# How We Make $200M/Year Selling A Wallet | CEO of Ridge Wallet **Creator:** My First Million **Platform:** youtube **Duration:** 1h 3m **Source:** https://www.youtube.com/watch?v=UQ5KfImd2yA ## Summary The podcast features a conversation with Shawn, the co-founder of Ridge Wallet, who shares insights on his journey from running an ad agency to building a successful e-commerce brand. He discusses the importance of understanding market trends, the significance of product quality, and the challenges of navigating the e-commerce landscape. Shawn emphasizes the need for adaptability and the value of community in business. - Ridge Wallet has grown from $5 million to over $200 million in annual revenue since its inception. - Shawn transitioned from an ad agency to e-commerce, focusing on the potential of the Ridge Wallet as a scalable product. - He highlights the importance of understanding Total Addressable Market (TAM) and warns against investing in low-potential products. - The podcast discusses the significance of customer loyalty and the challenges of acquiring customers profitably. - Shawn believes in the importance of product quality and customer respect, citing successful brands like Hexclad and Woobles. - He shares insights on emerging trends, such as no-screen time products and the potential for better-for-you candy. - The conversation touches on the evolving landscape of e-commerce, emphasizing the shift towards service-oriented brands. - Shawn's podcast, "Operators," focuses on niche e-commerce discussions and has garnered significant sponsorship revenue. ## Section Insights ### [[0:00]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=0s) Introduction and Expectations **Question:** What are the expectations for this episode? **Answer:** The host expresses excitement about having a guest who sells a popular wallet and is known for their strong opinions on e-commerce. - The guest's success with the wallet is surprising and intriguing. - The host appreciates guests who are candid and opinionated. - There is a playful dynamic between the host and the guest, setting a light-hearted tone for the discussion. ### [[12:45]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=765s) Understanding Market Potential **Question:** What insights can be drawn about the wallet market's potential? **Answer:** Despite initial skepticism about market saturation, the guest reveals that the total addressable market (TAM) for wallets is substantial, with luxury brands dominating sales. - The wallet market has a $10 billion TAM, primarily driven by luxury brands. - Many men's wallets are given as gifts, indicating a lack of consumer loyalty. - The guest believes their brand can capture a significant share of this market. ### [[25:31]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1531s) Risk-Taking and Market Awareness **Question:** What are common pitfalls in e-commerce? **Answer:** The guest emphasizes the importance of understanding market size and warns against pursuing low-potential opportunities. - Operators should be aware of the market size and potential before investing time and resources. - Focusing on niche products with limited demand can lead to wasted efforts. - It's crucial to align business efforts with market realities to achieve success. ### [[38:17]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2297s) Successful E-commerce Examples **Question:** What can be learned from successful e-commerce brands? **Answer:** The guest highlights a successful husband-and-wife team in the crochet kit business, illustrating the power of community and niche markets. - Starting with services can be a good entry point into e-commerce. - Identifying and capitalizing on emerging trends is key to success. - Community engagement can drive brand loyalty and sales. ### [[51:03]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3063s) Valuation and Future Growth **Question:** What is the current valuation of the Ridge wallet brand? **Answer:** The guest estimates the brand's market clearing price at around $300 million, with expectations of significant revenue growth in the coming years. - The current market conditions are challenging for brand valuations. - The guest anticipates substantial revenue growth driven by product expansion. - Strategic partnerships with major retailers are part of the brand's future plans. ## Transcript [[0:00]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=0s) I'm glad you guys invited me here because you're slumming it down with like the e-com millionaires again. This is like a make-a-wish type of episode for us. You know. There's really two things that I need to talk to you about. There's two reasons you're here. Number one, I cannot believe that you sell hundreds of millions of dollars of this stupid little wallet. This is unbelievable to me. It's been blowing my mind ever since I found that out and now you're here finally to give us some answers. And two, I think you're very opinionated when it comes to e-com. You don't hold back. You don't pull punches. And so we like that. We like spicy guests and I think you're you're going to be able to have both of those things for us. [[0:45]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=45s) I think you should you should smack Sean right now for calling it stupid little wallet. Did you get that? Yeah. Stupid little wallet. I'm just trying to get him fired up. I told you he gets fired he gets fiery he gets feisty. So I wanted to you know stir the pot a little bit. You you better play nice I'll dock your your e-commerce brand. Oh yeah. He knows he's got he's got some He knows too much. [[1:02]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=62s) He's got some compromat on me. Dude, I've been a I've been a Ridge wallet owner since 2016 or 17. You know Ridge sponsored the Hustle. Well dude, thank you for the support and you guys were super early for newsletter sponsorships. Like we probably run like a pretty big sponsorship like ecosystem now. We sponsor like a ton of newsletters like you know, YouTubers obviously. You guys were like one of the first people selling that ad space. So Yeah, and you know what I learned about your guys' industry? Well, just any marketer who's savvy is people like you and Sean, you guys know how to find early interesting stuff and you take all of the risks and you and you just you understand the arbitrage like the underpriced opportunity. And so we had a lot of smart people who would buy these ads with us and I'm like I can't believe they're doing this. This is so unproven. And then I realized that that's like the theme of a smart marketer which is throw dollars at a variety of things and then exhaust it once everyone else comes and finds it. [[1:59]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=119s) Yeah, it's ad arbitrage, right? Like everything's attention. So if I'm giving Facebook at this point $15 per thousand views and if I can get a better price off of newsletters or influencer or YouTube like it's all just an attention economy. And it's so funny to watch the like pendulum swing back. Linear TV like the TV your parents probably watch is so cheap to run ads on because nobody's buying it. So like, you know, I'll probably spend CPM of linear TV? [[2:28]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=148s) A dollar. Like Oh, wow. It's like cuz there's all these channels, right? There's been like, you know, thousands of channels that have come out that like have 800 people who watch them. So like you just buy like big blocks of random ad space that are just very male male targeted. and like yeah, literally like a dollar for each a thousand people. Do you know what our best performing ad channel is our marketing channel for my brand? [[2:51]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=171s) Postcards. But you would not believe it. Postcards. It's not super scalable like you can't just like spend to infinity on it. But you know, you put a dollar in you'll get eight or nine dollars out of revenue. It's amazing. That's great. You use PostPilot? PostPilot, yeah. Yeah. So okay, so Sean we should start at the start. So what's cool about y'all story is you sell a a simple product. It wasn't like some some Mark Zuckerberg, you know, innovation or anything like that. And you've scaled it up you built it brick by brick, but you said you started in the service in like a sort of sort of a sweaty services business. You didn't start the company and you didn't start off in the product game. So can we just do your story for a little bit and then I want to brainstorm other D2C ideas with you afterwards, but first let's do let's do your story. Sure. [[3:37]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=217s) yeah, you got that right. the show is My First Million. So I made my first million dollars off of an ad agency. So you know, Facebook ads came out in 2012. That was like when it was probably like an open beta anybody could join. And I learned how to do Facebook ads. I worked at an agency with my CMO Connor. And the agency sucked. Like, you know, it was 200 200 people working there probably with 500 clients. [[4:01]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=241s) You were an employee? Yeah, yeah. I was just an employee. And then I was like, "Oh, I should do this. I could do a better job of this." The ad agency I worked at the average client was around for four months. So imagine that sales cycle. Like it takes 60 days to onboard them. They're they get 30 days worth of work and they're like, "This sucks." And then 30 days to offboard. The average client was four months, right? And I'm like, "Imagine if I just did this, but I kept them for a year." I'm like, "I'll make so much money, right?" So I started an ad agency. I have 10 clients. So you're saying this like it's simple. So you you're working at a ad agency. How old are you roughly at this time? I was 22. [[4:41]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=281s) You're 22 years old. You're not like a marketing expert yet, right? You're like, you know, you're learning on the job I would assume. Yeah, yeah. But like it was it's kind of like TikTok Shops is today. Like nobody's an expert, right? Like it's it's a brand new thing that came out. Like I was we're probably two and a half years in the Facebook ads. People still thought Instagram followers were the most important metric and they're like wanting to run campaigns to get followers, right? So And was your agency super bullish on Facebook as a channel or it was kind of like this new thing that, you know, you got really interested cuz it was new, but was the whole agency like, "Hey, this is going to be a really big deal?" Yeah, it was like a cookie-cutter D2C agency like in the heyday. This is probably like 2015, right? So Facebook was Facebook and email was the services we were providing. Like there was no other services. Maybe there was one guy doing Google ads, right? But it was really all in on Facebook as like this brand new channel. And if I could go back in time, I would have been even deeper into Facebook. Like the biggest challenge with Ridge then we're we're skipping a couple years in the future, but like we tried to diversify too fast. [[5:49]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=349s) Like I was doing newsletter sponsorships and like they worked. I should have put all of my dollars into Facebook back then up until like 2020. I would have just been better off putting as much money into that as possible, but And Ridge was one of your clients. Were they an early client? Yeah, so I had 10 clients so I'm at an agency. It sucks. I think I can do a better job. Me and my CMO Connor we end up starting an agency together. We take 10 clients with us. [[6:17]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=377s) Eight of them you have never heard of, okay? Like they've just you know, gone extinct. one of them was Ridge and then one of them was actually Mud Water which has actually gone on to crush it. Like we did their Google ads at some point like in 2016 or whatever. But yeah, so we end up taking Ridge over. Father son best friend they start this business. They get to like five million dollars a year in sales. And they are you know, like the dad was a special ed teacher like, you know, Daniel was going to go to go be an accountant and this thing just kind of caught fire. And he really didn't want to be an accountant. [[6:51]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=411s) So like their expectations for the brand when they got to five million dollars a year they're like, "This is the best thing that's ever happened, right?" And me and Connor being hella young and I'm like, "I think we can get to 15 million dollars a year. I think we can get this thing to 30 million dollars a year." I remember I telling Connor I'm like, "I think we can do a hundred million dollars a year selling this wallet." And he looks me down the face and he's like, "There is no way in hell we're going to do that, right?" This was like 2017. But they didn't really want to run it all that much anymore, right? Like they didn't want to manage people. So I'm like, "Cool. We'll do everything else." So my agency kind of just gets built around running Ridge Wallet. [[7:25]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=445s) We do their customer service. We do their product importation. We do all of their marketing. We do their web dev. and then I'm charging them like 200,000 dollars a month. Like all of the money is coming from Ridge Wallet. They end up being like 60% of all agency billables for my for my tiny agency. And at a certain point they're like, "Hey, we should just merge, right?" so me and Connor take an equity stake. Everyone in my agency just goes in-house to Ridge. [[7:51]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=471s) I end up selling off the agency to one of the people who was running it. And that was probably 2018 and since then Ridge has gone from, you know, 30 million dollars a year to over 200. That's amazing. Look, if you're planning your marketing for the next year, I've got you covered. HubSpot just dropped their state of marketing report. Every year the team surveys and interviews over 1,200 marketers from around the world. They compile everyone's insight and turn it into one big report. You can directly steal the strategy from big companies like A16Z, Asana and apply them to your own business. So if you want it, check it out in the link below in the description. Now back to the show. [[8:34]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=514s) What I what I love about that story is that it sounds like when you were running the agency like almost like nobody would in a business school would recommend, "Hey, you're running this marketing agency and then for one client you're going to start doing customer service, you know, logistics support, all all these other things." It sounds like wrong to do that. It's like, "Wow, one customer is going to make up 60% of your billables." From a business school perspective that would be like a bad move, but Dharmesh said something once on the podcast he goes, "With my first business he goes I I got I got mixed up later." [[9:05]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=545s) He goes, "Just cuz I was ignorant doesn't mean I was wrong." Meaning I didn't know the right way to do it, but my instincts actually were leading me in the right direction. It just wasn't you know, I didn't have like some sophisticated game plan and maybe it wasn't typical, but it was my instincts were correct. And it sounds like your instincts were correct that you should just keep leaning into the Ridge thing even though it was like maybe not what a normal agent normal marketing agency ever would have done. [[9:28]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=568s) Well, most clients suck. Like if you guys have ever done client work, like most clients fight with you. They don't pay you. Like they're always trying to fire you, right? And Ridge as a business was ran by really cool guys who didn't want to take any like reins away from us. They were very happy with the five million dollar a year business and they're like, "We could always go back to shipping the orders ourselves, right?" Like I mean the guys are like, you know, Buddhist like raised raised Buddhist their whole lives. I think that's part of it, but they were very much like, "Hey, this is a good thing. These guys are growing this business. Let's give them more responsibility." And you know, you can't really exit agency businesses for all that much, right? One reason why we went all in on Ridge and did the merger is like an agency's probably worth maybe one X client contracts. And like maybe at the peak it was two X client contracts, right? So like if your clients you know, if you have a guaranteed million dollars in revenue, you might be able to sell it for a million or two. Where Ridge at the time were like $10 billion year business right here. We're going to grow this thing to the moon. [[10:31]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=631s) so it just made sense to put all our chips in that basket. What was the metric that you saw that gave you the aha moment where you were like, "All right, they're doing 5 million now, but this could be 30. This could be 100." Was there one or two metrics? Or was it just a guess? What what was that research process like? It just it just seemed like they could always put another dollar into Facebook and it could work, right? Like the limiting factor wasn't like marketing or awareness. It was like the operations of the business, right? We end up like we had a year where we didn't have any wallets cuz we couldn't keep them in stock. So like we went from 15 million to 18 million one year. And that was just because we couldn't make enough of the product. And I'm like you know, so often demand is the thing that stops these brands. Like you can only get to so big of a TAM. And that wasn't the case here. you know, we we did like a wearable and it was so hard to get people to buy the wearable. Like the CAC on Facebook was $400 back then, okay? It was like so hard to get people to buy these wearables. Where the wallet it was like a $6 CAC. Like we could just put up a new ad and they were just static images and they were just selling. So that was the metric, man. That's like an interesting process because a lot of people, myself included, will say, "Focus, focus, focus. Get it right. Make it great. It's going to take a decade plus." But your story is more so like, "I tried this. I tried this. I tried this. None of it worked. This thing was clearly the winner. I should go all in on this." Is that what your recommendation is? Well, my recommendation as a person trying to make it is you should make the best decision at the time. So whatever the facts are, when the facts change, make a different decision, right? strong beliefs held helpfully. So like I'm like I'm at an agency. I could have just like did that grind and be like I'm going to be a VP at this agency when I'm 26. I'll make like 200 grand a year. But I was like, "No, these people suck. I think the best decision for me is to just do what they're doing better, right?" And then from the agency to Ridge I'm like running an agency business. I'm like running an agency sucks. The Ridge thing seems to be going better. So I should just do that instead. I should find a way to to to incrunch myself inside of this business. [[12:34]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=754s) And then at Ridge it was just like I mean for so long we did not launch any other products. For eight years it was just selling more of the wallet because that's what was working. As soon as it started to get a little hard, then we pivoted everything else. Which is funny because I would have thought early on I would have the paralysis of analysis. I would have been like "Well, there's not that many wallet like you like if you told me $200 million a year in revenue, I would say, 'Well, you've you've sold every man in America a wallet. Like there are no more wallet buyers.'" [[13:01]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=781s) You know what I mean? That's like one of my uneducated self-limiting belief a little bit would have been on that. If you said 200 million a year, I'm been like, "Well, there are no wall there are no more no more people who need a wallet." It dude, it's a weirdly big TAM. Like the reason why like we in you know, in retrospect I can tell you all the reasons why Ridge wallet worked. It's a $10 billion year TAM, okay? And like most of that is luxury brands. LVMH sells like $4 billion a year in men's wallets. Like Kering, they own Gucci, they sell a ton of men's wallets. [[13:31]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=811s) But then Tapestry, which owns Coach, Coach does a billion dollar year in men's sales. So that's men's accessories. No men are buying those products. They're all gifts that are given to them. And nobody's ever excited about getting those products. So the reason why I like I I'm very public that I think Ridge can get to a billion dollars in revenue is because Tapestry has a men's business doing a billion dollars a year in revenue with nobody loyal or passionate about that. So I'm just going to make whatever they make in all of our cool colors and our cool materials. And you know, I think it's been so sexy to be talking about tech and AI these past 10 years, right? Or you know, tech for 10 years, AI for 10 months. [[14:11]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=851s) But I was at like the All-In Summit and I'm looking at those guys and like the products they're talking about exist inside of their phones, right? Like they exist inside of some server somewhere. But they're all wearing cool suits and watches and leather belts. And I'm like, "Okay, I'll just sell them all that right? Like I'm just going to sell like all the like the most practical thing ever." Because also smart people don't enter the space, right? The reason why Ridge wallet was able to be so successful is because we're the only people running Facebook ads for wallets. Like then there's been a bunch of other like people who've started up and like and have tried. They've all ended up going out of business because it's really difficult to get right, right? Like there is no repeat business. You can't like believe that the LTV will come save you later. It's very much like can you tactically acquire customers profitably every single day? Hey hey brown Sean, white Sean's got that immigrant energy that I love. [[15:05]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=905s) He's got You know what I mean? Like He's got the what what do you call it? The Korean restaurant owner I call the a Korean Korean convenience store owner energy. You know, it's just like there's not like two two much think overthinking it. It was like, "Well, you guys are all wearing this. I'll just sell that." Right. Yeah. And I think you'll keep wearing this. So you you know, Munger has these great quotes where he's like his his main thing is like instead of trying to be brilliant, just avoid stupidity. Or he'll be like, "You know, the best thing in the world is stupid competition and we just have not much and stupid competition." It sounds like that's part of what in retrospect made Ridge work. [[15:41]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=941s) Was you you were like, "Hey look, we took the simple idea and there's not a lot of other really smart you know, D2C marketers that were doing this. And so we were able to to make hay." Yeah, totally, man. I mean and to this day the best D2C marketers are working on stuff like, you know, AG1, right? Like they're selling supplements. And it's because it's a better business. Like undoubtedly, if there's an LTV tied to your business, like it's going to be better. It's going to be more valuable. [[16:09]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=969s) It's going to trade at a higher multiple. But the other thing is like the best marketers have have more or less left the industry, right? Like in 2021 running an e-com brand was incredibly cool. It has gotten less cool every single year. So there's less people doing it. There's less voices. There's less people talking about it. And it's cuz it's hard. Like I I'm unjokingly call it like the the blue collar work. It's like you know, everyone wants to be shipping cool AI products or everybody wants to be shipping you know, something that isn't physical boxes to people's doors of products you actually have to like make. Everyone wants to build, you know, the services of whatever. So anyway, yeah, over the past four years it's gotten really uncool to do what I do. Do do do you guys on 200 million in revenue are you able to make good cash flow and profit? Or you know, I know so many friends who have these companies and their numbers are huge, but they cash is always an issue. Are you able to manage this well and or at that scale do you still struggle? I think the reason why you guys asked me to be here is to talk about the fact that you can in fact make a profit running e-commerce brands. So Ridge has never raised any money. [[17:19]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1039s) We have no debt. So every dollar in this business, every dollar in my balance sheet is profit that has been reinvested. I've been able to make millions of dollars a year for the past couple of years running this business. So yeah, it can definitely be done, man. Like I I I bought a house in LA directly because of selling wallets on the internet. Give us a sense of the timeline. So you said kind of like I don't know, it was 2016-ish, right? When you when you guys merged or you took over the brand. But can you just give us kind of like a year one five five million when you when you started working with them, then it went to 10, then it went to 22, then it you know, give us a timeline. [[17:54]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1074s) Yeah. And I'm horrible at timelines. So I'll I'll I'll give it my best. It's basically been It's like a 50% CAGR since I started working with the business. So I think they did a Kickstarter in 2013. The first year they do like a million in revenue. In 2015 they probably did two or three. When I meet them 2016 they do like 5 million bucks. So I think it went from five to 10 to 15 to 18. [[18:20]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1100s) And that's like the hardest year of the business. When it went from 15 to 18. That was like we had no inventory with this massive tax bill. That sucked. That was probably 2018 or 19 when that happened. 2020 we do $50 million. So I might I mean that must have been 2018. It might it must have been 30. So 18 to 30 to 50. And then we then 50 this the COVID year. So it went from 50 to 100. And then it's been like Yeah. I mean last year was a I'll just say a multi-hundred million dollar year. [[18:52]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1132s) So So let me let me let me let me recap that for the listeners. So you started in 15. I didn't hear what you said, but in 2016 5 million. And then each year after that was 5 million, 10, 15, 18, 30, 50, 100 with last year being multi-hundred. That's incredible growth. Yeah. Yeah. Something like that. So it's been super fun, man. the you know, and Sam, you brought up have I sold every wallet in America? That was like one of your concerns, right? so like I said it's a massive TAM, right? And I always say like we're a great uncle gift. Like you guys are going to go to Christmas or you guys are going to go to a birthday or whatever and you have to buy some guy in your life a present and you don't know his size, right? The Ridge wallet's a perfect price point. You can get one on sale today for like 76 bucks. [[19:41]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1181s) And it is sizeless. And like every guy in your life you'll be like, "Hey look, it has your favorite sports team on it." Or it has carbon fiber or whatever else, right? So it's a perfect uncle gift. And most of our products are probably sold as gifts, right? Some woman in their life buying it for some guy in their life. And the wallets are about half of revenue right now. The other half of revenue is all the other stuff we've launched. So, the biggest unlock we've ever had was in 2022. We started selling men's wedding bands. And once again, this is a category where people thought it was so dumb to sell men's wedding bands. They're like, it is a commodity good. Like, who the hell is buying this? The first year we do eight figures. It is the highest margin, fastest growing part of my company is selling men's wedding bands on the internet. So, let's let's talk about this cuz we're in this group chat that you you have, which is like a bunch of bunch of D2C brands. I don't I don't know what the cutoff is. I think I'm like below whatever the cutoff was supposed to be, but you let me in, which was nice of you. You're in the like the charisma hire. [[20:41]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1241s) Yeah, exactly. I'm the personality hire. So, so I you you talked about like going into new categories. And like the wedding band was obviously a smash success. You've said the wearable thing maybe wasn't as big of a success. And you have this kind of interesting way of looking at it cuz I just thought Ridge wallets that kind of like the the sort of carbon fiber metal wallet company. And you were talking about like Mont Blanc. And you were talking about these other almost like luxury accessory brands. And that was the vision you had for the company. When did that vision kick in? So, like when did you reframe what the company is? Cuz I think entrepreneurs, we hear stories or somebody already has the vision and they already have the right frame and it sounds beautiful and big and and really appealing. [[21:22]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1282s) but at the beginning they don't always have that, you know? Mark Zuckerberg, there's a video of him on a couch somewhere and somebody's like, are you going to expand past colleges? He's like, no, that wouldn't be cool. And now he's like got satellites above India giving people internet so they can use Facebook. Like, you know, your vision expands as you grow. when did your the vision kind of change or when did you reframe it? And secondly, how do you think about going into new categories? [[21:44]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1304s) Yeah, well, I'm a very paranoid person. So, like in 2018, I'm like, this is going to end. We have to find some other to sell. So, we got into backpacks and phone cases, all this stuff pretty early in 2018. and we the first year we did like $4 million in backpack sales. Or maybe it was $3 million. It was like a big chunk of revenue. And we canceled that program cuz I was too stupid to know that was like actually a good amount of backpacks. I was like, I'm like, the wallet's doing $20 million. How come we can't do $20 million in backpacks? [[22:12]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1332s) In retrospect, we've since relaunched backpacks. So, I was just too stupid, right? So, we were always looking for new products to sell. Mostly because I was worried that I was going to sell every wallet to every man in America. But as you learn more about the industry, like the very common thing is very large hold cos holding lots of accessory brands. Like, LVMH is just an accessory brand. Like, everything inside their portfolio just sells accessories, mostly to women, but there are occasionally pop-ups of like very strong men's accessory brands. Mont Blanc is owned by Richemont. They own Cartier. Like, that is the strongest men's accessory brand. [[22:45]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1365s) And they do $500 million a year. You think it's going to be pens. Pens are like 18% of revenue. It's mostly just like small leather goods, right? And it's across the world people buy each other gifts, like wallets and backpacks and belts and everything else. So, it's there's a playbook here. It's like you have to find a group of customers who like you. You have to like continue to make products that they like and sell them into them. [[23:09]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1389s) And I am more ruthless with product expansion than I think a lot of brands are and I think more people should just try. They're really worried about hurting brand. And I'm like, your customers never think about you. Like, you're lucky if somebody is mad you launched something. Like, you know, I always go to like Bic is one of my favorite brands. Like, they make lighters and they make pens and they make razors, right? And we buy all of those products independently. And they're best in class at all didn't even think of the I didn't even think of those three. Yeah. [[23:39]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1419s) But you saying that, I'm like, oh, it's same. Yeah, yeah. And they're the best in class in all three of those. If you want a disposable razor or a cheap pen or a lighter, they that's the only one. They they own those markets. and it's just because the guy had a plastic factory. And he's like, he's it's it's a French company. And they they're actually they got into tattoo removal now, right? Like, they're making like they just bought a bunch of tattoo companies cuz they're like, yeah, whatever takes plastic, we're just going to do those things, right? And it doesn't violate anything in your brain cuz you just like that's just the way it's always been. So, I think it's more elastic than a like than a lot of people want to admit. And brands die of being too rigid by that. Like, Allbirds should have got into bedding and like all these other type of things, but they didn't. So, now they're just a dead shoe company, right? Like, you should just be so ruthless with that product expansion. You're a very charismatic guy. You you're you have a lot of interesting parts of your personality that I enjoy. What attributes would you say are most responsible for Ridge's success, you think? one, it's a very trust forward organization. It's a very transparent organization. When I say trust forward, six of us own it. [[24:46]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1486s) You know, three of them are father, son, best friend. Like, literally would die for each other. And then me and my CMO, Connor. I I lived with him for five years. Like, the guy we I was talking last night. There was a time when we were in the agency where we did not have a thousand dollars. Like, we would have to take he his dad gave him a car and it was like a 1997 Honda Civic that smelled and like paint was peeling, windows didn't work. We would take it to meetings. We would have to park it behind buildings so people didn't see us get out of this junky car. And you know, tying it to that, it's like not being not being scared to go back to zero, right? Like, I'm from like a very poor, bad area where kids died of fentanyl overdoses. [[25:26]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1526s) And like I lived in a flop house with like there was like 14 guys living in bunk beds when I moved to LA. And so, I'm like, dude, not scared to go back there. So, just more more willing to take risk. Things are never that bad. Also, being willing to eat I'm like, bro, if I have to be a waiter, we'll figure it out, right? Yeah. So, I yeah, that that fortitude. Like, not being like so ego tied to whatever the you're doing. If I if I have to pack boxes, I'm going to pack boxes, right? What are the ways people get e-com wrong? So, we've you talked about Allbirds, right? It was a a product that was hot and now the stock is, you know, dead. There's, you know, a bunch of other kind of famous examples of that. And then there's companies like yours, which is keep scaling profitably, you know, never took a dollar of debt, never took a dollar of investment, and made it work. what are the kind of give us like your your version of the do's and don'ts? And maybe just start with the don'ts, like the dumb that people do, the bad decisions that people make, or the the common traps you see people fall into. Cuz I'm sure, you you know, you're that's your network is e-com. So, you see the full spectrum. People who totally flop, people who grind away for years and get nothing out of it, and people who excel and succeed. Yeah, so you can't you can't out-muscle a TAM. [[26:43]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1603s) So, like, understand what you're selling and how big the market actually is. I see amazing operators waste time with horrible opportunities, right? Like, like the TAM is what the TAM is. And if you're like the number one garlic press seller, like that's kind of a meme in the community. Like, dude, I'm like in your executing ruthlessly to be the number one garlic garlic press seller, that is worse than being the 12th best creatine gummy, right? Because that market is exponentially growing. There's LTV tied to it. Like, so many people just waste energy and time on these horrible product categories. So, you can't you can't beat the TAM. [[27:21]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1641s) You're not better than the trend. So, bone broth. There was companies that exploded, got to $80 million in revenue. It was like, dude, we're this is the new way people are going to consume calories, bone broth. That is now at a 30-year low because that's not the cool thing anymore, right? People Same with keto stuff. Yeah, exactly. So, there's a guy from IQ Bar, his name's Will. He's incredibly smart. He talks about his trend surface area. So, it's like, look, people talk about their luck surface area. He's like, I make products to have as much trend surface areas possible. So, if keto's hot, I'll be keto. If gluten-free's hot, I'll be gluten-free. If it's sugar that's cool or non-sugar, like whatever. I'll I'll make those products to just hit whatever the trend is. And I'll just change my packaging so I'm always top of trend. [[28:05]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1685s) And you're not better than the trend, right? So, like that's the point I'm trying to make is you can ride it up, but it as soon as it crashes, you'll crash with it. And then my my third one, the most controversial one, is that LTV isn't real. Like, lifetime value only works if you're alive. So, most brands die waiting for LTV, right? And what you mean by that is you got to be profitable early on on that customer you acquired. If you acquire the customer for $200 and you only made, you know, $20 and you're saying, oh, the I the LTV, it'll all pay off. That's kind of what you're talking about, right? Versus the way you guys do it is you're trying to be profitable either first purchase or are you guys profitable first purchase or is it like, you know, a month or two later? Where where you guys at? Dude, I have to be profitable on the first purchase. You think people are coming back to buy a second wallet in a month? [[28:52]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1732s) It's like, I'm like, dude, the the LTV from wallet customers is like maybe in 90 days I get 10%. So, like it's very much I have to be I have to turn not not not a contribution margin per like actual true paying for all my fixed costs every time I sell a wallet to somebody. Can we play a game called change my opinion? And this is for both of you guys. I have a bone to pick with your industry. I I think Sean's heard me with this spiel before. [[29:22]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1762s) What what frustrates me sometimes, not exactly you guys, but I'm going to use you as an example, but people who they all they worry about is like the CAC and the LTV and the TAM of these industries or and they don't spend any time actually thinking, is this product awesome? Is this the best? You know, like is this truly solving a problem? And it bothers me sometimes that it's more of an arbitrage not exactly thinking about can I create a widget that makes a customer's life better and is of high quality. [[29:58]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1798s) I wish that more people in this industry sort of talked about that a bit more. Do you think that's a fair criticism or what where am I wrong on this? Dude, I mean I think it's a fair criticism. My industry has been washed out though. So like the people you're talking about have probably have all left. It's there's so few people left in e-com. Like like Shawn brought up like the group chat. Maybe two people respond every single day and one of them is Me Tab. Like it's it's like we're at we're at like a a multi a multi-year low of interest in the industry. So like yeah, all those people have left. The people who are still here in shipping. Dude, I bring up Hexclad. You guys want to talk about like amazing Yeah. Yeah, so like I'm very close to tweet about them all the time and like they inspired me cuz you said they like worked for 3 years finding the perfect pan. [[30:46]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1846s) Okay, so when I met Danny, it was 2020. They they didn't have a website. He says they did, but like you couldn't check out on the website, okay? They they were selling pans at trade shows and like county fairs cooking up eggs themselves, right? In Costco roadshow. So not even in Costco. They had to pay to show up at Costco and cook up these eggs and they from 2020 they'll do I mean it's documented at this point over a half a billion dollars a year. Like they they got to hundreds and hundreds of millions of dollars in annual turnover with a hundred million plus in profit. Danny will shoot me for saying all this stuff, but like I think it's all pretty pretty well public, you know. [[31:30]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1890s) Gordon Gordon joined the brand. They have Fox as an investor now. Pre all that, they were doing nine figures in EBITDA a year, okay? Didn't Gordon Ramsay like write a huge check? He didn't just like sort of join the brand. He like invested a a pretty sizeable amount or what was he part of the round or was it him personally investing in it? That's all public. There's like there's like a thing like he came in with Fox on some on some thing and like, you know, because Fox it's like a three-way deal. Fox wants to give him money to make shows and he wants to get more equity in Hexclad. So it's like a big three-way deal. [[32:00]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1920s) Got you. Got you. Dude, I have like 12 Hexclad pans in my Are they awesome, Shawn? They're great. You know, I don't know if they're the best pans cuz I haven't tried a hundred pans, but they're way better than the pans I had before and to the point where I bought a second set of them because I was like these are great. I I'm happy with these pans. Yeah, and they put years into their product development. Like they actually spit like they care about their customers. What it comes down to is respecting your customers. If you're just like that's why I don't like info products. Like if you don't respect your customers, if you're just like trying to arb them or like, you know, we have a customer name so our customer is Everyday Dad. We call him Ed. And I'm like almost every meeting I'm like, are we respecting Ed? [[32:39]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=1959s) Are we delivering value to Ed, right? Everyone has an Ed in their life. Think about like you guys' brothers or your dads. He's just like a guy who likes widgets and like he loves fishing and like he loves NFL. Like that's Ed. And I'm like, look Ed has Ed has paid for everything in my entire life. We need to take care of Ed. We want to make sure Ed gets like the best coolest possible that we give him great value and great deals. And that's what Hexclad did. And like when you talk about like I think this industry gets a bad rap because so many people have entered it and so few people have left with any amount of money or like if the people who did leave with money like it was like a greater fool theory. They were just tricking somebody to give them money and then they bailed out. But then there's companies like Hexclad where they'll be a 50-year brand. They'll be a generational brand and they're crushing it. So it's possible. They're buying Super Bowl ads. Like I mean this is you know, a they were bootstrapped up until like 2 years ago. Like a bootstrap brand getting that done. It's amazing. [[33:36]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2016s) Yeah, I I think Sam what you said is true that marketing skill is the core competency for most of the winners in this space. Most. There's a few there's a couple who just really nailed product or community, right? And then they just they they built slowly brick by brick over over the over a decade. But for the most part the people you'll hear about and the people you'll meet they're great because they are great at doing Facebook ads and Google ads or now Tik Tok content. And so that's true, but at the same time you're like, oh I hate that it's this CAC to LTV thing. Well, it's like guess what when you sit down with your team you're like, how do we raise LTV? [[34:11]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2051s) Right? Like there's some natural gravity like Shawn's saying like you buy a wallet every 7 years. You're not really going to change that. But like for my product you do buy it more way more often, you know, in the first 6 months we double our double the amount that they they paid us on the first order, right? So it's really it's a it's it's it's a movable number, right? We can actually affect that. And then you're like, all right, well, how do we increase LTV? It's like, yeah, you could spam them with emails. You could spam them with text messages, but guess what the better way to do it is to make an amazing product that they're going to want to buy again and like lower the return rate. How do you lower the return rate to get more profit, right? So like make a better quality product. And so I think that when you for anybody who's actually going to try to win, you will have to make an amazing product. [[34:53]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2093s) Otherwise you won't be able to do the the ad arbitrage you're trying to do because how else could you increase the LTV if everyone hates your product or it's not doing anything for them? And so you know, I think the the people who stick around and actually win in the long run are the ones who who do what you Yeah, I think those are good answers to the to the question. I think that like, you know, when I see someone making like a boost your testosterone like thing or I'm like dude, I don't know if any of this works or if they're just really good at making a label that's appealing. [[35:26]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2126s) And so I like start to lose confidence in the industry as a whole. Yeah, totally. What actually and that's actually I'm actually curious if you guys have any of these like D2C brands where you're like, this product is amazing. And so it's actually really good to hear that Hexclad is one of them. Do you guys have any other favorites? Well, going back to the supplement side, a lot of it is like I mean a lot of this work is being done by like the the co-manufacturers, right? Like there's co-packers that actually do all the formulation. So a lot of times people are just showing up and buy stuff off the shelf. [[35:57]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2157s) So if you're getting any sort of supplement like it's probably the same supplement white labeled a hundred times and that's just like the way the industry works. So, you know, I would put Hard Goods in a special category and like we talk about D2C brands. I mean all of my favorite fashion brands are small and independently owned, right? Like does that count? Like I'm this is Buck Mason. These pants are James Perse, right? Like I just got a suit from Billy Reid. Like these are all small independently owned companies, right? [[36:25]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2185s) That are that are running. They have Shopify websites. Does that count as D2C, right? It's it's very much like there's there's a a black box of bad rap products and I think a lot of it is supplements that come from co-mans, right? Or anything to do in the health and wellness space. Like that is like typically where there's a bunch of But if you buy a Ridge wallet, you're you're going to get what is on the package. [[36:47]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2207s) Right. Or one of our phone cases or whatever. It's like a phone case, man. Like it's pretty good. What who who else is crushing it? So what are some D2C brands that we wouldn't know or we wouldn't really realize how how well they're doing just because we're not in the space. We're not paying attention. Yeah, the other reason you guys called me here to talk about the Woobles, okay? The Woobles is crushing it. The Woobles. Okay, so what are what are the Woobles? So yeah, we are we are three young adult men. We're not the core customer, right? It is a crocheting product. So it is like you make little characters and they have licensing and like there's little education it's like basically like either it's, you know, young people doing it to have less screen time or it's you're doing with your kids so they have less screen time. And that product Yeah. [[37:36]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2256s) Dude, when I met them they might be they might have been doing 10 million dollars a year. Like they in 2 years they've gone from 10 to probably 150 million dollars in revenue. Like no no capital raised. They are still and I really I like them and I respect them. They will not launch subscription boxes. They're like, yeah, we don't we don't think it's that important. I'm like, Jesus Christ. Like if I could shoot these people I would because they won't do subscription. It's like the perfect product. Like it is this educational, it's fun, it's connecting with your family. Like it's this movement against screen time, which is like a big trend that they can take advantage of. There's every month they could have new characters. They could just show up in your door. You do them. There's a little community aspect. It's the single best brand and execution that I've ever seen. [[38:26]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2306s) Like this will be a billion dollar exit because they're so good at it. They've never raised any goddamn money. Just like it's two people just putting it together in North Carolina. How did they even think of this? Like how did this get on the road? Were they were they big crocheters? What what what is the origin story of this? Yeah, so I think it's it's a husband and wife team. I think she was just crocheting. And she's like, yeah, I would love to have little guides. And there was like an Etsy community of people like selling crochet guides. And she's like she would buy them and then she'd be like, okay, I'm going to make my own. And then she would, you know, release them and then it's like, oh maybe I should just sell the my my little crochet kits. And bam, explodes, dude. So like if you're listening to this and you're thinking like, okay, I want I'm I'm not washed out. I want to try e-commerce. I highly recommend getting into services first, okay? Like you should learn how to make money on the internet via services. And if the show's called My First Million, you you'll make your first million dollars delivering good value to people like me or like Woobles or whoever else. Then find a trend that's very fast emerging, right? Like I think no screen time. I think creatine. [[39:30]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2370s) Those are the two biggest ones in the next two or three years. Like if you could do a no screen time creatine crochet kit something you'll figure it out, right? Dude, I've spent so much money on Legos lately for that no screen time trend. What are other no screen time products? I feel like I feel like the microplastics is another another trend, right? Like And air quality. Yeah. Dude, yeah. So, like just glass everything. Glass bottles, glass containers. [[39:58]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2398s) What just like Imagine if you could just buy a backpack and they're like, "We guarantee there's no plastic in it." awesome. You wrap it in paper, ship to people. Then that's another trend I think is going to be fast emerging. Yeah, no screen time. Just more physical tactical toys, right? Like bringing back the fidget spinner, but as like a focus tool, right? Like I think there's a bunch of you could do in there. But anyway, those are fast emerging trends right now. Protein was a trend that's basically probably dead, right? [[40:25]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2425s) Pre-protein was collagen. There's always these just like pockets of success you'll find. And that's the beauty of the space. It's like what it is right now in that space? what's the what's the early boob milk called? What's it called? Colostrum. Yeah. Oh my god, I'm getting so many ads for colostrum. Yeah. You know, the other one will be like I think raw honey. I It had like a small moment. I'm sure it's going to come back, right? There's like a bunch of New Zealand honey companies. So, yeah, there There's all of these like And if you if you were a founder, where would you kind of look for these? Do you Are you Are you a proponent of look in your own life? What are you doing or what is your life doing that seems unusual, but actually there's a passionate community? Or you like, "I scour Etsy and Reddit." Is that where you would look? How would you do this if you didn't know which trend to start with? Right. So, you should look in your own life because you probably don't have the skills to actually go out there and like like you know, or in the I'm assuming you have no resources to actually pick a trend and double down and actually deliver on those promises, right? So, you should find something in your own life that you actually know and are passionate about. [[41:32]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2492s) If you're a more of seasoned professional, I think you can find those things, right? And really what it would be is I think Reddit's dead. I think Etsy's dead. Like that's AI slop basically at this point. The insidification of the internet has happened to those two websites. I would look at literally what's happening inside of Erewhon. Like I would just move to LA and go to Erewhon every single day because they was those are the best people at catching trends. Like they were anti-vax in 1997, right? Like that is what I Like they are very very early on those things. [[42:07]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2527s) And if you're if you're not going to do that, then it's like you just you have to follow the on Tik Tok, right? Like The The other one I bring up is Pilates. Like Pilates was a thing in 2000. It's having a massive resurgence right now. And like once again, we're three young men. How are we going to make a Pilates brand? But Pilates for guys probably could be another trend. Just needs a new name. Yeah, totally. Well, the pause I think is what the actual name is. Oh, no. Degree. Something like that. My my my wife knows. [[42:36]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2556s) but yoga is a very much a downward trend, right? And like yoga was just a syno- like a synonym for health and wellness. And like, you know, non just jacked dudes weightlifting. I think that's actually changing and it'll be something else like Pilates or or something else. What are some other going up and going down? Give me like a a topic or a trend and tell me is this a buy or sell moment? Well, look, this is not a hot take. This is not Scott Galloway but all all big box department stores. [[43:11]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2591s) Like it's very very much like we just saw Joann Fabrics go down. We just saw Container Store go down. We just saw Party City. Like that's going to accelerate. Like there's we are over commercial real estate. There's too many big box stores. Like even Target is having a really hard time. And my biggest wholesaler is Best Buy. I crushed it in Best Buy. but all of that is probably the the FUD isn't real enough. It should be even more real. Like Nordstrom's, Macy's. Like I think small independent brick and mortar shops really do work. Like if you're in LA, you go to Century City. Like but the I was walking around Bloomingdale's and you know, like 10 years ago it was or even 20 years ago probably. It was like the like the the number one place to buy women's fashion. Like women contemporary fashion. It was the coolest thing ever. [[44:05]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2645s) I'm walking around they got blouses that are $800 and it's dead on a Saturday. Like nobody's shopping there at the at the best mall in LA. So, I I think the FUD isn't even you should we should we should be even more scared that there's going to be more collapses and any any sort of commercial real estate that's like 10,000 square feet plus that is like selling physical goods. The other one is probably better for you, candy. Like there's like VCs have really backed this like better for you artificial sugar. [[44:34]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2674s) Like you go to a Target like there's all of these like weird artificial sugar brands. I think it it's got to come out to that college is cancer or RFK is going to be pretty against it. So, anyway, I'm probably not launching anything in there. Probably probably launching a real sugar. And that's a very hot take that could age really bad that like real sugar is going to make a massive resurgence. what do you think about like you know, these like other people who do the same model you did, services to products. So, for example, I think the guys behind Brez, which is that I think it's a I don't know what it is. [[45:08]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2708s) Like a mushroom drink or it's like an adaptogenic drink. It's basically it's like gives you a high, but it's not alcohol. It's like mushrooms or weed or something. Their website says Brez is microdosed cannabis and mushrooms in a can. Yeah, it's a weed drink. Okay, great. So, it's a weed drink. Those guys were agency people, right? I begged to be the first check in Brez. there's screenshots where they said they were working on it. I'm like, "Let me be the first check." Because Aaron is incredibly smart. he was the first person to figure out how to work with Meta to have controlled substances be advertised. So, like he That's like his specialty. Like if you had a cannabis company, you had to go through him and and his agency called We Are Lucid to actually do the cannabis advertising on Meta, right? He found a compliant way to do it. [[45:57]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2757s) So, he's incredibly smart. Nick's an amazing operator, ran a great agency. That's the best model. The other person is Zach from Homestead. He has a company called Hollow Socks. Like I don't know how much time we have, but to unpack the history of e-commerce. E-commerce 1.0, selling random on the internet, okay? Like whatever, pets.com. E-commerce 2.0 was marketplaces. It was eBay versus Amazon versus everything else. E-commerce 3.0 is what we consider DTC 1.0, which was like the first brands coming online, the Allbirds, whatever else. Then you get DTC 2.0, which was the COVID hotness, the peak. Every everything exploding, right? We are now in DTC 3.0, which is small service providers pivoting to brands with very lean teams and create gummies, Hollow Socks, Brez, the three best examples. Create gummies has a team of eight people. I think they'll do $40 million this year, right? Hollow Socks is a team of five people. They'll do $30 million this year selling socks. Most of it from Meta ads, right? And then Brez, they're public with their numbers. [[47:04]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2824s) Follow Aaron on LinkedIn and I think they did $5 million last month in revenue, okay? In beverage, in a controlled substance, that's insane. Like that company is worth $300 million today, right? And I think their team is incredibly small. Maybe maybe 20 people at this point. So, Yeah, that is that is the best bull case for e-commerce right now. Service operators who've seen like the rise and fall of all these different brands have learned from them, have spent their money to get good at ads, right? [[47:37]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2857s) Launching targeted hyper-specific brands. And the three I named are the best. Sean, you should go go to drinkbrez.com. Do you see their website? That's the prettiest website I've ever seen in my life. Yeah, that's usually not a good thing. The prettiest websites not usually the ones that that work the best, but I hear you and I'm on board with that. This is one of the exceptions. Look at this. But I you know, I think what what happens is you see the front The front of the house is not always where the traffic is going. So, you know, the front of the house is the It's kind of the hero. It's the brand. It's the aspirational. But you run your ads and maybe you're running straight to a PDP or to a Tik Tok shop or to different things like that. I think they're very heavy into Tik Tok, right? Like the Their model is the the Tik Tok blueprint, which we just did an episode with with Rob from Rob the Bank about like the the Tik Tok blueprint that a bunch of the brands are using right now. And I think Brez is doing that where it's organic It's it's kind of the Tik Tok affiliate {slash} organic model where you're getting really cheap CPMs because Tik Tok videos can just pop off and you know, you're you're putting out thousands of pieces of content a month. [[48:41]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2921s) But and it's driving sales on unlike the way you know, I've been doing it or you've been doing it, Sean, which is like a lot of you know, Facebook Google ads. You know, you put a dollar in, it's attributed exactly how much that that ad generated in revenue and you just sort of optimize from there. The Tik Tok game is a little bit different. It's a bit of a spray and pray game for the most part. Yeah, so I just sent you guys This is from Aaron from Brez. They did $4.6 million in revenue in month 21, January. This is their LinkedIn post. So, this is all public information that they share. [[49:15]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2955s) Tik Tok shop was 37 grand. Amazon revenue was 342. I'm not going to read this for the audience. Maybe I'll just show it, but Dude, they're killing it. Brez is awesome. Well, they post their P&L basically every month on It's not It's not an actual P&L, but like you know, sort of a marketing P&L on on Twitter and LinkedIn. It's great. So, said can read this. So, total net revenue 4.5 million. let's see. That's in You said month 21 now? Yeah, yeah. Dude, it's like And literally Then their ads, they spent a million dollars on Facebook, 400,000 on Google. [[49:50]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=2990s) On TikTok ads, they spent zero, but I know that they must be spending on on the affiliate part of TikTok because I If I'm on TikTok, I see Ridge stuff all the time, and it's always an affiliate link. you know, swipe up and you can sort of buy it from there. AppLovin 472,000. It really seems like the one of the keys to this business, like and this is not always the case, but it's picking the right idea. The right idea and the right angle it it seems like there's no other way to explain how something can get to $4 million in monthly revenue in 21 months. [[50:24]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3024s) Yeah, I mean and and the reason they were able to be right is because they're both agency operators, right? Like they the right people to launch a product like this. And also it's so hard. The reason why they're willingly sharing their P&L is they have nothing to hide and they they don't think you can beat them, right? And I think anybody listening to this can't beat them because Are they shutting down their agency or they just going to keep trying to do both? Like why would you run your agency once this happens? Yeah, I mean you end up just like, you know, selling it off or hiring operators. I mean I mean Nick Shackelford, which was the partner in Ridge. I mean he had, you know, an events business, he had an agency business, he had an email business. I think you just you find partners to take that over and you just put more time into this, but I mean early on, I was like bullying the bat on these guys because they're the best. Sam, I want you to Google Nick Shackelford tattoo. [[51:13]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3073s) And tell me if you want to compete with this guy. Oh my god. His whole body is covered. Yeah. From the neck down to his toe, every inch of his body is covered in a tattoo. He looks like a like a Japanese guy. He looks like a Japanese Yeah. Yeah, he looks like a Japanese murderer. Like you know how they do like the Yakuza? They do like the whole That's insane. Including his neck. I mean he actually got a dog, man. He said it was so painful. [[51:38]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3098s) Oh my god. It looks horrible. I mean it looks great, but I don't want to do it. It looks painful. Yeah, that's what I mean. that's insane. what do you think Ridge is worth right now? Oh man. I mean the the the market for a brand like us is at an all-time low. And like the like look Well, what's the all-time low number? we'd probably a market clearing price is probably 300 million. Like I could probably clear that at the market with our growth and everything. [[52:06]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3126s) It's really hard to sell my business right now. And like I'm not trying to sell my business right now, right? Like I think we have like by the end of the decade we'll be doing like five or six hundred million dollars a year in annual revenue. Really driven by this big tech rollout. So, like we're really big in Best Buy already. We're going to be in Apple, we're going to be in Verizon selling power banks, phone cases, cables. We already sell our wallets in a lot of those places. so, that's like the next evolution of the brand is just more product expansion, but it's hard for me to sell my brand when Solo Stove isn't a public company and I think they're worth maybe a hundred million on the public market, right? Like there's They peaked at $2.1 billion and now they're probably the market cap today is a hundred million. and they have like 400 plus million in revenue. They own Chubbies. [[52:49]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3169s) Like it's very hard for my brand to go to market when if you squint, we kind of look like them and they are They they just need to be taken private. There's a lot of take private things to happen and interest rates are still too high to take a lot of stuff private. So, we're just waiting waiting for all that to What would you want to sell if you weren't doing Ridge? If you had to sell Ridge today, what would you What other product I mean you're not a guy who would stop. What other product would you want to sell? [[53:15]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3195s) Yeah, my goal for Ridge eventually I'm not the long-term shepherd of this brand. Like if if it's going to go public or whatever or most likely get bought by one of the roll-ups. Like in our industry that's that's that's the exit path. There's 10 strategics that are into buying brands like ours. I would like to get a hundred million dollars and then I would like to start a portfolio of brands and services, basically. Like, you know, everyone wants to have their own little PE, their own little family office type thing. So, I would launch a bunch of weird little e-commerce brands that I think are going to be trend relevant and hire service providers to to run those businesses. [[53:52]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3232s) I love that you know what you want. You know you've mapped this out of like what your ideal setup is. I love that. I love people who call their shot. Do you You talk about trends like but but you know, bone bone broth, it's hot then it's not. Keto, it's hot then it's not. And so like why go after a trend if it's going to ultimately, you know, do what trends do? Most trends don't last forever. So, is that like building your sandcastle, you know, building your castle on quicksand or something like that? Like why why go after a trend when trends have this like shelf life? Are you trying to time an exit or you trying to you're going to hop trends? What what's the plan if you're going to build on top of a trend? Yeah, dude, going back to whale from IQ Bar, trend surface area. [[54:38]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3278s) Like you create a product in a trend because that's the the best way to grow is in a growing market. You can be average in a growing market and grow very very fast, right? I was an average operator when Facebook ads were growing and that's why I am my business grew. Now I can be a good operator cuz I have to be, right? But when a market's growing very fast, you could just be average. And then once once you get some sort of success, it's it's pivoting. [[55:04]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3304s) So, like if I was in the bone broth business, I would have told them like, "Hey, we have to do protein-focused bone broths or we're bone bars." Like I I'm that guy coming in here trying to like disrupt whatever business I'm in. I'm like, "We need to Yeah, if I was at bone broth, I'd be like, 'Look, that's fine. We should do that. We're going to do bone bars and we're going to get whatever some jacked guy to talk about how they're great.' Then I'd be in the bars business then I'd be like, 'We got to do bone supplements. We're going to be the only guys doing bone whatever marrow pills.' Like that's the type of I should be pitching to them. So, I love that that's your answer cuz it's like that's the attitude you have to have to win in that game. My takeaway is, man, what a horrible game to play. [[55:44]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3344s) like you you know, I I was just doing a podcast yesterday with a guy and he goes, you don't want to be in the fresh produce business. He's like you know, you know, he's like you want to be YouTube, not a YouTuber, right? Just as a simple example. He's like you you take the best YouTuber and they're in the fresh produce business. They have to keep running as fast as they can on that treadmill and then the treadmill gets faster and faster every year. And if they stop, they fall behind and there's a thousand other people on that treadmill. And so same thing like if you're on a trend and a trend you know, almost by definition is going to sort of peter out and then the new trends will emerge. [[56:19]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3379s) That just seems like a really hard way to win in business when there's other styles of businesses that don't have that problem, right? But I think but but but Sean, I think you're both could be right. I think the right answer though is to what whichever whichever path you take should fit your skill set and interest and you should commit to it and be that. You know, we had Moiz on, Moiz Ali from Native Deodorant and we said like, "Why don't you do something easier?" He goes, "Cuz I'm a merchant. [[56:43]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3403s) This is what I do." Yeah, I think that stuff is silly, dude. No, it's not silly. I actually disagree. I think committing to a path is significantly better than not. And if Sean Frank is committing to this trend thing, then he Yeah, it's exhausting for you because that's not your interest. a better path. That's That's That's not true that there's not a better path. How much better path could it be? He's got a a 10-year-old company that's doing $200 million a year in revenue. [[57:05]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3425s) That sounds like a good path. Yeah, I'm not saying what he's doing is bad. I'm saying he's the he's an outlier winner and even he's like, "Yeah, there's a company that's like us that does 400 million a year is probably and is worth a hundred million on the public markets, right? Or you know, we have to continually hop, you know, from one category to the next." And he's in a better one, it's more enduring, but let's say you're on the bone broth type of type of thing where it's a wellness trend. And the wellness trends or the diet trends, they change very very very rapidly, right? It's like that's a hard game to play compared to like you know, look at the other look at the possible set of businesses you could go into. That's That's definitely on the hard side, dude. Like e-com is definitely on the hard side and e-com on top of a trend is is the hard version of the hard version. Oh dude, look, I I understand completely, but the reason why I'm in it is because it's permissionless. When I was 22, nobody would let me build Nvidia servers or whatever. Like, you know, a a more robust infrastructure-led business, right? Like if I was going to provide I don't know, routing cable services, some random like that. [[58:10]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3490s) Like maybe now, I you know, I could I could get with that, but e-commerce is permissionless and that's why I like it. Agencies are permissionless. It's like the reason why we sold on Shopify is because nobody would give us a Nordstrom's PO, right? Like there's there's a a level of gatekeeping. SaaS is permissionless. Communities are permissionless. There's a lot of things that are permissionless. Newsletters are permissionless. Whatever. There's a lot of things that are permissionless. The agency one is actually more permissionless than e-com because, you know, for e-com you have to buy inventory, right? There's a there is a capital requirement. The agency one is different, right? That's just I'm going to hustle my skills and I'll get cash flow and then what you did was use that cash flow to then, you know, invest and continue to grow the brand, right? But for most people they they get I know a lot of people that got excited about e-com and didn't realize like how scaling works with e-com where Yeah, it's it like it people squint and think it's SaaS and it's not. [[59:05]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3545s) It's like It's like your your problems get harder the bigger you get, right? Like it's bigger POs, it's more management, it's everything else where, you know, if you're SaaS, it's like, you know, if it's if it's if it's 10 zeros or a thousand zeros being processed through your thing, who the cares? Hey Sean, you you've gotten more You're You're a great follow on Twitter because you're hilarious, but you're this perfect combination of being hilarious, but also I think you're right like because you've been there, done that. [[59:31]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3571s) But has being as opinionated as you have been and willingness to call people out and this willingness to like say what you think, has it ever held you back and do you regret doing that or do you think that like going all in on being a strong personality has benefited you? I mean, the only tangible negatives of being a public personality on the internet is is if and when you get sued because you will be sued, right? Everyone gets sued and it it's the cost of doing business. [[59:59]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3599s) They will read your tweets in depositions. So, just like that is the reality, right? I think a lot of people like don't want to like offend You're like, that's embarrassing or what? What did you mean by saying you want to shoot the Wobble family? Dude, no. Like I mean, I was I got deposed why I told someone I was going to drop a nuclear bomb on them and they read that. I was I had to explain like I don't have access to nuclear weapons. [[60:29]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3629s) But like that is you should you should be yourself and authentic and my Twitter has sold like $300,000 worth of wallets. So, definitely it's it's an net positive. And and your podcast, right? So, your personality and being public about what you guys are how well you guys are doing with Ridge and being funny and opinionated led to you guys doing this e-com podcast and the e-com podcast pays you a bunch of money, right? Like you guys are doing really really well off that. So, that's paid off in in a different way, right? You want to talk about that? Yeah, yeah. So, I only have like 4 minutes and I got to go to a call and do my real job. maybe maybe something you don't know anything about, but Yeah, what are you talking about? [[61:04]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3664s) Huh? I take naps after this. Yeah, so look, the reason why I got public on the internet is because in 2022 all of my friends moved across the whole world because of COVID and I didn't hang out with anybody. And it sucked for everybody. 2021 2022 like I used to have a community of people who talk about e-commerce and then they've all moved. So, I was just by myself and I'm like, let me just get on Twitter and start talking about e-commerce. [[61:30]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3690s) and through that I made a bunch of great friends. because it's a very lonely thing running a big business. Like you know, my my best friends from high school one of them goes to like crime scenes and cleans up like when somebody kills themselves or whatever and the other one does garage doors. So, like imagine trying to tell them being like, yeah man, like you know, I spent $8 million on meta, but I probably should have spent like they they're telling me to shut the up. [[61:56]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3716s) So, you know, you want to find friends who you know, can can you know, have some sort of sympathy for what you're building. So, I got on Twitter, found those people. they're all like you know, Jason from Hexclad's on there, Mike Beckham from Simple Modern. He sells like $200 million selling water bottles. Matt from Pela Case. We started a podcast. Yeah, dude. What's it called? It's called Operators. So, it's a it's a niche e-commerce podcast. We have spin-offs. We have Marketing Operators. Dude, I think it'll bill at least $2 million to sponsors, but it might bill like $4 million to sponsors. And it's just us talking about e-commerce. probably 1 10th the listenership. I mean, way less. Maybe 1 100th the listenership you guys get, but because it's so niche, it's like way more of an actual like like community, right? And you know, I think people want to be you guys because you guys are like an entertainment show, right? You guys are like a big show, you know, massive reach, entertaining people. But if you listen to this and you're an expert at something, do an incredibly niche YouTube channel because like the the sponsor integrations are just so much deeper. Like our sponsor is Fulfill the ERP, right? And like you guys don't know what that is, but if you're an e-commerce merchant, you need an ERP and the annual contracts are $150,000 a year and we've probably sold 100 of them, right? So, it's like they'll give us $600,000 a year because we're the only marketing channel for them, right? [[63:19]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3799s) Anyway, but yeah, so we do a podcast. I think that's good advice. All right, we'll we'll let you go. We know you got to go go sell wallets and rings and other other great things. where should people So, give Shout out your Twitter. Shout out your your URL. Where where do you want people to go? Okay, go to ridge.com/ Shawn and buy a wallet. That's the best way to support me right now in this moment of time. Never stop selling, guys. [[63:43]](https://www.youtube.com/watch?v=UQ5KfImd2yA&t=3823s) we appreciate you, man. Thanks for doing this. All right, that's the pod.