs. If anybody wanted to buy anything, my first question would be how much, how much were they asking for the product? And then my second question would be, how much did you actually pay? Because you should negotiate that price down.

Wow.

Like, I'd look over credit card statements and I'd be like, where's this $7 charge coming from every month? We need to get rid of it. I mean, we're doing $3 million in revenue a month. And I'd be like, this $7 charge, I'm gonna call this person today and I'm gonna make sure that they don't charge us next month for it. Um, so we were really cost conscious and that was great. I think that was the right thing to do. Um, and like, you know, uh, my first company, I thought being that cheap or frugal was really, uh, shameful because all these other people had beautiful offices and like all these snacks. and all this team swag, and we didn't have any of that. And now I wear that as like a badge of pride. I'm like, yeah, we don't have swag because I didn't spend our money on swag. How do you think— what do you think of that? And so like, was really cost conscious. And then I think otherwise was really just focused on the right things, which are, are customers coming back to Native? What's our NPS score? Do people love the product? And how do we generate— like, how do we continue this rocket ship growth? We weren't focused on vanity metrics. We weren't focused on how many people do we have that work at this team. We were focused on, do people love our product and how do we keep our costs low?

Yeah. My next question was about the profit margin on each individual unit is obviously very low. So how do you turn that into a business that scales so much? And it sounds like the answer to that is you kept costs as low as possible and you created a great frickin product that people wanted to talk to, talk about. And so at some point there was enough meat on the bone for you to start to scale that. That's my interpretation in 30 seconds. How would you answer that question?

Yeah, I think that's right. Sam Walton has this great book. I think it's called Made in America. And he's like, look, every dollar in savings that we have at Walmart HQ, we can pass along to consumers in the form of lower prices. And that's why when we go travel and we're staying at hotels, We have to double up, like, you know, even executives will double up on rooms. I read this obituary from the founder of AutoZone who forced his executives, including himself, to double up in rooms in Motel 6 in order to save costs. And when they were out to dinner at like, you know, when they were— when a bunch of executives were traveling and they were out to dinner, he suggested that we all go to Wendy's for dinner. And then he handed out coupons for Wendy's when we got there. Like, that was— I was like, this guy's on another level. I really appreciate that. I'm sorry, what was the question? I feel like all I'm doing is talking about Costco.

Well, it was, it was how do you turn such a, such a low margin product into such a scalable business? And, and it sounds like, you know, we kept costs as low as possible.

That's right. Yeah, kept costs as low as possible and then scale. When we, like, in December 2015, we were making 500 units of deodorant a week. Within 2 years, we had, you know, we were starting, we were making about 20,000 units of deodorant every day, actually north of 20,000 units of deodorant every day. So, an incredible amount of scale. Like, you know, it's not like we weren't selling any deodorants. We were like, we were more than 2% of the entire US deodorant market by the time we sold the business. Like, we were on people's radars.

Yeah.

And then, 2, you're right. Like, the margins were incredibly low. Like, when we launched the business, it cost us about $5 to make a deodorant. It cost us another $3 or $3.50 to like pick and pack and ship the deodorant between postage and picking and packing fees cost us about another dollar for boxes and our insert card and things to that effect. The actual cost of the deodorant once it was out the door was like $10.25, and we were selling the deodorant for $12. Oh my goodness. So, there was not a lot of meat on the bones, but one, scale helped, and two, very, very cost-conscious management helped as well.

Yeah, you would have to be. Those are razor-thin margins right there.

They are.

To get 2% of such a big market in 2 years is pretty darn impressive. You obviously had a great product and you've shared— actually, I tell the story in my book about you testing different types of deodorant on yourself and seeing which ones— rubbing it on your shirt to see which ones left marks. I tell that story in my book, but I'm curious, from beyond just having a great product, did you do anything from a marketing perspective in order to hit that type of exposure?

I think, yeah, the answer is yes. I think we did. We did ordinary things that everyone does or that most companies do, like Facebook ads and Pinterest ads. We had a refer-a-friend program. The great, the great thing about deodorant is that women were actually talking about the product. I thought it would be a product that nobody chatted about, but women were telling their moms or their daughters or their sisters and saying, hey, check out this deodorant, it's better for you. But I think we also did more interesting things that were like outrageous, that were sort of meant to be gags, but draw attention to our brand. So for instance, on the first day of summer in 2016, we launched— we launched— what was it? I'm sorry, it was 2017. We launched a rosé-scented deodorant.

Okay.

And we're like, yes, this is ridiculous. Like, who wants to smell drunk all day? But that's what we did. And all of a sudden we got all this crazy PR. Like, you know, we'd been reaching out to try and get free PR for a while for our business. And all of a sudden, Good Morning America was talking about our product. So was the Today Show. So was Vogue. So was, you know, Refinery29 and HelloGiggles. All of these publications that we've been reaching out to for the last 2 years were now reaching out to us to try and write about our product. And that was fantastic. We launched a pumpkin spice latte scented deodorant. We did like, you know, we tried to do like funny April Fool's Day jokes. Like we tried to launch, you know, a deodorant that smelled like the subway in New York City, which is, you know, if you've ever been in that subway, you know that it's not the best of smells. And so, and we launched a poison ivy scented deodorant. Like we tried to be funny and relevant to the, to the times. And we tried to not take ourselves too seriously with our marketing. We were like, here we are. We understand that using a better-for-you deodorant is probably a pretty serious thing, but this is still deodorant and we realize that we can be cheeky and funny without being offensive. And so, I think that's the type of marketing that we did and people really appreciated that.

Yeah, that's beautiful, Moiz. So, the crux of the business was a great product, a small team that was very cost-conscious, unique marketing that didn't follow any specific plan. But you had strategic things that you did that everybody does, like Facebook ads and Pinterest ads, and you got enough of a dedicated, loyal following that came back to the product over and over again that there was enough profit for you to have a business that was scalable and sellable. Am I missing anything from a macro perspective that's worth adding in?

I think that's right. I think there are 2 things that I would add. One is that we had phenomenal customer service, like it was based in the United States. I did a ton of customer service. In fact, I'm pretty sure I was the top customer service agent till we sold the business. Like I was on— like we were all on top of that and we made it a priority because we thought, hey, this is how we're going to learn from consumers. The P&Gs of the world are divorced from consumers because there is a middleman between P&G and the actual user of the product. There is no middleman and we don't want like layers of bureaucracy between our customer service team and executives. And so I think that we made that a priority. And 2, I think our team was actually like really invested in the success of the business. Like they were really motivated. They appreciated the autonomy they had. They appreciated the judgment and the abilities that they had. Like they were— they wanted to make— they were like, they wanted to do the right thing. Like even We'd have these customer service meetings and the customer service team would ask these amazing questions. And I was like, Jesus Christ, you guys care way more than I expected. Like, and that was really phenomenal. Like getting employees who were invested in the success of the business made it feel like I had a team that would like, you know, where a rising tide would lift all boats and we could celebrate wins together and they would be sweeter because we won together and our losses would be mitigated because we were all in it together.

Yeah, that's beautiful, Moiz. You mentioned that the companies like P&G are removed from the customer experience. I wanted to ask you, when you exited and P&G took over, what was the biggest difference that you saw between running a business yourself and then being part of a big publicly traded company?

Yeah, we had to get a lot more conference rooms, and in all the conference rooms, we had to install speakerphone so that we could have conference calls. We never needed that in the history of the business, in the history of the business. Like, we were just like, you have an iPhone, great, this is enough. And now we're like, there's going to be 30 people on this conference call, so we better get, you know, a conference room with like a nice speakerphone in the center. Like, there were a ton of meetings. And by the time I left the business, like, I was involved in meetings All day, every day. And, you know, it was a lot more like, it was less decision-making. Like, in order to make a certain decision, you had to run it by a bunch of people, and they would have their input, and then you'd have to run it by a bunch of other people, and they would have their input. And it created, like, you know, we were trying to make a horse, and we created a camel by committee. And I thought that was the biggest difference.

Okay, I need you to explain that analogy. You were trying to make a horse, and you made a camel by committee?

Explain that to me. A camel is a horse made by committee. Everyone wants to add their own 2 cents into something, and all of a sudden, you went from this idea of creating a certain object, and everyone's added their own 2 cents. Sometimes you can say no to those things, and sometimes you can't. As a result, you have a very different product at the end than when you started out with.

When you were taken over or acquired by a big company like that, they've obviously got a whole lot of operations going on, and I'm sure that some of them are positive and some of them you would like to never be a part of. So would you give me some insight into some of the things that were really beneficial from being part of a, you know, one of the biggest companies in the world?

Yeah.

And then I want to switch and ask, okay, what do you think that big companies could learn from scrappy startups like us?

Yeah, great question. So I think there were a lot of great things about working at P&G. One, you understand structure a lot more in terms of like, you know, when we sold the business, we had 8 people, like we had different teams, but almost everyone wore multiple hats. And like P&G is like, hey, this is how you structure teams and how you build larger institutions. And that was like something I'd never learned before. I'd never been a part of a big company and gotten to sort of create those structures. And so that was really beneficial. I also think from like an operation perspective, like P&G is cost conscious, understands the costs at much larger scale, has economies of scale, understands manufacturing of CPG products, particularly deodorant. They make Old Spice, they make Secret, they make Gillette. And so like understanding what we should be doing from an operations perspective, how to improve those operations and how to reduce costs were really helpful. Like, I don't think we would be as large as we are today without P&G's backing. I think we would have gotten there. I think it would have taken us a couple more years. But I do think that they accelerated our growth. And so that was super helpful. And so was the idea that, like, you know, when we hire somebody, I'm not afraid that we're going to have to fire them right away because we're going to be running out of money. There is like, you know, we're backed by the largest CPG company in the world. We're probably not going to run out of money in the next, like, you know, 6 months.

Right.

And so that was fantastic as well. And then I think what can large CPG companies learn from us? A couple of things, and I'm not sure they can learn this. Like when people ask, people ask me, why didn't P&G just start their own native? And I'm like, why is it when you see a bird, you're not like, let me jump off a building and start flying?

Mm-hmm.

Like it's absolutely not in your DNA. Like you don't have hollow bones, you don't have wings, you would crash and die instantly. And, you know, the people that work at P&G are the stewards of multi-billion dollar brands. You know, Pampers and Tide and Charmin and Bounty, like, you know, these are multibillion-dollar brands that have existed for generations. And the person who's running that brand today did not start it, has a playbook of what things should look like. And it's trying to marginally improve performance, you know, 6 to 10%. And that's a really successful employee at P&G. The people who are, you know, who are starting these brands are trying to improve performance by thousands of percent or hundreds of percent per year. And so it's a very different mindset. And I think that like the first thing that they can try and adopt is a lot of passion. Like, I think that that was missing when I was at P&G, is passion for the business or passion for the, like, you know, the heritage of the business. They were more focused on, okay, how do we increase the business here 2% and not what does this business stand for and how do we like, how do we like leverage its strengths? And I think that was surprising to me, but I think that that's something that they're lacking. And so was like risk-taking. Like, you know, P&G's growth has generally been just beyond inflation over the last few years. And that's not surprising. Like, they're an amazing institution. You know, Tide controls something like 80% of the laundry detergent sold in the United States. You're not going to be able to grow that thing 30% year over year, right? There's not that much market share left. But I do think that like risk-taking needs to be more embedded in people's DNA and like, you know, risk-taking at startups. startups is part— it's table stakes. It's what you need to do in order to start the business. At a company like P&G, you're expected to grow that brand. You know, people want you to grow that brand 6 to 10%. You grow it 3 to 4%, that's not bad. But if you take a risk and things go south, now you're in a ton of trouble.

Yeah.

And I think that there should be consequences for risk, but there also should be the appetite for risk. Like, you know, Amazon launched the Kindle Phone, which was an absolute disaster. I think they ended up selling that thing for $0.99, and they couldn't get rid of it. But when it stopped working, they weren't like, great, Amazon is fucked. We're going to stop Kindle everything. They're like, okay, that didn't work. You know what we're still going to do? Kindle for books, Kindle iPads, Kindle tablets, all of these things. There's still an appetite for risk-taking there. And I think there isn't at P&G. And it's really hard to reform that at P&G because you need need a very long-term-oriented shareholder base or you need a founder in charge of like the company. And like, I think it lacks both those things. Like, you know, it's not going to have a founder in charge of the company that was created in the 1800s and it's got a retail shareholder base. And so I'm not sure how invested they are in the long-term focus of the business as opposed to the short term.

What about from a marketing perspective? Because, you know, a lot of the brands that you're mentioning that are owned by P&G are, are running TV ads and doing really old-school marketing, whereas Native was scrappy PR, fun PR, Facebook ads, and Pinterest ads, and you don't see a lot of the opposite happening. I know Native's on TV now that they've been acquired, but you don't see a lot of small brands doing TV ads. You don't see a lot of big brands doing the marketing that you and I are familiar with. So, where do you think that puck is going, and has your— Sure. Has your analysis of advertising changed at all after being a part of a huge company?

That's a great question. Would love to hear your thoughts about it as well. My thoughts are they're doing like in many cases they're doing the right thing, like TV ads. You don't see a lot of startups on TV ads because TV ads require a lot of capital. Like we couldn't afford them early on. And capital can be a moat, like cash can be a moat. And once you have enough cash to be able to buy TV ads, they can be really successful for you. And as a result, you're like, that cash becomes more and more of a moat because you can afford more and more TV ads and sort of blow away the competition. I do think that they're starting to do a lot more digital advertising, which is right for them. I think one of the hard parts that they have is like their brands are often, you know, fragmented into so many different types of like, like, you know, when I think about Crest toothpaste, you know, Crest has like 3D Whitening, Total Whitening, and then 3D Complete. And I'm like, what the hell are any these things. How do you advertise 3D whitening? Because when I'm buying Crest, I'm not like, oh yeah, I need 3D whitening, it's better than total whitening. I have no idea what any of those things mean, and so I just buy any of them. Uh, so I think that there is a problem with fragmentation from the brands, but I think from an advertising perspective, um, you know, TV's not wrong. They're focused on digital, they're focused on— and like, often their ads are really clever. And like, um, you know, they're also focused on— like, you know, when they did— when they created something like Tide Pods, Tide Pods was such a revolution. They spent an absolute fortune advertising it. And I think in the first— within 2 years of launching Tide Pods, there was like an 80% awareness of Tide Pods in the United States. Like a crazy percentage of people knew that they existed. And that's because they have a large marketing budget and sort of know how to deploy it.

Hmm.

The other thing is that, like, you know, if you gave me— if you gave Native $500 million to spend on advertising, I'd have no idea how to spend it. $500 million is just way too much money. But the guys at Tide and the guys at Charmin and the guys at Bounty and, you know, Pampers have spent that kind of money before. And so I think they're gonna have a better idea of how to manage such a large budget than I will, having spent a much smaller budget. And I think, like, look, you're gonna get inefficiencies. When we, when we went from spending $1 million a year to spending $10 million a year to spending $40 million a year. There were inefficiencies in our marketing budget as well, the way we grew. And so I'm not like— like, I think that they're doing a good job. I think that, like, yeah, I do think that digital is amazing and can be really fantastic, but it really works well for e-commerce companies and it can work for brick-and-mortar companies. I think they still haven't figured it out yet or like there isn't good attribution just yet. But I—

So Moiz, seeing these brands that are so entrenched in TV and mass advertising, and you coming from the more startup scrappy mentality. There's— that's like such a clash of philosophy, I would think anyway. And so I'm curious if you see the ball moving in any specific direction after playing in both worlds.

I feel like, like, you know, the way I feel is that omnichannel marketing is going to be the future. You're not gonna— look, you're gonna be able to win if you're just on Facebook and you're gonna be able to win if you're just on TV. That'll still be the case, but there will be a ceiling to those wins. And in order to raise that ceiling, you're gonna have to do omnichannel marketing. You're gonna have to be where consumers wanna see you. You're gonna have to adopt new tactics. Yeah, Facebook was great, but is TikTok the new Facebook? Maybe. And who's gonna adopt that as quickly as possible? Who's gonna find the inefficiencies in TikTok? It's gonna be the people who are early adopters Because there isn't a rush of marketers there just yet, and who understand the platform really well. And those are the types of people that can win.

Moise, tell me a little bit about the podcast and where people can find it. I mean, I'm a huge Moise Ali fan. I can't wait to hear you analyze these companies that you're going to be talking to. So tell us a little about where we can find it.

Really appreciate it. It's going to drop probably at the end of next week or early the week after. So it'll probably drop in the middle of like, you know, early to mid-April. It's called Exit Strategy. You'll be able to find it on Apple. And we're creating a website right now, which we don't have up just yet. You're gonna be able to find it there as well. And yeah, so the first person we're interviewing is one of the investors of Native. His name's Nick Green, who's the CEO of Thrive Market. We've got the CEO of Hims Hers coming up. That interview's tomorrow. We've got a CEO with Dan Levitan, who's the founder or co-founder of Mavron. which is a consumer-only VC fund based in San Francisco that he founded with Howard Schultz, the founder of Starbucks. We've got the founder of Hint Water coming up next week. What I'm trying to do is interview a bunch of—

Kara.

Yeah, Kara, exactly. I'm trying to interview a bunch of great CEOs and great companies to understand exactly the questions that you were asking. How did you get to where you are? How did you start? Like, how did you start? How did you get to where you are? What's working and what's not? What are the challenges that you faced? Native almost failed 5 times in the growth of its company, in the growth of its history, or in its history of growth. What are the 5 times that Nick almost failed? What are the 5 times that Andrew almost failed? I'd love to hear that because I think that people are inspired by that. And like when they're running businesses and sometimes struggling, which Native was often, it's really great to hear those stories because it sounds like everyone else is human.

Yeah.

Not everyone is Jeff Bezos and has created a trillion-dollar company. People have struggled along the way. And that struggle is very human and inspirational. Yeah.

If you're an e-commerce entrepreneur, if you're an entrepreneur of any kind, if you sell on Amazon, if you're an internet marketer, this is a podcast I'm going to be glued to, especially while we've got a little bit of downtime right now. Moiz, I think, is the— I've said, I've said several times, Moiz is the smartest person in e-commerce who does not have a podcast. So, all right, I'm glad that he finally does. So it's called Exit Strategy.

Thanks so much for the support. Really appreciate it, Ryan.

What's that?

Thanks so much for the support. I really appreciate it.

Of course. We're glad to have you, Moiz. Thanks so much for hanging out with us at capitalism.com.

Thanks. Talk to you soon.

Hey, I hope you enjoyed this episode with Moiz as much as I enjoyed recording it. Remember, if you're an entrepreneur and you're building towards an exit, I help entrepreneurs build 7-figure businesses that they can sell. Whether you are an experienced entrepreneur and you've hit a plateau, or you're starting something new and you want something scalable that you can grow and sell, that's my sweet spot. So you can apply to work with my team and I inside of the Tribe. That's where our trainings, our coaching, and our in-person workshops all happen. It's all within one group, and we're there to help you navigate the ups and downs and decisions of building a 7-figure business that you can sell. So you can apply to work with myself And my team over at capitalism.com/tribe. I hope to see you inside. As always, thanks so much for listening to the show. It really is a privilege to invade your brain to talk about business and investing, and I really enjoy hearing from you. So if you've got any feedback about today's show, feel free to hit me up. I'm @ryandanielmoran on Instagram. Thanks for listening, and I'll see you on the next episode.