I'm obsessed with learning. I'll stay up in the middle of the night watching podcasts, reading books, studying, I know it's snowing and understanding what went wrong. Listen, we're not going to win on Capitol. We're not going to win on resources. We're going to win on speed. That's Ross McKay, founder of Cadence. A brand that's building the world's first $2 luxury products. But Ross' real advantage is in product. It's positioning. Wrong brands remove confusion from a category. They don't add noise. Our first carons are just like a minimal DDC can, but it didn't work on shell. We saw that data. When we launched a new can in, same liquid, sales were three times. It was literally a packaging decision. I have extremely hot tolerance for discipline, so I don't like get inspired or motivated by external pressures too much. It needs you all to believe in me. I just need to go buy this and target it. You've done just under $10 million in 600 days and the cat's not the bag. You're going to do 40 million next year. We're going to share that playbook today. I personally think a big reason is the branding positioning. We're talking about a lost camera. Let's start there. How do you make a $2 product luxury? We use that tagline where the only thing in consumer good that's under $2 or at least under $3 depending where you buy it, this luxury. I actually put that in chat GBT and I could not find anything under $3. That's factual. I think premium as it stands doesn't need to exist through price point. It comes to positioning. It comes to content. It comes to brand partnerships. It comes to where you sell the product, where you show up. You can look at brands in the space and I'm obsessed with this saying of premium scale. It's very hard to build something that's ultra premium and build scale at the same time. Very few brands have done it. On running is a good example. My dentist wears on. Yeah, the best athletes in the world wear on. They have the best stores on Bond Street in New York. How do you juggle with both? That's something that we are constantly striving for. Internally and now externally people are saying it's too long luxury or like the champagne of electrolytes. How do let's start? Let's start with just an obsessive research at looking at the aisle and what does everybody else in the market doing? Yeah. I am that individual that will spend a ridiculous amount of time in an aisle watching consumers have fast they pick up something, how we can differentiate. What's the white space? What's the price point? I think price point is often a determining factor based on category. So it's hard to price outside of the category when you're essentially selling to a consumer that is used to this brand, this brand, this brand. You can't generally give them something as twice or three times as much. It's been done before for sure, but under $34 it doesn't really exist. So you have to align your price point to the consumer what they're used to, I believe. But it was an obsessive deep dive into what we felt was missing in the category. In every one of us say there's no room for another beverage brand, but we believe there was. So you start with price. And again, we are talking a lot off camera. We'll get way more into product deeper into the episode. But I think also the branding, what went into the branding kind of inspiration? Honestly, it was a true reflection of what I would be proud of to represent when I built my first business. It was purely because it was a gap in the market. This business I immediately, I easily said, if I'm going to do anything for the next 5, 10, 15, whatever, however many years, I want to be super proud of it. I want to be proud of the branding. I want to bring you a can right now and you're like, wow, that's impressive. And I want it to light me up. So I think as naive as it was, I built the brand on what I wanted to see. Also the liquid, what I felt was missing in the category. And then through ideation with George, his co-founder of the business, we felt like we had something that one, we loved. And then two, we felt that we're different, you're on shelf. I think you have to also design the architecture of the brand to where you want it to sit. And for us, 2026 is about retail. Where do consumers going to buy this product and it has to work on shelf. So there's been some iterations. This is the third rebrand we've had since 300 days almost. So there's been a constant involvement for sure. Yeah, I mean, I love it. It's just super minimalist, super sleek. What have you learned in that rebrand? With three different iterations now going into retail. Where are you sitting at now as far as how and why was that can design, how it is? I think strong brands remove confusion from a category. And that's what we wanted to do with this can. And this design, we wanted to remove confusion from what is a very confusing category of sports nutrition, sports hydration, sports drinks, beverage. We wanted it to be super simple. We wanted to ideate on unique selling points, flavor, etc. But our first count of this count is to some extent would look the same, but it's wildly different as positioning, especially as we've moved into more stores. People have milliseconds to pull it off the shelf. What flavor is it? What is it now? Now we have a huge half inch colored rim. We have unique selling points like no sugar, no caffeine. And before it was just like the minimal DDC can, but it didn't work on shelf. We saw that data. When we launched into our first two stores, Vitamin Shop and GNC, we could see the feedback that it wasn't turning at the velocity we wanted. So it was literally a packaging decision. And I think for any founder that's out there building a brand, like build the design for where you want the product to sit. But it's almost like, especially for the people from an econ perspective. Formerly, you were very kind of like top of the funnel, cool. And now it's like almost like direct response. Like this is what is in the can. Yeah, to some extent, marrying the premium and the scale facts were always. So there's just general things on a can you cannot change. We have battles internally, like no joke, my team will laugh at this. Where my QA guy wants to change the collar of carbonated drink and the 12 fluid ounce bigger because FDA regulation will say it needs to be the size of minute. I'm like, no, it doesn't look good. So we always juggle that line of like what you're allowed to do and what looks good. And often they're in complete polar opposites, like genuinely speaking, like pretty much for 35% in this can, we cannot touch it. The barcode, the UPC, the callouts, etc. Where it's made, you know, like if you're optimizing for design, half that can wouldn't be on it. But you're optimizing for what's allowed and what's not allowed. So it's been an evolving, you know, discussion, but data informs design as well. So specifically from a product perspective and relations to the branding and positioning, obviously the words on it, the visual identity, the colors, what about like, you know, how many milligrams are in it? In terms of can size, you know, it's a fairly standard 355 ml. That's what, you know, a Celsius or a blue energy or, you know, other, you know, new olive pop cans would be. I think when you're building a category and you're building within a category, you really only have to change one on two percent. I talked about this recently. You don't have to reinvent the wheel. I think for us, we didn't want to change size can because consumers are so used to what they're used to give them something that's familiar with and just make it that little bit better for us. Better was design better was positioning and better was liquid. I think so many brands of common goal within this world drinks category because ultimately why they haven't worked is they haven't delivered on a great product and all of the design and everything makes sense. But what first thing to do is you crack it open, you drink it and it has to be delicious, it has to be craveable and not allows for a peak purchase, both D to C and in retail. So we spend a lot of time on design, but we spend a lot more time on the liquid itself. Makes a lot of sense. From a branding perspective, what are some of the big brands that have inspired you? Obviously George is a co-founder, I think represents, it's like a, we joke sometimes, it's like a represent liquid in a can. What are some of those other like big brands that you've looked to? Because I do think, you know, when we speak, I don't look at you guys as like a CPG or like a drink company, it's way more of like a lifestyle brand, almost like a fashion or a parallel company. Yeah. It's going to sound cliché, I think, from a lifestyle perspective, when I look at brands like a Red Bull, they have a formula, one team, someone surfing a 40-foot wave out there in the world right now with a Red Bull cap on and a Red Bull board, someone's back flipping off the Alps in a Red Bull, you know, parachute, like, but yet they sell $10 billion of carbonated beverage every year. So I'm inspired by brands that, and I think a lot of brands will say we're a lifestyle brand and you're like, really, you do a run club, but you're really a lifestyle brand, but like, we really want to fuel the goal oriented athlete. And our innovation is the means to allow that individual to do that. So whether it's someone running across Australia, like they did a few months ago and Will did the same, we fueled his ambitions. Whether it's her, can he's running across Cypress or Greece or Montenegro, we're fueling those individuals. And if you're seeing yourself as a lifestyle brand for consumers who want to achieve things within the sport of running, cycling or whatever it may be eventually, there's brands like on who are premium at scale that have built a multi-billion dollar business, maintaining a premium positioning, but yet achieving scale, which is, while the, once a brand becomes a victim of its own success, right, everyone's wearing it, you don't want it anymore. Very few brands have been able to do that and contain to evolve. I'm a sucker for if I keep seeing the same t-shirt, I'm a running brand or a clothing brand, I don't want to wear it anymore. I think that's the issue which people have within a power. Yet within beverage, so almost seeing the more people are drinking it, the more I want it. So I think on Red Bull, obviously George and represented 247, you know, brands like Bandit and Satisfy have done something great in the running scene, but it's honestly obscure brands like Nespresso. Nespresso is such a premium content brand, beautiful education. Big coffee guy, completely agree. Yeah, the machine arguably is great, but the coffee is pretty terrible. It's not like a Lama-Zach, beautiful craft.
Yeah, it's premium at scale. The shops are insane, the contents insane, the packaging is beautiful, but you can get one for 90 bucks, which relatively is mass America. So I think about that. I'm really inspired by brands that can achieve hundreds and hundreds of millions, if not billions of revs, and you but yet maintain a premium positioning. Yeah, I think you've done a great job of that thus far, the fact that you're scaling, and I still, it's almost like you want to look like you're small. Yeah. You guys look like smaller than you are. Like when you told me how much revenue you were doing, I was very, very surprised. You can play frankly. I thought you guys were doing $234 million. You guys were super, super small, and you were waiting to take that big swing, but I was surprised you were, you were early at where you were. Yeah. You know what? I think the category scales so quickly within beverage. When I look at the brands that I'm saying they did 50 to 500 in two years, now being on the other side of beverage and understanding, because I'm doing sales. I mean, I'm just off of a wall, not called like 30 minutes before I came in here. I'm flying Austin tomorrow to me, a big retailer. When I see the velocity of retail, and I see the data within the category of beverage grocery, I'm like, now I understand why brands are doing $100 million a month, because they've a lot, 86% of people roughly in this country today will buy a cold carbonate beverage. It's insane. The category turns an insane rate. And when I moved into a new business, I wanted to do a couple of things. One was being a category that had that velocity. Expectations are higher because buyers are saying, "Well, that space is moving so quickly. If you're going to take that shelf space, you have to turn it that rate, which is the scariest part of my business. How do we do that?" But once you do that, this is where $3, $4, $5 million days exist. So we really look at two things. I think retail is distribution and marketing. That's all it is. Units per store per week is how you measure success. Distribution doesn't matter. If someone comes on here and says, "We're in $10,000, you're like, great, but how are you doing in those $10,000? Are you winning?" So, dollars per store per week or another KPI that a retailer is going to look for, how many dollars are you bringing into my store on my shelf a week? And you basically win in retail every 30 days. After 30 days, you get your data, you make changes, you might drop price, you might add promotion, you might do two for four, etc. But we're priced so fairly in the category. That we think success to us is driving trial. And then winning consumers over that way because we have such great supply chain and unique economics that we're able to compete like that. I think we live in LA where $7 matches are normal, but once you scale mass America, $2 is expensive. So we have to compete with the biggest drinks businesses in the world. Gatorade is a monster. And it's like sub $1 for a bottle of crap. Yeah, I want to dive a little deeper into retail. We talk about all the time and all the episodes. I think you know better than anybody. It's about the sell through not the selling. If someone tells me they're in 10,000 stores, that means absolutely nothing to me. Nothing. How has that been for you? Have you been approaching these retailers? Have they been approaching you? What does that look like? It's been a mixture. My last business, we were in not that it matters. We were in about 60,000 TDPs, Starbucks, Walmart, Costco. Pretty much every retail in the country, other than Sam's Club. We were pretty much in BJAs and Sam's Club. So I've commented this from us as a second time find it with the pattern recognition or what it takes to win in retail on what it looks like to lose in retail because there was retailers we didn't win in. But I have some relationships in the game where there's direct relationships with retailers or with brokers that we utilize to access distribution. At the same time, we have friends in the world which are selling beverage into retailers that just the way you're a phone book and your network is built, you're going to have them help you as well. So it's a combination. We're going out people that we've done business with in the past, we're also utilizing our network and our investors to help us access distribution. But it's been amazing to help retailers build the category of sports hydration and sports nutrition because a lot of retailers are seeing this emerging trend of run clubs and run grips and cycling competitions and marathons and half marathons. When you turn a run to the retail and you say, what are you doing to support that customer on their journey? Like I was just in Chicago, I go into a local CVS. There's literally thousands of runners that they before Chicago marathon with no choices. I call CVS and say, let us be that choice for a consumer. Here's what we're doing. Here's all the cool vents we've done. Here's the collage of all the run clubs we've done. Here's the sizzle reel. Let us be that brand for you. So being a thought partner and then that's what they've been really excited about. Now we have to prove it out. Makes a lot sense. What does that retail pitch actually look like for people that are going into their first pitch? What is in that deck? And what is kind of that leverage that you can bring in and show them? The best pitches are always informed by data. The first pitch you're going to have no data. So ideally, pitch two is we are selling this much in this store. This could be you. Retailers can be like, wow, I'm missing out on that. If I look at what else I'm selling. Okay, if I take that away and I get that, I'm going to get incrementality. Great. That's pitch two. Pitch one is much harder because you're not able to turn around to retail and say we're performing at these numbers. This could be you. So pitch one is essentially, here's how we differentiate in the category. Here's the incrementality we can bring you. Here's our large D to C audience potential that we have that we're not going to shove into retail. Look at Brownling Blum. Greg, here's D to C business. The minute you launch into target, turn that off. Go to target guys. Go to target. Go to target. Go to target. So you're taking that and we've kind of played that play. We had a pretty solid D to C business. I think right now we're about 65, 66% subscription on our website. We're now turning that off and saying go to target and buy in February because ultimately that's where the unlimited scale is. That's where the unlimited scalars. That's where you can achieve a hundred million dollar quarter or a hundred million dollar months, which we're seeing in beverage today because we're able to drive or consumer into that space. Add incrementality drive trial. So that's where it is at today. The pitch is so far have been. We can bring our community, which is ridiculous. It's becoming very, very strong and drive them into your retail doors. What about from an economics perspective? What's have a margin profile? Are they looking for what type of profile do you need on your side? Take genuinely you want to give a recommended retail price. So for us in you take a target or 279 on shelf. Generally speaking, they'll be middle of the ground. You're going to have people in like an era one at like $5. But like eradicate that from the conversation. Walmart is going to be lower than target. They're probably going to be your lowest. Everyone's looking for 45 to 50%. So you take 279 subtract 50% from that. That is your selling price to the retailer. Then you have to subtract distribution cost, shipping costs, et cetera. And then that gives you your margin from cost of goods into your selling price. So anyone in CPG today you really want to be building off like a 50 plus percent gross margin because of the cost of doing business. The biggest line item on most brands that no one talks about is tradespent. 20 to 30% in order to activate and work with that retailer. So we've built this business ultimately with the very, very strong unique economics understanding the cost of doing business in retail. So retail price minus 50%. That's your selling price. Retailers are going to want 50% margin generally for forgiving. And for promotion of marketing you mean like NCAPs or maybe like street teams coming at any type of event anything. Yeah, and it could be even trade promotion. So when you go into a Walmart and you see two for four, the brand often is paying for that. If every day price is 250 and now you're down for two for four, so the dollar off, you're generally paying for that dollar as a brand 50% maybe 100%. So that over 60 days, 120 days a year, potentially 12 weeks of the year, the brand is paying for that promotion. So it drives trial and what you're going to expect is after that trial, your velocity based jumps. So drive trial, drive trial, drive trial, make sure you're building a business that allows for that because if not you're going to be losing money, but you have to making money too. And then after that promotion goes back to an EDLP every day, a little price maybe off to $179 instead of two bucks. When consumers come back, you've driven enough trial for that velocity at base price to jump up. That's kind of the game of retail. But again, you have to build the foundations of supply, and the unique economics to allow for this game. So I am radically confident that you're going to have great sell through and you're going to scale it a big way. I never think it's too late to go into retail, but some people think it's too early. For people out there listening that have any CPG brands, where do you think you need to be, to be radically confident that you can go into retail? And obviously in retail, like you want to hit a home run on your first swing. It's very, very tough to have not a good sell through, get taken out and then be put back in. How and why were you comfortable going into retail when you were? Good question. We talk about a lot. I talk to my, I guess, advisors about this question a lot. I think it comes down to how much do you, the risk you want to take to make the business as big as you want it. And people will give you a definite answer for that. And there will be people who listen to this and say, "Oh, well, you've got to be achieving this." And there are two questions. One is, do you have the unit economics to allow you to scale? So if everything else is true and the loss is incredible, and it pumps on shelf and blah, blah, blah. Could you build a business that is ready for that scale? So don't go into retail till you're ready for that scale. From a production perspective? Production perspective and a supply chain, and the economics are safe. Can I sell this into Walmart and Target and still make money while building that supply chain out? Hold still. At a worst case, you would maybe say break even from a marketing distribution and just to live another day. Oh, now, but then maybe later, obviously. Yeah, you're going to find efficiencies over time. Yeah.
eventually costs will come down as you order more of course. But generally speaking, you should not be aiming and going into retail until you've built the visibility into the supply chain that if this happens and we achieve this scale, we will be achieving this gross margin, contribution margin, et cetera. The second question I just asked this exact thing because we have an opportunity with CVS Walgreens Wal-Mart target this year. This is the distribution. Very obscure. New brand would go farmers market, airlines, sprouts, Whole Foods, Bristol Farms. That's what you would see in this city. You've seen it happen dozens of times. It's the natural route. COVID screwed that differentiator between natural and conventional. Now anyone, what everyone cares about is convenience. We want something in 20 minutes. I don't care if you're in that retail, that's it retail. I'm probably going to order off Instacar, Amazon or wherever else I shop. I want it in 25 minutes. The only thing really matters to us is accessibility. I want to go after Gatorade. Gatorade don't sell in sprouts in Air One. They sell in Wal-Mart target in Costco. That's what I'm going after. I'm very inspired by the founder of David Bar where they were like, why not going the traditional CPG route? Farmers market, Air One, Bristol Farms. You've seen that pattern happen so many times. He's like, I don't care about them. I care about Mars Bar. I don't care about the healthy snack bar that your mom and pop made in their village kitchen. That's ironic because I walk to get a David protein bar from CVS every other day because it's right there and just super convenient. That's so I'm un-apologized. I am not looking to build a $15, $20 million business. I want to build the next Gatorade. How do we do that? We make accessible to Mass America. That's great for you back. Just understanding and knowing that from a price and a production perspective, you can handle scale if and when it comes. We only talked about it at once and I want to dive a little bit deeper because you're like right in this mix right now about, you briefly touched on it, about going direct versus using distributors. The pluses, the minuses, the margin profile. Obviously you have a little bit less control if you go through a third party. What have you learned through daring and now cadence with retailers versus distributors? Pluses and minuses. Ultimately, the end is you always have to win over the retailer and then they're going to determine your supply chain and they're going to ask for us to be direct distribution or they're going to ask us to go through a distributor, which may be like one or five guys or whatever. Direct distribution allows you to maintain margin, potentially pass it onto the customer and make it cheaper, which drives velocity and that's amazing or have that money in your own pocket to spend on marketing, etc. The issue with that is you're delivering a lot of trucks and a lot of cans into different and it's a big supply chain risk. When you work through a distributor, you're generally deploying your cans or beverages into one location and they're handling all of that. The con is less margin, potentially more expensive calls to do business. Is there less margin though under the notion that you're going to have to incur on the direct side, that 3PL, the warehouse, you're going to have heavy SGNA and humans managing as well? We outsource all of that regardless. Generally speaking, direct distribution is better for the P&L from our perspective, what we've seen and distributor margins can work on anywhere between 15 to 25%. It's still very expensive costs to do business. However, this kind of a natural evil because they also have other customers that you might not be talking to that they can unlock for you because you're doing well and it's a whole game. You can't have one without the other and you probably want to have both. I'm learning this world. I didn't deal with any direct distribution before. We only work through Cisco, Unify, KHe, the Big Mafia guys. Now we're understanding the DSD network of the developers of the world and it's a crazy landscape but it gets me super excited. I want to really, really educate. There's a guy out there listening. Actually, I know a bunch of them that follow and they want to do on the podcast that are doing $12 million in protein cookies or something like that. Tell them a little bit more about this distributor game because from my understanding, you mentioned Mafia, there's a finite amount of people that are controlling all the distribution and they could basically block you from getting in anywhere versus this distribution is basically for people out there listening. It's almost like a marketing agency where they have X amount of clients and whichever client is bringing them the most amount of money, they're going to push that as much as possible. So if you could just speak on that a little bit. Yeah, I would say let's underwrite distributors to be box movers. That's all they are. They're never going to sell your product for them. Brokers, on the other hand, are sales agents on behalf of your brands. The issue with the sales agent is they've got other brands that are their favorite child and they're more willing to spend time with them until you prove it out and successful. So think some individuals right now with a cookie business doing $12 million a year, they want to get into target. You have to be the one I would say to win over the end customer. Once you do that, a distributor, a broker will be happy to take your business. But until you win over that anchor customer, it's very hard for you to turn up and knock on the door of a distributor and say, hey, take inventory. Good luck selling it. What's your sales team look like? Are you going to underwrite this talk? Are you going to buy it back if it doesn't sell? Because I've got six other protein cookies that are selling really, really well. Why would I take years? You have no customers for me. What we've always been focused on is let's win the end customer. Let's turn around to a distributor or a broker and say, we'll give you that business. I want you to manage it. You can take your margin profile on it, but here's some expectations for us. So anyone out there that's building that, go win over the anchor customer yourself. Do whatever it takes to get that product, that customer. Once you want to optimize, turn around to said party and say, we have this customer. Now you can have them. So yeah, thank you for clarifying that. The difference between the actual distributor, which is just shipping the product versus the sales broker, which is a guy that was probably formerly a buyer of Walmart that says if any CPG brand wants to get into Walmart, come to me and I'm going to take a phase, something like that. I know the buyer really well used to say that and then you turn around and you're like, don't go to sleep at night thinking that this guy girl is doing anything on your behalf. That's one of the biggest mistakes I've ever learned. He's like, oh, we've got all these brokers out there. Wait for my phone. No one's calling. Like build your own sales team. I'm my own sales guy. Probably this is so crazy that you say that because in the Mark Manson episode, he talked about the importance of not outsourcing your zone of genius to someone else. And I was outsourcing our sponsorships and partners to somebody else, IE, a sales broker, almost like an agency. And they weren't asking the questions like, what does success look like? And really, really caring. And I feel like for me and for the people out there listening, like I can just imagine sales broker in a meeting with Walmart versus Ross. No, I'm meeting it's a fucking different universe. You cannot allow anyone else to speak on your behalf as the brand owner. No, and obviously overtining that's hard to scale. But my job as a funder is to sell, sell to my team, to join me on the mission, sell to the customer, sell to the buyer, sell to the investor. You're a salesman. Believe in the mission, believe in the product, comment joiners on the journey and tell you you can't be in two places at once, only then do unlock a sales distribution team. But tomorrow, I'll be an Austin selling to a retailer. We have a sales team, but I'm the one going because I want to meet the buyer. I want to build the relationship. I want to understand what success looks like. And that is what's key. And that's what I've seen from the best browns in the world. The funder is still out there selling. Yeah, we're going to, I want to jump into founder, light contact because you've done a great job of that. And I think that goes hand in hand with being in the sales meeting and filming it. You got a bunch of people here at the tie a bow on retail though. What do you think has been like the biggest surprise, good or bad when scaling retail for cadence under the notion? This is, this is your second ride here. I mean, you went into, what was it, 50,000 plus stores with your last company? The biggest surprise. I talked about the scale a little bit. And when we sell into, we're loading into target in two weeks, loading into Walmart. We just got the order from Walmart, just prior to this call. And I continue to be amazed at the demand planning, data and sell through of the grocery beverage category. When you see brands like Oli Pop and Poppy doing 800 million, 500 million, I'm like, really? And then when I look at 10 to 20 units a week per store and 3000 stores and you model back from that, and you do a top down build, you're like, that's $20 million for this milling berry cat in one account. We have three flavors going in. And we have all these, I'm like, that's her brands get to a billion dollars. I continue to be amazed by that because in the business before my category turns so slow. So you can be in 10,000 doors, but you're turning one unit a week. This category can turn at 20 units a week. Same amount of doors at 20 is an incredible business. So I'm just continuously amazed about how many people buy beverages every single day. So it's a race to grocery. That's where the velocity is. Listen, you ever bought a drink online? Yeah, that's other than cadence. Blame milk on Instacart. I love Slate Milk. Break a shout out, man, I love you. 86% of people a day will buy a drink. Almost none of them are buying one line. So to answer your question is be where your customers? People buy drinks not online generally. They buy them in stores. They buy them in convenience on the way here. It might be in a 7-11, might be a CVS, maybe a Air One, maybe a Walgreens, maybe a Starbucks. I don't know where it is. But for the most of the people out there, you buy your drinks in a grocery. Therefore, I need to put my drinks in grocery. I need to put my drinks in the aisle, beside water, beside redville, beside Celsius, beside whatever else. It may be in as many stores as possible. That's the game of beverage. Now, I have a whole other range of innovation that is largely
focused on D to C on Amazon because people don't go and buy running gels in Walmart. They buy them on the feed. They buy them on Amazon. They buy them on cadence.com. So we always position our innovation for where the customer is today. Don't try and drive a new customer into Walmart to buy a running gel. They're not going there to buy running gels. They're going there to buy walk your eggs and cadence. It's really important. How did you learn and understand about all of this? No idea. Honestly. I don't know. I said, "I jumped in." My business grew so quickly the first time around the daring. I was surrounded by such excellence, specifically around team and investors, that I had no option and that saying, "Sync or swim." I was kind of sinking and maybe surviving at the same time because we grew so quickly. We had so much capital. We had so many great people around us with so much practice and recognition of excellent businesses that I figured out. A lot of mistakes, some good stuff, some bad stuff. This time I'm taking all of that into the next business. I'm also surrounded by some really great thought partners, people that I've done this before. I'm a type of individual that is obsessed with learning. I'll stay up in the middle of the night watching podcast, reading books, studying analysts, notes from the public offering of beyond me and understanding what went wrong. I'm an obsessive founder. I say it all the time the most dangerous founders. I'm with you. I'm on the same boat as those second time founders that didn't hit a big home run of the first one and have a chip on their shoulder. People make sure they do it. I could tell the first time I spoke to you, I'm like, "This dude is angry and focused." When I tell people I'm angry and focused, my wife is like, "You should show with that." I'm like, "No, no, no. That is the exact type of weapon that I want to associate with and invest. Angry and focused." You are literally the poster child. I built my first business with a chip in my shoulder, for sure. More personal stuff. People are not believing in me. That stuff doesn't bother anymore. I'm like, "I need you all to believe in me. I just need you to buy this at Target." This time is a different positioning where it's a chip in my shoulder, but less angry. More methodical, more sniper. I'm underwritten how I've taken capital onto this business a little bit more, a bit more like, "You watch this grow." Not saying yes to so many people, but I agree. I'll make bad some funders that have got a bit of a lesson to teach. Use that something very subtly there. I think it's one of George's superpowers as well. It's something that I've learned the hard way that I'm just getting better at is the power of no. You most definitely are a guy that's saying, "No, 20 times before you say yes to one thing." I love that. One of the reasons why I would imagine the first business was hard and it might be the same kind of hurdle that you might have in retail period is just like the education on the product because you're so methodical. I got a package of yours. This race recovery was a bunch of products. I actually sent it to the Mad Ravika. It came with this beautiful illustration outlining how many milligrams were in each thing when you take it. I was like, "I have never seen a product be so informative and educational and telling me how and why and when I should take product." That obsession is a huge motive you have. Let's talk about products. If you are only building on social, you do not own your audience. You are borrowing it. The algorithm decides who sees it. That is a bad business. Beehive changed that for us. It's where open residency runs our newsletter and growing our newsletter is the number one initiative for us this year. One place to grow, engage and monetize with zero platform foods. They even have a built-in ad network where sponsors come to you directly through the platform. Guys, I believe in Beehive so much that I put my own money in as an investor. The team is elite, the vision is world class, and the product is built for operators, not amateurs. If you want to give it a try, head to beehive.com/openresidency or 30% off your first three months. Make sure you enter the code Mark30 at checkout. That's beehive.com/openresidency. Mark30 at checkout. Stop renting your audience. Start owning it. You've launched how many SKUs in under two years? 13. 13 SKUs. Just walk me through that kind of innovation kit. How do you look at products? I think my general consensus on products is fewer SKUs are better than bloated ranges. That's kind of the punchline. Go really narrow and deep on what's working. Generally speaking, our mission always has been to fuel the goal-oriented athletes. Let's take the highest level approach. What does that athlete need in and around their work out to achieve their goals for us, the runner, the cyclist? They need pre, during and post, carbohydrate and hydration. We just believe that proper nutrition starts to proper hydration. You can optimize your gut, your cognitive health, your skin, your bone density, whatever it may be. But if you're not hydrated, we believe that none of that really matters as much. So first thing you do in the morning, you drink a glass of water. Then you understand water's not enough. So you add minerals. Hopefully it's electrolytes through cadence. We underwrite the customer journey from 24 hours of the day. We built a system of core race and recover. Race is energy. Recovery is sleep. We take those three pillars and we allodge assets under each of those pillars, depending on channel strategy or whatever it may be. So can, for example, ready to mix sashie, gel, bar. 90% of the focus is on the beverage because that allows us to scale the most into B2B. And the other innovation is high margin subscription, channel focused distribution and innovation. It's been a year and a half with launched 13 SKUs. The main focus being on the beverage and then the other innovation just keeps us grounded in who are customer and who built the brand. I'm very inspired by brands like RX bar who continue to build the brand within the CrossFit community and stayed there. They always built the innovation for that customer, even when they got widespread distribution cliff bar. Very good friends with the XCO there who sat on my board previously, same thing. They built that for the trail runner, the guy on the bike with his family hiking. Even when they built mass distribution, they continue to innovate for that customer. So we'll never lose sight of that customer, even when we get more widespread distribution. Yeah, like for me, I do feel like you guys were like early on like the high rack strain. I think running is obviously a big one. I'm so so bullish on high rocks. So for anybody out there listening, you have these three kind of core pillars as far as when in the 24 hours of a day you would take it. And then these are my ICPs and then it's fitting in this distribution. And you're just building products based around let's just call there's some core products i.e. the gel, the protein bar, the red. So you're starting there and then what? Because I know that you're a savage and you're definitely testing all these out when you're working out. What does that process look like? We're like, okay, I want to create a bar where you start. We have a very in the beginning is different. It was like I want to create a bar. Let's do it. Find the manufacturer, run samples, make sure we can make money and launch it. We're very different now. We have a stage gate. It's tightly run. We have to understand size of the price. So let's take a new flavor. Let's take a let's take an orange can. It's not a net new category. So if the net new category, which could be what do we not do? I mean, we don't do like a powder in a top. We have to understand like, okay, where are we going to manufacture it? What are the margin requirements required? What is the MLQ? What is the cost to the business? What's the lead time? What's the channel strategy? And then we have to try and underwrite that with an anchor customer. So for us, we're printing millions of these cans now. We have to unlock that press goal with an anchor customer. Otherwise, as a financial risk to the business. So we won't press yes on our orange flavor until the retailer said, we will launch orange and June. I go back to the manufacturer and say, press go. So we're underwriting some of our risks now with like guaranteed customer. In the beginning, it was basically like very inventory heavy, sitting on inventory, hoping we can sell it, D to C or B to B, which obviously the scary game because inventory is cash and cash need to run a business. But we have a very rigorous stage gate where we underwrite every innovation. And the last I veto it, which is like once a year, if there's an innovation that I truly believe is a yes must go, which pulls back to one or two things. One is it's a company changing innovation. I think no one is paying attention to or two. It grounds us back permission, even when this high as the price is small. An example would be a carbohydrate powder, very small business, very small category. Most people won't consume it, but it grounds us back in performance. And I truly believe my core customer needs it from us. Yeah, it's not going to be $100 million. Almost like an 80/20 Fied your core ICP, elevate the brand, cement the positioning versus, let's sell a shit fucked on a cans. 100% makes a lot of sense. So for everybody out there and you kind of, you touched it on it earlier, like this RTD drink, which I'm sure you'll end up doing 90% of your business with this, is just take something tried and true and then win on something differentiated. And for you guys, I would say the liquid is great, but brand and positioning. Yeah, 100%. Sports hydration is not new. It's been around for a long time. Look at every single category in beverage alcohol, disrupted by non alcohol, are better for you alcohol, low ABV, whatever it may be. Take soda, two big brands completely disrupted that category were acquired. You look at energy, you look at Celsius, even a Lani, disrupted Red Bull and Monster acquired. Who's disrupted sports drinks at scale? It's been some cute little brands, no disrespect to them, but no one has achieved mass distribution and taken shell space from Gatorade. That's really what our mission is. You mentioned M.O.Q.s for some of the newbies out there. M.O.Q.s minimum order quantities. It's the PO that you have to put in to get the ball rolling on the production side. I mean, when you start, you don't have that built in PO from distribution. You have no leverage. What do you say out there to people that are starting? What are the best things you can do to kind of chop those M.O.Qs down? With beverages harder because not to get into this specific category.
we have a printed can, printed cans are higher than sleeve cans. Like there's specific things you could do to maybe de-risk the business and not go for the $2 luxury off the bat. Like you could do a sleeve can, which is a 10th of the MLQ of a printed can. So understand what's nice to have and what's must have, printed cans are not must have. Most startup beverages would do a sleeve can, for example. But with any category, whether it's protein, cookies, beverage, pizzas, whatever it is you want to do, a sure job is the funer to go to the manufacturer and say, I'm a new business, I am going to get target in Walmart. I'm going to achieve this scale. I need you to work with me helps that I'm a second time founder. So when I called my beverage manufacturer, they were like, okay, that's exciting. And we got very warm introductions. But the first time I called my manufacturer, I genuinely just told them I had a Walmart Pio. I didn't have a Walmart Pio. I just told them, oh, I've got meeting with Starbucks. And I'm going to change your business. I'm moving my product away from my other manufacturer, RFPing this over. It's the first time I've told this. I just lied. I just told the manufacturer that I was way bigger than I was and I was in stealth mode. And we're about to launch here and all these exciting customers. So then they trusted me and they made me innovation. They made me samples and they were willing to work with me knowing that I was going to battle myself that one day I would get these customers and by time, but as a founder, a sure job just to win over that manufacturer because they're getting dozens of calls a day from their next cadence to say, hey, I want to launch this. And like, if they invest their time in everyone, they're never going to have time for their core audience. So honestly, you just have to be a really good salesman. I mean, you said something very profound and very simple. And I remember the day almost 10 years ago when I just go it up in Austin, Texas at my production's door. Yeah. I can't say enough about face to face showing how serious you are and meeting people in person, having a couple call for them. So for an hour, you can get crazy benefit of just doing that. If there's a few minutes in person helping know who you are, who your goals are, and this kind of a conversation, and you're going to hope they're going to make a bet on you. So people buy from people. And I wouldn't say that was a lie either. It was like a white lie too. You're getting some leverage in this. You know, while we're getting a big picture, I don't say that's a lie. You think that is a level of delusion. You know, we're delusion. For sure. Because you do believe it. I said some wild shit when I went into Austin. And then I just remember like a year later, having dinner with them. And they're like, everything you said has happened. And then that's where you get even more rope. Because you know, it's the kind of regretter. Say you're going to knock him out in the second round. Knock him out in the second round. I understand. You're going to get big bucks. You're always sold out. So demand plan. You've been sold out 200 plus days. Good problem or bad problem. How are you solving for that? terrible problem. We sell a problem that we promote as a daily consumption when you can't consume it every day. It's not aligned to your mission. So like, if you're doing a clothing drop, I think it's quite cool to be sold out. And don't get me wrong in the beginning. It's great because it shows that product market fix exists. But ultimately, it's a problem because one, we're not doing good enough job of supplying our customers with product they want. I mean, we're not demand planning. Come back to that. And then two, when you're building a brand based on daily hydration and daily pattern recognition and daily discipline. And you can't have it every day. Again, there's a problem. And if people love it, they're going to get it from somewhere else. Don't think anyone's loyal. I think that's a massive mistake brands make. Because they believe that brands are loyal. I mean, I try new brands all the time. I subscribe to a few brands, but I'm willing to switch. And if I can't get out, definitely switch. So that's one thing I think about all the time. At the same time, we bought enough cans the last of the year. The last is a month. Like yesterday, I think, first of all, problems we back. That's true. And then we made an order on Friday for a million of each flavor. It's wild, making those big bets to launch into one retail. So we have a demand planning team now. We have an operations team now that are looking at data and informing with our retail team, what's coming in the pipeline, what's our current velocity? Let's measure it up. Let's balance that against cash and inventory. How much we can support lead times. It's a whole puzzle. But demand planning is ultimately the most important thing in the business, especially when you're in B2B. Can't call Walmart and say, give me another couple weeks. But they're going to say, absolutely not. That's two weeks of $4,000 selling that many-- I'm missing millions of dollars a week if you're not on. And if you're not on, I'll put sales to you, son. That's it. Again, no one's loyal to your brand. So I think supply chain demand planning is one of the hardest things to do. But it's one of the most important things to your business. You drop the subtle gem there. And I just want to put a pen and then really, really point it out. It's very, very dependent on the category. Totally. Because from a clothing perspective, obviously, you're not wearing it every single day. Siegelman's table is a great example. My buddy Max is just like-- I mean, he started at the beginning. He was doing like 20 hats a run. And you just went on the website. And there's 22 hats sold out and one available. A human psychology gets to you at that point. Totally. How many things you've seen? I just found sold out five times. And 20-- I'm like, I got that ad all the time. This brand sold out five times this year. I'm like, what does that even mean? And I'm looking at it. I mean, they ordered a hundred every time. Which is great. Then 500 people bought it. And it could host to them. But I don't believe sold out. I guarantee you B2B sold out is a massive issue. It's a problem that you should be focused on. And then D2C sold out is nice on a limited time offering. We're doing a drop with 247. Selling out was cool. If that product goes into Walmart, which it's not, sold out is not good. That's destructive for your company. Visuals go crazy. And that 247. He just showed it to me. Looks amazing. What's the biggest kind of mistake or learning that you could share with someone based on supply chain and production? I think a great call that you said as well too was, your business is about inventory planning. What are some other big key mistakes or learnings that you would share with someone? I think launching too many products. I'm obsessed around businesses that can build a several hundred million dollar business with one ski. How great is that? Picking all your wood behind one arrow. What that means is if I can give this kind of manufacturer all my capital. The more currency can buy, the more salt he can buy, the more water, more flavor, whatever they can do, the more packaging. Like if I just keep funneling my capital into this ski, the more cost is going to come down. If I say some of that and some of that and some of that and some of that, different manufacturers, different terms, different volume, it starts to spread you tooth in. So even though it's cute and nice to launch something else because it tickles your fancy, I would generally say, and still this ski is reached $10 million. Don't worry about the next ski. Don't worry about the next one and the next one. The next one retailers do want to see two or three options. That's why we launched with a few different flavors. But we started the business with one ski, one flavor. And then we spent a year building one ski, one flavor. Then when retailers said, okay, we like citrus, what are the flavors that you got? We earned the right to get more horizontally ambitious. So earn the right. Don't just do it because that one's not working and you want to do more because you want it as a customer. You have to put as much capital and efficiency behind the one ski deal reaches a certain KPI for us. It's like until that's doing 10 million, there's no point of doing the next flavor. Yeah, you get all the compound effect. I mean, from a relationship perspective, relationship medication and SGA perspective, a big thing to touch on there too for people that are listening, I've made this mistake before. You talked about, let's just say one product, the canned one flavor, and then you're iterating to more flavors. It's so important that if you do do these tertiary kind of ones to hit that core ICP to build brands, try and find a way to keep it with that same production facility because the second you deal with Johnny and Jeremy and Mark and Austin, it's just two completely different things that you have to manage. Different 100%. The issue you're gonna have within different categories is some manufacturer should just the best at doing one thing. But everything has pros and cons, but I would agree with you. Stay focused. What about the cans, the satchets, the bars? What's been harder than you expected? And where have you been pleasantly surprised as far as looking at the category mix? I think everyone said you're gonna launch beverage business, that's crazy. You know what's capital that needs? How much money are you gonna have to raise? An expensive that is, you know, about the unique economics are like, I'm wildly surprised about how profitable the channel and B2C in beverages. I think we've nailed it on a formulation standpoint. You know, it's water and salt at a premium price point. Fish. So we've allowed to build, we built a formula that has allowed us to make really, really, really solid gross margins. That when I speak to an investor, they're like, surely not. Like that's incredible. So I'm pretty amazed by how many people told me, don't do beverage. At the same time as we've leveraged or de-risked the business to some extent by saying, we're not only a canned electrolyte, we also have ready to mix satchets that are, against 65% subscription or website. We have Jail Innovation for the runner that is number one selling on the feed and on our website. And we have all the renovation that is extremely high subscription, very high volume and very high margin that is feeding the rest of the business. So they kind of work in tandem as like a halo effect. Chances are someone's tried my Jail at Brooklyn half marathon and the bandestore, they pop into target, they buy my canned. Same thing. So they're kind of married against each other and we feel like we're hitting a really good sweet spot there. You can upsell and cross sell across all of those. What about the actual liquid? Because when I drink this cola, it literally tastes like Coca-Cola to me and we joked off camera like Coca-Cola and Gatorade to me is like dessert at this point. This is like the actual premium fuel that I wanna drink. For people out there that don't wanna do the white label and just do some cool branding, stick around in product that everybody does, how should they approach making their own custom product?
I can give you it from my perspective and what I've seen to work. We've contacted and worked with a formulae there. I think one of the things that 90% of brands will go to a manufacturer and say, "How want to launch your hydration brand? Give me your three or four options. I'll bottle it. I'll stick her at and I'll go." And there's nothing wrong with that. It allows you to get to market. Again, the Moe and CPG is brand. So like, ultimately, why are you focused on investing or your capital into formulation? For us, it was different. We were a formulation first and brand very, very, very, very, very close second. We cared about a formulation because we went out and said, "We are the best. We're unique. We're informed sport-proof or NSF approves. We're the best in the world. We're the best innovation in hydration beverage." Most funders, if you want to build something unique, you go to a formulae there. There's a bunch of them out there. And you say, "Project-based, I want you to build me this. They'll build you samples. You pay for their time. You pay for samples. Those samples to a manufacturer, chances are that developer knows someone. And you say, "I want you to scale this up." The pros are you own your IP. I own the cadence cola formula. I take that formula to my manufacturer now and say, "Run this. They don't need to worry about it. They didn't develop it. They don't own it." So when it comes to that big payday from Coca-Cola or Pepsi or Dr. Pepper or wherever it may be, you have IP and you have protection. So there's a way for us to transfer that technology to a coal man and they run it for us rather than the coal man, white labeling for you and you really own nothing other than your logo. We've looked at it that way. Every formulation we have has been custom-formulated. We actually have full-time developers now in internal. I've always been very curious and I know you run an absurd amount of miles. So you would have like a bigger sample set than others. Like if you're making this drink and you're trying to figure out how much magnesium to put in it, how does that go? Are you doing a run with 400 milligrams and then doing a run with 500 milligrams? Like almost like a split test on e-commerce that we've done? We've always approached it from a data perspective. So when we looked at the can, it's funny I had this conversation yesterday. We have a head of innovation nutrition called Mad Jones. He's the head of sports science nutrition for the Boston Celtics Championship winning team. So he's got deep, deep understanding of sports nutrition, sports science and everything we do has been informed from studies out there in hydration or from sweat testing or from other data points that are clinically proven. And we've taken that data and we've built a formulation. So for example, this can has 500 milligrams of sodium. Y500, Gatorade has 100, barcode has 60. I'm using those example numbers. I don't actually know. But generally speaking, we're over indexed in sodium. The reason why is because the average sweat loss, if me and you both go for a one hour run right now, the average we will both lose is genetical base, not in genetics and climate, et cetera, is will probably lose around 800 to 1000 milligrams of sweat. Wow. You didn't know that. This is half of your run. This is 30 minutes. What is the average run cloud in America? Three miles. What is the average time it takes 30 to 40 minutes. Therefore, you need 500 milligrams of sodium based on 30 to 40 minutes of it, high to moderate activity. So that's pulled back from data and we're able to go to a retailer and say, we're different because all your other drinks are using 50 to 60 milligrams. That's like me coming to you and say, I have a five gram protein shake. You're going to say five grams. And he's 50 grams now. And he's 40 grams now. And he's 15 grams of creating, not five grams of creating. So we're never going to dumb ourselves down in innovation. We just expect over time the next one to two years, consumers and retailers and buyers to eventually evolve to the point and say, why was I stalking a 50 gram sodium drink? That's pathetic. That's like a five gram protein shake. So we're the best in class there. And that's all informed by data. Outside of the people that are running one hour a day, just the average human being. How many milligrams should they have a day? Should they be drinking one of these a day regardless? It's very, yes, 100%. I think so. So it's such a negative connotation. I tell my mom and dad I'm launching a brand around sodium. I tell you, oh, sodium is bad for you, right? And you probably heard the same thing. Again, our positioning is not for the average. It's for the goal oriented is the person running high-roxing activity. And then over time, we scale that. However, the general population massively underestimate how dehydrated they are. And I think whether it through food, now becoming, you know, potentially over time, more cleaner, less sodium, less seed oils, you've seen that move and pretty aggressively. We're generally indexing that people will start to consume less sodium in their food. And they're going to need that sodium from other things, sachets, cans, et cetera, supplements, minerals. So we truly believe that over time, we'll be able to educate consumers on how much sodium they actually need, specifically within the world of sport. Because I think pure hydration can affect resting heart rate and makes threshold sessions harder. They're like, now with the adoption of people pushing their bodies even further within sport, amateur sport, they're going to need more education around sodium, sweat and takes, sweat loss, et cetera. And goes back to the fact that if you can make that an enjoyable experience, they're more likely to come back time and time again. But mass America today probably don't need more sodium generally to have enough to their diet. But in certain key pockets, we have a big enough demographic that we can scale a business to where we want to get to. Radical transparency. You're saying some people don't need it in some context? I honestly don't. Some people don't. I can imagine with some of these foods, how much salt. That's all backs into, for me, content. I think that's one of the key drivers and how you've solidified your brand positioning. How do you look at content into your overall kind of positioning strategy? I mean, ultimately it's just storytelling. You know, we talked about the brands that were inspired by, I'm not inspired by their liquid. I'm inspired by their brand, their storytelling, their romantic short form content they do about that individual who's achieving like, it's just like, I'm so encapsulated by it. Now we're consuming more and more content from brands all the time. Liquid, it's like just constant involvement, podcast media, YouTube, whatever it may be. So we see ourself and we see our positioning in marketing and storytelling as inspirational, yet achievable. And I think we're doing a pretty good job with that. Honestly, I think if we're doing one thing really, really well, it's our positioning within the world of running and endurance work right now. And the storytelling are brand new doing. Again, it's hard when you want to scale that to the masses, but we see it as a very, very big lever and a high importance in the business. Your CMO may or may not have said that you're involved in all the details down to the Instagram, Carousel Post, the copy. Why do you think it's necessary to be that involved in all of the small minutia in relation to the brands? I think I don't believe that that is required over time. It's just that everyone in the company is relatively new and it takes time for them to see the world, how you see the world. It's a big comes back to the hiring process and people and your culture, etc. But it's so, so important that you maintain your brand equity for as long as you can, hopefully, forever. And a lot of what goes on on our feed on our page or design on our campaigns is a brain dump from what's in my head along with the team. But a lot of it does come from the inspiration that I have for how I want the brand to be portrayed. So I care a lot about those minute details and I think for as long as I can, I will. But I think again, it helps my team to understand how I'm thinking and eventually you can let them run with it. But right now or not in that position, yeah. Yeah. Your YouTube, George's, Dom, Nick Bear. I actually just sent this morning with Greg from Bloom. He's playing some great content out as well too. I think that there's a very, very small amount of people that are putting out both entertaining but also very educational content and inspirational content. You've done an absolute great job. What does that look like for people out there that want to do this YouTube this day in the lifetime content? We have our own process on the podcast side. But what does that look like? Is this an ideation day? A guy comes over one time a week for people out there that want to get started. What's the simplest way to get started? One of my biggest regrets in my last company was I didn't document anything. I got an incredible journey and some incredible moments and pinching moments that will live in my brain forever and my photo album and I didn't get to share with the world. Guys, we're getting to that at the end of this episode. Raise 100,000,000 dollars. Check from Peter T.O. and I airplane. We're getting to that. Don't worry about it. Keep going now. And part of that is I didn't post it. Not for any reason other than I just wasn't focused on it and it wasn't a priority. And I truly believe that impact is really important and I think that one, it helps the business and the brand evolve for a very low-cost capital. I mean, ultimately, I can build a YouTube almost for free on my iPhone, and win over 10 customers. The ROI is really, really high other than time. Now it's got to the point where we have people dedicated to words, content, and media, and how can I position myself to bring in new customers? How am I involved in launches, campaigns? I think there's incredible founders where you could actually turn off the brand's Instagram and the brand was still exist. You look at Ronnie at Kith. Ultimately, he's the one who's 10 days out from every launch who's posting before Kith is and you can build the man. You can start to measure what we think the drop is going to be and George obviously does it. And there's a number of other founders. I will say this brand is bigger than me. This brand could survive. With me operationally out. No. But with me, not as the face of the brand, absolutely. I never wanted to be the, you know, you talked about one brand, the nutrition brand. Like, I don't want to have the name of the company, my name. It's not Mekai Nutrition. It's not raw supplements. It's cadence and it can exist without me, but I add feel to the fire. I help to bring in new customer and audience, new subscribers and help to educate because I think people nowadays want to understand what happened and how we got here. It's not just this faceless brand, but it's a big time suck. It costs a lot of money now. It's a big, big cost in my time, but we're seeing the ROI for sure. Great YouTube channel. Definitely check it out. And you said something and we also talked about a little bit off camera for everybody out there.
I think the ultimate goal I've talked about a little bit with George as well too is in the beginning, we called it like a hedge. You guys got to double down with you and George out the gates is definitely utilize the personal brand in the beginning to get you off the ground. But then it should be a race to be removing yourself forward facing so the brand can live past you forever. That should be the goal in my opinion. I'm not on the Instagram page. There's one picture of me and George. That's it. Wow. Did not know that. Yeah, it was one picture and we posted a 29th 30th of December. It was a recap of the year. It's the only picture of me and him sitting there whiteboarding. So I think, you know, we see the data, how many people come in through me, how many people come in through other influencers, how many people come in through word of month, whatever, maybe podcasts, et cetera. There's a high percentage that come in through my following. I have a relatively small modest following, but it's a very sticky, engaged consumer because I'm really talking about one or three things, business, brand, training or my family. Don't have like a widespread distribution in terms of what I'm educating on. And I think that's a reflection of like what they're my customer and our customers today want to be fed. They want to learn about how to build a brand. How does they fit and balance a family at the same time? And there's very few people doing that. So at the same time as building this positioning in brand, we're also thinking about how can I position myself to add, you know, and how can I advantage it? How can I move this business forward? But I agree with you fully. Like you don't want the tune to be inseparable. I agree. How do you decide what is on brand versus what is the distraction from both a personal perspective and a brand perspective? I know you guys have done a bunch of collabs. Is there any type of kind of like mental model or rubric that you say, we should do this. We shouldn't do this. No, it's got. It's got feeling. It's purely feeling honestly. I think that's something that is a superpower. You can just feel if it makes sense for the brand. There is obviously an underwriting of allocation of time, capital size, the price, et cetera, but doesn't get to them until I know it just feels right for us. Makes sense. I know you guys have done collaborations with like raw, you do stuff with bandit. What do you think makes a good collaboration for you guys? Non-competitive categories that add advantage to each other. Bandit is a good example. Bandit have one of the strongest run communities in the world. Thiminic and order that done an incredible job there. We're proud to be a partner of that. And I would say that they've helped us tremendously and elevate and access into the consumer category, specifically in the world of New York City. They will never do supplements. We'll never do a parallel. We'll never do a run club. We'll fuel run clubs. We'll fuel a power brands. But we're never going to go out there and try and stomp on their, we are to their one of the best. But we're not going to drop clothing for a quick million dollars. Like we have very fundamentally said, we will not do that. If you want to collaborate and we will collaborate with bandit in the summer, then let us do what we do best. We'll let you do what you do best. And that is what makes a good partnership. Raw was the obscure one where we both do supplements, but my relation with the team there is like family and they have a very different audience than us. And we wanted to win over some of that bodybuilding hybrid consumer. And they wanted to tap into endurance. So we had very different demographics and was actually just friends sitting across the table saying, "Fuck it, let's do it." But I think non-competitive categories that you will never step into without the club make a lot of sense. With the same ICP. With the same ICP. Yeah, I think bandit is a perfect example. And I think like positioning from a quote unquote like cool perspective. You guys are both very elevated in your categories. I think that was an absolute home run. Any other dream collaborations or someone that you want to collaborate with that you guys haven't yet. I know it's still early in the game. We're going to manifest it now. Dream. Absolutely. Dream is, I would like to do a sleep capsule with this vessel. So we have a sleep product that's best served, in my opinion, hot. So if you were to capsulate it, run it through an espresso machine, it would be like a warm, soon to be chocolate flavor. Hot cocoa. That would be incredible. Like an espresso cadence. It seems very different. I bet you weren't expecting that. I dropped them at the beginning, but I think that would be amazing because we'd reach Mass America, potentially. And we still achieve our mission of hydrating performance support. And there's probably a few brands right now that we're in discussions with for some stuff that's outside of clothing. And maybe footwear or something like that. 2030 espresso times cadence. Come into your home. Guys, quick break. This episode is sponsored by Universal Ads, a division of Comcast. I have spent tens of millions of dollars on meta ads. At one point, it was 95% of my marketing spend. That is super dangerous with one algorithm shift. Your whole entire business can stall. A great option is layering in advertising on streaming TV. I thought it would take weeks to set up and a big agency to maintain. Guys, it took five minutes. Universal Ads gives you direct access to a ton of premium publishers. 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[email protected] with subject line Universal. Platform dependency is dangerous. Don't make that mistake. Link below for more. If somebody wanted to be on this quote unquote cadence team, how would they come on? Same question that I asked George. What would you say? What makes someone a quote unquote cadence athlete? It's funny because we positioned away from our initial thesis on athletes was, we don't do ambassadors who do athletes. The difference of an ambassador and athlete is an athlete is a full time athlete. They are in the world of running, probably achieving Olympic qualification. They're training to compete at an Olympics. For example, within the sport of truck and field, marathon, Ironman, you know, world championship level. And we did that. And what we saw from that is the cost of businesses relatively high and the return of investment outside of credibility and awareness is very low. We'll take one of the best US marathon runners. An incredible individual, one of the best athletes, potentially in the country. Yeah. He wouldn't sell one of these because like who's, like, how does that work? He runs a two, ten, two, seven marathon. Like, truly, it's not because of mail and very cadence, right? It's so far. I already know. You know why? Because he's got eight thousand followers. Not eight thousand followers. It's fucked up, bro. It's messed up. And that's like a reflection of the category now yet we'll take individuals. I think that's the reflection of the world right now that like, obviously, you know, you could have a smaller audience and it could be super, super sticky. But the reality is if you don't have distribution, yeah, distribution, product can only go so far. It can go far if you have superior product. But I think distribution just amplifies everything totally agrees. So we build basically like the dumb down version of the tier, like most brands we do, we like, we have a few select tier one athletes that ground us in. Who the brand is, the authenticity, the performance, we'll compete at the highest level of sport within their realm, Olympics, Iron Man, you know, Tour de France, whatever it may be, tennis, world championships, et cetera. And then we have a more volume base where it's tier two and three, where we're more focused on codes, influencer content ads, which drive 99% of the revenue to see rather than these top tier expensive customers. So we've juggled with it. We've just brought in a head of influencer and a head of social to manage that department because I was always scared about moving away from that top tier and what they would do to the brand and sacrifices we'd have to make on like brand authority to have no offense to running influencer, Bob is running a four marathon, but has 400,000 followers like really feels so unauthentic. But yet when I look at the Shopify and he's doing 20 grand on a swipe up, I'm like, well, let's have 20 in. I'm here to make money. You know, it's definitely a tough balance. And when I, I actually know too, because I looked at your your Facebook ad account and I'm in your funnel, what I like about you guys to and again, you'll be able to do this for only so long and or you can scale at retail. You guys don't seem like an ad company. The ads that I get are basically from you. It's very organic. It's very authentic. It doesn't surprise me that a lot of your businesses through affiliate. What's the strategy behind that of just like not doing quote unquote direct response ads? It's a reflection of where we are in a life cycle. It's a brand. We can get away with it right now. I also, you know what it is. I just goes back to the first question you had. I want to be proud of the brand I built. And I'm cringed when I turn on and I see some stuff. And I'm like that. I mean, George went for run and something we talked about like when is the time? What's the inflection point when you're like, fuck it? Like turn on the gas, turn on the water. It still does not have direct response ads. Yeah. You know what a supplementary bit different I find a little bit like I don't want to see an influencer like show me their outfit the day. I don't know. I just it's interesting and it's a reflection of like what's working our category. We will go harder on influencer. But yeah, there is a very strict guideline on the type of influencer we will have. I don't care how high the ROI is on Bob. But if Bob doesn't look and feel and touch how I want it, I want to be, I want to be Bob. If I don't want to be Bob, then I'm not working with Bob. So I have a big, big cringe factor. And if I don't think that individual represents the brand or at least represents where we want to position the brand, we will not work with that individual. And then to go back to your question, how do you become an athlete? You know, it's building within the pillar of performance, aspiration, quality, content. And then generally what we do is we send on our team and we shoot content with them. Like we're going to sign a new athlete who's in Austin tomorrow. We'll find Austin. I'm gonna shoot him, but we're bringing the team. So we're gonna bring that pair. So along with us, we're gonna give that--
I'm a huge one of content on our books. And then hopefully they have like the ability to distribute that and it still looks and feels like how we want to position the brand. - I'm gonna take out of that for brand owners out of there. If you develop a great brand and a great visual identity, the fact that you're pointing it on your books is such a huge value add to these athletes where they get the distribution, the branding, the costs to create the content. It's the same thing with this brand. - I agree with this. - Like we're literally giving you $100,000 worth of agency content via content and distribution. So building that internal content engine gives you a lot of leverage in the marketplace to get, I would imagine really good deals. And the higher you are positioned in the market, obviously the better deals. People want to be cadence athletes. - It's very hard to measure the ROI on the stuff that we do right now. But I am not hacking my way to this. I mean, if you talk to Greg, he's the same thing. He's big on brand. Like he has done a great job of keeping brand and community. And I mean, they're doing incredible numbers. They're wild numbers. But what I say to you is like, I don't care how much brand X and X is doing on D to C. It's not cool. I wouldn't trade that for the world for what we're doing, what we're building. I think we're building a generational defining brand that can be as big as Gatorid yet. We're gonna make it as sick possible. - Maddie, your CMO said, Ross quote unquote, "fucking hates meta ads." That's what he said about you. So that's a good tie. He also had a lot of other great stuff to say about you, which I wanna get into that a little bit of hiring and talent development. You went from zero to a hundred people at daring. I know you're still in a small company now, but what did that teach you about hiring and what are you doing differently with cadence from a hiring perspective? - I don't think I get it. I appreciate that, Maddie. I don't hate ads. I just, you know, time will tell. I think in the beginning, you hire for pace, you hire more journalists. You hire people that are willing to do just about anything to get you from point one to point 10, potentially. Maybe that's one to 10 million. I think one of the best founders in the world right now has got Eric Glyman, he's the founder of Ramp. Being fortunate enough to spend some time with him in a prior life, he's now hiring, you're hiring for spikes. So in the beginning, you take a generalist marketer who can do social media, who can do paid, who can maybe shoot content, who can do this, but everything because you're so small, you need one person as a generalist. Then as you evolve into 10, 20, 30, 50 million, you're hiring spikes. I need the best content team. I need the best paid media team. I need the best creative director. I need the, like, it's not a generalist anymore in operations. It's a demand planner, it's supply chain. It's contract manufacturing. So generalist evolve into spikes, spikes being like one major skill set, the best in the world, that one or two things rather than being pretty good at a lot of things. So in the beginning, we hired for generalists and now we're moving into this much more spiked approach because we're about 30 people now, roughly at the company, I'm sure we'll grow to 50, 60 people this year. And that's what I've done. And then the same thing, the culture starts with me. I mean, I appreciate what Maddie said, but like, I am generally on 3, 4 AM calls. I'm not saying that's the way to do it, but I'm also late. Like, I set the pace. I set the intensity. I raised the bar. I read an amazing book. It's called Amped Up. It's by Frank Sloven. - Sloven, I read that four days ago, randomly again. You can go faster than you believe, keep pushing the pace. I mean, that's the general thesis of the book. - Yeah, and I think top performers want pressure. You know, a leadership sets the pace. Amped up, I can get it in a week. What does three days look like? Let's settle it four days. But if you combine that over 100 decisions in a month, that's an extreme competitive advantage when you're this small. We're not going to win on capital. That's how we're going to win this game. To a certain point, 200 million. Like, other than that, it doesn't matter. - And people will crack. If they say it's in two weeks or you need to buy ones, then they can do it. And those are the people you want on the last anyway. We're going to pop up that book in, but a light blue and white book. - Incredible. - And Snowflake. Got like a Dutch accent. Great. - Dutch guys, you guys. - You guys got some great interviews as well too. I've gone super deep down that rattle. It's one of my favorite books. I literally just reread it like four or five days ago. - The best thing I went to funders fund, a D1 capital, where I played my series beat my last company. The gifted experience in Florida when money was free and they sent us all there. And Frank Sloven, talk to the prior, the co-op CEO of Instacart and Stripe. And they had a conference and it was 100 people in a room. We got to ask questions and I got to spend some time with him. And it was one of the most incredible experience that I read that book, I think four times. I gift that everyone joins the company. Because I'm like, this is, there's one thing I say. I'm going to financially change your position in life. Just give me the best you got. That's all I want for you. - That was like Sluteman on that. I love that. And it's a short book too. It's like 225 pages. - Yeah, I need for a watch. - And you can watch it on YouTube. - It's a good reason. - I want to point out something to just for people out there listening that are earlier in the journey. You talked about kind of the generalists and the spikes. A huge thing. And I've had this conversation with multiple people on my team is obviously there's going to be what is their core competency? But then also like what are they deeply passionate about? Where you can identify early that if they are doing six things and you're going to bring on someone to take three off their plate, you're going to want to allow them to have the decision to do the three things that they're passionate about. So you can elevate them, but also put them in a position where they enjoy their life and their future. That's just a great conversation that I've had early and off one a lot of people. And it definitely pays dividends. People appreciate that too. Giving them the insight into this person is coming next. How do you want to be positioned? - Underbushed forward. - And how do you think the most impact? Because I think ultimately like clarity creates velocity from individuals. If you help that individual understand the goal that we have, whether it's 2026 or 2030, and they understand how they can time you move the ball forward, then it's going to create velocity. So I think that's a big, big, big role. I think any founder, their job is really three things. One is to set the vision higher the best people in the world. And if you need it, raise money. That's all you really have to do as a founder. - I agree. When people are coming out, what is that interview question that you always ask? You're going to get the job today. You're going to hire you. I'm going to hire you. You're going to start on Monday. I'll hire you guys. You call me in three months and you say, Ross, I'm leaving. I'm shocked. Why? Well, we're crushing. Like what do you mean you're leaving? But I gave you the money you wanted. I gave you the equity package and we're crushing. Did your stocks were finally back? Why are you leaving? Why are you leaving? Your decision. - What is that reveal to you? - Here's an answer I've had. Because Ross, I worry that I won't be able to get involved in serenery is the business that I'm really passionate about. I don't need you to be involved in that. I need you in that. Like, or, you know, I worry that like this work like balance thing is very important for me. Like, sorry, we're scaling from 10 to 50 this year. Like, there's a time in the place for that. So a lot of times their answer will underwrite the type of person that they are. The type of person they are. And it's a very hard question to dodge. And if they dodge it, I'm also red flat. Just tell me straight up. Answer I had the other day was, you know, I'm an sales buy really love branding and marketing. I really want to sit in on those calls. I'm like, if you're sitting on those calls, you're not selling products. If you're going to call me and say, I'm really not involved in the brand campaign for the orange. I'm like, well, we got 15 people worried on that. I need you worried on this thing. So that's a great question. I always ask, you call me to leave. Why did you leave? - I already, expectations, good communication up front. I can't believe you agree. I'm going to steal that one. You read this book, "The Who" about hiring. So many people have come on and talked about it. I'm going to do a whole entire thing. I got to read it this weekend. Kent's from Barrow Gum and Jeff from Omentis talk about it. I got to check that one out. You know what the problem is with this? Is we live in a really interesting work culture where it's like deemed psychotic. I was to be in a very aggressive CEO. - I think it's coming back. - It's coming back. - It is. And it's coming back a little bit and you're seeing that. But like, - Yo, it's so funny. Is the revenue and EBITDA curve of iconic art company last 10 years is directly in proportion to the general macro statement on hustle culture. - It will. - Like from like 16 to 21. And then like, "Covid and I get, we're not in work. We gotta be not." And then now it's three day work weeks. And like, "Don't get me wrong." Like, you know, pros and cons, but like, all in. It's so funny that you say that because we, fuck it, I could say it on here. It'll be announced by them. We just signed a partnership with Behive, a guy named Tyler Denk. - Gross. - I invested too. I mean, they are brushing it, but for me, I was talking to someone else in their space. He was in Colombia. He is in Colombia, his girlfriend is in Colombia. And he was at a wedding. The back and forth cadence, how fast he was and the aggressiveness, what he was sending me. I went, I had my first touch point with him. And within four days, we had a whole entire deal close. While it took 10 days for the other person, it even responded to me. And I was just like, the speed and psychotic has like a negative connotation, but just the speed and aggression to get stuff done. - The most successful people I know will reply to me the fastest, the busiest people because they have such a high ability to prioritize. - Makes a lot of sense. I would love to know this answer because I actually spoke to someone on your team about this. How would your team describe working for you? How do you think they would describe that? - I would say that it's a very fast piece yet disciplined workplace. - One to one, he's got a perfect match. That's basically what they said. So that's great that you have that awareness. What do you think has been like the biggest hiring mistake that you've made over the years that you could share with the people listening? - Hiring the people.
based on experience. I've been here before, Brown shoes, square toe, sales guy, who X and Y sold this. Hiring people because they have the experience doesn't mean that they have the intensity, the velocity, and they're willing to deal with the pressure. They might just wanna hire more people and say at the top. So I've hired people more green and more earlier in their career with a very high update for pressure and velocity and scale, and then try to add experience through the ability to use things like mentor pass, or boot calls with consultants or experts, we were on a call the other day, my whole marketing team with Greg talking about target. We paid for that call in mentor pass. That's what I'm trying to do. So bring in patent recognition to these young hungry guns, not just guys who sold Celsius into Walmart 10 years ago. I always asked the people who are interviewing, when did you join that company? Because I think pre 50 to 100 million is very different than joining at like 200 million. You know, that's a very direct specific question that can unlock. Head of sales at Celsius from zero to 500 million is very different from head of sales at Celsius at 500. And like where do we need that individual? How big was that team they had? Because often our teams are one people. Like my sales team other than me is one individual. So like, are they used to having seven other people do the work for them and fill out on boarding forms at target, or are they like, like that's how I think about it a lot. And everything you're saying is 100% and mimicking the conversation with Matt, and he said one of your superpowers was, he was someone that was fairly junior and you brought him upstream to be a generalist and do a lot of things. He said your ability to pick people and give them a sandbox to figure it out themselves and really empower them to take the next step in their career. He was very thankful for it and he said you've done that. We have a ton of people. - I think your job is a funder is to make people feel 13 feet tall. You know, I was made to feel 13 feet tall by my father. And I think that you only really need one person to really believe in you. And then I'll give them the tools. Like trust me, I'll give you the cap, or the resources or the access, like just go build it and watch how it lice people up. People don't leave jobs because you're not gonna pay them enough, well, I'll always be able to support them financially, but like people leave because you're not making it a great place to work. A great place to work is like impact. - They don't leave the company, they leave the founder. - 100%. - I'm gonna fire away a million questions here, I got a ton. I guess let's first start with, you've raised over $100 million in your career. What's your best piece of advice on raising money? - I have a good lawyer. Never skimp on two things. One is an accountant, one is a lawyer. - How are a good early stage funders lawyer? I have one if you need one. - I got a good one too, his name's Gudi Agahi. I get my straddle already. - Jason Cornfield, Cricidio. - They say in Cornfield versus Gudi Agahi, we're gonna pop the off. - I'm gonna pop the mob when he's from Stats. - My guy's good, and I love him too. He's a former tax guy, turned corporate lawyer. - Worked with both of them, you know, figured it out. The reason I say that is because, and I can see that from the position of it, I'm able to afford a good lawyer and understand, like, you know, but if you can, never skimp on it because that term sheet, the eye in the tee, not being crossed and dotted, is a difference between you controlling your business and you know. Term sheets are wildly, like they can be so detrimental to your business. - We've talked about it in a couple of past episodes. I think that one of a topic that I am most surprised that some of the highest level entrepreneurs know the least about is legal. Like not even knowing what strike price means is absolutely not knowing what a waterfall means, meaning who's money, who gets the money first. That's something that at this point I've learned a lot, actually from Goodie. Everybody has to learn that, that's out there. - There might be a reflection of the fact that you built such a good business, you didn't need capital. Like I talked to Don this morning, or yesterday, and I was like talking about preferred nations and safe notes, he was like, what are you talking about? And I was like, you know what that means? You're just such a great partner, you didn't need to know what else is money. - We raised a million. I've only raised a million of my career, never ever more. How much money have you raised with cadence? - More than half a million. What'd you learn from that process? - It was all from people, I would say, in my immediate network. I didn't learn anything I didn't learn from before, to be honest with you, it was relatively easy. Second time founder, good funders, great brand, good early velocity, good early signals, relatively affordable price, not overpricing the business, making it fair, making sure we can get people great upside in the future rounds, and we're exploring a potential capital raise right now. - Would you share the valuation potentially? Would the audience here? - It was, you know, 10 times what I raised. - 10 times what you raised? - We're raised to 4.5 million. - Wow. - Safe note or regular? - Safe note. - Discount on future equity? - No. - Fair enough. - Guys listening, safe note is just like a simple agreement under the notion that you're gonna get the equity valuation at a future round. - Just a discount on tomorrow, ultimately. It's an interesting stage because at the early stage you're basically betting on a little bit of most working with yet where do we think we're gonna be in 12 months? The good news is that my business is we have such bill out distribution that if we do this, if we buck this up, we'll be at 40 next year. You know, like it's incredible. And also like, right frankly, we don't need the money. You know, like we're in a position now where demand is very high and supplies very low. And thankfully I have friends and co-founders and people in my network that are willing to like help out if we need it. - I think supply is non-existent. We're talking about this off camera, the marriage of the actual liquid and the branding. I love the liquid and the branding. I think you guys are literally in a league on your own. - You know, if I could get one point across, I raised 140 million of primary 65 of secondary in the last four years, five years. And I'm not proud of it. I'm proud of the secondary. Because the only thing that matters is you create a great business. Great business creates optionality, allows you to raise capital, allows you to sell a business. But I have been guilty in the past in trading myself on how much capital I have raised. And that is not a key indicator of how successful or funder our company is. So that is something that I do not take for granted and do not bring into this business. I'll raise capital to grow the business because the business makes sense with without your money. Unfortunately consumer packaged goods is so capital intensive. You said something to very, very subtly. I forgot who I heard it from, but it's brilliant. And for people out there, I highly recommend you take this when you're raising money. It wasn't even about your quote unquote valuation. It was about you're giving them a discount on the future valuation. So it's not about X times EBITDA X times revenue. It's, hey, I'm giving it to you at 40 or 50, but this thing's going to be at 120 in 12 months. - How do we get there? Let's look at it. Let's do a build. How many doors this may skews? Here's the peos. If we do right, and if we build that base velocity and our website, you see continues to grow at the current rate, here's what it shows. Maybe we don't get there. Let's go here. Oh, that valuation makes sense. It's also stage of where you're at. Like we're raising in 20 months into a business where it's still so early and growth rates are so crazy that you kind of want to create this feeling of like getting in before. But we're growing up, a great business. Like the business fundamentals are very solid. - With a super lean team, with a lot of generalists, which makes it even more impressive. - Super lean team, a lot of generalists, no one really has seen greatness before. And yeah, I always invite investors to come down and see it. So our last run was Stephen Bartlett. I love it. He's a friend of mine, George introduced us. He's, we've done some work together. It's great individual. But one of the other investors is I invited them down to our London event, pop up, run, come and see it, come and feel it. Don't just believe me, come and see the 800 people that want to get tattooed of our, speak to the store that sells our product, how it compares against the competitive. Like I want you to come and see it and feel it. And it was really important for me. And they did. They came and sell it. They felt it in the city in New York in Marston, we can, they were like, wow. Like this is incredible. - Ross knows how to sell. I love that. That's a great vision. Let them see it for themselves. - Yeah. - What's Stephen Bartlett's superpower? That was my next question. - Similar to you, his level of, his level of inform, is the clearly informative conversation. The questions he asks and the ability to seem to know just about a relatively solid understanding just about any topic is incredible and not feel like it's fluff. I mean, he's obviously surrounded by greatness. He's interviewing great people. - Great to hear me as to. - But you know, Alex and I, we spent some time with him a day in New York together and we, he didn't touch his phone. He looked at me in the eye the whole time. For a gentle and his phone's probably going, like I, I worry about my phone right now. - It's gone crazy right now. - And this guy would look you in the eye, have a conversation, not talk about himself for someone that's just, he's on a scene scale right now. In general, I feel interested in what I had to say, what my office manager had to say, what my assistant had to say, what Alex had to say. Like it was very, very amazing and humble to see how much he seemed to care and how much he genuinely seemed to be interested in what we were talking about. And it was being around enough people who were like, yeah, bro, that's a, oh yeah, yeah. And you know, Zika Brooks on the phone, you know, like, you know, name dropping and even,
none of that. It was incredible. I thought his superpower was his ability to engage with people. It's so funny that you say that because I most definitely have ADD. I'm not clinically diagnosed. But what this podcast has done for me is like, how often do you have to sit with someone and have a deep conversation for two hours? Never. Very, very, my wife would love this. Yeah, I know. It's absolutely amazing. And what this has done for me, it's so crazy is my wife's season now because I do it on weekends. I do like, I had this past weekend. I had basically a podcast episode with someone, but it was just I obviously wasn't filming. So I'm taking this exact kind of format and bringing into my real life and doing the no phone. When I sit down and have dinner with someone, like when I have dinner with one other guy, it's basically like a podcast. So I'm basically just duplicating this format in my life and it's helping me create deeper relationships and getting smarter faster. So all Steven is doing, I know. I'm just, I'm doing what he's doing, but he's obviously a bit further ahead. I would say a bit more than a bit further ahead. He's just duplicating what he's doing on Kramas offline. That's why this is this is a super power this podcast thing. It's it's incredible. Anything. Yeah. Getting smarter faster. I never thought about that, but it's true. That's like my number one KPI for happiness in life. That is why I started doing this again as I looked back. Me and Jake spoke about it and I was the happiness because I was getting because a lot of your intelligence is going to come through third party. So I was just meeting more people and this forces you to do deep research on the guests. So all of your superpowers are now baked into my brain through the research on the conversation. So what about George? What's George eating super hard? Work, Ray, ability to endure stress. He's Kevlar. You know, I never heard this guy complain. Never. He went for a run on Sunday. And it was a pretty tough run. I was panting. And I didn't even realize he was we're hard for him. Any after he was that was so hard. I was like, you never complain the whole way and that's George. You never complain. It's 15 years, no complaints. His ability to endure stress is incredible. I've never seen anything like it. Those type of friends you need in life, complaining for losers. I love that. To give people context too, do a little flex. What type of pace were you on? I know you're a specimen, bro. Flex on it. You know what? I'm talking to the camera flex on him. I know. You just can't you just randomly doing triathlons and shit. What are you doing here? Tell him. I'm not fast. I just enjoy the sport. And it was it was a fast run because George is training for Ellie marathon. And I was huddling and keeping up with him. It was it was a tough run. As I'm going to pop off some screenshots on there. He's being super unworthy now. He's a machine at that by himself. If you could only focus on one metric for the next six months, what would it be? Sales. Sales cares all. DaVage. We're going to keep it super simple there. What did Peter T.L. teach you that you still use today? Focus on the areas where no one else is looking. Go to markets and things that are so small and the ones focused on them. Tell us more. He invested in your past company. Tell us more about T.L. T.L. T.L. is one of the absolute legends early investor in Facebook. If you're living underneath the rock, anything else that really struck you from him. There is like this general aura that you get when you're around people is that you if you were to move their name from it, there's just like an aura and a feeling of like an obscene level of intelligence. I've had it around him and Keith and Dan Sunheim. I was fortunate my last company to raise money from some of the best investors in the world. I don't take it for granted. Very obscure equity financing path when I went from venture into hedge fund in this very short period of time. But I met Peter T.L. in LA, an anti-fluentist, African-Sysco and he wrote me a 45 million dollar check in the space of a 30 minute flight. May as whole team and it was an incredible experience. But again, someone is even just in a scene level of detail about things that you would most people would regard to be non-important detail-oriented individual asking questions, asking more questions about the answer and the question and the question and the question. Not to trip you up, but he seemed like he really wanted to know. Why does Peter T.L. want to know about the packaging machine that we pack out on? It's almost like he just obsesses over details. What is the best question that you've ever gotten from an investor? Could be from T.L. Could be from someone else? It's a really good question. Ultimately, the most common/best question is, I think, where do you want to take business? I think underwrites the funder's ambition. The best question, I'm not sure, seems like if I had so many of them, they're all a blur right now, but probably a bit of a detail into the ambition that underwriting the ambition of the funder is always something that I think is really hard to shy away from. Yeah, for me, I've invested in a couple of companies and I like almost all my bets outside of one and it's a direct correlation between what I think about the individual driving the ship. If you don't have an insane belief on the individual driving the ship, I don't care how good the opportunity is. It's a no. Nearly all of my investors know I've sat with my family for dinner because it's a genuine, I'll spend just as much time with my investors if they're a continued back us through the life cycle of the company. To the point where I'll talk about them so much in my home that I have to bring them into my home. It's a very obscure dichotomy potentially, a relationship, but I've rejected a number of investors in the last few months because I've taken them out and I've exposed them to my network and there's been red flags that have occurred that I couldn't underrate because I was so focused on cost to capital and the check. Not all money is good money. Very, very, very little is. Need is need and one is one that's the difference. Need is need. Need and one is different and they don't have the same outcome always. Looking back at any and all of those kind of daring investors, Peter Tio was a big one. Is there anyone else that you can look back at and kind of point out and draw one or two lessons or learnings from them? Another was some impressive names. You had Drake on there as well too. Yeah, Drake, how are your jokes for my series A through his venture fund? Raise a lot of money from a lot of fancy names. You know, the biggest lessons come from the negatives to be honest with you. Like the board, like the board dynamic and the structure and listening to investors who are not operators. I've had a tough time this time around taking capital from people that have done what we've done, built what we've built, hired what we've hired, like lost sleep over the fact that like this is there's no plan B, whereas to a lot of capital allocators, it's just capital allocation. Right. The fits in this box because they are 10 million in sales and the subscription rate is this and their cat is this and it fits the puzzle and did it unlock $5 million. There you go. But like to me, it's much more than that. And we've avoided, you know, institutional capital because I wanted to raise the beginning from capital allocators that have been in the war room, not in the board room in the war room, like actually being and built something. And that's harder to find because not a lot of operators are leading funds, but I'm finding the ones that have. Yeah, for people out there listening, I picture first time listening to this podcast. I only am sitting across the table from people that are currently in the arena, not even people formally, because I think the game is changing so much that being in it right in the here in the now, we're going to be able to give you guys the most amount of valuable possible. The worst investors, and I can one day I will talk about this. I think it's my duty to share more light on that. Not everything I did was great, but some of the worst investors are investors only. And they make big decisions with an inch of information. They take an hour, a quarter, and they make these massive decisions in a board room where you've just done 80 hours a week. No one knows more than you about the business, ultimately, but that's the cost of raising capital sometimes. Yeah, I feel like sometimes it would just be like, what are the economics? What's the tam is the general direction going in this way? And that's where we let soft skills. We got to hire my friends. He was at X all birds for four years leading, you're like, wow, selling counts. What are you talking about? Yeah, that's a hard now. What's the next big trend in CBJ? Mail test, a strong sperm health. Are influencers overrated or underrated in 2026? Depends on your mind. Anything in any third party, influencer, broker, whenever it may be, it's how you manage them. They need manage, they need accountability, KPIs. Last four questions that I ask everybody, favorite book or podcast, and why? I'm put up without a doubt. We talked about it. So change my leadership skill in running a business. I'm put up by Frank Slutman, favorite, but I actually just read Being a man by Scott Galloway. I think it's called Life of Being a Man or I need to check. He's got some good tips and talks a little bit about the evolution of man, not being man anymore and how we've shrunk into this landscape of lowest testosterone levels and not saying a good example. On one end, you have the Androtates who are so extreme, but opinion is your opinion. On the other end, you have men, bad women sharing the same bathroom and where do men fit into that? They've lost their way in life. I think, make men great again. I'm proud to be a father and I want to do things that inspire my daughter through how I show up and what I build, not just. So that's one of my favorite Scott Galloway's LeVeedit recent book. I need to get the name and then I'm put up from a business perspective of the entrepreneur or brand that you want to give flowers to and why.
Two founders specifically within my last year of experience, one is Dom, the founder of Ra, who has shared his bond book to me like it was his own. Walk me into a number of the accounts that we will launch into. Walk me into a lot of my manufacturers, help me with agreements, help me with trade terms. So thank you, Dom. And someone I'm seeing tomorrow, who I think is also becoming slowly a similar mentor as Greg from Blin. I love finding mentors at a built-in scale within specific categories that I am in today. So don't get me wrong, I want to speak to a tech founder who has raised a gazillion dollars but very different categories. So I'm enjoying my time with those individuals and brands, obviously George in 2014-2017, and just, you know, catalyst for this whole thing. So his community is very much our community and we wouldn't be here with him. Love that, yeah, those are two really, really impressive guys that eventually will be on the pod for sure. What about a creator that you want to get flowers to and why? I want to ask you that. Is there any creators that you see online because you now are, obviously you're an operator, but you got a great YouTube channel. You know, someone that I respect to walk and it was actually about a year ago in Australia, Alex and me and this gentleman, Hercules, were in Australia and he was like, I might do this content thing. He was working at another job as on sort of smaller business and he went all in on it and he devoted time and discipline and now he's, if not one of the most influential creators for our business, he also works full time at the company in the UK, leaving brand and community. But is he the biggest no, but his consistency and his discipline and his impact that he's had on our business directly has been like remarkable. So I think just the conversation from might do this to you should do it and him actually saying, you know what, I'm going to do it because how many people have you met, like, I've been just done that back in the day. I would have like, you know, I wish it had done that. He just did it. He left a pretty solid job and a pretty solid position in life and he backed himself and he constantly put out content over the last 365 days and it's put in a position now to be able to conduct great paycheck from brands to be able to add impact to our company and he's being incredible. Great ads as well too. I actually got an Instagram story out from him sitting on the bleachers yesterday. We'll pop it up. You know what? He's like, he's actually about it. He does the work. You know, like, oh, he's a specimen as well. He's a specimen. He is a smart customer. Yeah. Last question, man. How big can cadence be? The iterate did about 11 billion dollars in 2025. I think I'll need to check that number. I think there's, I believe there's a high, highly probable week and achieve similar scale within sports hydration, sports nutrition. And hopefully I'm there to see it. Oh, man. Amazing interview. Where can I find you? Tell us everything. Cadence, you personally. So myself, I'm on an arosmicae on Instagram, arosmicae on YouTube and then cadence on Instagram. We're very proud. We have cadence. The word. Use cadence.com. We would find all of our store locators where we position all the products in retail and then also everywhere you can buy it on a website, the feed Amazon as well. So pretty widely distributed. Fabri's target. March is Walmart, April, CBS and Walgreens. And then hopefully every shelf and fridge you open in this year will be there. Love it. Appreciate it, bro. Cheers. What's up, guys? If you guys got this far in the episode, I would assume that you enjoyed it. If you got any value, it would mean the world. If you hit the subscribe button, give it a like, post a comment, tell a friend. We could keep going bigger. Bigger guests, bigger locations, more value. See you in the next episode.
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