Advice Line with Carlton Calvin of Razor

Today’s callers: Shawn from Saskatchewan weighs whether brand-building or licensing is best for his card-based party game. Then Shirin in Texas wants to differentiate her graphic stationery in a crowded Etsy marketplace. And Mark from New Jersey works through refocusing his line of craft spirits. Plus, Carlton’s recent efforts to pass on his trendspottting talent to the next generation. Thank you to the founders of Youlogy, Honey Bespoke Stationery & Paper Goods, and Little Water Distillery for being a part of our show. If you’d like to be featured on a future Advice Line episode—where Guy and former show guests take questions from early-stage founders—leave us a one-minute message that tells us about your business and a specific question you’d like answered. Send a voice memo to [email protected] or call 1-800-433-1298. And be sure to listen to the Razor founding story https://art19.com/shows/831bd173-0992-41b7-b1eb-112db904d947/episodes/f45fbe76-9c6a-44ad-af31-8d13f1d5d820/embed as told by Carlton Calvin in 2025. This episode was produced by Casey Herman with music by Ramtin Arablouei. It was edited by John Isabella. Our audio engineer was Annlie Huang. You can follow HIBT on X https://x.com/HowIBuiltThis & Instagram https://www.instagram.com/howibuiltthis/ and sign up for Guy’s free newsletter at guyraz.com http://guyraz.com/ or on Substack https://guyraz.substack.com/. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Guy Raz?

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• 4:40Guy Raz?

  Hello and welcome to the Advice Line on How I Built This Lab. I'm Guy Raz. This is the place where we help try to solve your business challenges. Each week, I'm joined by a legendary founder, a former guest on this show, who will help me try to help you. And if you're building something and you need advice, give us a call and you just might be the next guest on the show. Our number is 1-800-433-1298. Leave us a one-minute message that tells us about your business and the issues or questions that you'd like help with. All right, let's get to it. This week, I'm joined by Carlton Calvin. He's the founder and CEO of Razor USA. You've probably seen a Razor scooter, maybe you've owned one or bought one for your kids.

• 5:20Guy Raz?

  Carlton built Razor into a hugely successful company, turning an overnight craze into a classic toy. Carlton, it is great to have you back on the show.

• 5:30Speaker 01

  I love being here.

• 5:31Guy Raz?

  Oh, we love having you. Well, so you were first on the show back in September of 2025. And as always, to anyone listening, if you haven't heard that episode, we'll put a link to it in the show notes. Really great story. And I have to say, as you will hear in the story, Carlton has this uncanny way of knowing what kids want even before it happens, including how about two decades ago, you caught wind of this sleek collapsible aluminum scooter that was trending in Japan. You saw the potential immediately. You reached out to a factory that was making them. You locked down the exclusive US rights and then you brought them to the US. And before long, it was a massive craze. You were selling a million units at one point every single month. It makes me wonder, Carlton, I mean, obviously trends have changed and it's not a million

• 6:16Guy Raz?

  units a month and the technology has changed. You also have electric scooters and electric bikes and so many of the products you sell. But do people still buy the standard aluminum collapsible scooters?

• 6:29Speaker 01

  Absolutely. I think it's still our largest selling item by volume. So, you know, close to a million units a year, I would say.

• 6:38Guy Raz?

  Wow. I know we talked about this when you were on the show about like succession. You own this company. This is your company, right?

• 6:45Speaker 01

  Yeah, with partners. I just want to be 100%.

• 6:47Guy Raz?

  I mean, privately owned, I should say, yeah. But, you know, you do a bunch of other things that we didn't really talk about on the show. You're interested in art and you support different initiatives. What do you sort of see your role in Razor? I mean, do you, at some point, think that you want to focus on the other things that you're interested in?

• 7:09Speaker 01

  I absolutely am trying to do that. Yes, 100%. But this one part of it, I've got amazing people that work for me that are super capable. But this weird talent that I have for the new product, that's very, very hard to find a new person.

• 7:31Guy Raz?

  Yeah.

• 7:31Speaker 01

  You know, I'm getting on in my years and I am trying to institutionalize at Razor my trend-seeking abilities. I am actively trying to see if I can figure out how to teach people. I'm kind of a fun analytical person and I'm trying to analyze and see if I could come up with like an algorithm for it in some way.

• 7:52Guy Raz?

  In a sense, right? What you're saying is you have developed this instinct, or you have an instinct, but you've honed it over the years because you've picked some losers. It's normal. We all have, right? But you've picked a lot of winners. And in a world where there's lots of people out there in this space looking for the next winner, it's got to be like, almost like, the analogy I think of is like going to the beach with a metal detector, you know? And it just gets like bottle cap, bottle cap, bottle cap, bottle cap for hours and hours. Then maybe you know you get a quarter. And then if you're really lucky, you get a silver dollar like once every month. Is looking for the next big toy kind of like that?

• 8:29Speaker 01

  It depends how energetic you are. And I think that what's been very satisfying to me is that in going, trying to develop this algorithm, I'm exercising that organ much more aggressively than I have been in the last several years. I think for many years, I was even, I might say passive, just like, I don't have to go out and look, I'll just spot it when it comes. And it did, you know? It always came through for me. But now, in the process of trying to make this transition, and I'm seeing a lot more opportunity. I think if you're really out there looking, you can see more. But it is rare.

• 9:11Speaker 01

  The things that really shift the culture are rare. But if you keep your eyes open, there's more than you would ordinarily think. One that's probably, people already know, just burst like maybe two months ago is hacky sacks are coming back in a huge way. And Razor already has hacky sacks in the stores start shipping this week. I mean, we moved very quickly to hop on that trend. But I've got many more on my plate right now.

• 9:40Guy Raz?

  Carlton, I'm curious about, and earlier this year, you won a patent infringement case against some competitors who were doing copycats of one of your products, the hoverboard, I think. And so you won that. And I, you know, from the outside perspective, you hear, oh, they won. And you'd assume, oh, you got a bunch of money and whatever. But actually, it can be a mixed bag, right? I mean, it costs a lot of money, it takes a lot of time, and in the end, it may or may not resolve the problem. How has that been for you?

• 10:10Speaker 01

  I think that's a deep insight. I think I've learned a lot pursuing patents over the years. I think they're most helpful for inventor going after a big company or big companies battling each other. My biggest challenge is, we won our patent lawsuit. That helps me clean up the market. But actually getting all those damages, they're very small copycats. So there's no assets.

• 10:37Guy Raz?

  They don't actually have much money.

• 10:39Speaker 01

  No, there's no deep pockets at all. So it costs millions and millions of dollars to do a patent case. And then you get nothing except helping to clean up the market. It's very, very challenging.

• 10:49Guy Raz?

  It's kind of demoralizing when you think about it because it's like... The system and the courts work so slowly. I guess by nature, by definition, they have to, but it really does disincentivize brands from protecting their products. And just, I guess, many brands are saying, you know what, we're just going to focus on brand, the brand, rather than trying to go after these copycats because it's going to be a waste of our time.

• 11:12Speaker 01

  That's exactly right. I just think that the copycats are, again, just to the point, they're so thin that there's, I mean, the patents have some functions, like in drugs, or, you know, where you have big, deep, popular people to sue. So you got to focus on the brand and you got to be, you got to focus on being quick and delivering a good product.

• 11:31Guy Raz?

  Yeah. Carlton, we've got callers waiting online for your wise advice. So you ready to take our first call?

• 11:40Speaker 01

  Sure.

• 11:40Guy Raz?

  All right, let's bring in our first caller. You are on the line with Carlton Calvin, the founder of Razor. Please tell us your name and where you're calling from and a little bit about your business.

• 11:51Speaker 02

  Hi, Guy. Hi, Carlton. Thanks for having me. My name's Sean Barassa. I'm calling from Saskatoon, Saskatchewan, Canada.

• 11:58Speaker 01

  Wow.

• 11:58Speaker 02

  And I'm calling about a party game that I created called Eulogy. So the premise is everyone playing is at a funeral and the game helps you create the character you're there to mourn the loss of. And then the winning player gets to pick who's going to perform the eulogy for the character you just made.

• 12:15Guy Raz?

  Wow, this sounds depressing, but I don't, I think it might be wrong. I think this might actually be more of a funny game, right?

• 12:22Speaker 02

  I would be surprised if, based on the layout of the game, if anyone could make it a serious game. Like, sorry, it's a serious subject, but the game itself just usually gets ridiculous. So in round one, you pull a portrait and it's kind of like cartoon insanity game flow. So each player takes a turn being the judge.

• 12:41Guy Raz?

  Yeah.

• 12:41Speaker 02

  Round one, they flip a portrait and everyone else writes a name down that they think goes with that portrait, put them into the game box, and then they'll read one out. The judge picks their favorite name. Now, we've named the character whose funeral we're at. The rest of the rounds are all different life stages. So birth and toddler, school age, young adult, career, family life, old age, and death. So you bring them to life through all these different rounds in that same format. You write the answers and then you kill them and someone's got to perform the eulogy. So.

• 13:11Guy Raz?

  Wow. And then how do you win?

• 13:13Speaker 02

  So each round has a point. So if you write the answer that the judge selects for that round. So round two, a prompt would be something like, we didn't have toys growing up, so we played with blank. And the judge will pick their favorite of all the players who submitted.

• 13:28Guy Raz?

  Got it. Okay, it's called Eulogy, but spelled Y-O-U-lyge. And how did, and how long have you been, when did you launch this, this idea?

• 13:37Speaker 02

  So this was a COVID baby. Like, I kind of, I'm an extrovert and I lost all my social outlets. And then I, most of my mind, I'd tell people. And then I had the people in my bubble. I don't know if you guys had the bubble in the States where you could hang out with a certain amount of friends. And I was like, do you guys want to play a homemade board game? And everyone was kind of like, oh, yeah, I want to play your homemade board game. But then when they left, they were like, oh my, like, they wanted to play again and again. Like, it was a long night.

• 14:06Guy Raz?

  Wow. So you decided to turn this into a business?

• 14:10Speaker 02

  Yeah. So, so right now, we've, we did a Kickstarter in 2024, and then we got our product in 2025 now. And I have, like, I have a vision to make this, replicate the basic game structure with different life events. So you're going to kind of get the same game flow. If you know how to play one of our games, you'll know how to play them all. You'll get an entirely different experience based on, based on what you're doing.

• 14:38Guy Raz?

  Got it. Okay. And is this your full-time job, Sean?

• 14:40Speaker 02

  Uh, no, I'm, by day, I'm a registered nurse at the pediatric hospital in the, in the operating room. So.

• 14:47Guy Raz?

  Amazing. Okay. So you have, and how many copies of the game have you sold so far?

• 14:50Speaker 02

  We've sold just shy of a thousand. And then on top of that, we've given some away. So we've got about an inventory of about 500 currently.

• 14:58Guy Raz?

  Got it. Okay. And before we dive in further, tell us what your question is for us.

• 15:02Speaker 02

  Well, I've created something that like, I've proven to myself is special. People have told me this is special. I have visions of this being the next household name in party games. Is, my question is basically, how do I get it there?

• 15:17Guy Raz?

  Got it. Carlton, please say hello to Sean. Before we answer his question, do you have any questions or thoughts for Sean?

• 15:25Speaker 01

  I think I understand. So, you know, again, I've been in the toy business for a long time. I do know that, you know, a very, very traditional way of getting your game out there is to bring it to a publisher, a toy, another toy company. And I think that's a super solid way to do it. You know, I would often suggest to people who invent toys, it really depends on whether you love being in business, like, which I did. You know, I do. I mean, the day I started doing Scorpion Pogs, I was like hooked for the experience of selling and packing up the stuff and sending it out and bookkeeping and everything. I

• 16:08Speaker 01

  loved it. So if you love being in business, be in business. If you love inventing toys, then I would say, you know, I would license it for sure.

• 16:18Guy Raz?

  Yeah.

• 16:19Speaker 01

  I work with inventors and they've done extremely well for me.

• 16:23Guy Raz?

  Carlton, I have a, I have a question for you because I'm thinking about this licensing question, which is, and you know this, and I've got a kids media company. We make kids podcasts. And I think I've told you about it. We actually, we actually have a line of toys. And my general sense is that toy companies don't actually buy ideas that often.

• 16:43Speaker 01

  You are definitely right. That, that is the sad, that's the sad half of the other side of it. And I was going to sort of give you that little bit of a warning. The people who buy games are going to look at hundreds or thousands of games and buy one. So your chances of getting, it's a great thing if you can make it happen, is what I would say.

• 17:05Guy Raz?

  They want to, they want a proven product, right? They want something that already has traction, which is, and it sort of gets to this idea of like, and Carlton, I think you're getting to this, which is that Sean needs to, needs to prove this out more. Like, a thousand units is great, but it's like, you need like a 10,000 units sold or like, right? Like retailers asking to carry it. The other thing I would say is, you know, the upside of you scale it yourself is huge. I mean, I mean, we had, we did Exploding Kittens on this show. They've got like, a bunch of different card games and they built this on their own, you know?

• 17:43Speaker 02

  Correct.

• 17:43Guy Raz?

  I guess if you were able to just luckily get this, you know, this becomes a hit, you own the thing. But I think before you even think about trying to pitch it to somebody, you've got to prove that, you know, that there's demand for this, right?

• 17:55Speaker 01

  For sure. And striking, lightning would be striking if somebody brought it from you without any track record, like Guy is saying.

• 18:03Speaker 02

  Right.

• 18:03Speaker 01

  I would assume you would have to go into these, this licensing strategy, assuming you were going to be rejected. And then I agree, build it on your own, which is also, that's extremely challenging. You have to go to all the toy conventions and get into every mom and pop little store. And you have to go knock on the doors yourself and you have to have game night. I mean, you must know all this.

• 18:25Speaker 02

  I kind of knew this answer going in almost, right? Like, you have to build it yourself. I'm not, I'm not opposed to that. So that's, that's such sound advice is like, keep putting in the work. Now I'm at the stage where people are coming back to the conventions and they're like, hey, we played this and it's so fun. So that's such a rewarding thing to actually be on the ground level. And so that is the part that I really enjoy.

• 18:50Guy Raz?

  Yeah. I mean, trade shows, you got to get into trade shows. Obviously, you've got a full-time job as a nurse. You have a very important job, but, but maybe you have plans to go to a trade show if one's coming up. I mean, right now, and you know this, Sean, people are looking for community, or at least people are talking about wanting to look for community. And, you know, there are games, cafes here in the Bay Area, there, some of them are doing very well. People are showing up to be together. And, and so you're, you're on to something. You've got something interesting. Now you just got to get into more hands. Not easy, I admit.

• 19:24Speaker 01

  And I will give you, and I will give you one more compliment. You have a very unique sounding game. You know what I mean? And that's a good edge. So if there's something that's an interesting story to it, it does have the potential to get some traction on Instagram or in some kind of a news format.

• 19:42Guy Raz?

  For sure.

• 19:43Speaker 01

  I like the story. Yeah.

• 19:44Speaker 02

  And thanks for saying that because that's, that is a really fun part because people will introduce me to people that they've created and then tell me all about the person they've created. So that's pretty fun.

• 19:54Guy Raz?

  Sean Barassa, the game is called Eulogy, Y-O-U-lyge. Good luck. Thanks for calling in.

• 20:01Speaker 02

  Thanks so much for having me. Appreciate you guys.

• 20:04Guy Raz?

  All right, we're going to take a quick break, but we'll be right back with another caller and another round of advice. Stay with us. I'm Guy Raz and you're listening to the Advice Line right here on How I Built This Lab.

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• 25:57Guy Raz?

  Welcome back to the Advice Line on How I Built This Lab. I'm Guy Raz, and my guest today is Carlton Calvin, co-founder, president, and CEO of Razer USA. Carlton, let's bring in our next caller. Welcome to the Advice Line. Please tell us your name, your name of your company, where you're calling from, and just a little bit about your business, please.

• 26:15Speaker 03

  Hi, Guy. Hi, Carlton. I'm so excited to be here with you guys. I am Shereen Tippett. I'm calling from Houston, Texas, where it is 1,000 degrees. And I have a business called Honey Bespoke Stationery and Paper Goods. I am a designer of stationery, such as flat note cards, birthday invitations, birth announcements. And one of my biggest sellers right now is collegiate stationery. And I have licenses with a number of big schools. So yeah, I sell paper goods. Yeah.

• 26:45Guy Raz?

  Amazing. I'm looking at your website. And so you design all of the cards or stationery, like I see personalized stationery with note cards with people's names on it. And you've done licensing deals with some universities like Indiana and Clemson and Texas. So that's cool. And tell me a little bit about how the business is doing.

• 27:05Speaker 03

  It's doing well. My revenue last year was $120,000, nearly $120,000, which is funny because I talk to people about it, and I think people think it's just like a little side job, like a fun thing that I'm doing, like a little hobby, your cute little Etsy business. I'll get that kind of comment. But I'm like, no, it's actually, it's doing pretty well. I'm not doing as well this year. It's been a little bit slower. But like I mentioned, I sell predominantly on Etsy, and that marketplace gets very saturated with competitors. So yeah, that's been, that's part of why I'm calling today.

• 27:43Guy Raz?

  So let's jump into it. What's your question for us?

• 27:46Speaker 03

  So my question is, I do sell predominantly on Etsy, but I have a website, which I also build my website all by myself. I've done all of it by myself with my AI partner. So I want to know how I transition from keeping my customer base on Etsy, because there are people who are shopping specifically there, but also shifting over to my own website. How do I get found in this sea of other stationers? You know, I was listening to Carlton's episode a while back, and you had mentioned you weren't the first scooter, but you set yourself apart. How do I set myself apart?

• 28:25Guy Raz?

  Okay, I want to bring Carlton in. Carlton, please meet Shereen. Tippett, Honey Bespoke, making stationery, and pretty good business, $120,000 in sales last year, but of course, crowded space. And everybody, everybody wants to know this. How do you stand out? So before you answer the question, any questions that you might have for Shereen or thoughts?

• 28:46Speaker 01

  Well, I would say I'm not an expert on how to drive people to a direct sales website. So I am someone who sells at retail, and that's what I, I think you could stand out by doing the hard work and trying to get into stores, into stationery stores. And even, I mean, my initial thing that sounded really good was trying to get into the stationery stores associated with the schools that you have licenses from. And I've got questions about that, too. But I'll let Guy, Guy, do you have any other?

• 29:21Guy Raz?

  Yeah, I mean, I think, I think that's an interesting idea, especially if you're talking about like cards, right? Sort of, you know, you've got some beautiful designs here. I'm looking at them. And you could, a lot of what you do, of course, is personalized. But there are lots of things that, you know, are just universal, right? There's a card store near where I live, and they have beautiful embossed cards. And they're lovely. And they're like $7 to $10, sometimes more. They're, and I buy them, believe it or not. You know, I wonder if you have tried, first of all, have you, have you done paid advertising?

• 29:55Speaker 03

  Yes, and that is one of those things where I did it and I started at the end of March for the first time on Meta and did it for about a month or two and my sales skyrocketed.

• 30:08Guy Raz?

  Awesome.

• 30:08Speaker 03

  But no, not so awesome because I don't know, I felt like I was just throwing money out there. I was like, oh, okay, let's put a hundred here, let's put, I wasn't doing it smartly just because it's confusing to me. I'm a one woman show. I'm doing all of this, literally everything by myself. So the advertising I think would help. I just don't understand how to do it.

• 30:28Guy Raz?

  And how were you advertising? Were you doing social media videos? Were you doing just stills?

• 30:33Speaker 03

  No, just stills. I have what's called flat lays. Like when you look at my website and you see the picture, I just boost that. I boosted on Instagram. I boosted on Facebook and most of my sales were coming through the Instagram. I did look at that data, but it would lead traffic to my website, which was great. But.

• 30:56Guy Raz?

  But yeah, then it slowed down.

• 30:57Speaker 03

  Yeah, yeah.

• 30:58Guy Raz?

  Okay, let me ask you a question. How did you learn how to, how to design cards?

• 31:03Speaker 03

  Well, it was another COVID story. I had time at home. I had a seven month old baby and we were being very protective of her during COVID. So we were at home all day long. So I decided, I loved playing on the computer. I liked doing things on the computer, graphic design things. And long story short, I took an Adobe course on YouTube. So.

• 31:26Guy Raz?

  But you learned this by watching videos, basically?

• 31:28Speaker 03

  Very much so, yes.

• 31:29Guy Raz?

  Okay, so this is important because I think that you can do a similar version of this with how to advertise. I could imagine you getting, taking your iPhone and putting on a tripod and angling it and a video of you sketching designs and a video of you being kind of the face of this brand and putting some money behind, not too much money, maybe a hundred bucks, share, etc. And seeing how that does, because I think that there's something about you making this will resonate in a way that is different than just seeing a static image of stationery.

• 32:04Speaker 03

  I agree with you and because when I, when I look at other people in this marketplace, other women who have these businesses or men, but it's predominantly women, the one difference between the two of us is I'm not putting my face out there. I'm not putting videos of myself out there just because I'm not comfortable on camera, really, to be honest with you. But I realize when people see a person, it makes a difference. And so I have thought maybe that would make a difference.

• 32:30Guy Raz?

  You've got a great story. Yeah, I, I don't know. Carlton, what do you think? I mean.

• 32:34Speaker 01

  I'm a hundred percent there. I mean, I think you're doing very well. I mean, I'm only seeing you on Zoom, but I think you're doing very well on Zoom.

• 32:41Speaker 03

  Thank you.

• 32:42Guy Raz?

  Yeah, you look great on camera. You should be on camera.

• 32:44Speaker 03

  It's just, it's just so.

• 32:46Speaker 01

  That's another way of saying that. But yes, I think you're photogenic and I think you could develop a following on Instagram or TikTok and just like, you could even have

• 32:55Guy Raz?

  your kids. Narrating it, right? Like a voiceover, like, you know, I, I couldn't find cards that I loved, so I decided to make them myself. And.

• 33:03Speaker 03

  I've never thought of this. Yeah.

• 33:04Guy Raz?

  You know, and it's like your voiceover with you, just images of you like putting a car together and, you know, and design, at your design table, something like that. It can be a cool thing, just a short 30, it's not easy to do. I'm not saying it's easy, but you could figure it out.

• 33:19Speaker 01

  And I'd almost say you'd have to do it because paying for advertising is always a very challenging thing in your kind of space. If you can develop your own following, that's, that's everything for what you're trying to do. And also try to get into the stores. I would say that too. Like if you can get up the nerve, you know, and get up the budget to go to a show and just start, start building that, you have to, I mean, I could give you the whole thing with sales reps and the whole thing. You have to get a line together, but there's like tens of thousands of stores out there you could be selling at. And people are so focused on the internet, but getting some of that old fashioned, get into the stores. But if you're going to do it on the internet, you have to have a social presence and you have, and you have something to take advantage of. I do.

• 34:02Speaker 03

  I was hoping that you wouldn't say that, but, but I think that you are correct. And then I have considered going to the, the big marketplaces. There's a big Dallas market. There's one in Atlanta. And I actually was reached out to by the Dallas market, the lady who puts that together just a few months ago. And I thought, maybe I should put some money into doing that. Maybe I'll see a return on that.

• 34:24Speaker 01

  You need to go to the markets and you need to get reps. And the whole thing is about getting reps. And it's.

• 34:28Speaker 03

  Okay, okay. That's good to know. I never, I never even thought of that.

• 34:31Speaker 01

  Yep.

• 34:31Guy Raz?

  All right. Well, you have, you get your marching order, Shereen.

• 34:34Speaker 03

  Thank you so much. Thank you so much.

• 34:36Guy Raz?

  All right. The brand is called Honey Bespoke. Good luck. Thanks so much for listening and for calling in.

• 34:39Speaker 03

  Thank you for your time. Bye.

• 34:40Speaker 01

  Thank you.

• 34:42Guy Raz?

  All right, we're going to take another quick break, but we'll be right back with another caller. Stay with us. I'm Guy Raz and you're listening to the Advice Line right here on How I Built This Lab.

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• 36:35Guy Raz?

  Welcome back to the Advice Line on How I Built This Lab. I'm Guy Raz and today I'm taking your calls with Carlton Calvin. He's the co-founder, president and CEO of Razor USA, the scooter company. Let's get back into it and take another call.

• 36:49Speaker 07

  Let's go.

• 36:50Guy Raz?

  All right, let's bring our caller in. Hello, welcome to the Advice Line. Please tell us your name, where you're calling from, and just one quick line about your business, please.

• 36:57Speaker 07

  Yeah, my name is Mark Ganter. I own Little Water Distillery in Atlantic City. We're a craft spirits distillery and we've been going since 2016.

• 37:08Guy Raz?

  Awesome. Welcome to the show, Mark. And tell me, what do you guys do? I mean, I'm assuming vodka and gin.

• 37:14Speaker 07

  Yeah, so we make, I really do this without actually giving the brand names. Rusty Revolver Gin, 48 Blocks Vodka, Liberty Rum, Prosperity Rum, 16 Knots Bourbon, and 48 Blocks Espresso Martini, 48 Blocks Chocolate Martini, and then a barrel aged Old Fashioned.

• 37:30Guy Raz?

  Wow, okay.

• 37:31Speaker 07

  Those three have really been kind of running the show for us recently.

• 37:36Guy Raz?

  All right, I got it. Okay, so tell me a little, so this is Little Water Distillery based in Atlantic City. You mentioned you started in 2016. Did you come from like the spirits world? Were you in this world when you launched it?

• 37:47Speaker 07

  Yeah, not entirely, not entirely. I worked for Total Wine & More on the design development side, really kind of building out their retail facilities and kind of getting them to the point where we turn them over to the operator. So I was familiar with the industry. I had some contacts within the retail, you know, industry. But the whole thing started with, you know, just a random gift for a seven year old man. My father turned 70 in 2013. My brother and I bought him a copper pot still. And we, as a father and son, spent time together, really kind of playing with it. And we became aware of the craft distillation laws being enacted in New Jersey and applied for one of the earlier licenses. And we're like, I guess we're doing this. So we kind of put the business plan together and launched, left our careers and kind of went cold turkey and then launched

• 38:32Speaker 07

  the business.

• 38:33Guy Raz?

  And tell me a little bit about where you sell your spirits? Mostly restaurants and bars? Are you in shops or both?

• 38:41Speaker 07

  So the spirits industry, the alcohol industry is regulated in the US. It's challenging. So in New Jersey, with this license, we're able to manufacture, operate a tasting room so we can sell retail out of our tasting space, direct distribute or go through distributors. And we initially went, you know, we did direct distribution because we get to keep a lot of that margin back at home. But you quickly see you're wearing a lot of hats for a small business. I mean, you're a manufacturer, you're marketing, you're now distributing, you have to have a, you know, a vehicle or vehicles on the road. You have to have salespeople employed, but then you're also operating on the retail side. You have a tasting room. So you're doing almost hospitality and you have to staff that. It's a completely different, you know, staff than you'd have.

• 39:23Guy Raz?

  You have a tasting room and you are still in spirits?

• 39:27Speaker 07

  We're manufacturing. And then we're also taking them to market. We're also branding them. And we also have quite a few SKUs, you know, for what we do. I mean, I'm so envious of like a brand like Tito's. They make vodka, comes in three sizes. That's it.

• 39:39Guy Raz?

  Yeah. And, and how is the business, how's the business doing? Like, are you guys profitable? Are you, what's, tell me a little bit about how it's?

• 39:47Speaker 07

  We, we had some ups and downs. Obviously, we went through COVID. We kind of came through that with shining colors because of, so we pivoted and produced a huge amount of hand sanitizer during that period.

• 39:57Guy Raz?

  During COVID?

• 39:58Speaker 07

  During COVID. So we actually were able to really turn a profit that year. But I've taken on a fair amount of debt in recent years. And I'm so jealous of some of these other callers because they were starting out that, you know, they're early on in the operation, in the process, and they have, you know, nowhere to go but up. And we've kind of seen some contraction of our sales. And we recently made the decision to work through distributors because we just couldn't figure out, we couldn't get the direct distribution model working to the point where it was profitable for us. Bars and restaurants and liquor stores to some extent, they're used to working with distributors. They're used to having like one sales guy come in and have a thousand SKUs or 500 SKUs or whatever. So we decided

• 40:41Speaker 07

  to make this strategic decision to go through distribution.

• 40:44Guy Raz?

  All right. So before we get to Carlton, tell us your question.

• 40:47Speaker 07

  So like I said, I'm jealous of those brands that have one product or two products. That's part of our challenge. We have too many out there, but we have one product, our 48 Blocks Espresso Martini, which is really best in class. It's truly the best product out there. It's priced at a premium and it's a premium product. And the industry is trading down. A lot of what you see is coming out in cans, you know, smaller, like where quality's being kind of traded up for convenience. How do we take this product from where we are, which is? A solid but very small local reputation to this is the industry standard for the best espresso martini.

• 41:26Guy Raz?

  All right. I want to bring in Carlton Calvin Carlton. First of all, say hello to Mark.

• 41:32Speaker 01

  Hi, Mark.

• 41:32Speaker 07

  Hi, thank you.

• 41:34Guy Raz?

  And as you heard, he's got this brand, but of course, it's a challenging in general in this industry across the board, wine and spirits, but he's got to make some, some decisions here. So thoughts or questions for Mark?

• 41:48Speaker 01

  Um, yeah, I mean, my overall, I do like this idea of focusing. I do like the idea of, you know, you're really trying to tell your story about get, how do I get my story about my product out there? Which is making a good story out of it. You need to get out and be the face of your product. You have to have an Instagram presence. You have to have a Tik Tok presence. You have to, again, you're in a highly regulated industry. I don't even know what you, you could do, but you could show how you distill, you know, the process of distilling and what makes yours better and show it. The other thought is if you could get some influencer or somebody with a reputation for judging quality to endorse your product,

• 42:31Speaker 01

  probably out of just affection for you.

• 42:34Guy Raz?

  I think there's, you're onto something there for sure Carlton. I want to double down on that. Mark, I question for you. What are your best selling? You've got rum, two rums, gin, vodka, espresso martini, chocolate. What's the, what are the three top best sellers?

• 42:48Speaker 07

  So 48 blocks espresso martini, 48 blocks chocolate martini, and they're, they're, they're aligned, espresso and chocolate, both again, top, top.

• 42:55Guy Raz?

  And, and the chocolate martini, the espresso martini are made with vodka?

• 42:58Speaker 07

  The vodka based and our vodka is called 48 blocks vodka.

• 43:01Guy Raz?

  Okay. So it's, it's a, the bottle, the espresso martini has the espresso and vodka in there and you just chill it and pour it over a glass, in a glass, basically.

• 43:08Speaker 07

  Cocktail shake it with ice, shake it, strain it. And the coffee we use is from La Colombe. We use a cold press Brazilian espresso from La Colombe.

• 43:14Guy Raz?

  Fantastic coffee.

• 43:16Speaker 07

  But, um, you know, no one in the industry is talking about the quality of the coffee and the quality ingredients. They're simply pushing convenience.

• 43:24Guy Raz?

  I mean, it sounds like you're already moving in this direction, but I think, I think you've got to reduce SKUs, right? Because you're talking about a challenge around cash and debt, right? And, and as you probably know, many companies that die, don't die because the demand goes away necessarily. They die because they run out of cash. So I think if you want to optimize, and it sounds like you do, you want to optimize for cash for the moment, simplify the product line and then you focus on the, the highest channel margins. Maybe you, you continue to make smaller quantities of the other ones for the, for the tasting room.

• 44:06Guy Raz?

  I don't know, but really lean into those, especially the, the chocolate and the espresso martinis. And you build around those while you conserve cash because, and you want to talk about what you just mentioned. It's La Colombe coffee. What kind of chocolate are you using in your, in the chocolate martini?

• 44:25Speaker 07

  Yeah. So it's a, it's a custom roasted chocolate from a, a small producer, a small chocolate here called Vidary Chocolates in North Carolina.

• 44:32Guy Raz?

  I mean, amazing. You know, you, you've got La Colombe coffee, this high quality chocolate. I think that could, I mean, is that realistic to really double down on especially those two products and maybe sunset some of the other SKUs?

• 44:47Speaker 07

  Yeah, it's, it's, you know, it's hard, right? That's the challenge, right? It's emotionally hard, which is a terrible, a terrible reason, terrible excuse, but you're kind of getting past it. And then also limiting the experience of the tasting room. That's where, you know, that piece, which is weekly revenue, that's very important. We've got to figure out how to keep that interesting while we focus on these distributed products, these two distribution products. Um, and really grow them because that's where that, you know, we're, we're limited by the four walls in the tasting room, but the market is, is vast and endless.

• 45:17Guy Raz?

  I hear you, right? And that's hard, right? Because it's going to come to a point where you're going to have to make a decision and it's going to be painful. We've had many examples of this on the show over the years where people are like, we abandoned, you know, our main product. And we went with this product, Mailchimp. It's a great, Mailchimp is a classic example. You should listen to that episode. They were a website building business. That was 90% of their revenue, but they, they saw that there was potential in this email list site. And they basically dropped 90% of their revenue in, in instantly. But Mailchimp, you know, it'll sell for many billions of dollars. The, the point I'm making is that it's, there is going to be pain, but you never know what's going to emerge from it. I mean, in five years' time, you might be the martini brand.

• 46:02Guy Raz?

  Got espresso martini, chocolate martini. Now you're making dirty martinis and pickle juice martinis. And, and your story is we put the best ingredients in the bottle, you know, and that, that might actually be what you are in the future. I'm not saying it's going to happen, but that put sort of sets you in ideally a more efficient course.

• 46:23Speaker 01

  And, and I would just add, my experience is always, it's so rare to find anything that resonates with the consumer. That if you've got one thing that does resonate or two things that resonate, really focus. You, you don't have time for anything that doesn't sell in my world.

• 46:42Speaker 07

  I have one more question for Carlton, specifically about kind of the trends, because you're, you're, you know, you have that, as you said, a gift of identifying trends. And part of the challenge right now with what we're doing is, is not following a trend, which is trying to take what we do and put it into cans. Because cans are extremely trendy right now, but I feel like the consumer perceives like a lower quality product in the can. And we're trying to maintain a position of, of premium quality. What do I do?

• 47:09Speaker 01

  And so my general analysis is you want to be on those trends early. But if you can perceive a trend in your business, like cans, like the, I, I even, even I'm seeing, you know, and I don't drink, but I'm seeing trends in the alcohol world. And, and I think there is for sure, uh, this notion where like, I have my vision. I'm going to stand out and be very different. I'm like, don't fight the culture. Just like because American Idol, you know, came out and, you know, did a, a, you know, singing contest on TV. You'll notice there were 27 other singing contests that came out after them. Some of them exceeded the American Idol.

• 47:53Speaker 01

  And being second, being third, being 10th, you want to be inside the culture. So I'm not saying it's these cans, but if you can see anything that's happening in your industry and, and you're one of the early people to notice, that's a huge advantage.

• 48:08Guy Raz?

  Are there, are there, there must be, maybe not. Are there espresso martinis in cans?

• 48:12Speaker 07

  Oh, there's, there's quite a few.

• 48:14Guy Raz?

  Tons. Okay. By the way, just as a, as an aside, is there a world where you have like a sort of a white Russian meets an espresso martini? Where it's, it's, you've got the espresso and the vodka, but you add a little bit of cream or milk?

• 48:28Speaker 07

  Yeah. I mean, there's, there's, this core can, can have extensions to it. This line, you know, we can, we do various, we combine the chocolate and the espresso and make a mochotini, which is very, very trendy. And there's no, there's no R and D to that. We just add them together in a can.

• 48:43Guy Raz?

  Yeah. I think there's some need to this martini thing. Anyway, you, I think you've got, you've got a sense of what you got to do. It's not going to be easy, Mark. I do not envy you, but it's probably what, what's going to be best for the business.

• 48:57Speaker 07

  Thank you so much.

• 48:58Guy Raz?

  Yeah. It's Little Water Distillery, Mark Ganner. Thanks so much for calling in.

• 49:01Speaker 07

  Thank you for having me.

• 49:03Guy Raz?

  Um, Carlton, before I let you go, I want to ask you a question that I've been asking everybody who comes back on, which is, now that you have all of this experience, if you could go back to when you were first starting out, what advice could you now, would you now give to your former self?

• 49:19Speaker 01

  I mean, I made so many mistakes when I was starting, you know, and, and this gentleman was also the, in the distillery. You think, oh, I don't want to give up my margin to a sales rep because they'll take five or 10 or 15%. But you have to delegate. You have to give the sales reps. They're so much better at selling and you can't do it all. So that was a big, huge thing that I, you know, took me a long time to figure out that just trying to do, it's very fun and satisfying to do everything yourself, but you can't. You have to delegate it all out and it really, that transformed my business.

• 49:55Guy Raz?

  Yeah. That's Carlton Calvin, co-founder, president and CEO of Razor USA. Carlton, thanks so much for coming back on the show.

• 50:04Speaker 01

  My pleasure.

• 50:05Guy Raz?

  And by the way, if you haven't heard Carlton's original How I Built This episode, please go back and check it out. We will put a link to it in the show notes. And here is one of my favorite moments from that interview. Wait, so in June of 2000, you were selling a million a month?

• 50:19Speaker 01

  Yes.

• 50:20Guy Raz?

  And January of 2001, you couldn't sell one? The, the sales stopped?

• 50:25Speaker 01

  Yes.

• 50:25Guy Raz?

  Doesn't make sense. It makes no sense.

• 50:27Speaker 01

  It doesn't make sense unless you understand praises. It's happened to me so many times. And no matter how many times the retailers go through this, no matter how many times I went through this, everybody's thinking to themselves, this time is different.

• 50:40Guy Raz?

  Yeah.

• 50:40Speaker 01

  Like this time, it's going to sell a million a month for the next three years. And they can't even just do simple math that there's not that many people.

• 50:48Guy Raz?

  Hey, thanks so much for listening to the show this week. And by the way, please make sure to check out my newsletter. You can sign up for it for free at guyraz.com or on Substack. And of course, if you are working on a business and you'd like to be on this show, send us a one minute message that tells us a little bit about your business and the questions or issues that you're currently facing, because we would love to try and help you solve them. You can send us a voice memo at [email protected] or call us at 1-800-433-1298. Leave a message there and make sure to tell us how to reach you and we'll put all of this information in the podcast description as well. This episode was produced by Casey Herman with music composed by Ramtin Eravlui.

• 51:32Guy Raz?

  It was edited by John Isabella and our audio engineer was An Li Huang. Our production team at How I Built This also includes Alex Chung, Carla Estevez, Sam Paulson, Chris Messini, Elaine Coats, J C Howard, Catherine Seifer, Carrie Thompson, and Niva Grant. I'm Guy Raz and you've been listening to the Advice Line on How I Built This Lab.

• 51:55Guy Raz?

  Thanks again to Engine for their support. If your business is growing and your team is traveling, Engine makes it simple and saves you money doing it. 33,000 businesses have joined. Now it's your turn. Engine.com/built.