Audible is the home of storytelling from audiobooks across every genre to all your favorite podcasts and exclusive Audible originals.
As an Audible member, you can choose one title a month to keep from their entire catalog.
Audible is the destination for thrilling audiobooks with highly anticipated new releases and next-listen recommendations to pique your curiosity and sense of mystery.
If you're selling titles like First Lie Wins or the upcoming Stephen King novel, you like it darker.
New members can try Audible free for 30 days.
Visit audible.com slash built or text built to 500 500.
That's audible.com slash built or text built to 500 500.
Financial operations are needlessly complex.
With Mercury, you can simplify them with banking and software that power your critical financial workflows, all within the one thing every business needs, a bank account.
And with new bill pay and accounting integrations, you can pay bills faster, stay in control of company spend, and speed up reconciliation.
Apply in minutes at mercury.com.
Mercury, the art of simplified finances.
This show is brought to you by Schwab.
You're here because you like to keep a pulse on trends in technology.
Well, now you can invest in what's trending in artificial intelligence, big data, robotic revolution, and more with Schwab investing themes.
It's an easy way to invest in ideas you believe in.
Schwab's research process uncovers emerging trends, then their technology curates relevant stocks into themes.
Choose from over 40 themes by all the stocks in a theme as is, or customize to benefit your investing goals, all in a few clicks.
Schwab investing themes is not intended to be investment advice or a recommendation of any stock or investment strategy.
Learn more at Schwab.com slash thematic investing.
There's a lot to say when buying a new home or car, but only one thing to say that can help you protect them.
Like a good neighbor, State Farm is there.
And just like that, a State Farm agent will be there to help you choose the coverage you need, no matter where you are in life.
When you need coverage options, your State Farm agent is there to help.
On the phone or in person.
Like a good neighbor, State Farm is there.
Hello and welcome to the advice line on How I Built This Lab.
I'm Guy Reyes. 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 hibt.id.wondery.com and make sure to tell us how to reach you.
And also, don't forget to sign up for my newsletter.
It's full of insights and ideas from the world's greatest entrepreneurs.
You can sign up for free at gyrus.com.
And we'll put all this info in the podcast description.
Alright, let's get to it.
With me this week, one of our very first guests on the show, Gary Erickson, founder of Cliffbar, Gary Erickson.
Welcome back to the show.
It's so awesome to have you back.
Thank you, Gary. So Gary, when you were on the show, you and your partner Kit were still the owners of Cliffbar at the time, though your employees also owned a significant chunk.
And in 2022, after 30 years, you sold it.
And I know that in that time, over those 30 years, you guys fielded tons of acquisition offers.
You even had to fight some of them off.
And in fact, I think listeners who remember, who heard your episode, remember quite an emotional moment in our conversation when you talked about walking away the first time you had an acquisition offer and you had to come up with the money to buy out your first partner.
Yeah, I still have, now in the nightmares, of what if I would have sold the company in 2000?
Yeah. That was after only eight years in business, which is a long time.
But I can't even describe the exponential growth and good things we were able to pull off over the next, what, 22 years.
Yeah. And if we would have sold it, yeah, I'd probably, I'd be fine.
I'm happy, anyway, I'm happy living in a garage like I basically do now.
Which I do now, which I...
With your bikes. Which I did before I met my wife.
And I'm just so thankful that we escaped that moment and went with the gut reaction and the heart, and both of us decided this is what we're going to do, and we did it for 22 more years.
And you turned it into one of the biggest energy bar brands on earth.
One of the things that I love about how you started Cliff Bar was that initially you focused on a community of people that you were a part of, which in your case was cyclists.
You are an avid cyclist, you go, I know you do these long cycling trips through Europe and Italy multiple times a year.
You started by getting the product into their hands, into cyclists' hands.
Was that critical, do you think, to Cliff Bar's eventual success?
It was the path to success, for sure.
Many ways to say that, but that's how I feel right now.
I think the two sports that I was deeply involved in were, well, three actually.
Cycling, I did some triathlons before that, and then I climbed since...
At that point I was about into 20 years of climbing.
So I went to each of those groups and would just pass out bars.
And I knew I had a tiger by the tail when I was able to go to multiple, like either climbing crags or bike races or whatever, and just literally hand out the bars out of my car.
And for free, it's like, take this.
And their reaction sold it to me, and then from there on it was just, as I say, hang on to the reins from year one to...
We never did not grow for 30 years.
And what started out with a small group of people, cyclists, triathletes, climbers, eventually became a mass consumer product with moms and kids and people on the go and people going to the gym and people just getting some energy.
But it really... It's interesting because so...
I think a lot of really great products start that way.
They find a small, narrow group of people who love it.
And then from there, that group helps to grow it out into something bigger.
You have to have that foundation first.
And then from there, you go out.
If you're going to try to go mass market, you'd have to have so much funding to be able to do that.
And chances are, it's not going to work because you've got to build that base.
Yeah. Well, Gary, so you ready to take a call?
Yes, let's go. All right, let's go.
First caller on the line, I think it's James.
James, are you there? I am here.
James, introduce yourself.
Tell us what the name of your business is and where you live.
I'm Colin in from LA, Los Angeles, actually from the Techstars Accelerator Program podcast studio.
I'm representing Stoke Plastics and Opolis Optics.
We transform ocean waste plastic into sustainable performance plastic.
And we're making everything from adventure gear to luxury hard goods.
And tell me what your question is for us.
Yeah, sure. How did you cut through the noise when building Cliffbar and effectively communicate your products, unique benefits in a way that resonated with consumers and made them choose your product over the competition?
All right, we're going to get to your question and to Gary's answers in a moment.
But if you don't mind, indulge me, I have some questions for you first.
Sure. So your company is called Stoked Plastics.
Correct. And you basically use recycled plastics to make things like sunglasses and ski goggles.
Is that right? Yeah, so our specific or unique niche is that we use water bottles, ocean bound and ocean found.
Okay, so just to be clear, you've got Stoked Plastics, which is the technology company that makes this recycled material.
And then you create a separate brand called Opolis, which makes sunglasses and ski goggles using the Stoked Plastics technology.
Correct. And we started off making sunglasses and goggles, but now we're doing prototypes for buckles and trims and coolers and really anything that uses a high density of our pet or PET in manufacturing.
Yeah, now I'm understanding it a little bit more.
So when you look 10 years from now, is Stoked Plastics the material supplier of this great plastic that you're providing?
Is that going to be 98% of the business and Opolis is there as a kind of grounding thing or signature or the other way around?
So Opolis Optics at this point is almost our proof of concept for Stoked Plastic about the capabilities that we have through our IP.
But essentially, we would love to replace all Virgin PET with our Stoked Plastic IP.
For us, and we want companies and brands to be able to use our Stoked Plastic in their manufacturing and have our icon right there.
So when consumers are shopping, they know that it's affiliated with sustainability, circularity and performance.
It's a really interesting idea because it's your vertically integrated business from the get go.
You manufacture your own material and then you make your own products.
And essentially what you're saying is by showing how it can be used in your products, the hope is that other brands will just buy Stoked Plastics.
You will continue to make sunglasses and ski goggles, but really it's the plastic material that you'd like everyone to use.
Yeah, that's the impact.
That's the change that we want to kind of motivate.
When we first came up with the IP, you guys, no one wanted to touch us.
I was a former U.S. government contractor.
We didn't really have a foot in the door in the outdoor industry, so we're like, look, no one's going to buy it.
Let's go create our own product and see how it resonates within the outdoor space and beyond.
Put on my finance hat. Cost of goods, a pound of your Stoke Plastic versus your same use for same sunglasses or whatever.
Sure, that's a great question.
One we get a lot. So yeah, comparative to the RPET that you can currently buy on the market, ours is about 10% more than that.
But because of our high recyclability grade and economies of scale, we can hit ESG targets a lot quicker for companies that are trying to meet those targets.
Here's an off-the-cuff idea.
I'm thinking of a hot idea.
I'll get my pen and paper.
So I think in food, organic is Stoke Plastics.
Look, it's going to be a hard time sometimes to convince the CFO of company to buy, but if you could build this to be like the organic of plastic, then...
That's where you can justify the price point.
Yeah, because you've got to justify the price point.
No, I like that spin on just using organic because that makes people feel good and they know they're paying more money.
Yeah, and it's a certification.
Oh yeah, of course. James, just out of curiosity, how have sales been so far?
Well, I was just saying this, we've got enough sales where funds and investors are interested in us.
I can't make a livelihood off of it.
Not yet. But after four years of spending a lot of money, and this kind of goes into my question to Gary, on educating the marketplace on the difference between what we're putting in our sunglasses and goggles and what others are not.
And that is just, as you guys know, it's just been this huge PR and marketing effort that is time-intensive and expensive.
So your question was about breaking through, right?
And your question for Gary is why should somebody eat a cliff bar versus a competitor snack, you know, which you're trying to figure out how do we get people to get educated on what we're offering?
Gary, where would you even start?
No, boy. This tough one has changed over the last 30 years.
It's changed so much. I'll start with our story.
In 1992, it was really only Power Bar, and a few bars had come out during that time, but they were kind of like, they took the Power Bar ingredients and they added a little more vanilla or a little more peanut butter or something.
We created a completely different product.
You're kind of like that, and you're kind of not.
There's so many sunglass companies, I don't have to tell you.
And there's some beautiful designs out there and all these companies, but what is the difference?
And we had this radically, we had to educate people that it is an energy bar, it just tastes better.
And so we sampled a lot, which was, that was instant sale, but you can't get to everybody.
So we did some print ads, and we did a print ad called, It's Your Body, You Decide, and it was going directly after Power Bar.
And in five days, we had a lawsuit against Power Bar.
They sued you guys. And that lawsuit actually was a blessing in disguise, right, Gary?
Because it got you all this attention.
You took the words out of my story.
Sorry. Sorry. No, I'm glad you did because it's so, it's, people don't realize that sometimes it might be what you want.
And, you know, so I, and I think people are afraid to attack competition.
So, you know, my question back to you would be like, do you pick the number one competitor that you can grab?
Or do you do them all together?
And, you know, do you go after them and create a super aggressive campaign that gets you PR?
Because back then there was no PR, as per se.
But it was usually, oh, in a retail magazine or a trade magazine, you know, Cliff Bar gets sued by Power Bar.
We're like, thank you. And guys write, like, then all these bike shops are like, well, let's just try it.
I mean, gosh, and they did.
And we had 700 accounts in like months.
And our goal, this sounds very aggressive, but we're, our goal is to put them out of business.
And for the first 10 to 15 years, our people were like, we are going to just go after their market share everywhere we could.
And so that's how you tell people you're different.
You've got to show the difference between what everybody's doing and you're not doing, and that you can't be bashful or shy about it.
You got to, that's my opinion.
Yeah. And what's kind of cool is like you could have, you could basically take a competitor's sunglasses and just show a pile of plastic and say, this becomes this.
Yeah, I like that. Right?
Something like that. That's amazing.
Yeah, guy, you just took the design right out of our heads.
We're looking for some marketing guy.
That's exactly. Call my 800 number.
And Gary, how important is like athlete influencer association with brand voice, brand identity?
It was in our mix always.
And we still have, you know, world-class athletes with cliff bar stickers on their helmets and like ski racing.
You know, you're in the skiing because I saw your goggles, you know, Bryce Bennett, who won a World Cup race this year, gets in the start line.
You see this big red sticker and then he crosses the finish line and he wins and he literally points to the cliff bar sticker on his helmet.
Like, holy crap, that is worth so much.
Doesn't get better than that, doesn't it?
It doesn't get better than that.
And so I 100% without having to go on and on about it.
Yes, we've always had athletes from day one endorsing our product and they're super legit.
They're not just celebrities who, you know, look good and, you know, they could choose anything with these people used our product for function and for quality and for and believing in our story.
I think that's a key point, Gary, is that there will be some consumers who are attracted to the story and the recycled aspect of it.
But I think most people are going to want about the function.
They're going to want to know why this is better.
And I think this, that having an athlete, having a, you know, I think like an Alex Honnold or an outdoor person, you know, somebody or a Michaela Schiffen wearing the ski goggles.
I'm not, you know, they're probably already sponsors.
Taking care of him. But you think about the shoe brand on, right, which we're going to tell that story in the show.
I mean, Roger Federer supercharged that brand because all of a sudden Roger Federer is wearing on and people are like, what is that?
Roger Federer, they must be amazing.
Sure. People need to understand because the majority of people are going to buy it because they look good and they're functional, not because they're recycled.
Yeah. And I promise to do this.
I'm going to get some, but I'm paying retail, buddy.
I'm going online and that's my gig.
That's my gig. I pay retail.
That's fine with me. I pay retail.
That's fine with me. Hey, Gary Erickson wearing Apollos, that's a big deal.
That's a huge deal. That's a big milestone.
A lot of people are going to be like, what is Gary wearing?
Okay. I just resigned from the World Cup, so I don't think he's going to.
Up there with how I built this and Gary Erickson wearing our eyewear, that would be cool.
James, thank you so much for calling in.
Good luck. We're going to be following your progress and we'll catch up with you.
Maybe you'll be back on the show.
I hope so. You guys, I've been listening to you for four years.
You've gotten me through a lot of ups and downs and Gary, you've gotten me through a lot of hikes, snowboard trips, surf trips through your bars.
I really appreciate the time and thoughts.
James, thanks a lot and hope we get to catch up more.
I'd like to catch up one-on-one if we can someday just to check it out.
I'd love that. Thank you guys.
All right. Take care. Gary, I mean, this is a complex business, but I think the idea of pre-release, the idea of producing the material and turning into a product is a kind of a cool idea.
It's super innovative.
I mean, he's gone from zero to vertically integrating his business right away.
Yeah. There are a lot of ingredients and materials out there that are like what he's doing, but they're more purely functional, like a better plastic or a better Kevlar, for example, or fiber, radically changed the bike industry, but there's no patent on carbon fiber and everybody's doing carbon fiber.
So, I think he's got the advantage if they can get the IP on that and it's got to be functional and it looks like it is very functional.
At the same time, it's got that property that it's where everything's moving towards more sustainable.
Yeah, totally. Gary, we're going to take a quick break, but when we come back, a co-op of Artisan Systems, competing with giants like Etsy.
Stay with us. I'm Guy Razz and you're listening to the advice line right here on How I Built This Lab.
Picture this. You've got an incredible idea.
You've rallied a team to bring that vision to life, but how do you streamline all of your big plans into a workflow?
Simple. We're going to turn to the team collaboration products that are built to power your progress.
That's where our sponsor, Atlassian, comes in.
Every groundbreaking idea begins with a solid foundation and Atlassian products like Jira, Confluence, and Loom are here to help support your startup as you scale.
I've got a soft spot for startups.
I mean, they can be really special and they're just loaded with potential and the passion to tackle challenges head on.
But sometimes logistics, tracking, and planning can slow you down, at least if you don't have the right tools.
World-class companies like Snowflake, Cloudflare, and Canva all grew from early days to unicorn status with Atlassian at the core.
And now, Atlassian's new Atlassian for Startups offering provides everything early stage founders and teams need to prioritize the best ideas, build the right thing, and keep everyone on the same page as they scale the next big thing.
Atlassian for Startups is here to help you and your team use built-in AI features to augment workflows and accelerate productivity.
Let Atlassian be your co-pilot as your ideas take flight, enabling you to track work, manage releases, and evolve from a concept to impact in one central system.
With Atlassian for Startups, you can build a roadmap using their startup templates for fundraising, business plans, competitive analysis, and much more.
Plus, you can check out other startup resources through the Atlassian community, startup AMAs, Atlassian University certifications, and more.
Don't wait for your ideas to fade into the what-ifs.
Learn how to unleash the potential of your team at Atlassian.com-startups.
That's A-T-L-A-S-S-I-A-N.com-startups.
Atlassian, my favorite spring cleaning takeaway is the post-clean clarity you get.
Wow, how have I been living like this?
It's kind of like when you find out that you've been paying a fortune for wireless when Mint Mobile has phone plans for $15 a month when you purchase a three-month plan.
It's time to switch to Mint Mobile and get unlimited talk, text, and data for $15 a month.
Over a year ago, I ditched our family's overpriced wireless contract and the unexpected overage fees we got billed every month.
To get this new customer offer and your new three-month unlimited wireless plan for just $15 a month, go to MintMobile.com-bilt.
That's MintMobile.com-bilt.
Cut your wireless bill to $15 a month at MintMobile.com-bilt.
$45 upfront payment required equivalent to $15 per month.
New customers on first three-month plan only.
Speed slower above 40 gigabytes on unlimited plan.
Additional taxes fees and restrictions apply.
See Mint Mobile for details.
This episode is sponsored by Squarespace.
Squarespace is the all-in-one website platform for building your brand, engaging your customers, and growing your business online.
So if you're running a business like the founders on this show, then you'll love some of Squarespace's features.
Choose from professionally curated layout and styling options to build a unique website that's optimized for every device.
And with integrated SEO tools, your website will show up more often to more people.
No matter what you sell, Squarespace has the tools you need to run your business online, including lots of payment options for customers at checkout, as well as easy client invoicing.
And Squarespace has tons of analytics so you know where all your site visits and sales are coming from.
So check out squarespace.com for a free trial, and when you're ready to launch, go to squarespace.com-bilt to save 10% off your first purchase of a website or domain.
Hey welcome back to the advice line here on how I built this lab.
I'm Guy Ross, and I'm with Gary Erickson.
So Gary, market share is obviously super important, right, especially in a crowded space.
And as more and more competitors started to get into the energy bar space, how are you able to fend off the competition and stay ahead?
Like what were some of the strategies that worked?
I would argue that we were built through grassroots marketing.
We did some print ads at the beginning, which did put us on the map, but Kit and I would fly all over the country and be cutting up bars and thousands of pieces of bars just at these marathons.
And it was great. It's so hard, but and then we started hiring people to do that for us.
We had a team of 25 people around the country and then they had local people that they would hire for the weekend events.
And I really think that's what put us on the map.
But where our product was inexpensive enough where we could actually give out whole bars and they could experience that.
And then the next thing you know, they're buying 12, 24 and hundreds and we built a lot of loyal, I mean, we have such loyalty with a small group of people that buy the majority of our product.
Yeah. Okay. Let's get another call in.
What do you think? All right.
What do you say? Another one.
Okay. Valerie is on the line.
Hello, Valerie. Hello, hello.
Welcome to the show. Please introduce yourself.
Tell us your first and last name, what the name of your business is and where you live.
My name is Valerie Franklin and I'm representing Artisan's Cooperative and I'm calling in from the beautiful North Oregon coast.
Nice. Oh, this is a beautiful place.
Okay. And what's your question?
So, we have almost no funds but a strong bottom-up community ownership.
How do we break into a market space that is filled with giants like Etsy and Amazon?
Woo. Those are giants. Okay.
We've certainly told the Etsy story on the show.
First of all, tell us a little bit about your business, about Artisan's Cooperative.
What is it? What do you do?
Yeah. Artisan's Cooperative is a co-op alternative to Etsy.
We're growing an online handmade marketplace for crafters, makers and artists owned and managed by the people who love it as a cooperatively owned business.
I'm looking at the website now.
And so, first of all, what's the problem with Etsy?
Why did you? It seems like you are really, it is competing with Etsy, but what prompted you to start this?
Well, it's easy as for me to answer in some ways from a personal point of view because I'm one half of a leather crafting business, a small husband and wife leather crafting business that we started on Etsy in 2009.
So we know Etsy very well and we're still on Etsy and they are a great option to have it in your portfolio as a small artist or maker.
But over the years, they've changed a lot, starting in, I think, 2012.
They started growing much bigger.
2015, they went through an IPO and sellers started becoming, I would say, the product as much as the offering, the way that Etsy's making revenue.
So this all really got started when they increased their fees a second time by 30% in 2022.
And they announced that fee increase in the same week that they announced record profits.
And that was just something that struck a lot of small makers and artists who rely on this income kind of struck a nerve.
And so it kind of spontaneously organized into a protest online through social media, which is how I got involved.
It was called the Etsy Strike and thousands of shops took their listings off of the site for a week in protest.
And it actually caught some pretty good mainstream attention, but didn't change the fact that the fees were going up again.
It's at the point where a sales commission might vary anywhere from 10% to 40% per sale and you won't really know what that is until the sale happens.
And how do you differ from Etsy?
Like presumably you're charging much lower fees to your sellers?
Not necessarily, no. The big difference is that we're owned and operated or owned by the members themselves.
So a cooperative is a member owned business that's organized on a principle of one member, one vote.
So we have a multi stakeholder cooperative, which means that the artisans themselves can be owners of the business and the shoppers or any general supporter can become an owner of the business, which means they get governance rights, they get a vote and they get to have a say in how things are run and they get financial rights so that when we have profits, the dividends
are distributed among the people.
How many artisans do you now have involved?
We have a little over 300 members now.
Wow. Yeah. And we have about, I think, 200 shops on our marketplace.
Okay. So Valerie, you brought us this question about you've got, say, almost no funds, but you've got a strong bottom-up community, how do you break into a marketplace kind of dominated by Amazon, Etsy, eBay and other massive retailers?
Gary, you want to take the first crack at this one?
Oh man, this is a tough one.
Well, you've got a real targeted competitor.
You would call Etsy a competitor, is that correct?
Yes, although we're not necessarily trying to replace Etsy.
If we could get the 1% of artisans who are looking for alternatives and the consumers who are looking for ethical options, I think that's a great starting place.
So the answer is yes, you're a competitor.
Okay, yes. You just don't want to say it.
So yeah, we used to say that at the beginning when we were at Cliff Bar, like, if we could just get, oh man, 10% of their business or 20% of their business, I'll be set for life, and that would be revenue of a million dollars and little did we know that we far surpassed that.
So yeah, so you could target that.
Don't be shy about that.
Is there a place where you would feel like if we got here, then we've got momentum and we're able to sustain our business for the long haul?
How far are you from there right now?
That's a great question.
And I think that's one of the special challenges we have in trying to build a marketplace is that we're in a bit of a chicken or an egg situation.
We need enough artisans to provide good consumer choice for the shoppers who are coming on, so they have things to sort through and define what they're looking for.
But we need enough customers to make it worthwhile for artisans to want to sign up.
And so I hope that we're growing both in step with each other in a balanced way.
We're not there yet. We just started.
We launched our beta marketplace with existing tech in October of this year, so six months ago.
And I would say we're probably at least half of where I'd want to be.
Okay. So we could start feeling like we were getting there.
And I think about, it's really interesting because we've done a whole series on the show recently about content creators and the business of content creation.
Ten years ago, in order to reach mass scale in media, you had to be on CNN or be at a major media organization today.
You could be some dude with a YouTube channel and reach 50 million subscribers.
And so what's interesting about how social media platforms work now is that they want to attract all these creators.
So for a long time, it was YouTube where they were trying to get onto because YouTube paid the most.
And then they went to TikTok.
And now a lot of people are migrating to Snapchat.
Now they all use all of them, but these different platforms offer different incentives.
And now it's getting me to my question for you, which is, is there a world where you could offer an incentive that is so good, like no fees for the first year or something radical where that kind of message spreads among crafters?
Because there are craft fairs all over the country.
Crafters talk to each other.
You guys have a Discord channel, I see.
Is there some kind of incentive that you are able to offer to bring this critical mass in?
That's a really good question.
I absolutely think that we could come up with such an offer if we could find the right audience and the right moment to share it.
But I do think one of the things we've had a challenge with being on a platform is that we don't have a lot of ways to connect with other artisans other than at like craft fairs and things like that because places like Etsy control the narrative and control their forums.
Right. That's right. But for you to control the narrative, you've got to give your members the tools.
You got to make it easy for them.
You've got 300 members.
Each of those members is on social media.
I mean, they may not have hundreds of thousands of followers, but they might have hundreds or thousands on their social media and I wonder whether you can leverage your community in a better way to have them promote what you're doing.
I think our members are not only committed, they're literally invested.
They're co-op member owners.
They've invested in this company and we're all equal owners of it together.
So it brings up an interesting point that I hadn't fully thought through, which is that artisans have, we have people who are just starting their careers, people who are doing it just for fun, and then people like me and my partner who do this full time for a living.
So everybody comes with it with a different set of skills and a different background and using everybody's strengths where they are makes a lot of sense.
Valerie, once people come onto your site for the first time and maybe they buy something, do you got them?
Do they come back? They're like, wow, I never thought this existed.
This is really different.
I think we've had repeat customers already.
Yeah. I mean, in our six months of operating, I think one of the ways that we try to encourage that is through email campaigns and trying to make people aware of the variety of things on our platform, everything from wooden coasters to hand woven silk shawls.
There is such a wide variety of products and that's sort of the treasure hunt of it.
One of the things that I've noticed, I'm going to give you some feedback on this.
I know the site's early.
It's still in beta form, but there's too much stuff.
There's joined the member, four artisans, handmade this, there's all these drop down things and what I think Etsy does well and what I think you could do really well is they just have pictures of different categories and you have some of that.
I know Gary is a cyclist and is there a world where you've got people who love cycling or you've got clothing and accessories, arts and craft, but could you break that down even further like beanies or games instead of personal care and leisure like domino lovers?
I mean, you don't have to get super micro niche, but you could get kind of niche.
I understand you guys don't have massive budgets, but you're working with artists.
I know you give a lot of talent in your group to really kind of think a bit more intentionally about the design of the website to make it pop a little bit more.
You know what I mean Gary?
I like that a lot and I like also that you're trying to move toward something that Etsy isn't doing on their website or with their product line or whatever is available.
I mean, you could go if you want to differentiate.
It could be your headline.
You may not find this on Etsy.
You may not want to say you won't find this because maybe you will, but you could say you may not find this on Etsy.
That would give them like, well, maybe there's other stuff on here I won't find in Etsy.
Because you've got to create, you can't be an Etsy with better values.
You got to be Etsy with a different product.
I'm telling you, I agree.
I'm just spitballing here, but maybe think of a different way of categorizing what you offer and you focus on the things that people love or might be attracted to.
So here's a question that follows that, I hope perfectly, is how many people come to this and buy a gift versus buying something for themselves?
That's a great question.
I would say so far more purchases have been personal, and yet that contradicts my own experience with my own business, that when you make these niche things that are perfect for that one person, you know, a higher percentage of them is gifts.
I also know that Etsy is pushing gifts hard right now.
Okay, that's interesting.
That was their super bowl ad.
Is that right? Yes. But gifts is the way to go.
It's the way, I mean, if you push gift, you might find something for yourself too.
You know, like you go in for like, I go to wherever, wherever and buy a gift for my family or my wife or something.
And then I ended up like, well, this looks, I think I want to get this for myself.
Yeah, I mean, there's a lady here who's making knit beanies with like an octopus on it.
I'm seeing that. I'm on the same page.
The chicken and the lemon.
I mean, there's lots of people with octopuses or let me go.
I'm on the same page. The yellow one?
Right. The yellow picture?
Yeah. I'm looking for gifts.
I'm looking for a gift for somebody.
And I don't even know where to begin.
You could have a revolving top gifts, top sold gifts.
And if you just had like a headline of like, first thing is top 50 gifts.
Because if I'm looking for a gift, I wouldn't know where to start here.
And I would like to be led to something.
And I might come back here and be buying gifts all the time.
Because I'm always searching for a gift for my friends and family.
Valerie, I think we're onto something.
I think we might be onto something.
You have given me so many great ideas and feedback and direction.
And I absolutely loved Gary's point too that gifts are a great add on and it would be a great way to increase our per order amount.
And look for yourself and also think about other gifts to add on.
And back to trying to get that message out is wherever you get, if you could just say a gift you may not find on Etsy.
Yeah. Yeah. Try that. Right?
Try that. And Etsy's not going out of business.
They'll be fine. And we love Etsy, by the way.
They're going to show big fans too.
So no shade to Etsy. Valerie Franklin, Artisan's Cooperative.
Thanks for calling in. I'm going to be stuck.
We'll be watching. Awesome.
I was delighted to be here.
Thank you so much. All the best, Valerie.
Great job. Gary, I'm going to get you a chicken hat, I think.
Which one? I don't know.
That or the lemon, the big lemon on the side of that knit hat.
I think that one's for you.
I think you look good cycling through Italy on your racing bike with that.
Oh, that'd be sweet. I have to put it over the helmet if I can get it over the helmet.
Put it over the helmet, yeah.
All right. We're going to take another quick break, Gary.
But when we come back, an inventor whose fluffy dog gave her a great idea.
Stay with us. I'm Guy Razz, and you're listening to the Advice Line here on How I Built This Lab.
Okay, some quick math here.
The less your business spends on operations or multiple systems, the more margin you have and the more money you keep.
So to reduce costs and headaches, smart businesses are using NetSuite by Oracle.
NetSuite is the number one cloud financial system, bringing accounting, financial management, inventory, HR into one platform and one source of truth.
With NetSuite, you reduce IT costs and cut the cost of maintaining multiple systems.
You improve efficiency by bringing all your major business processes into one platform, slashing manual tasks and errors.
Over 37,000 companies have already made the move, so do the math.
By popular demand, NetSuite has extended its one-of-a-kind flexible financing program for a few more weeks.
Head to netsuite.com-slash-built today.
Learn more at netsuite.com-slash-built.
Again, that's netsuite.com-slash-built.
How I Built This gets support from our sponsor, Yahoo Finance.
Wouldn't it be great if you could find all of your investment and retirement accounts in one place?
Well with today's sponsor, Yahoo Finance, you can.
I have an account with Vanguard and another with eTrade and a few others, and I've been using Yahoo Finance to consolidate them in one place, which has made it incredibly easy to manage them.
You can glance at all of your accounts all at once and access the analysis you need to attend to your entire portfolio with confidence.
They are the number one finance destination, offering a holistic look at the financial news cycle, including breaking news, original editorial perspectives, analyst ratings, independent research, customizable charts, and so much more.
For comprehensive financial news and analysis, visit the brand behind every great investor, Yahoo Finance.com.
The number one financial destination, Yahoo Finance.com.
That's Yahoo Finance.com.
Hello and welcome back to the advice line here on How I Built This Lab.
I'm Guy Ross. Gary, what do you say?
Should we go ahead and bring in our last caller?
Just go. All right. Hello, Elsie.
Are you there? Can you hear me?
Yes, we can. Hello, Elsie.
Awesome. Please tell us your name, what your company's called, their business, and where you live.
Hi, Guy. Hi, Gary. Hi, Elsie.
I'm in Denver, Colorado.
I started my company in Lily Brush 14 years ago after I invented a pet hair cleanup tool that's faster than vacuuming and better than sticky rollers without creating single-use waste.
I've since invented four more pet hair cleanup products, and now we have this incredible core group of pet parents and professional cleaners who love our products, but I'm still struggling with how to scale up our marketing so more people can find us.
Right. Okay. So you're looking to figure out how to scale up to get more people to find you, how to do it efficiently.
Before we get there, let me ask you a couple of questions.
Lily Brush is a pet hair remover for furniture and whatever pet hair.
I'm a beloved pet. I've got two cats and a dog.
So this is a big problem in my house.
We have a lot of pet hair.
I have a one cat that's particularly bushy hair.
Morty, he's a great cat, but he sheds everywhere.
How is it different than, I don't know, a roller or other pet brush removers?
Oh, let me count the weights.
Please tell us, yes. Count them out loud.
Okay, I will. So if you have pets that have that very heavy undercoat, that soft, fluffy stuff that sheds all year long, we make these fantastic bristled products that you just brush back and forth across the hair, it picks it all up.
There's no sticky roll or waste.
There's no peeling. And it's faster than vacuuming.
And you just pull the hair out and you just toss it in the— It stays right on top of the bristles.
And you just—I like to tell people, take the hair outside because birds like to use it for nests.
Wow, that's cool. It's like you're recycling.
Like James and the plastics.
You can build a nest for a bird and then your cat can go and eat the bird.
Oh, dear. No. How did you—tell me how you started this business because I see you started in 2010.
What were you—I mean, did you have a different job or are you doing something different in your life at that point?
I was. It's kind of one of those crazy stories.
But I used to be a painter.
I was a portrait and still life artist.
And in 2009, I was a single mom and I shoveled a driveway full of snow and it caused my widowmaker artery to dissect at the family dinner table.
So after I was very lucky to wake up the next morning, but I went to reach for a water glass and my hands were shaking.
They were like nervous parakeets.
I'm sure you can hear it in my voice.
I have now a pretty prominent tremor.
And so I knew that morning that my painting career was over.
Wow. So, you know, I'd never looked back.
I just—I knew I had to find a new career.
I mean, it's an amazing story because you have this, of course, near-death experience with the heart attack and it completely changes your trajectory.
You wait—I mean, you're a painter, you need still hands, but you have a—you develop a tremor and you have to pivot.
But it's like it's so—I mean, it's one of those weird things.
It's like that happened and that as a result of that, you started this thing, right?
Like this—none of this would have happened without that horrible tragedy, but it's an amazing kind of turn of events.
I just—that's how my life has always been.
I've had a lot of faith in just follow the lead.
If something happens, you just keep going through it.
I love your website. It's really clear.
It pops. I like the logo, lily brush, the red.
It pops. How did you—how did you invent this thing?
So I had to go to rehab for my heart and I always wore this polar fleece jacket and this little dog, Lily, used to enjoy sitting on the couch with me.
She's an Australian shepherd.
She's a very fluffy dog.
And so I'd go to rehab with all the other 80-year-olds and I was only 48 when I happened.
So I'd go and I'd be covered in pet hair and it was embarrassing.
So I went to Petsmart and I looked to see if there was anything that would take care of the pet hair and all they had was a sticky roller and I hate single-use products.
But I wasn't allowed to lift it vacuum so I took this sticky roller home and I would carry it with me and roll my fleece and I just thought there's got to be a better way.
And then one day I was scrubbing around the fixtures in my kitchen and Lily happened to jump onto the couch in front of me and she had muddy paws.
So I went over with a toothbrush and I went to wipe the mud off of the couch and I noticed that her hair stuck to the bristles and I was like, oh, it was like, oh, so I ran upstairs.
I have two sons. I took both their toothbrushes, cut the heads off of them and I found this little palm sized block of wood in the garage and I super glued these three toothbrush heads onto mine as well.
And my kids came home and they found me cleaning the whole house with this little block of wood with toothbrush heads on it and I'm sure they thought I had a stroke.
So Elsie, a guy has a question.
I know this is in your head right now, Guy.
Did you keep that prototype?
Of course. That's a Smithsonian, you know, New ZMP.
It's going in your head.
That is so awesome. Yeah.
So, Elsie obviously is coming with a question of how can she scale this?
How can she get the word out?
How can she grow this thing?
She's been doing it since 2010.
Yeah. Gary, what's your take?
I've got a lot. I'm so inspired by this story, all of it.
So it's awareness and trial.
Now how do you do trial? Question.
Are you in like Petco or any of the, you know, Pet Mart or any of those retailers?
So we're in this. I'm very proud of this.
We're in a container store.
That was our first big company and it took me a long time to get there.
We kill it on Amazon even though after like the first year, Alibaba just started pumping out copies, but cheap copies of our products.
And the thing I hate about the products that these guys are making that are copying ours is that they only last for a week or two.
And I built our products to last for really the lifetime of your pet.
I mean, that's the competitive advantage.
Gary, it makes me think of an episode we did on TRX straps with Randy Hedricks several years ago because that happened right away.
All of a sudden all these copycats and they were poor quality, but he spent and still spends a lot of money suing them.
And I know you don't have those kinds of those resources in time and it's a pain, but I feel like a simple fix is to emphasize what you just said.
The original and best because I feel like that is the brand is your advantage here, right?
Right. It's a tough one, Guy, because when I first started talking to buyers, they used to kind of laugh at me because they're like, why would you make something that lasts for years and years?
We don't want that. We want the repurchase, but the fact that these things last so long has been kind of one of our problems.
I wonder whether they're, I think about partnerships, right?
And increasingly you're seeing collaborations with brands.
I'm certainly an apparel.
Adidas and Gucci or Liquid Death does, that's not apparel, but they're doing partnerships with different kinds of brands like grooming, men's grooming, for example.
I wonder if there's a way for you to partner with a product that is associated with cleaning cars or carpets, something like that where they get it with that product.
I think about that too, like a different vacuum, like a Bissell or something like that.
That's a great point, Guy.
Yeah, especially a product like Bissell or a brand like that that's probably a little easier to get to the right person there.
It's not at Adidas where there's a bazillion people pitching them.
I don't think a lot of people are pitching Bissell for collaborations, but it could be kind of cool.
Or like this to me seems like, you know how Slim Jim is at the checkout counter of every convenience store, right?
And that's basically how Slim Jim and now five hour energy is there too.
I see this as a product that's at the checkout of every car wash, right?
That would be ideal. And I do go to the car wash trade show.
And I did the first year I went, I thought it was, I'd made a terrible mistake because I had this little 10 foot booth and I'm in this hall with all these spinning brushes, bright lights.
And I sort of timidly went and started doing demos.
And the next thing I knew, my booth was three people deep just mobbed for three days.
So that's when Gary talks about going and giving away product at bike events.
You know, that resonates with me because I knew I'd hit something.
But we're still just a little tiny brand.
We're still, you know, they talk on Shark Tank, they talk about the cockroach that people can stomp on.
We're still that little guy.
And it makes me nervous.
It's 14 years in, you know, we're trying so hard and we're still that little guy.
Well, first off, don't give up.
Okay. Some effort. Because I think you've got, you have something here.
I wouldn't even, I'm embarrassed that I didn't know you're brand before this because we've had, I've got these sort of sayings about innovation and so on.
You've solved a problem, Cliff Bar, to me solved a problem with a better tasting energy bar.
And you know, you're in, it's inventive.
It's totally original.
I mean, how can you get more original than using toothbrushes to make your first product?
And it's transformative.
You know, you're, it's for people that have this issue, we, everybody has a dog and a cat pretty much has this issue.
And we all want to solve it, but we just are lazy and we just, you know, and it's hard and you try to vacuum, vacuum doesn't work and the rolly thing doesn't work.
So there's that. I feel like it's a matter of time in some ways.
This is the kind of product that if you could get it into the hands of a couple of the celebrities who just have, you know, who post with their pet all the time.
Like I think, I don't know if Chrissy Teigen has pets, but I just think of something like that, you know, like Chrissy Teigen who's like associated with like cooking in a beautiful house and like, you just imagine her like, oh my God, this like, you know, here I am brushing this off with this thing.
I think to get to some of those really high end ones, you've got to incentivize them.
You know, you've got to say something like, look, we're trying to scale this and, you know, we'd love to partner with you in some way.
I don't know what that would look like, but to me, it's just a matter of like getting it into, getting it to a place where somebody like that who's a real like lifestyle influencer gets people excited about it.
Because as Gary said, it's a great product, it's just a matter of getting it, getting it in front of the right eyeballs.
Question, how many people are with you in your company?
There are four of us. Four people's pretty lean.
It's tough. Yeah. So I love guys idea of the retail thing, like at the counter.
I mean, we've all bought stuff that when we're in a store like, ah, never.
I mean, what's that? Oh, okay, I'll buy that.
And you may have to bring on a sales person that you've never thought of needing before that can go to the car washes and the wall greens and the, you know, and the Fridays, whatever.
Yeah. You know, we bootstrapped it.
So it's been slow growth.
Yeah. But we've got money in the bank.
That's awesome. So I just, I just have to figure out who to hire.
I'm really into giving people a shot, you know, show me what you got and do your best.
And let's see. So I get, you know, marketing people from University of Denver.
And it was cool, you know, two, three years watching someone develop.
But I think it's time that we go and we find someone who really knows what the heck they're doing.
And, and we do, we do have the money to do that.
I just, honestly, I've, I've done this whole thing.
I've flown by the seat of my pants this whole time.
That's super impressive.
And, you know, for the, for the record, I think if you can do it self-funded, then you control your destiny.
Yeah. Kit and I never took a dime from anybody over our 30 years of running Clif Bar.
We never brought on an equity partner.
Yeah. I'm, Elsie, we're gonna, we're gonna be following you and Lily Brush and, and good luck.
Thank you for calling in.
I think you've got something there.
And I think in about a six months time from now, if we check in on you again, you will have hired somebody to take the load off and hopefully to start to really do some of that business expansion that you're not able to do because of the other stuff you have to focus on.
I hope so. And Guy and Gary, thank you so much.
I just, you guys are my heroes.
This has been really, so cool.
Well, you're so welcome and thank you and you know, it's, we're just starting to roll.
So just keep this momentum going with other people and keep this conversation going with other people that can support what we've talked about and take you, help you take it up a notch or two or more.
Thank you. Thank you, Elsie and we'll be in touch.
Thanks Elsie. All right.
Great job. Thanks. So I'm ordering one tonight.
You're gonna be saddled with all these products after today, Gary.
Like I'm solving all kinds of problems today.
I'm getting the sunglasses, goggles.
What's up with all these packages coming to our house?
We're getting ski goggles and I got a brush and now I've got all this like these crafts below.
What's going on? Well, you know, I have, like all of our friends have animals.
I'm probably gonna order a dozen of these and then pass them around and then tell them to, see that's the other way to do it.
This is a word of mouth product.
It's a word of mouth product.
A total word of mouth product.
And you could have a brush in every vehicle you've got.
Every, you know, room you've got, they're just sitting there because then you don't have to go, where's that brush?
It's, they're everywhere.
Okay. All right. Gary, thank you so much for coming back on the show.
It's awesome to have you.
I'm honored. Thank you so much.
Guys, if you have not heard his story, go back, way back in our podcast queue, back to like 2016, early 2017, look for Gary Erickson Cliffbar.
It's an amazing story. And I still reference it all the time when I talk to people and give them advice.
So check it out. Thank you everybody for listening to the show this week.
If you are working on a business and you would like to be on this show, please send us a one minute message that tells us about your business and the issues or questions or problems that you would like help with.
And please make sure to tell us how to reach you.
You can send us that voice memo at hibt.id.wondry.com or you can call us 1-800-433-1298 and leave a message there.
And we'll put all of this in the podcast description on your smartphone.
Thanks again. We will see you back here next time.
This episode was produced by Sam Paulson with music composed by Remtine Erebleuie.
It was edited by John Isabella and our audio engineer was James Willits.
Our production staff also includes Alex Chung, Carla Estevez, Casey Herman, Chris Messini, Elaine Coates, JC Howard, Kerry Thompson, Malia Agadelo, Neva Grant, and Catherine Seifer.
I'm Guy Reyes and you've been listening to the advice line here on How I Built This Lab.
If you like How I Built This, you can listen early and ad free right now by joining Wondery Plus in the Wondery app or on Apple podcasts.
Prime members can listen ad free on Amazon Music.
Before you go, tell us about yourself by filling out a short survey at Wondery.com and the link below.
Thanks for watching.
