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Hey everyone! We are going to be speaking to Ryan Benzine and Arjun Singh from Joly, one of the hottest consumer startups. We're going to be talking about their growth over the last three years, the different sort of marketing tactics that they've deployed and what we're calling common sense marketing. If you like the episode, please subscribe. Like and follow us for more information.

00:00:26:14 - 00:00:43:09

Well, thank you guys for coming. I appreciate it. Yeah. No, it's been good. Ryan, it's good to meet you. Finally. Nice to meet you as well. Arjun did an awesome talk last year in June at Torch Capital discussing just the launch. And it seems like you guys have progressed so much more since then. I think at the time it was like $20 million run rate.

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But at that point it was, what, 18 months that was? Yeah, just about it. And so now we're like, we're we're over two years or over the 24 month mark. And so some of the stuff I want to discuss today is like Ryan, I've been following your LinkedIn. You've been posting great content. Obviously Arjun speaks the the brand, brand marketing game.

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And I think that's been a lot of your success as a business. So I want to delve into, some of the different ways that you guys think about building brand. There were some other, like, sound bites and Easter eggs that I pulled out of your LinkedIn. And each of your your content regarding, like how you think about valuation with Lee and some of the growth.

00:01:20:04 - 00:01:42:12

And then I also just want to start with like talking about the category, because I think it seems so simple. When we think about the product and your hero skew the shower head, and then in some of our email conversations, you discussed why the category was overlooked. So why was this this issue with water filtration? Like, why do you think it just went went overlooked for so long?

00:01:42:16 - 00:02:01:08

Because I think it's really rare in consumer when, you know, most consumer categories are commoditized. You find something, you know, that has so much depth. It's a great question. Yeah. I think that in general, the beauty industry is focused on putting things in a jar for the most part. Right? They make things that can go on a shelf.

00:02:01:11 - 00:02:36:04

They call it wet, whether it's for hair, skin and things that are hardware oriented. They don't do, for whatever reason, the beauty. And again, there are niches within that. But the beauty industry at large, and that was where the opportunity really was because it's essential. This is an essential beauty wellness tool. If the water is harming your skin and your hair, which it is, unfortunately that becomes sort of ground zero, what we call step zero in improving your skin and hair, which is clearly a beauty product.

00:02:36:06 - 00:02:59:06

But because these legacy beauty players don't like hardware, they left that completely open. But I also think just in terms of the question around the phrase overlooked, we tend to not think about what's right in front of us and obvious and right underneath there nose in life, whatever situation or setting that we're in. And in this case, the water that we shower in.

00:02:59:06 - 00:03:19:02

And I think when you had a personal issue dealing with dry skin on your on your legs, and I think through your own practical approach of looking at the world from a very common sense, what's happening like right in front of me perspective, you're like, wait a second, the water is causing something here. It must be. Let me do some research.

00:03:19:04 - 00:03:43:18

And common sense is sort of a superpower. It's a lost skill. My approach is always common sense oriented. That's sort of what I do. And I was like, wait, why? Why am I using more lotion on my legs? What is happening here? What is the thing I'm doing every day? Maybe there's something in the water that led to researching the water, then understanding what was in it, what it was doing to my to my skin, which was making it dry.

00:03:43:20 - 00:04:03:15

And then that lightning bolt, you know, shower thought like, okay, let's create a beauty one, this company that purifies your water. You both live in New York City, I imagine, right, for the most part. What about this misconception then? Like New York, water is, you know, the cleanest, safest to drink? Could that be a barrier to historically, it used to be.

00:04:03:19 - 00:04:22:23

New York has been known for great water. Our dinner, and I joke all the time, like the proxy for good water shouldn't be bagels and pizza, because that's what we're known for. And why, like the water makes up allows our pizza to be better, right? Which is true. But there's things in it. And especially more recently, the water has just gotten contaminated.

00:04:22:24 - 00:04:53:20

New York is not the only city this the water is bad in LA. Chicago. Dallas. Austin, Oklahoma. Yeah, Iowa. Miami. It's bad everywhere. The spectrum has just gotten worse. Yeah, right. So New York is it's also a global issue too, from from my understanding, just working with other consumer companies that focus on hair, particularly like you have other cultures and societies like Denmark, I know has really hard water.

00:04:53:20 - 00:05:11:24

It's not necessarily bad for you, but your skin has and your hair has a different reaction to it. There's a few things on the topic of water as it relates to New York, and then what's in the water? What's bad for you, and what, you know, might not be causing as much harm. And I'm not just talking about skin and hair here.

00:05:12:01 - 00:05:33:05

New York water, as you mentioned historically, has been cleaner than the rest of the country. Historically. However, what we do in the US is we coordinate the water at a municipal level. So what we don't want to be showering in or drinking things like salmonella, E coli or other bacteria. Chlorine is added to kill and disinfect the water.

00:05:33:07 - 00:05:53:11

That is a good there's a good outcome there. However, the chlorine that sits there is not good for our skin and our hair, so we focus on removing that. That's something that's found in almost every water system across the country. But if we take water that you drink, there are minerals in the water that are technically good for you.

00:05:53:13 - 00:06:12:06

You know, magnesium, calcium, things that are not necessarily going to cause so much harm if you're drinking it. However, that's not good for your skin in your hair. What we focus on in terms of filtration is we remove chlorine and heavy metals. That's where we focus because there's, two things. One, they're the main culprits for the skin.

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And hair issues tend to be causing them. And also there are of course limitations of what you can filter at this. The use which is in the shower, a whole house filtration system is obviously a way more heavy duty solution, but it's widely expensive. It's a difficult to install if you live in an apartment because you don't have control over what's going into your building, etc., etc. so that's why usually is the Or having a shower filter is the best solution that is within the realm of possibility for most of them.

00:06:42:09 - 00:07:02:04

What have their results been like? I've seen obviously so many of the testimonials, I use the products. Awesome. I'm just curious, like how you guys are thinking about the science behind some of these great, you know, results and content moments that you can have with when, you know, when we started, we it was developed with science and we left all the science out.

00:07:02:04 - 00:07:27:15

We just didn't say, you know, we have the most science. That was not what we thought. Yeah. You didn't want that to be part of the brand. Exactly. Beauty customers or customers in general. If you have a solution for their vanity, they're going to be pretty invested in that, which is what we provide better skin and hair. However, we started here, you know, as the business grew, we started to hear a lot from customers saying, I'm losing less hair in the shower or my eczema is gone.

00:07:27:15 - 00:07:56:04

And we knew that it was going to solve those problems. We didn't really appreciate the volume of people that would tell us their story. So we we decided to have lab test done so we could potentially talk about what was really happening and why. And then we had clinical trials done specifically around hair shedding. In that example, because the general customer vanity, when they're losing their hair, that is a that affects their emotional state.

00:07:56:04 - 00:08:15:16

It just does. And when women say, I'm losing less hair, whether it's a postpartum issue or just a general issue, which for most people it is and we can reduce that. That was super powerful. So now we can make the claim, and we're probably the only filtering shower in the market that can make that claim that we reduce hair shedding.

00:08:15:16 - 00:08:41:17

If you use Jolie less hair will fall out of your head. Not genetic balding, but hair shedding, which is an everyday occurrence that's been really powerful to. So to take the user generated stories that they're sharing on their own and then add this science backed support has been an accelerant to our business. The focus and I think you touched upon it when you said, we don't want science to be part of the brand.

00:08:41:19 - 00:09:07:11

It's more about it's not that we don't care about science, it's more we don't want this to be expressed and told in a way that makes it confusing or like you can understand it. Our marketing, you know, as we spoke about in the talk last summer, is it fluid, is driven by one thing. People influence people, and we want you to be across the dinner table from someone and say, hey, I just use this product.

00:09:07:11 - 00:09:23:10

My hair has never felt better. I was dealing with breakouts on my skin, and I realized it was the water that I was showering that caused it. And since I've usually it's now gone, you should try this out. And that's the most powerful is word of mouth. We all know that. Yeah. To be the most powerful form of marketing.

00:09:23:12 - 00:09:46:11

So that's where we focus. But in certain areas and topics, particularly hair shedding, we know the benefit of having it be backed by something that's tested in the clinicals that we did were four month trials with, you know, statistically significant group of people. But science isn't the way in which we tell the story. Well, I like that because from all of the marketing I've seen, it's been very straight to the point.

00:09:46:11 - 00:10:23:22

It's very we, you know, solve these sorts of issues. And I think that's important, especially today, to get right to the point, you know, to explain the value proposition of the product relatively quickly. Talking to you guys today, though, and hearing about all the clinical trials and the product efficacy is, is really interesting. Because I think it's an important part of the entrepreneurial experience and like making sure you have great product, obviously curious how you guys think about creating competitive advantage with your product and but leaving that out of of the marketing because it might get too complicated for people who don't give a shit about it.

00:10:23:22 - 00:10:45:04

They just want to know the product works. You know, we've really perfected the filtering shower. We did not invent it. There were others in the market and they were always lacking. They were lacking efficacy. They were lacking design. And that's because of the design of the product. And so it was a combination of things. But down to, you know, user experience, unboxing in our case is really critical.

00:10:45:04 - 00:11:04:12

And it was completely dogshit like it was what a shower company does, like a cola, for example, they put their shower heads in a cardboard box, or maybe like a plastic that you need a razor blade to cut apart. That's a plumbing product. Yeah, it's what plumbing companies do. It's what they've done for 50 years or beauty products.

00:11:04:14 - 00:11:33:15

Ours is very different. So when we're designing that box, literally the box and what's on the box and then what's in the box, that was through the lens of a beauty company, not upon any company. Because we're not we're not a plumbing company. Every detail like that really matters. And how competitive advantage like there's others in the market, but their experience from web to unboxing to performance is it's just not where we are.

00:11:33:21 - 00:11:56:19

We're just the best in the market. So can we maintain that position forever? Hopefully. Well, I mean, this goes back to one of the things I want to talk later, like the importance of, of brand, because you can only remain so competitive on, on product for like to maintain that edge for so long. Must you have a patent or something more proprietary because people inevitably are going to copy you.

00:11:56:20 - 00:12:22:05

They're going to learn how to do it. How many patterns do you think Apple has stolen? Yeah, I don't even know. Multiple. Yeah. And they've paid billions in penalty by losing in court. Yeah. The number one valued company in the world. So patents doesn't really matter for early stage business. They're sort of there's this belief that intellectual property has the ultimate value.

00:12:22:05 - 00:12:53:00

And it in the case of Apple they're workarounds. Yeah yeah. On the brand. So just talking about the competitive moat on the product. Sure. There's there's things that we have done that have upgraded but currently existed digitally. There's the design, there's the unboxing experience. But I think the biggest piece is the brand that we're building because anyone could, could go out and create an a carbon copy of our product and have, yeah, yeah.

00:12:53:02 - 00:13:21:01

I've seen them going back to a few things that you've, we've already spoken about simplicity and focus. We are laser, laser, laser focused on water is a key ingredient for better skin and hair. Full stop. We're not trying to create a bunch of other product that sits in the home and in other rooms. We're very focused on the filtered showerhead as our hero product, but one that is we will be focused on this for some time before going into other categories, which we will.

00:13:21:03 - 00:13:45:13

Yeah. I think you spoke about this during your talk. You were like, these are other product categories. We're thinking about, but like, we just don't know if we're going to explore those. You know, right now it's it's less a question of if but when and also not diluting the message because we're creating a new category. Most people prior to to Joly have not used or even heard of a shower filter or filtered showerhead.

00:13:45:15 - 00:14:16:10

We're reorienting something that is formerly seen as a plumbing fixture that just pushes out water to something that's essential for your skin in your hair. We've sold, you know, getting close to 250,000 Jolies since launch. There are 260 million residential showers in the US alone, so there's a long way to go on this mission of what we truly believe in is that everyone should be filtering the water they shower in is something that's normalized, and we think everybody will ultimately have a filtering shower in their bathroom.

00:14:16:12 - 00:14:35:06

And that when you if that's your mission, then selling a quarter of a million units, which is a lot, you're just scratching the surface. You know, the game is even we're still sort of warming up, right? Like the game hasn't really started. Yeah. Well, I think it's also you're how you guys went to market, though, and the, how thoughtful it was.

00:14:35:08 - 00:14:55:08

Not pandering here, but like, you know, I think businesses that have to explore product expansion, they either hit some sort of plateau or they just can't get they can extract the LTV that they need out of the customer, which is why subscription is great and something that you're using every day is so critical. And actually, something I wanted to ask you was this is a totally different category than footwear.

00:14:55:08 - 00:15:20:07

You obviously have experience in, in, in consumer. And I was just curious to hear your, your like quick little side of the story on why you're reentered consumer. You know. Yeah. Well consumers broad footwear is part of that and beauty is part of that. But the journey of building a footwear brand is what led to Jolie. And I'm going to use a fad.

00:15:20:07 - 00:15:49:13

I'll just use fashion as the, the, you know, a category that footwear sits within fashions. A it's a really bad business. It's a really bad business. It's it's a business that you are constantly forced to create new product on a quarterly basis. There's seasonality there, sizing how does it fit? Yes, I think it's hyper competitive. And you put all that together and you have like a shitty business.

00:15:49:13 - 00:16:10:05

It's a shitty business. Can you do well, sure. Can you build a big business? Yes. But it's not a good business. Does that make sense? Yeah. The the journey of building great sort of informed me on if, if I could sort of build this framework, which I, you know, ultimately, Jolie fit inside this framework. That would be a good business.

00:16:10:07 - 00:16:28:18

And the framework was simple product focuses on vanity product that's one size plumbing is universal sizing in America and most of the world in a product that you use every single day without thinking about it. That was the framework. And then I thought about that for years. Like what what what fits in that? And discovering water had an issue.

00:16:28:18 - 00:16:50:05

Barrier skin and hair. Boom. Shower thought, Holy shit, let's create a beauty wellness company that purifies your water for better skin, hair and health. The other part here relating to brand related to the product is a everyone showers. Right? Ryan mentioned you do it without even thinking. Do I do it or not? For most people it's very difficult to change consumer behavior.

00:16:50:07 - 00:17:14:00

But the shower also and this is getting more to consumer. The emotion of the shower that the shower creates beyond just its function is something that we all can relate to and from, you know, from a perspective of brand founders, focus on marketing of that and telling the story, the shower. It doesn't just clean us physically, but spiritually, mentally.

00:17:14:00 - 00:17:34:13

It's a great thinking session. We all know shower thoughts. We might sing in the shower. Maybe you've cried in the shower after a breakup. I certainly have had sex in the shower. It's a magical place and it's one of the few places, by the way, that you're alone. Exactly. For the most part, yeah. It's hard to have sex by yourself, but some people say you can do it.

00:17:34:13 - 00:17:58:01

You can do it. You can still do it. And I think possible, I that's what makes this so fun as a topic. Because from a marketing storytelling perspective, we can really again, we're laser focused water and the shower. But we can extend that thread in a way that is, you know, continuously engaging, piques your curiosity. We're talking about pizza and bagels.

00:17:58:01 - 00:18:29:20

We were just filming last week with Paulie G's in Greenpoint series of what we call Water End water, and its connection to pizza. This isn't the core for marketing, but it sort of sits and and the next one is is bagels. Tomorrow, 5 a.m. in the morning at Apollo Bagels. So, water and is one of our content platforms where we, you know, water is such a experiential substance and we all use it for sport, for relaxation, for travel, like it's been in your life from the time you're born to the time you die.

00:18:29:22 - 00:18:51:22

Everybody sort of some people feel water, some people embrace it. Some people, you know, just can't not be around it. It's a really unique substance that everybody has a story about. So the water and content series for us is sort of a evergreen thing. And it literally, you know, Cynthia Rowley, we did surfing and we did make making pizza.

00:18:51:22 - 00:19:15:15

Right. So those are two very different stories with the same anchor of water. And water is our lens for marketing. Everything we think about is through the lens of water. Yeah. And it has so much depth to you know, it allows you guys to. Yeah. Yeah. You guys I mean but yeah you can create so many different moments around it.

00:19:15:15 - 00:19:45:00

It allows you to be creative and fun, which is another thing I want to talk about because I think the modern marketer has kind of forgotten that we've kind of tried to optimize, especially if, you know, beauty. Beauty is very repetitive in the way they market. And there's there's a herd mentality to every industry, beauty maybe more. So there's this idea that you need to show a certain level of beauty for your beauty product to be good.

00:19:45:02 - 00:20:09:06

And we sort of take a counter intuitive approach. We're not always showing beauty at all. Yeah, I like that's the that's the difference between what Jolie is, which is used every day without consideration, and a beauty product, which you could consider all the time because you're a traditional one. You're like, what lotions should I try this month? And you're changing them out all the time?

00:20:09:06 - 00:20:33:00

So sure Jolie is the constant in your beauty routine forever. Arjun spoke to spoke a lot about, the importance of creating conversation. This UGC content machine that you guys had built, there were a lot of statistics thrown around, around, it was like 20,000 pieces of content, a thousand pieces of content. You had 25,000. I mean, it's impressive.

00:20:33:00 - 00:20:55:21

I want to talk about why that's important and how you guys are using that as like an evaluative metric. It goes back to people influence people. I mean, whether it's someone at a dinner table across the country talking about Jolie or a regular, you know, person who's not an influencer, posting about Jolie online to their community of friends, family, whoever's following them.

00:20:55:23 - 00:21:33:24

That's how word spreads in the most effective, compelling way. And this content we then can use and repurpose. Of course, you know, with rights from from those that are. But the content up there to continue to spread the word about Jolie. When we started, we thought that we would have a lot more of produced editorial shoots, which are beautiful and fun to work on, but the sheer number of pieces of content that were being created not by us, but by customers or, you know, we do seed product and get it out there in the market, because that's the way of, you know, having the product use.

00:21:33:24 - 00:21:51:07

People put it in this, love it, start talking about it. You're kind of sparking the flame, sparking the flame, which is what we've done. You know, as a core to the strategy. But that speaks volumes over any produced shoot that we'll do. Not that we don't do that. We have the big one coming up on Monday for Mother's Day.

00:21:51:09 - 00:22:12:20

There are moments when they make sense if we're adding, you know, a unique sort of take and message that we want to spread in a way that's either funny or humorous or, you know, taking on a moment of culture. But we joke around that it's half out of our control. The sales, the customer base has become the sales force, and that's ideally how we want Jolie to spread the the best.

00:22:12:22 - 00:22:32:16

The holy grail of marketing is when you turn a customer into an advocate, when a customer goes out of their way to create content for you and promote your product, that is, that's the holy grail, right? What I'm trying to dig in to is, was there a mechanism for, for for building that, like how can you share it with them.

00:22:32:18 - 00:22:53:24

Yeah. So I want to talk a little bit more about the details of how you guys, how you guys made it. And everybody, most brands today are doing some version of what we do. They know they need more. UGC they know UGC is valuable. What they don't understand is the volume. Yeah, that it requires that it really takes.

00:22:54:01 - 00:23:19:18

And because it's unmeasurable, the measurement is how many pieces you have. But I can't really tell you what it did for my cat directly, what it did for my web traffic directly, what it did for my conversion rate directly, what it did for my LTV. I can't tell you that. And because marketers today are basically analysts and they need measurement to feel, yes, comfortable and confident in what they do.

00:23:19:20 - 00:23:46:11

Most people don't do it or they don't do it the way we do it. We sort of say, we know this is really valuable because we know in real life people, people influence people. And even though you went to dinner yesterday and told your friend about Jolie and probably converted that friend, I have no measurement of that. But we know that's what happens in the real life, so we're totally comfortable allowing that to happen, being not not that we can measure it.

00:23:46:14 - 00:24:07:09

And what we saw by committing to that belief is a $4 million business in the first year, or $28 million in the second year, and somewhere north of 45 in the third year. Profitably. Yeah, we are a profitable business. We've raised no venture capital, and we're one of if there's five more in the country, I don't know, four of them.

00:24:07:11 - 00:24:37:08

So I know we're one but I don't know any more. I'm assuming there are some. No with that sort of growth for sure. And that's where you say okay, so what's missing from the thousands of brands that are not doing our form of marketing but continue to lose money? Well, there are there are tons of venture backed companies who are doing seeding at scale, like, you know, I know that firsthand, but the the unique formula that you guys have created is is is really interesting to explore.

00:24:37:08 - 00:24:58:11

I would love to hear your thoughts on on you know, why you guys think you were able to to create that. It's a confluence of factors. Of course. I mean, hey, the product has to be we have an advantage and a leg up because this is a product that works. Yeah. Is efficacy driven. It's not trend driven. It's something that hasn't really been done before from the positioning of beauty.

00:24:58:11 - 00:25:17:20

So you're not so is not getting sent a bunch of different showerheads. You're getting a bunch of different. Being first in the market certainly has it. It has its advantages. But also like I'm assuming subscription is really strong. You guys have great retention. You're like not taking this thing out of your out of your shower. And people like margin of course, you know.

00:25:18:01 - 00:25:39:03

Yeah, a lot of these different groups, those are, those are sort of the best business parts that people sort of overlook or founders do often. They sort of get those, they get those wrong. But that's not marketing related, right? Yeah, yeah, yeah. They kind of set up the foundation to when you are growing like, you know, you don't need to be on a treadmill because you have great repeat.

00:25:39:05 - 00:26:16:16

You're if you're doing a first customer discount of 20%. Yeah. And you have a 50% margin, you're never going to make money. But there's also the the culture element of it, of tapping into culture, sending it to people that others look to, whether they're shares, they talk about beauty every day or whatever their lane is. We've done a really good job of of building that network of people, whether it's an existing network of ours that we've brought in or through the business, and we do a lot of events in person, and we like developing relationships.

00:26:16:18 - 00:26:36:20

It's also a confidence thing, though, to to both of your points, like there is this part of the customer journey that's so important. It's like this dark attribution place where, you know, you can't directly point to say, oh, this customer heard of us here, but you know, it's influencing them in such a way where it's allowing you guys to grow at the rate that you are.

00:26:36:24 - 00:26:56:08

And it seems like most of your investment just from the peripheral is in this product seating. It's an experiential aisle. You know, it's in out of home, out of home. You can measure a bit, but you know, it requires a degree of confidence. I think a whole generation of marketers really lack because they're just looking at the data.

00:26:56:08 - 00:27:20:14

Yeah, I think those sort of unmeasured traditional or old school marketing methods. Today's marketer, if you've been marketing for 12 years, you've never done them. Yeah. Which is crazy because they're very they're they're very that. That's right. I say this all the time. There was a lot more profitable businesses 25 years ago than there are today. Yeah. And there those companies are going to die.

00:27:20:14 - 00:27:41:22

I mean, there's just no way around it. They're not going to be able to raise money and continue to try to grow at a loss. So, you know, if you don't diversa fire marketing mix, you're sort of on this tread treadmill of like, you know, how long can you survive? But it doesn't really there's no growth in the business that growth happens and profit comes in.

00:27:42:02 - 00:28:04:23

It's yeah look at Allbirds. I mean they're going to get delisted from the stock market. Yeah. And that was a company that was you know, heavily funded and profitable at one point. And now they're not. It just I mean, it's also something as like it's like your tolerance level almost. It's like if you are tolerant as a founder to just be unprofitable and continue to spend like that, that creates bad habits.

00:28:04:24 - 00:28:28:11

It becomes culture almost when it's almost like, why would you do it? Okay. I mean, this is another thing I wanted to focus on going back to common sense marketing. Like, you guys don't use discount codes right? You focus your email on education rather than transaction. These are all like common sense things that everyone wants. They just they just don't do right.

00:28:28:11 - 00:28:50:22

And these are things that previously like I love your point on LinkedIn about the discount code on a pop up. It's like that not in the business of collecting emails. I think that was a line. Yeah, it oh, if the email value is less than the friction of what you're doing to your conversion, like focus on getting people to actually want your product first and then buy your product second.

00:28:50:24 - 00:29:16:09

And if your email pop up is your first experience, that then says 20% off again, like it's the business part of it doesn't make sense. So why do we why is our entire industry? I adopted this strategy as the best practice. And from an experience standpoint, I mean, if you were to walk into any shop in person and the first thing is you get hit with a, hey, give me your email and I'll give you a discount.

00:29:16:11 - 00:29:42:06

It's not. But if all of our peers were making money, I would say, yeah, it's a good strategy, but they're not. Yeah, well, I think they I mean, it's obviously it's definitely cultural, but there was this preconceived notion that the data so valuable. Right. Yeah. Which is just played out and it's just not true. We so not the data I still see there's data at this point is sort of available everywhere to everybody.

00:29:42:06 - 00:30:09:14

Yeah. Retail e-commerce guys. Shopify it's everywhere. We don't really do that much with it. No. Yeah. I mean for you guys, it's really interesting because the data literally is not valuable because you're not going to make another product. Yeah. Right. Well no we don't. We know you will. But you get my point though, right? It's like it's like I see e-commerce founders now earlier just they want to prioritize direct to consumer over Amazon when they have like an Amazon product.

00:30:09:16 - 00:30:29:17

And the reason is because of of data. Maybe it's because of margin. But I think when you factor in a lot of the overhead and you look at contribution margin on direct consumer, sometimes it's not as it's not as profitable as on Amazon, it could be more yeah, yeah, it should be. It actually should be more profitable as a channel because you're you're marketing.

00:30:29:19 - 00:30:52:20

You're marketing. Exactly. And if you're not on Amazon because you are by margin a product margin issue, fix that. Don't turn off the channel. Right. Because if you can't make Amazon work because your margin is too low on your product and you've you have an issue, you have a different issue. Yeah, that's don't blame Amazon for that. Amazon there's all kinds of issues.

00:30:52:20 - 00:31:17:16

But it doesn't mean you shouldn't be like we're on it and we love it. And it's going to be a really robust business and it's great. It drives great bottom line revenue. Yeah I think this is also just part of like how VCs have entered the this I guess then like people's just psychology when building a business because VCs undervalued Amazon businesses and Amazon performance because of that data issue.

00:31:17:18 - 00:31:37:21

Yeah. But again VCs never operated a company for the most part. I say they look at a spreadsheet and sort of come up with some. They invented the cat to LTV equation. Yeah, 3 to 1. Because eventually, eventually, yeah, eventually you'll get it right. It's like, well yeah, it never in ten years it didn't really work out that way.

00:31:37:23 - 00:32:04:04

Yes. If a customer likes your product, they'll come back and buy it again. But you should really focus on trying to get first purchase profitable, not profitable in 38 months or whatever the distance is that it would would take because nobody's been able to really do it. So is the takeaway like some founders, you know, I feel like I could I would talk to some founders and like, they would find it so hard not to discount on their e-commerce experience.

00:32:04:06 - 00:32:27:19

And is that just because of all of this conjecture and these bad habits? But it's a short term. If I discount now, then I'm going to, you know, people are going to buy, but then it's a we talk about it's a race to the bottom. Sadly I think that brands that are embedded in the industry today that have been around for a while and that's been part of their strategy, it's very, very difficult to undo if at all like probably impossible.

00:32:27:21 - 00:32:43:20

But if you're a new company you're about to enter the market. Don't do it. There you go. You have one chance. And it's like now. So don't start that way. Yeah. Figure out how to make your business work without doing well. Let's switch gears. Let's talk about, you know, the brand side of the equation and and brand building.

00:32:43:20 - 00:33:02:05

It's really impressive what you guys have done over two years. It sounds like the third year, you know, Joly has been a center of attention. And it sounds like it's because of these these really intentional decisions that you made. Can you just speak a little bit more to the brand building process of, of creating this and what's gone into the success?

00:33:02:10 - 00:33:25:19

We've spoken about a few of the elements. I mean, people influence, people create conversation. There's hyper focus. So when you say that you're interested as a person in many different things, you can dilute the message and you're just interested in nothing, right? If I'm interested in fashion and watches and furniture and plants and lighting like it's well or hey, I'm interested in plants, okay?

00:33:25:19 - 00:33:52:23

This guy's a plant guy. He loves plants. That's all that he thinks we are interested in water. That is our lens. And we like to maybe even over emphasize our focus to make the point that this brand is. Everyone knows what Joli stands for internally. Externally customer is whether you have the product or not. And that's a very clear intention from our side that aids in building a brand faster, as opposed to us trying to do many different things.

00:33:52:23 - 00:34:17:02

And it's really hard to do that, by the way, like as brand guys and marketing guys like product guys, we kind of want to make more products, right? Stay focus. It's got it's maniacal. You sort of you start to see the value when this is an exercise in restraint and when you can sort of keep the noise away, you see something you were living in.

00:34:17:06 - 00:34:43:14

But it's really, really hard to keep that noise out. That is a different I was I was not able to do it ten years ago personally. The few other things repetition. And in the talk also from last summer, we spoke about momentum and density, and I'll give a few examples of what we've done. One form of marketing that I think has been our one of our most successful are these trucks that we have running around New York inspired.

00:34:43:14 - 00:34:59:05

Any brand, of course, can take ad space on a truck. It's not unique, but what we did in terms of the content and the creative is we were inspired by a dirty van where you might write wash me. We instead created with actual dirt in our fingers. What if we told you your shower water was dirtier than this truck?

00:34:59:07 - 00:35:31:01

Written in that same form of wash may, but with dirt. We then put that around a truck. Five of them had them running from May of last year through the summer, and it was very clear that this was working just by the sheer number of conversation that was created. We then wanted to continue with this, and we had the opportunity to increase the number of trucks by three x, and we had the conversation quite quickly of do we do a few in Miami, a few in New York, a few in L.A., a few in Chicago.

00:35:31:03 - 00:35:51:14

The answer was no. We're going to go very deep into New York. And that's this density that creates momentum. The analogy that we tend to use, if you have matchsticks and you're trying to create fire, the matchsticks are far apart from each other. The fire is never going to spread. You know, the closer they are to each other, you have to commit.

00:35:51:16 - 00:36:12:09

It's like, you know, when you're trying to commit, you know, do a trick. Learning a trick, whether skating or a bicycle or skiing, you have to commit and you're going to fucking fail. There's no question you're never nailing it. But without committing, like if the mental part blocks you, you're never going to do that trick ever. This is about commitment.

00:36:12:09 - 00:36:37:24

You've got to commit and you've got to stay at it. That's marketing. There are also some signature things that we've done, so we host an event every two months called Oysters and wine. Oysters are a natural water filter. We do that in New York. We change locations each time. And it's something that when you I said repetition, the more you repeat things, whether it's a message about what Joli does or an event or every year for April Fools, we do a fake collaboration.

00:36:38:01 - 00:37:04:20

There's then an expectation and it's crystallize in someone's mind, and it's something that people then talk about and hopefully look forward to. And we tend to to think about that with all the marketing activities we do, as opposed to we're going to do it once and then maybe we'll do it again. We like to commit water, and we do every month, hour a day in the life series, which is a video series that showcases Joli in the broader context of one's day and again, focus on the person.

00:37:04:20 - 00:37:26:11

People influence people that we launch every month with a different person in different spheres of, you know, land culture. And we also have a shower Thought series, which we do every week, where we're interviewing people in our community. And that's, again, a commitment to that marketing. How how big is the team right now? Three people, two thirds are sitting right there in terms of full time.

00:37:26:16 - 00:37:50:21

The third one is Charlotte Morris. She was at, she's worked for a handful of brands. Do you guys all handle marketing? Yeah, we're all sort of involved in the marketing of it. We're all wearing many different hats. We've built a business that is simple, elegant in its simplicity, where we're not launching a ton of new product like we're a fashion brand where we need a whole team developed, dedicated to.

00:37:50:21 - 00:38:09:03

So operationally, fashion is really bad. Yeah, Jolie's really elegant. That allows us to do other things, to focus on marketing, and if we were releasing a new product every quarter, we would not be able to be three people. Yeah, for sure, for sure. It's a really unique, I think situation that you guys, you know, find yourselves in.

00:38:09:03 - 00:38:29:19

It's I agree, I don't, I don't know many other companies that that are in a similar situation. What is next for for the business like when you guys think about the evolution of the brand, how are you thinking about that? We have sort of two two lanes distribution which will expand and continue, which we're doing and product. I spoke to you soon.

00:38:29:23 - 00:38:49:05

Can you give us any sort of indications of what that might be now under, you know, in terms of distribution, you know, something to do with water? I know we, we in terms of distribution, we just, you know, it's a unique product and that we can play in the very traditional lens or lanes of beauty. And then in the lanes of, you know, home.

00:38:49:05 - 00:39:31:13

Right. So Lowe's for example, is a is a store that Jolie could show up. So show up at just as comfortably as we would it all to. That's really unique, right? There's no plumbing shower company that could go into the traditional beauty and there no pure beauty that could go into those. Yeah, it's very elastic. So we have this really, unique advantage of how we can do distribute Jolie and not dilute the brand at all, but gives us massive scale so that you'll see in the near future in terms of product, it'll be yeah, it'll be water related and filter water.

00:39:31:15 - 00:39:50:10

Okay. We're we're getting closer. Maybe some collaborations. It's all so I think you guys have a the Stanley collab was very cool. Is that the first collaboration that was April Boyfriends? Oh my God, really? That's how good our April Fools are. That's the third year in a row, so we've done three. It was the year, one was I was like, how is it said a word?

00:39:50:10 - 00:40:16:17

Tiffany or mezze? Burrito Supreme Apple. Evian bill carte. And last year we did a whole succession each character. Yeah, I remember that you were telling us. I mean, again, this is where you guys shoot traditional beauty brands would not do that. But our we like to maintain hyper relevancy around culture. We think that great brands do that and do that well.

00:40:16:19 - 00:40:42:14

And this is how we execute. Or one of the ways we execute that we we do something around April Fools. That is so of the moment. It feels real. We did, we did a Jolie, Thanksgiving Day parade float. Oh, I saw that. Yeah, that was like, no known. And it was you people. It was great. And I put it on LinkedIn and people were asking me what we paid for it.

00:40:42:18 - 00:41:01:05

We have a pop up right now in Soho, the corner of Prince and Mercy. Like it's also fake. That is real. That's real. That's very real. That is real. That is not an April Fool's joke. And that, again, get a red pill or a blue pill there and then. Yeah. How is retail been? Just like as an experiment for us that's more marketing than it is retail.

00:41:01:05 - 00:41:18:06

Yeah. Retail sales. We are of course selling Jolie's. With each Jolie you get your choice of a dried flower bouquet, each of which has eucalyptus so you can hang it up in your shower underneath your Jolie. But the truth is, we don't care how much we sell. Yeah, just like our email. It's not that we don't care, we just do it differently.

00:41:18:08 - 00:41:37:11

Right? So you I think you read my post and most ecommerce brands are generating 25 to 35% of their revenue through email channel. We're 25%. So we are on the low end of that spectrum. Except our content is not about go buy this. Yeah, there's a discount. It's just great content. How much do you guys send too infrequently?

00:41:37:17 - 00:42:01:02

No, not included in our flows. We send a couple a week. Yeah. The other thing I thought was really interesting was just your take on valuation and the comparison to, you know, tech valuations. I just want to hear you opine on that for a quick second. How much time do we have. Well it okay. We got to September December to simplify it.

00:42:01:04 - 00:42:26:23

We are a hardware business with a margin profile that is identical to SAS. We have a subscription business that has lower churn than almost every SAS, which is like 85% gross margins, 90% gross margin. Yeah, something like that. And then really low churn. Yes. Single digit. Yeah. We hit the million dollar air mark faster than the best SAS companies ever.

00:42:27:00 - 00:43:02:20

The 5 million, the 10 million we beat the best SAS companies in the world in terms of hitting that milestone of annual recurring revenue. And the question I'm asking everybody because we don't there's just never been anything like that in hardware. There's no comp. I mean, hardware two trades on a very, very, very low multiple. So but but because we have the if you put up two blind slides, our business and a SAS business and said which one is SAS, most people would pick ours because our metrics are better than most SAS companies including Netflix.

00:43:02:22 - 00:43:24:00

So. So why wouldn't we be valued like a SAS company? That's the question I continually ask to the market. I'm not saying what our valuation should be. Yeah, but I'm asking why it wouldn't be similar to a SAS in terms of a multiple of what a SaaS company would get. What was the consensus like on that post? Because I saw it and read the comment.

00:43:24:00 - 00:43:42:10

Most people think we should be valued just like a SAS company. That's pretty cool. So ten x revenue, what do you guys think? For, you know, with this business, are you building it? You know, obviously you're going to want to monetize at some point. How are you thinking about that, though? We're we're profitable. So we've monetized it.

00:43:42:12 - 00:44:09:20

I mean, from an excerpt. Yeah. But unlike businesses that they need to make, we can distribute profit and do. Yeah. So that's different than most. And yeah, we're building it to sell like any founder that says they're not is probably lying to themselves first and then to you. Yeah. But what we're not under pressure to do that. That's the ultimate lever freedom or.

00:44:09:21 - 00:44:31:19

Yeah, that's it. Because we know people call us every day. Yeah. You want to add anything to that? Other than I mean, just selfishly, there's other things I want to do in my own life. So I answer the question with that, there's usually should be around 400 plus years. I really believe that. But personally, there's other things that I really want to do.

00:44:31:21 - 00:44:54:15

So there will be come a time when I focus on that. We're only in year. Yeah, we're here 328 months, so it's pretty young. Well guys, congratulations on the success. Thank you so much for sharing the wisdom. It was a pleasure to have you both. Thanks. Thank you. So it was a pleasure.