Advice Line with Sarah Kauss of S'well

S’well founder Sarah Kauss joins Guy on the Advice Line, where they answer questions from three early-stage founders about positioning their products in competitive markets. Today we meet Chiara, a recent college grad who invented a protein-packed chickpea hot cereal. Then Jesús, who left his tech job to go all-in on a line of greeting cards inspired by his Latino heritage. And Adam, a former X Games gold medalist who launched a brand of razors for men who shave their legs. If you’d like to be featured on a future Advice Line episode, 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] mailto:[email protected] or call 1-800-433-1298. And be sure to listen to S’well’s founding story https://art19.com/shows/831bd173-0992-41b7-b1eb-112db904d947/episodes/690e87a9-b2b2-45b8-8f41-8a7d8d8d66d7/embed as told by Sarah on the show in 2020. This episode was produced by Chris Maccini with music by Ramtin Arablouei. It was edited by John Isabella. Our audio engineer was Neal Rauch. You can follow HIBT on X https://twitter.com/HowIBuiltThis & Instagram https://www.instagram.com/howibuiltthis and sign up for Guy's free newsletter at guyraz.com http://guyraz.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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• 5:20Guy 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 the show, who will attempt with me 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. Send us a one-minute message that tells us about your business and the issues or questions that you'd like help with. You can also send us a voice memo at [email protected]. And make sure to tell us how to reach you. And also, don't forget to sign up for my newsletter.

• 6:04Guy Raz?

  It's full of insights and ideas from the world's greatest entrepreneurs. You can sign up for free at guyraz.com. And we'll put all this info in the podcast description. All right, let's get to it. My guest today is Sarah Kaus. She's the founder and former CEO of Swell, as in the famous swell bottles. Sarah, welcome to the show.

• 6:26Speaker 01

  Thanks for having me, Guy. I'm thrilled to be here.

• 6:29Guy Raz?

  It's so great to have you back. We first had you on the show, well, the last time, the only time, was in April of 2020. It was right at the beginning of the pandemic. And it was just kind of a nutty time. I remember you were in your, sitting in like your living room or your house and everybody was freaking out.

• 6:47Speaker 01

  Yes. And at that time, I still remember, Guy, at that time, I thought, wow, this pandemic thing has been going on a few weeks. It feels like forever. I had no idea it was going to change our lives, really, for decades to come.

• 7:00Guy Raz?

  So for those of you who haven't heard the story of Swell, Sarah started it in 2009, basically after getting the idea on a hike, that you were, you had a thermos and you took a swig and it was warm water. And you thought, why can't bottles keep water cold? So you left your job and then you launched this company. And six years after launching Swell, the company made $100 million in revenue. It's an amazing story, full of pivots and problem solving and massive risk taking. But eventually you built it into an incredible business. And by the way, if you, if you listening have not heard the episode, just scroll back and check it out. It's in the podcast queue, but we'll also put a link

• 7:42Guy Raz?

  to it in the show notes. Sarah, you are no longer with Swell, just to be clear, right? Like, the company was acquired, I think, two years ago or three years ago?

• 7:52Speaker 01

  Exactly. Two years ago. So yeah, I'm a free woman. I sold the business and I'm not associated with the brand at this point anymore.

• 8:00Guy Raz?

  And how does it, how does it feel? I mean, I mean, to be, it was your life for, what, 13 years?

• 8:07Speaker 01

  Yeah, 13 years it was my life. You know, it's bittersweet. The overriding feeling when I sold the business was relief. I was so proud of the company and the brand and the team. And I was incredibly happy to land the plane in a soft place that I knew that this brand that I built and loved would would go on, almost like sending a kid off to college, I would say. I was proud of what I had done. Um, I still miss it. I, I still miss it. Um, sometimes I'm, I'm still in contact with some of the team. I obviously still love the brand. Uh, I buy at full price now off the website. You don't even get a discount? No, I, I should have negotiated. I, all founders out there, when you sell your business, negotiate a lifetime discount because I forgot to ask for that.

• 8:52Guy Raz?

  I, I mean, I think Tom Ranks of Sunbum, who was on this show a couple of weeks ago, I think he gets free or discounted suntan lotion forever.

• 9:00Speaker 01

  Well, he's probably a better negotiator than me. No, I probably, I mean, I probably could ask, but I'm, I'm happy to support them. I, I actually really love what they're, they're doing right now.

• 9:08Guy Raz?

  Yeah. All right. So Sarah, before we get to today's callers, um, let me, let me ask you a question about positioning, right? Because I think, I think all of our callers today have, you know, unique products that they're trying to position within larger markets. And, and, you know, I mean, water bottles, even when you started in 2009, I mean, it was already starting to get crowded. Um, and it's of course continued to, to become more and more so, right? With like Stanley cups and hydro flasks and Yeti and Owallas and everything under the sun. Um, what was your process? Can you remind us of your process of getting your product onto the shelves? Cause I know, if I remember correctly, you were in New York City and you went like store by store. Like the idea was you'd get them

• 9:52Guy Raz?

  into Bloomingdale's and then you'd be gangbusters, but that's not how it happened.

• 9:57Speaker 01

  No, that's not how it happened. And really for me, Guy, it was a crowded marketplace, but for Swell, it came down to positioning. I saw a position in the market for a higher quality water bottle, something that, again, that kept things hot and cold, but was more of a fashion hydration accessory than something that you would take. To the gym or on a hike. I didn't want something that looked like a camping canteen. I wanted something that looked as elegant that you could buy it in the MoMA Design Store or, you know, would be in the holiday window at Bloomingdale's, you know, places where we were featured eventually. But you are recalling correctly that in the beginning, it was just me hoofing it into stores with my backpack, asking to leave a couple of water bottles

• 10:40Speaker 01

  on a shelf, sometimes even on consignment, just to see if they would sell in those stores.

• 10:45Guy Raz?

  Okay. Sarah, let's, let's take our first call. You ready?

• 10:50Speaker 01

  I'm ready.

• 10:50Guy Raz?

  All right. Caller number one, I think it's Kiara is our first caller.

• 10:56Speaker 02

  Hi. Yeah, it's Kiara.

• 10:57Guy Raz?

  Hello, welcome. Kiara, tell us where you're calling from and just briefly about your business.

• 11:03Speaker 02

  Okay, cool. I'm so excited. My name is Kiara Moonsey. I'm calling from San Francisco, California, and I'm the co-founder of Chi Chi, a breakfast company on a mission to replace oats with chickpeas and all sorts of breakfast foods, but starting with the first ever instant chickpea hot cereal.

• 11:22Guy Raz?

  Nice. Okay. Chi Chi is the brand.

• 11:25Speaker 02

  Yeah.

• 11:25Guy Raz?

  Kiara, can you tell us, what's, what's the question that you brought for us today?

• 11:29Speaker 02

  So my question for you both today is how do we increase our in-store grocery sales as a brand new product that nobody's ever heard about or is really even looking for in the hot cereal category?

• 11:42Guy Raz?

  All right, we'll get to your question in a moment, but, but let me ask you a couple of questions about the brand first. Tell me about, like, about the product. So it's, it's oatmeal, right? I'm looking at the website now. It's, it's basically oats that are made from like dehydrated chickpeas?

• 11:56Speaker 02

  Yeah, exactly. So there's no oats at all. It's just chickpeas. So it's grain free.

• 12:02Guy Raz?

  And tell me about the, like, the genesis, like, the idea. What, how did this start?

• 12:07Speaker 02

  Yeah. So it started kind of from a personal experience. I used to eat a ton of oatmeal, like, regular oatmeal from the packet, you know, maple brown sugar flavor, et cetera. And I would eat that every day. And like, an hour after eating that morning oatmeal, I would feel a little tired, a little hungry, like, right after. And I realized it didn't have that much protein. I went to Google and saw that people were adding protein powder to the oatmeal. But that ended up making my stomach hurt and tasting really chalky. So then I just kind of looked around, actually, in the grocery aisle. And I saw chickpeas going into other categories like pasta. I don't know if you've had like.

• 12:47Guy Raz?

  Yeah, and sure, yeah.

• 12:49Speaker 02

  Yeah, all those other chickpea brands. And I said, why aren't chickpeas in the breakfast category?

• 12:54Guy Raz?

  Yeah, that's cool. I mean, chickpea and you're right, like oatmeal does, like people think of oatmeal as this really healthy thing. And I guess there are things about it that are healthy, but oatmeal does spike your blood sugar for most of your blood, your glucose for most people. It actually, because it's high in carbohydrates. It's not unhealthy. It's just it can create like a crash like a couple hours later.

• 13:17Speaker 02

  Yeah, exactly. And that's a lot of our customers are diabetic or they do wear those glucose monitors. And they're looking for an alternative to oats and we're right there.

• 13:27Guy Raz?

  So how did you do it? I mean, tell me, I mean, because I, I think you're, you just recently graduated from college, right? In the last year or so?

• 13:36Speaker 02

  Yeah, I graduated less than a year ago. My co-founder is actually still in college. But we started off really in our dorm room, rolling chickpeas with the rolling pin.

• 13:46Guy Raz?

  You would cook the chickpeas and then you just like roll them and smash them down?

• 13:50Speaker 02

  Yeah, just to make them into an oat shape and then dehydrate them. And that was kind of like our initial version of of what this product could look like.

• 13:58Guy Raz?

  And then, and that worked? I mean, you would basically cook the chickpeas, roll them, dehydrate them. And then when you rehydrated them, it actually kind of had an oatmeal like texture?

• 14:11Speaker 02

  Yeah, exactly. Surprisingly, it did. And it almost is a little less mushy than oats. Sometimes people think oats are a little mushy and watery and the chickpeas kind of hold their shape a little better.

• 14:22Guy Raz?

  All right. And so how did you take the next step? Like, how did you, for example, how did you just finance the first run of this product?

• 14:31Speaker 02

  So after we had this weird bowl of chickpea mush, basically, yeah, we had to figure out how to commercialize it, how to do our first production run. And the first step was the hardest step of making the whole business, which was basically a year of me calling different chickpea farmers, chickpea processors, co-manufacturers to try to get them to produce it at scale. And obviously, it was hard because it was just me as like a 22-year-old being like, can you flake chickpeas for me? Can you like make this chickpea oatmeal product? I have this new startup idea. And what I've learned, especially what I've learned on your show, is that a lot of times when you start calling co-packers, they don't really give you any time because you're just a nobody.

• 15:16Speaker 02

  But after around a year, I did find some great partners to kind of help me scale it. And then, of course, yeah, we needed the money side of things. And as two college students, we had literally no money in the bank at all. But what we did to finance it was actually enter ourselves into a bunch of pitch competitions. And we raised over $100,000 just with pitch competitions that were non-dilutive. And we traveled around just giving our pitch to dozens and dozens of judges.

• 15:46Guy Raz?

  I love that. That's awesome. Congratulations. Let me ask you one more question, then I'm gonna bring Sarah in. Tell me a little bit about where the product is sold right now. Is it mainly, are you mainly selling direct to consumer on your website? Are you, are you in stores?

• 16:01Speaker 02

  Yeah, so right now, we sell 95% of our products through our own website on Shopify. And then about 5% of our sales are coming from around 30 Los Angeles grocery stores.

• 16:13Guy Raz?

  Awesome. Okay. Sarah, do you have any, before we start to tackle her question, do you have any questions for Kiara about, about the business?

• 16:21Speaker 01

  Yeah, Kiara, it looks like you're creating an entirely new category, something I feel I have a little bit of experience with. But one of my questions for you is, your placement in grocery store, where are you placed right now, today?

• 16:36Speaker 02

  Um, so right now we're placed in the hot cereal category with the regular old oatmeals, which is actually one of our biggest problems because a lot of our customers actually don't eat oatmeal because they might be diabetic or gluten free. So they're not even in the category.

• 16:53Guy Raz?

  Yeah.

• 16:53Speaker 01

  I see. And I'm on your website now. Is your product gluten free? Cause I don't see that it says it on the packaging yet.

• 17:01Speaker 02

  Um, yeah, it is gluten free.

• 17:03Speaker 01

  Well, I know in my local grocery store, which is a, which is a Wegmans, a nice big chain here on the east coast, that they have a gluten free section of the grocery store. So I was thinking, just looking, you're beautiful packaging, by the way. Kiara, I was just looking at your website. I was thinking if you could more prominently display that this is a gluten free item and get that on the front of your packaging, that could be really helpful.

• 17:25Speaker 02

  Actually, we are kind of in the midst of updating our packaging. So it will say gluten free on the front. And then another change that we're making is instead of calling it oatmeal, we're actually changing the name to hot cereal because we found that a lot of our consumers were confused about why we were calling it oatmeal because there's no oats in it.

• 17:44Guy Raz?

  Yeah. So, all right. So your question is how do you increase grocery sales, right? And, and, and you're mainly in grocery stores, you said, in Los Angeles right now?

• 17:53Speaker 02

  Yeah, exactly. So I'm mainly interested in learning how to increase sales when we're already on the shelf. Like, how do we get random shoppers to pull our product off the shelf?

• 18:04Guy Raz?

  Um, I think something Sarah, something you said, which I think is, is critical is that this is like a brand new pro- this is an, an invention. This is something that doesn't exist. I don't, do you have any competition? Are there any other brands that are making chickpea hot cereal?

• 18:19Speaker 02

  No, we're the, we're the first chickpea hot cereal, which is why we're very urgently trying to move fast. So we can be kind of the chickpea oatmeal.

• 18:28Guy Raz?

  Yeah. I mean, Sarah, I mean, I mean, I think about you going door to door in New York with swell bottles. To me, it seems like this is, it's a no brainer for samples, right? To, to sort of, and that costs money to get people to do the samples in stores. But to me, it seems like Kind this product is kind of screaming out for a sample table. Have you guys done some of that in the grocery stores?

• 18:55Speaker 02

  Yeah, we have started doing that. And that's like basically where all of our sales come from is when somebody's in there doing samples. So we're trying to ramp that up a bit. And we're also planning to hopefully do some like right now we sell in five serving bags, which is a pretty big bag. So we might start selling in single serve pouches so that we can just hand out samples to people as well.

• 19:17Speaker 01

  That's great. I think sampling is a wonderful idea because the more you can have people taste your product, know that it's not only healthy, but it's delicious would be, I think, a wonderful idea.

• 19:28Guy Raz?

  Kiara, if you could be on any shelf or any part of grocery store, where would you want the product to be?

• 19:34Speaker 02

  I don't really, I think I would want us to be in hot cereal, I think. I don't really see any alternative to that.

• 19:41Guy Raz?

  Yeah, I mean, it's like, it's like plant milks, you know, many plant milks want to be or beyond meat. You know, they want to be where the meat is and plant milks want to be where the milk is. And it makes to me makes a lot of sense that this would be exactly where you would go and look for oatmeal. But I do think that you have an opportunity and it sounds like you're moving in that direction to really emphasize things like, you know, a hot cereal, take out oatmeal, grain free is great. 10 grams of protein, that's a lot of protein, you know, and I feel like that could pop a little bit more. Protein is really, I feel like protein is the new gluten free. You know, it's just in everything now. So to me, that that's a huge selling point, you know, high protein, high fiber is another thing.

• 20:26Guy Raz?

  People are really excited about fiber, six grams of fiber per serving. That's, that's a lot. I mean, that's great, you know, and, and, and I feel like that is especially as people are getting more interested in gut microbiome and gut health. I mean, fiber, protein, I'd slap both of those on the front.

• 20:43Speaker 01

  Yeah, I think you're so right. My advice would also to try to find your influencers, not necessarily the big brand name influencers, but the hyper local influencers that care about fiber, protein, glucose. The more that you can get individuals to really share within their local communities to go and find this product on your website or in their local grocery store, I think it'll extend your reach. Because you know, my example is Swell. We sold over 50 million of our original Swell bottles before we spent a dollar on marketing. We asked our consumers to get out there, take the product and to ask other consumers to give it a try. And the more that you can do that, before you know it, those people are going to be organically sharing on their stories as well.

• 21:28Guy Raz?

  Yeah. And this, again, I mean, you have a product that is differentiated. No one's making it right now. And but it means something really critical. And I don't know if you heard our episode with Magic Spoon, but if you haven't heard it, it's worth listening to. That is a, you know, it's a grain free, sugar free breakfast cereal. They use allulose. And they use like whey protein to create this puffed breakfast cereal that tastes like Cocoa Puffs or Fruity Pebbles or whatever. Well, the minute that they put that out and into the marketplace, there were a bunch of other competitors that some came just right before, some came after. You are going to have competition. And so you're right

• 22:07Guy Raz?

  to try and get this out there quickly. I think that there's an argument to be made that you should also concurrently, and Sarah, you might disagree with me here because you didn't do this, look for some more capital, look for investors. Sarah didn't do it. You never did it. You scaled your company without investors. It's an amazing story. But I think maybe in this case, it could be worthwhile. Do you have a different take, Sarah?

• 22:36Speaker 01

  I'm not anti-investment. You know, in the last few years, I've been working as an advisor and a board member to a bunch of companies. I'm even an investor myself now in a bunch of companies. I'm not anti-investment. I can see what capital smartly applied to good brands at the appropriate times can do. So, you know, just be cautious and make sure you're using the capital appropriately. You're still thinking about your margins and your burn, and try to find someone that can help you with the spend. Hopefully, it's someone that's actually, you know, done something in a category similar or adjacent to yours. In addition to capital, they bring, you know, some other help in sales or other resources.

• 23:16Guy Raz?

  Okay, great. Chiara, it's awesome. Congratulations on the brand on Chichi. We're gonna be fall, I mean, I'm gonna be, I'm gonna look out for it. I know in a short period of time, I'm gonna see it all over the place.

• 23:31Speaker 01

  Congratulations.

• 23:32Speaker 02

  Thank you so much. Thanks so much for having me on the show.

• 23:35Guy Raz?

  Thanks. Thanks, Chiara. It's cool. I mean, it's a great idea.

• 23:41Speaker 01

  Yeah.

• 23:41Guy Raz?

  I love the thinking behind it because there is, right, there's chickpeas now in everything.

• 23:45Speaker 01

  But not in breakfast yet.

• 23:47Guy Raz?

  Not in breakfast cereal, not in hot cereal, in pasta, and then cookies, and crackers, and, but yeah, that's cool.

• 23:54Speaker 01

  Started in a dorm room. Some of the best things are started in a dorm room.

• 23:57Guy Raz?

  Right?

• 23:58Speaker 01

  Yeah.

• 23:58Guy Raz?

  I love it. Okay, Sarah, we're gonna take a quick break, but when we come back, we will be talking to a caller who is looking to bring greeting cards inspired by his Latino heritage to national retailers. Stick around. I'm Guy Raz. You're listening to the Advice Line right here on How I Built This Lab.

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• 27:02Guy Raz?

  Hello, welcome back to How I Built This Lab at Vice Line. I'm Guy Raz. And joining me to take calls today is Sarah Kaus, the founder of Swell. All right, why don't we bring in our next caller? Hello, caller number two. Is it Jesus on the line?

• 27:18Speaker 03

  Hello, Guy. Hi, Sarah.

• 27:19Guy Raz?

  Hello, Jesus. Hello, hello. Welcome. Tell us your name, where you're calling. Well, you know your name, but tell us your full name, where you're calling from, and a little bit about your business.

• 27:29Speaker 03

  Yes, so my name is Jesus Rualcaba. I'm calling from Salinas, California. And my business is Paper Tacos greeting cards. So Paper Tacos are cards that are rooted in Latino culture and tradition.

• 27:42Guy Raz?

  Nice. Okay, cool. So greeting cards rooted in Latino culture and tradition. What's your question?

• 27:48Speaker 03

  The question that I have is how can I tell the importance of representations that Paper Tacos greeting cards brings beyond Latino specialty stores?

• 27:59Guy Raz?

  Got it. Okay, let's talk about your story first. So what was going on in your life when you started this company? What were you doing?

• 28:08Speaker 03

  Yeah, so I started the company in 2017. And I've been a designer for the last 20 years. So I was working at Heeler Packard at the time. But as a designer, I got to a certain point where I felt the need for something creative, where I wasn't bound by guidelines from big brands. And it started because my mom's birthday was actually coming up. And I went to a local grocery store to look for a greeting card for her. And my mom's first generation immigrant here to the United States only speaks Spanish. And I was happy to see a wide selection of Spanish cards. But I didn't really see anything that resonated with me, like in the sense of like a culture or traditions or from the Latino experience.

• 28:51Speaker 03

  And so that's kind of got me thinking. We're so much more than just Spanish language. You could incorporate our food. You could incorporate our music. There's, even within Latinos, there's so much diversity from what country you come from. And even here in the United States, my mom being first generation versus me being second generation and first born here were so different. And so just by using Spanish, I felt that there's still a lot more that could be represented there. And that's how the idea started. And I started doing it on the side.

• 29:22Guy Raz?

  I'm looking at the site and these, the illustrations are so fun. They're so cool. Do you, do you do all the illustrations?

• 29:29Speaker 03

  Yeah, about 90% of them are done by me. Now I'm partnering with other Latino artists, which helped me produce some of the cards.

• 29:36Guy Raz?

  They're so bright and joyful. And like some of the cards, I mean, that are, I mean, some of them are in English, like have a flantastic birthday, which I love because I love making flan. And then some are in Spanish, but everybody knows what feliz cumpleaños means, right? I mean, so, so tell me who in your mind is the ideal customer for, for your products?

• 29:59Speaker 03

  Yeah, so the ideal customer would be, I think, someone exactly like me, like born in the United States, still has really strong cultural ties to their background, speaks both English and Spanish. So throughout the day, they're, they're switching back and forth. And not only people that are shopping at, you know, like I mentioned, Latino specialty stores, but you know, I shop at Target and I shop at Walmart. So I would like to see more of that representation there. So that's like the type of people that I'm, I'm targeting for my products.

• 30:31Guy Raz?

  All right, let's bring Sarah into the conversation. I still have a bunch of questions, but Sarah, you probably do too.

• 30:37Speaker 01

  Yeah. So I'm on your Instagram and man, you have some amazing designs. I'm with Guy. They, they just make me smile. They're, they're bright and they're happy. I'm a card writer. I write cards. I travel with cards. I write them all the time. And I already have some cards that I, I'm looking forward to sending. You've done such a nice job here.

• 30:56Speaker 03

  Thank you.

• 30:58Speaker 01

  What's the experience been with the retailers that you're, you're with currently? I'd love to just understand a little bit about the experience that you've had with selling so far.

• 31:07Speaker 03

  Yeah. I mean, so far, the, the majority are Latino specialty stores. So like, because within the Latino specialty stores, they get it right away. They know what I'm doing and the products sell very well there. But it's when I'm trying to explain to other people that aren't from that background where some of that story gets lost, or they're, they're not really grasping with the benefit that they would have by doing this.

• 31:31Guy Raz?

  One of the things that I really love about what you're doing here is that it's also, it's sort of like a third culture. It's not your mom's culture, it's yours. And kids like you, I say kids, children who were born in the United States to immigrants, right? And the jokes and the art and the sort of aesthetic, essentially what you're saying is like, this appeals to us. And we're talking about an enormous potential market, right? I mean, we're talking about tens of millions of Americans who trace their heritage back to Mexico or Latin America.

• 32:11Speaker 03

  Yeah, so like, according to the US Census, Latinos make up 20% of the US population. So 1 in 5, if you could think of it that way. So it's, the market's really big. And the trend in that market is young. So 60% of that population is under 35. So yeah, so born here, raised here, but still culturally very tied to their roots and where they came from. So feedback I get from customers that see my cards is an immediate reaction of nostalgia, like, oh, I remember my dad used to say that, or my grandma does that. All of these, you know, great reactions that immediately has a connection for them as a buyer. And they

• 32:56Speaker 03

  know that as a sender to that recipient, they're going to get that same exact reaction.

• 33:02Speaker 01

  I'd love to pick up on that thread that the guy just put out there and maybe pull that a little bit, because I think that there is sort of this second idea that these aren't just Spanish language cards that you're making. And I wonder, when you're in pitching these larger retail stores, I wonder if you lead with the cards that even, you know, Sarah Kaus that doesn't speak Spanish will smile and understand and want to send off to friends. So that way, you almost have a starter conversation. And then you can explain the hole that Paper Tacos is actually filling in their clientele. Because all of that great data, Jesus, that

• 33:43Speaker 01

  you just explained, maybe isn't fully understood by all of the card buyers at all of these chains. But I wonder if you led with something that was more mainstream-ish, that could really cross that divide that we're talking about.

• 33:58Speaker 03

  Yeah, I I really, really like that idea. Um, one of the things we noticed when we went to the trade show is they liked, again, like the colorful illustrations and the envelopes are really bright and stuff. But then they're like, what does this say? And, you know, so I had to like translate it on the spot for them and and kind of give them the background. So some good feedback we got there was like, oh, you know, you should put the translation like on the back. So we're starting to do that. But an idea that came out of that was like, hey, we should have like a a subsection that's like Latino inspired, right? They're in English, but they're Latino inspired. And those could maybe be targeted to those stores that, um, you know, they might be

• 34:40Speaker 03

  in English, but they have some type of cultural reference in the artwork or something like that.

• 34:45Guy Raz?

  I I feel also like you should think regionally, at least initially, right? Because there are parts of the United States where where Spanish is widely understood. And so I feel like maybe your your target, in terms of retailers, like you're already in these these sort of Latino specialty markets in California. But I also think like, you know, HEB in Texas, you know, like, because in Texas, most people are going to understand these cards, you know? And as you know, there are third, fourth, fifth generation Mexican Americans in Texas who don't speak any Spanish, but might still really love this stuff, right? So I I as again, I think that that you want to kind of think, okay, Texas, California,

• 35:30Guy Raz?

  Arizona, you know, sort of those areas where you have this really interesting third culture.

• 35:38Speaker 03

  Yeah, for sure. And and, you know, looking at at sales, because we also sell direct to consumer through our site, um, you could see like where, you know, we have the majority of our sales, so like California, you know, Texas. So, yeah, so I I think that's a good place to start with those type of stores.

• 35:56Guy Raz?

  Sarah, I have a question for you. Um, I mean, because you obviously were very successful in getting your product into. Lots and lots of retailers, right?

• 36:04Speaker 01

  Yes.

• 36:04Guy Raz?

  And obviously, every product is different. How would you approach a retailer around something like this? Because you would, certainly in California, Texas, and other parts of the United States, you would think that there's a natural audience and market for a product like this.

• 36:21Speaker 01

  I agree. I would really try to tell your story, Jesus. I would say to go deeper into your background and story, just the way that you've explained to Guy and I today, but concisely, in a way that a retailer could picture showing this at the front of the store, on their website, and maybe one of their marketing mailers. If you show your face, you show your story, and show some of your cards, I think then the second page, the second topic you would go into with that retailer is their story. What does this mean for them? Touching on the price point, the margin, the story and the success that you've just told, that how well that you're doing at regional retailers, and how much of a part

• 37:01Speaker 01

  of the business it could be by being a unique part of their assortment in the store, and that gap that you're filling for them. And then finally, I think really you could show what the materials could look like in store. Make it as easy as possible for the targets of the world to say yes to you. Show what that assortment could be. Show what the point of sale material would look like. Really make it a whole concise package that the buyer could just look at and say, yes, how many can you make, and how soon can you be in the door?

• 37:31Speaker 03

  Got it. Yeah, I really appreciate that advice. Thank you.

• 37:35Guy Raz?

  It's such a cool idea. It's called Paper Tacos. Jesus, thank you so much for calling in. Good luck. It's awesome. Congrats.

• 37:46Speaker 03

  Thank you, Guy. Thank you, Sarah. I really appreciate the advice.

• 37:49Speaker 01

  Congrats.

• 37:50Guy Raz?

  I mean, the cool thing about these cards is that you don't have to be fluent in Spanish to understand them. The visuals are clear, they're super fun, they're really cool.

• 37:58Speaker 01

  I think he's doing amazing things. Oh, by the way, Jesus, I think you need to post more on your Instagram. You have a lot of followers. So, I know you're wearing a lot of hats as an entrepreneur, but I just, you should, yeah, make those 30,000 people buy a card this week.

• 38:13Guy Raz?

  Yes, exactly.

• 38:16Guy Raz?

  All right, Sarah, we're going to take another quick break. But just ahead, we're going to hear from another caller who just launched a brand of razors for men, but not to shave their faces, instead to shave another body part. Stay with us. I'm Guy Raz, and you're listening to the Advice Line here on How I Built This Lab.

• 38:49Guy Raz?

  Welcome back to the Advice Line on How I Built This Lab. I'm Guy Raz, and with me is Sarah Kauss, founder of Swell. All right, let's take another call. Hello, caller. Is it Adam?

• 39:00Speaker 04

  It is, it is.

• 39:02Guy Raz?

  Adam, please introduce yourself. Tell us where you're calling from and just briefly about your business.

• 39:07Speaker 04

  Yeah, hello. My name is Adam Barker. I'm calling in from Salt Lake City, Utah. I'm the founder of Bolt Skin and Shave, and we produce razors and shave products as the first brand for men who shave their legs.

• 39:19Guy Raz?

  For men who shave their legs?

• 39:21Speaker 04

  That's right, that's right. We're here. We're finally here.

• 39:23Guy Raz?

  Amazing. I have a million questions for you. Okay, first of all, what question have you brought for us today?

• 39:29Speaker 04

  Yeah, so we are incredibly new. We just launched three weeks ago, and I'm really focused on growth. What kind of growth profile should we be pursuing? Are we growing at all costs? Are we burning hot, trying to grow quickly? Or are we trying to take a more linear approach and focus on profitability first?

• 39:46Guy Raz?

  Yeah. All right. Okay, we'll get to your question in a moment. I've got a million questions for you. First of all, how did this idea come about? I'm assuming you're a man and you shave your legs?

• 39:57Speaker 04

  Yes, yes. So I've been a cyclist most of my life. You know, for the better part of my adult life, I have shaved my legs. And I've used a pink razor and a bar of soap. And finally, I was like, I think there's got to be a better way.

• 40:12Guy Raz?

  All right, I'm gonna ask you such a dumb question and I'm gonna get heaped with abuse, but, but as, why, why do cyclists need to shave their legs? What, what advantage does it give them?

• 40:20Speaker 04

  So, there's a lot of, there's a lot of perceived reasons out there. I mean, at the very top of the top, the biggest competitors, the professionals, there is a power advantage to shaving your legs.

• 40:31Guy Raz?

  Wow.

• 40:32Speaker 04

  Right?

• 40:33Guy Raz?

  Even with this micro millimeter of hair that gives you a, a power advantage?

• 40:38Speaker 04

  Yeah, it's wild, it's wild. They've done tests in wind tunnels and over the course of a 40K race, you know, 40 kilometers, you can save up to 82 seconds. I wanna say the, the statistics are. So, so there is that, but honestly, for 99% of us that ride our bikes, even if you're a very advanced amateur, let's say, it's a cultural thing, right? When you get into riding road bikes or mountain bikes or gravel, whatever it might be.

• 41:06Guy Raz?

  You wanna show off those calves? You wanna show off those, those quads?

• 41:11Speaker 04

  We've been working hard on that. We're, um, so it's aesthetics and then to be perfectly honest, the most functional reason is if you spend enough time on two wheels, you're gonna spend some time down on the ground. And when you crash and you get all scraped up, it's no fun picking hair out of your limbs. And it's also easier to clean up. As a mountain biker, let's say, you come in at the end of the day, it's a whole lot easier to clean up. But the honest truth is, is like, you just kinda, a lot of guys do it for, from a functional standpoint and then you just like it. You like how it looks, you like how it feels. I'm telling you, you'll never sleep better than the night when you shave your legs and you slip into the sheets. It's the best sleep you'll ever have.

• 41:49Guy Raz?

  I believe that, cuz yeah, because, cuz it does get, yeah, I mean, I'm, I'm kicking the blanket off at night sometimes. Sometimes it's hot.

• 41:56Speaker 04

  Let's get you taken care of, smoothed up.

• 41:58Guy Raz?

  And I sleep on one of those mattresses that cools you down. But that makes a lot of sense. So, all right, so you saw an opportunity, basically, to enter this, this space, saying, hey, there's no razors for men who wanna shave their legs. I'm gonna create one. Tell me what you were, you just launched it. What, what were you doing up until this point? Or what are, what's your, what's your profession?

• 42:20Speaker 04

  So, for the past 15 years, I've made my living as a professional photographer in the active lifestyle and outdoor space. So, a lot of skiing, a lot of fly fishing. I've traveled the world from. Antarctica to Southeast Asia. I work for brands in the active lifestyle and outdoor space like Traeger and Yeti, Lifestra, Skechers.

• 42:39Guy Raz?

  That's awesome. Yeah. Sarah, this is, this has got to be right up your alley because this is a, it is a consumer product that could go on a shelf that, I mean, right? So what do you think?

• 42:52Speaker 01

  I love it. Adam, congratulations on your brand. I love everything that you've just said. I've just checked out your website. What I love about what we're talking about is that this is a great solve for a personal problem that impacts many other people as well. You're, you made this product for yourself and I'm not worried that the market's too small. I, I love the fact that you're creating something that's, that's niche, but at the same time, you never know how big the market is. This could be the first razor that women steal from the men, right? Like you said, you didn't want to use the pink razor anymore. Well, you know, you just don't know. The women might start using the bolt razor. So it doesn't concern me the size of the market. What, what I love about it is that

• 43:33Speaker 01

  you, you are the consumer and you're creating this to solve your problem, but then it's also going to solve the problem for others at the same time.

• 43:40Speaker 04

  Yeah. And thank you, first of all, Sarah. It's so great to meet you. I'm a huge fan of your story. I'm a huge fan of your hustle.

• 43:47Speaker 01

  Thanks.

• 43:47Speaker 04

  Very inspiring. But you're spot on. You know, we're, we launched three weeks ago and our reviews are just now starting to trickle in. And a lot of those reviews say, now my wife is stealing my razor. Because it actually, it functions so well. One of the biggest differences in our razor is that it, the cartridge is tuned for coarser leg hair. So the product, yes, we're targeting men, but I believe there will be an underground movement where women are, are finally stealing the razor from their men instead of the other way around.

• 44:19Guy Raz?

  Adam, how did you, how did you finance this?

• 44:22Speaker 04

  Friends and family round. I raised just under $400,000 in about the last year.

• 44:26Guy Raz?

  Wow.

• 44:27Speaker 04

  Yeah, it was.

• 44:28Guy Raz?

  By the year. Was it, was it, was it hard or was it, I mean, that's, that's great.

• 44:31Speaker 04

  It was very hard. In fact, I'd say 75% of that, just around 400K came in the last 90 days of me raising over the last year. So there was a lot of, I have this idea, I've got my manufacturers, I know what my costs are, I have to launch. In April, we had a hard launch date for a huge trade show and event that we were going to. And it was a little bit of field of dreams where if you build it, they will come. And I, I just committed. And then what better motivator than, than bills coming in to, to raise some money?

• 45:05Guy Raz?

  Do you, I, I, I read here on your site that you are, you're an X Games gold medalist. I mean, you're, you're a serious athlete. And one of the cool things about being a serious athlete is you can connect with others. Like, I think about, you know, we, we have an, an episode of the show on Theraguns. And, you know, Jason Worsland, who started that brand, he really got it in the hands of athletes. Or Gary Erickson, who started Cliff Bar, who was on this show, the Advice Line, a couple of weeks ago. And, you know, he's a cyclist. And he gave his bars out to every cyclist. He went to every cycling event and gave that Cliff Bars as a Cliff Bar tent. I mean, you, because of your, you are an athlete, in addition to being a photographer, like, you need to be giving away

• 45:51Guy Raz?

  a significant amount of product, like, now, you know, already. Obviously, you want to, you want to make money. But you need to basically say, okay, I'm going to give away $25,000 worth of this stuff. And do it really, really strategically. Sarah, I, I think this was kind of pivotal for you. You basically gave a swell bottle to everybody, every attendee at TED. So in their gift bag, they got a swell bottle that said TED, you know, whatever, 2010 or something. I, I, I used to go. And so I have a bunch of these. But I think that proved to be a transformational decision, even though it cost you a lot of money. Is, is that right?

• 46:30Speaker 01

  That's right, Guy. We worked with the TED conference for probably 10 years and we, it was expensive. When they first called Adam, it was a very big decision for me to donate, you know, 2,000 bottles and, um, you know, pay for the shipping and, and all of that. But it was a big decision. But how do you get in front of your core market? You know, for us, it was, it was the TEDsters, as they call themselves, you know, the early adopters of, of technology and design. But, but we, but for you, Adam, it's, it's those athletes, you know, so it could seem like a, a big, a big part of the money that you just, um, preciously earned, you know, and I, congratulations on your 400,000.

• 47:11Speaker 01

  And I'd be very careful on, on giving that away. But I absolutely agree with Guy that you really do need to find out, you know, who are your influencers and how do you ask them to not just use the product at home, but to post about it so those in their community will find out about it as well. It really helps you extend your reach in a way that is, is really imperative at this early stage for you.

• 47:36Speaker 04

  You know, I actually come from that world, uh, working as a photographer. I would see the people that were in charge of marketing for the companies that I would shoot for. And as a new brand and a, and a very bootstrappy brand right now, I'm super sensitive to asking people for something without being able to offer them something in return beyond just product. And so Sarah, I wonder, or Guy, if you guys can speak to, you know, what is a good give back? How, how can I, how can I give without writing a massive check? Cause to some of these athletes, you know, they're willing to do it. And to others, they, they definitely need some money behind that, which we don't have yet. And, and I'm sensitive to, to that, to that ask of wanting something for nothing.

• 48:21Guy Raz?

  My answer to that is to find lower tier athletes, not lower tier, but athletes who are more like you. It's like you don't go to the winner of the Tour de France, right? But you go, I mean, there are Ironman triathlons all over the country. There are all kinds of local competitions. Like, I mean, you're in Salt Lake City?

• 48:42Speaker 04

  Yep.

• 48:43Guy Raz?

  I mean, there have to be dozens of cycling and running events every weekend, starting in the spring and all through the fall in Utah. So I feel like it's those kinds of athletes that could at least initially have an impact. And also, you know, there are lots of, I mean, there are an enormous number of people on social media, right, who have 100,000 followers. And they're not, these are sort of more micro influencers who still are influential, are still reaching a significant number of people.

• 49:22Speaker 01

  I have to agree with you, Guy. I think it's those 100,000 influencers, those micro influencers that were the most impactful for us as well. And, you know, maybe they do it for a free razor, maybe they do it for just showing that they're tapped in to what's new in their community. But I do think that having those hyper local influencers are going to be really useful to you, Adam. You might actually have some top tier athletes that find your product and post unbeknownst to you. They might buy it themselves, they might find it and then post about it. But I think the more you can ask for help from your community along the way, I think that's helpful. Another idea for you I had was maybe

• 50:01Speaker 01

  trying to find some partners to help you co-market and extend your reach. Maybe other brands that are in the fitness industry that they're doing gifting, maybe a subscription gift box that you could join without all of the expense yourself.

• 50:18Speaker 04

  Yeah, that's fantastic advice. And in fact, to your point, Guy, I just got back from the St. George Ironman last week. We were there last weekend. We've exhibited, you know, what I'm finding is that in-person activations right now are the key, is having people handle our product. Our razor feels different. It's quite weighty, right?

• 50:35Guy Raz?

  Yeah.

• 50:35Speaker 04

  And so getting that in-person exposure, nobody can sell it like the founder.

• 50:41Guy Raz?

  By the way, when you're going to those events, are you shaving legs onsite?

• 50:46Speaker 04

  So that was the plan. I actually, we have a leg barber shop themed booth. It's awesome.

• 50:52Guy Raz?

  I love it.

• 50:53Speaker 04

  Um, I actually found a 1920s barber chair on Facebook Marketplace. I got it reupholstered in our branding, uh, with blue vinyl and a big yellow embroidered B. It weighs about a billion pounds, so I didn't take it to St. George because I couldn't move it myself. The, the plan was to shave legs, um, at our launch. We didn't quite get there. We had a ton of people ask, so it, it's in, it's in process.

• 51:19Guy Raz?

  And that's going to be so awesome on social media. I mean, that is the kind of stuff that you're going to want to film. You're going to want to put that across all the channels. You're going to want pictures of guys getting their legs shaved on the site because that's the kind of thing that pops. I mean, it's, it's, it's so fun. It's kind of weird and quirky, but it's cool. But Adam, I, I realized we haven't actually answered your question yet, uh, which was, uh, should you just try to grow, grow, grow, grow fast or, or try to focus on, on profitability and take it slowly? This is a great question. I'm really glad you're thinking about this. Sarah, you, I mean, you grew really slowly until you grew really fast.

• 51:59Speaker 01

  We grew really slowly and then really fast. However, we were always profitable and I have to say, I started my life and my career, Adam, as a CPA and as an accountant. And I was afraid of debt and, um, I absolutely think you should dream big, but I would caution you to think about profitability. Don't be afraid of those marketing giveaways. You have to feed the brand. But at the same time, this isn't a story of growth at all costs because you really want to stay in this for the long term. It's going to be a long, a long bike race for you and you don't want to run out of cash early on. So I would, I would do both and I know that that's a cheater answer, but think big.

• 52:41Speaker 01

  But let's think about profitability at the same time that you're doing all the really sexy things to build this brand.

• 52:47Speaker 04

  That's such great advice. I really appreciate your encouraging words. I do believe that we have a great opportunity here. What we're finding is, is that a lot of men, we're taking an activity that for the men that do it, it has largely been totally overlooked and unacknowledged, and we're turning it into an experience. You know, we have not just a razor, but we've got shave products. We've got an exfoliating leg scrub, a shave butter, a post-shave lotion, a CBD recovery balm, and these all create an experience around an activity that's kind of been in the closet for a lot of guys. So it's answering those needs and then some. So, and, and I really appreciate the methodical approach that you took. And I mean, of course,

• 53:28Speaker 04

  I've raised this money. We had to spend a lot of it, right? CPG startups are stupid expensive. I couldn't believe it. I spent $100,000 on stuff you can squeeze into your hand, you know? But I do have a little bit of runway that I'm clutching so tightly to, and, and it's hard for me to wrap my head around letting go of that. But I am a marketer. I believe in marketing. You gotta spend money to make money, but I gotta find a responsible way to do it, you know?

• 53:55Guy Raz?

  And you will. And again, shave legs, man. You gotta go out and just shave legs, film it. I want to see that all over social media.

• 54:03Speaker 04

  We'll do that. You gotta go to our website and watch our launch video. It's an AA-style support group for men who shave their legs. It's hilarious.

• 54:10Speaker 01

  Hilarious. I will definitely watch that.

• 54:13Guy Raz?

  That is great. Adam, congrats. Bolt, Skin and Shave. Good luck. Keep us posted.

• 54:20Speaker 04

  Thank you, Guy. Thank you, Sarah. So appreciate you having me on the show. I appreciate your advice.

• 54:25Speaker 01

  Good luck, Adam. Guy, you're a good marketer. I love that you thought of that idea about the shaving legs on site.

• 54:32Guy Raz?

  I mean, wouldn't you watch, wouldn't you watch that if you saw the video? Like, wait, what's going on? Well, look at all these, like, jacked dudes getting their legs shaved. And then you find out that actually helps them with their aerodynamics.

• 54:45Speaker 01

  Showing off their muscles at the same time.

• 54:47Guy Raz?

  I mean, I, I live in, in the Bay Area, you know, and, and there's a lot of hills around here, and I see these cyclists just going up these grueling hills, you know, and you're just like, now, now I'm gonna look at their legs. Because he's probably right. Most of these guys are probably shaving their legs.

• 55:03Speaker 01

  I never paid attention. I will have to watch.

• 55:05Guy Raz?

  You learn something new every episode. Sarah Kaus, founder of Swell. Thank you so much for coming back onto the show.

• 55:13Speaker 01

  Thanks for having me, Guy. It was fun to spend some time with you.

• 55:16Guy Raz?

  And by the way, if you haven't heard Sarah's episode, the story of swell, go back and check it out. It's an awesome story. You can just scroll up and find it in our podcast queue, or even easier, we will put a link in the podcast description. Also, it'll be in our newsletter this week, so check it out. You can sign up for our newsletter at guyraz.com. It's free. It comes out every week, and I think it's pretty good. And thank you for listening to the show this week. If you are working on a business and you'd like to be on the show, send us a one-minute message that tells us about your business and any questions or issues or challenges or problems or crises that you would like help with, we will try and do our best to solve them. And also, make sure to tell us how to reach you, because some people don't, and then we can't call you back. You can send us a voice memo

• 56:01Guy Raz?

  at [email protected], or you can call 1-800-433-1298 and leave a message there. And we'll put all of this in the show notes, so if you don't write it down like me, you can just scroll down and see it there. Thanks. We'll be back next week. See you then.

• 56:20Guy Raz?

  This episode was produced by Chris Messini with music composed by Ramtin Arablouei. It was edited by John Isabella. Our audio engineer was Neil Rouch. Our production staff also includes Alex Chung, Carla Estevez, Casey Herman, Elaine Coats, J.C. Howard, Catherine Seifer, Kerry Thompson, Neva Grant, and Sam Paulson. I'm Guy Raz, and you've been listening to The Advice Line here on How I Built This Lab.