May 20, 2025 • 30 mins
EPISODE 9
Megan Berry—architect, pop-up pioneer, and Mentors Fund partner—shows DTC founders how to move from clicks to bricks without torching cash. She explains her 8-foot-by-50-square-foot kiosk “permit hack,” the KPIs (unaided brand awareness, repeat engagement, dwell-time hot spots) that justify a multimillion-dollar flagship, and why post-COVID stores should feel like friction-free showrooms, not inventory caves. The talk digs into festival activations, cadence-matched merchandising, omni-channel partnerships that now include hotels and Pilates studios, AI-powered journey tracking, and practical founder advice on conserving runway while staying crazy-creative.
CHAPTERS
00:00 – Permit Hack & Pop-Up Spark
06:46 – KPIs That Green-Light a Flagship
12:51 – Post-COVID, Low-Friction Store Design
19:17 – Omnichannel Expansion & Partnerships
26:25 – AI, Cash Efficiency & Founder Advice
LINKS
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Connect with Jason
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
And so then I started looking atthe permit and I realized that
if something was under 8 feet and under 50 square feet,
technically it was not a building.
Therefore, it did not need to meet building codes or building
permits. It just, I just needed a sales
permit and all I need to do is like the business and that it
was in front of they needed to approve it.
And then I needed like a seller's license and I could
(00:21):
pretty much go anywhere I wanted.
So I was just trying to hack thebuilding permits and that was
how I designed the kiosk to be able to fit within.
Yo, welcome back to Founder Mode.
(00:43):
Where we unpack how founders crush it.
Jason, DTC brands going physical, I mean, big move.
I mean, when you're like sort ofgoing from that online thing.
I mean, me as a software guy, I've been doing a lot of
software and so very rarely do Iwork at or sort of participate
in startups that end up with, you know, a physical office.
And so super interesting to learn about like when is it time
to make that shift? And I mean, even for e-commerce,
(01:03):
right, where they've, you know, spent all their time building
their brand online, like when dothey go, you know, IRL?
Yeah, it's a. It's an important question.
I think if you're selling physical goods, your DC brand
and you're making money and you're like, man, I wish my
stuff was in that store. Just think, think carefully
because there's a lot of stuff that you don't see behind the
scenes happening, whether you'regoing wholesale into a big
(01:25):
channel like the Costco's and Targets and Walmart's or you're
like, I'm going to stand up my own flagship store.
It is expensive, right? It is very expensive.
And it's so this this one's exciting because we're going to
talk about how to do it on the cheap and kind of test the
market much in the same way we run all sorts of experiments
online to best if something's working before we go and make a
big investment. Yeah, let's talk about, let's
(01:46):
talk about your, your experienceon this.
You know, your software guy, right?
But, you know, any brands come to mind that that you've seen
make that the make that leap into the physical world?
Good, good, good or bad vibes? Yeah.
Nightmares. I was thinking back like I, you
know, I'm kind of like thinking back when was the last time I
walked in with a box from the mailbox versus when did I walk
(02:07):
in with a bag that like came from a store?
Yeah. And and I would and the
literally thinking back, it's been a few months, but it was
AII brought some shorts at brewery.
I'm like a huge brewery guy. And it was literally sort of
serendipitous. We were just walking to the mall
in Vegas and I was like, oh, those are really cool.
You know, kind of saw it and it's a brand that I've already
had and worn. In the window you saw it.
Yeah, like saw some and I was like, that's a cool different
(02:27):
color or whatever. And then, you know, I was
basically like going to just take a picture with my phone and
then just order it online. But for whatever reason, we
walked in and started chatting. I was like, let's see, what else
is there because that color was cool.
Ended up not getting the one in the window, but one that was on
the raft and they had my size, which is rare to be honest.
And like, you know, and the linewasn't crazy long, like, you
know, so it kind of required, like I would say a lot of the
(02:50):
times you go to a store perfect Storm where I actually purchased
a pair of shorts and then I camehome and I ordered like three
more of the same time online. And that's, you know, they came,
you know, three days later. So today we're diving into DTC
brands, hitting physical retail,doing it smart and not crashing
and burning. There's huge upside here, but it
is a different beast. You need a tight playbook.
Yeah, so we're sitting down withMegan Berry to break it all
down. Megan is a beast.
(03:10):
She founded by Reveal, which wasacquired in 2021, and now she's
a partner at Mentors Fund. She's got Harvard and Washu
degrees, and she LED Starbucks first Reserve store.
Yeah, she knows Retail Insider now.
All right, let's talk to Megan. Megan, welcome to Founder Mode.
(03:31):
Thrilled to have you and you know, want to talk of all kinds
of things, brick and mortar, DTCand yeah, just excited to have
you and the energy on the pod this morning.
Awesome. Glad to be here.
Love what you guys are doing. So it's very exciting.
Yeah. So let's let's dive into it.
Megan, your background, which issuper interesting, you know,
from architecture and founding by reveal to your work with
mentors fund, you have such a unique perspective on the on the
(03:54):
topic of de risking brick and mortar for DC brands.
So we're we're excited to dive into it.
Let's let's kind of hit you withsome questions.
You ready? Always, always ready.
Let's go. So what was the like initial or
single insight that sort of convinced you that this pop up
model could disrupt traditional refill?
I mean, we've talked in the pastand it was just amazing to see
how that journey. And so I'm curious, like, what
(04:15):
was that kind of first spark that in your mind sort of kicked
off but became of it? Yeah, so it was, you know, over
10 years ago, I was working on my graduate thesis, and I was
just so amazed that with literally a credit card and
Internet connection, people could launch a website, a URL,
and then all of a sudden test and learn immediately.
They could look at click maps, they could test out skews.
(04:37):
They could sell their goods globally.
And it was just such a smooth sale to be able to test and
learn, to be able to get your products out there.
Meanwhile, I'm in Graduate School for an architecture
degree, looking at these projects that take north of 10
years to do. I'm like, Oh my gosh, in my
entire life, I'm only going to be able to work on five or six,
you know, monumental projects. And so there was just like such
(05:00):
a disconnect between the lifespan of how we build
buildings versus how quickly technology was evolving.
And I just, I was like, Oh my God, this is totally diverging 2
totally different paths. Like there needs to be some sort
of a middle ground. Yeah, it it was, it was just
kind of mind blowing too, because you know, you're 20
something and you're just like, I'm going to change the world,
you know, like, oh wait, how am I going to do this?
(05:20):
So. Idealism, right?
We all, we've all, we've all been there.
Now we're now we're here. Let's talk about let's talk
about your architecture training.
How did that inform the way thatyou designed the, the customer
experience when you when you built by reveal?
And maybe just for those who aren't familiar, just like the
quick, quick kind of hit on whatwhat is by reveal?
What was it? So by reveal was a pop up
(05:40):
company. He basically did small format
kiosk that got deployed pretty much anywhere consumers were.
So sidewalks, hotel, corporate lobbies, malls, public plazas,
parks, pretty much anywhere. And it was this small format
boutique that could get deployedin under an hour where consumers
could come touch and feel products and then transact
directly on site. So I was pretty much just trying
(06:03):
to hack it and I was like, OK, well, it needs to be something
flat packed and be able to be able to just, you know, in a
truck. Basically.
I was like, I need to be able torent a U-Haul and be able to
like get it in there and then get it out and set it up.
And so then I started looking atthe permit and I realized that
if something was under 8 feet and under 50 square feet,
technically it was not a building.
(06:25):
Therefore, it did not need to meet building codes or building
permits. It just, I just needed a sales
permit and all I need to do is like the business embedded was
in front of they needed to approve it.
And then I needed like a seller's license and I could
pretty much go anywhere I wanted.
So I was just trying to hack thebuilding permits and that was
how I designed the kiosk to be able to fit within those
(06:46):
parameters. So good.
And so like what was that sort of KPI that sort of triggered
like OK, pop ups there it's activated like when is it ready
to scale into a permanent store?What is that indication that
like, well, it's ready to go to the next step?
Well, my business was pretty much all on only pop ups, so I
was just convincing clients thatthey always need to test and
learn and just keep on going. But what we did get to is
(07:06):
realizing that once you had aided brand awareness with the
customer and wherever that was, whether if your target market
was on the East Coast, on the West Coast, in vacation
destinations, etcetera. Once you had that, then you were
ready to deploy that large amount of capital which to do a
good flagship it's a couple $1,000,000 and you're, you're
set and done. So a lot of it would came down
(07:28):
to just how can you test and learn in these hyper local
markets and then create nuances that you could potentially scale
online with targeted specific marketing campaigns.
Makes total sense. And for these early D2C brands,
you know $1,000,000 ARR, how do you think about and you know to
give them talking to them now founders that are doing this,
(07:49):
what's the kind of budget and timeline for that first pop up
to, to de risk the move before they you know, go spend
2,000,000 on a flagship store? How would you how would you
advise somebody wanting to do this today?
Yeah. So I think it's really important
to understand what are you trying to test and then how can
you design an experience or piggyback off of an experience
that is already has some sort oflike a time bound initiative
(08:12):
around it. And so that's why I think a lot
of these festivals and conferences have really blown
up. So you think of Coachella, you
think of South by Southwest, ArtBasel, Miami, you know, those
are areas where you already haveyour demographic selected, you
already have these time bound experiences selected.
And for us, it we found that it was great to be able to
understand where could we insertourselves, you know, and insert
(08:32):
our clients into these experiences.
So for example, if you spend allday listening to music at South
by Southwest and you come back to your hotel, you have a couple
hours to kill before you go out to dinner.
What do you want to do? Well, the number one thing you
want to do is you want to sit, you want to relax, you want to
have a drink. And so we launched a series of
different beauty brands in hotellobbies at South by Southwest by
giving people, you know, a complimentary glass of bubbly
(08:55):
and they would sit down, they would try on a face mask, They
would, you know, engage in a product, they would get a Mani,
pedi, whatever it was. And then we'd be able to give
them like some sort of gift bag where then we could measure the
bounce back after the activationor after South by or after, you
know, those different areas. So I think a lot of brands
struggle because they decide to go into brick and mortar with
(09:17):
this idea of this beautiful 4 walls and they're like, oh,
we're just going to open up a store and then they will come.
Not necessarily. So you need to be very, very
hyper specific about who you're going after, why, why you're
doing it, and then what you're looking to test ideally with
almost like a teaser, like a subset of the product offering.
So then you encourage people to come back to either your site
(09:38):
or, you know, follow you on Instagram or whatever, whatever
it is. Yeah, it's in fascinating.
And so how do you judge like a digital native brand
storytelling? Like how do you know that that
will translate to a physical space?
I think you said that it's like you're not just going to go and
build a flagship, you're going to do something.
How do you sort of know? Like, hey, they've got a set of
storytelling that's going to make sense for something IRL?
Well, a lot of times it doesn't because we usually, I mean, if
(10:02):
you think about your phones, which is where a huge amount of
mobile converse transacts, you have two eyeballs and most of
the time 2 hands and you're completely focused on that
thing. And when you're walking down a
sidewalk or you're in a mall or you're shopping in some cute
little St. you are so distracted.
You're constantly looking up. Maybe you're with your kids,
maybe you're with friends you'remeeting there.
So I think a lot of times peopleneed to understand that you need
(10:22):
to really sort of optimize everysingle square inch of that
physical area. You know, a consumer may just
walk by the front store and be like, oh, that's interesting.
They'll pull it up on their phone, or they may just walk in
and be like, oh, this is nice, this smells pretty, I'm gonna
look at this later. Or they may come in and try
something on and then decide they want to buy it later.
So I think those elements are really important and understand
(10:42):
the consumer journey and knowingthat it's not going to be
sequential, like how you're scrolling in a very sequential
way online. So it comes back to just picking
something hyper specific that you can test and say, OK, what
is the message? If somebody glances at us for
three seconds, what are they going to receive from that?
And then are we aligned with what the current mindset is of
that particular location? You'll notice there aren't a lot
(11:06):
of great retail stores next to banks.
Why? Because banks are boring.
You're never in a good mood whenyou go to a bank.
Well, maybe you are, but I'm not.
You know, it's like I'm trying to get in, trying to get out.
But you know, when you think about like the best restaurants,
you think about, you know, greatexperiences, whether it's
cultural or what have you, that's where great retail is
because people are in that mindset of taking a moment to
(11:26):
pause and they want to walk and they want to see like, oh, what
is that? What is this?
And then that's where you have those opportunities to kind of
insert your brand in a in a great way.
Is there a non obvious signal that you look for to say, OK,
we're ready to go to a physical retail presence for a brand?
Is there something that's like, oh, if this if this bit flips
now I know we can green light that that physical store.
(11:48):
Yeah, I think a huge amount of it is dwell time and figuring
out a particular location, if there's the dwell time that
supports it. You know, a lot of brands,
because brands that succeed nowadays, it's beautiful
pictures. And if you could put together
beautiful pictures and captivating videos or things
like that, that's what helps yousucceed on online, on
(12:08):
e-commerce. But in physical retail, it's not
like that. So sometimes I'll have brands
where they say, oh, you know, wereally want to go to this little
area and we just think it's so beautiful and quaint.
And I'm like, yeah, it's quaint,it's quiet.
That's not good. So we don't want that, you know,
we want, you know, busy and bustling and things like that.
So if you can figure out if a location has, you know, a high
dwell time where people are hanging out there for a long
(12:30):
time, whether it's groups of people or, you know, families or
things like that, then you more likely have an opportunity to
help have your brand discovered in that moment.
But the in and out transactions,those, those are very difficult
to be able to have a have an experience that's horrible.
What assumptions are like sort of brick and mortar CAC like our
founders getting wrong in 2025? Like what, what, what did you
(12:52):
mention like the dwell time? Like, are there other things
that, you know, founders are sort of getting, you know,
wrong? Yeah, a lot of it is just it's
matching the consumer experiencewith the cadence of of purchase.
So for example, you know, if you're selling socks, you know,
how many times a year do you want consumers to buy your
socks? That is probably a lot lower
(13:12):
rate with a higher quantity versus a aesthetician or some
sort of a spa service. Ideally with spa service you
want people coming back every. Week that recurring, sort of,
yeah. Exactly.
So it's like if you want people to come back every single month
or every single three months, like how are you designing that
consumer experience in order to match that?
And I think Zara does this really well.
(13:33):
Like they want people coming in their stores at least once a
month, so they swap out their merchandise every two to three
weeks. It gets people coming back in.
Then you look at some of these department stores and these
legacy department stores and they're like, gosh, we don't
understand what's going wrong. It's like, well, you know, you
don't switch out your merchandise.
You know, it's like 3 to 6 months.
It's like, well. The same suits, the same pants,
the same shoe. Like literally nothing new.
(13:55):
Right, great. It's like you don't, you've seen
it once, like you'll come back in three months when they swap
it out, you know, so, so matching that cadence and if you
can get the cadence of purchase aligned with a consumer
experience, then you can really start to see your CAC dive down.
But a lot of times people get false hope from a pop up or from
a short term activation because they get a huge amount of people
(14:16):
coming in and huge amount of people buying, but they're
buying one time and they haven'treally designed an experience or
helped people understand the value of building a relationship
up with that brand. And that's where sometimes
things don't translate well intoa longer term, longer term
store. Let's talk about COVID so, you
know, contact, I mean. Where I cried every day.
(14:38):
So many of us did you know, Contactless retail talk about
how your playbook has shifted tode risk.
You know, on the flip side, the physical store world in a world
where you know, the shifting between D to CE com and and the
physical world, and this idea ofthe pop ups is kind of a step
step function there. How do you think about it now
(14:59):
post COVID? And what's that playbook that
you would articulate to the founders that are trying to do
this? Well, I think there's a lot of
things that have stayed with us.I mean, I think if we think
about these QR codes, which we all just thought was so ugly,
really, really another QR code like tapped onto a gift bag,
really like how are we doing? But most restaurants still have
the QR codes, like it's still kind of working, right?
(15:21):
So I think that when you think about contactless retail, it's
really about how can you have the lowest friction experience
and the least amount of barriersto entry to help the consumer
get what they want, when they want it in that little micro
moment, They have to be able to pop into your store in and out.
And so that really comes into one, the sequencing, which we
spoke about, but also understanding, you know, a lot
(15:42):
of storefronts are designed likea shotgun.
And so you only have, you know, 1015 foot feet of frontage and
then it goes back 30 or 40 feet.And traditionally that was
because people had a lot of inventory.
They had a back of house inventory.
Now people don't really need that back of house inventory
because ideally if you want to have a, you know, low CAC, high
ROI store, you want to ship to the consumer so you can get more
(16:03):
data. So you ideally want someone to
come in, try out all these products and say, you know what,
ship it to me and then you get all that information, all that
data. So with stores now it's about
how if somebody comes in for if somebody just walks by, are they
going to have a good experience and is the brand message going
to resonate? If they come in for two minutes,
are they going to have a good experience?
Is the brand message going to resonate?
(16:23):
And then, you know, if they stayfor 10 minutes, if they stay for
20 minutes. And one thing that we also
realized is, you know what taints an experience and
gentlemen, not to not to scrutinize on you, but most of
the time it's the spouses that taint the experience.
Where's? The chair I.
Need to sit. Down, yeah, need chairs you need
a good place to sit and sit on your phone.
I need. To look at my well.
(16:44):
My wife takes as long as she needs.
Yes, so don't. Bring me.
Right, right, right. Exactly.
So you know, it's, you know, thecontact list is just one area of
reducing friction, but also, youknow, making the whole group of
the shopping group, you know, and spouses and children
comfortable is also like anotherway of, of reducing the
friction. What do you think about like
(17:06):
emerging tech like AI or some ofthe new insight stuff and how
will that kind of reshape? I mean, you talked about
analytics and what can happen inthe store, but how do you think
that will just change how physical retail works over the
next coming years? Well, ideally it will solve one
of the things that has still notreally been cracked.
And that's just understanding the consumer journey right now.
You know, consumers are getting educated on so many different
(17:28):
platforms and it's it's all overthe place.
So you think about just buying acar.
You know, traditionally you justgo down to the dealership, you
talk to Joe Schmo and you say, Hey, I'm looking to buy a car.
He would talk, you're off for like 45 minutes.
And then you'd be like, all right, fine, I guess I'll get
this one. But nowadays when you walk in,
you're like, hey, I want to testdrive this one and this one, and
(17:49):
these are my questions. Like tell me the answers right
now. So consumers are so much more
educated on what they want because of that.
They're dancing around all thesedifferent channels and all these
different platforms. They may have walked into a
department store and then walkedinto your flagship and then
scrolled on Instagram and then went to your website.
And right now where the analytics are, we can't trace
that. So we're guessing about how
(18:11):
educated a consumer is and we don't know if was it a
billboard? Did they get lucky?
Someone message it to them on Instagram?
Did they see it, you know, at a department store and then they
tried it on, but they didn't have the colorway.
So that now they're in our store.
We just have no understanding ofthe entire, you know, collage of
the consumer. So ideally with all the
(18:31):
different tags and cookies and you know, all the analytics are
coming in, ideally we'll be ableto sync that much more and be
able to provide much more specific and accurate consumer
profiles and understand that consumer journey a lot better
because right now a lot of us are guessing at the wall.
No one, I'll admit that, but that's the truth.
Another one I'm interested in is, you know, how does, how does
like AI revolution and ChatGPT changes?
(18:53):
Kevin and I talk about this a lot, but you know, next time I
want to buy something, I'm I maynot be going to Google, I may be
going to ChatGPT and it's then how are those are those results
optimized to send me to your brand or somebody else's?
Right. So continue looking into the
future. What is the optimal Omni channel
footprint look like for a consumer brand that has
successfully de risked its physical presence?
(19:14):
How do they how do they set themselves up for success?
I think it's it's going to be even more channels than we have
now. I think it is going to continue
to be a really solid mix betweenthe social media and the
websites, but also these flagship stores and these pop up
stores and these activations as well as the department stores.
I think you know, right now a lot of brands because of how
(19:36):
it's set up, you have to hit a certain revenue mark in order to
get to the department stores in order to even have a sit down.
And so that's why a lot of brands started with pop ups
because they need to kind of proof out that concept.
Now there's going in order to grow because it's so expensive
with the custom, you know, the acquisition cost with marketing
and all of that. Brands need to push like on all
cylinders, all of the channels. And so I think, you know,
(19:57):
growing ideally, you know, when you spoke to a brand, you know,
seven years ago, their goal was just to have three to five
flagship stores and that was it.You know, and then it started to
change and now hands are very much like they're trying to push
the hotel partnerships, they're trying to push any sort of
Pilates partnership, whether you're a Wellness company, a
nail company, whatever. It's like we are in the studio
(20:17):
and you're also trying to get tothe department stores.
You can have that long term kindof business continuity of like a
clean buying cycle. And then you're also trying to
have these small short term leases, which now are a little
bit difficult to get to be able to be wherever you want, be
wherever the consumer is. So I think it's just going to be
consistently evolving and the dream mix of what it was 10
(20:38):
years ago and five years ago andtoday is it's all changing
because the consumer is changingbecause how we shop is changing,
how often we leave our house is changing.
You know why we leave our house is changing.
And that all impacts, you know, our discretionary spend and
where we're spending in our mindshare.
Super good. I mean, shifting gears a little
bit in your work with Mentors Fund, I think, you know, now
when you're like looking at a pitch and sort of thinking about
(20:59):
that, like that first 30 seconds, whether they're
considering physical retail or not.
Like what is it that you as you think about like these shifts
that we've seen over the last decade?
And what is it that you're like,wow, when you heard this, that's
like something that's exciting and makes you want to lean into
that pitch and feel like you want to hear the rest of the
Founders story. Yes, well, I, I think as much
as, you know, so many founders having extreme amount of passion
and I'm just like, oh, I love this, this is great.
(21:21):
But you really have to take a step back and realize like, is
this a fad or is this something that's durable and that is kind
of, you know, the investor's jobof figuring out like, OK, can
this scale, is this just a one off thing?
Is this just a short term fad? And so I think, you know,
understanding if they can cross that mark and make sure that
there are certain indicators andcatalysts that are not just
(21:42):
today's headline, Like that's super important.
And sometimes we get carried away and we have to catch
ourselves like, OK, no, this is definitely a fad.
We love the fad. We're on the fad, but it's a
fad. It's not going to be around in
in a year and a half. Cupcakes, cookies, Donuts,
anybody OK, no, so what's what'sthe the red flag deal killer?
Like what's something that you, you hear this in a, in a pitch
(22:03):
in it, you know it's dead and you think they're not going to
make it. Yeah.
You know, it's, it sounds clicheto say, but the passion, so many
founders try to be so serious and just so like this is our
solution and it's going to be great.
And we know it's going to be great because of this.
And I think sometimes people come off of not being very open
minded. And I think it's very difficult
(22:25):
because you're trying to raise money and you're trying to show
that like this, we've figured itout, we've cracked it.
All we need is your check and like then we're good to go.
But I think now more than ever, you need to be super nimble and,
and just just very open, super passionate, but very, very open
and a little crazy, right? Like you don't be a good
entrepreneur and even a little bit nuts.
So you know if you're too, you know, monotone and you know
(22:48):
it's. Like you embrace the crazy here.
Unfounded. Definitely into the crazy thing,
like that's kind of a first and foremost first principles.
Yeah, yeah. You know, if you knew how hard
it was, nobody would do it. So.
Exactly. So I mean, when you're coaching
portfolio CEO's or talking to founders, like what is your sort
of viewpoint on, you know, balance of like this speed and
execution versus saving cash? And sort of, I mean, just the
(23:09):
difference in building teams with AI these days where like
the efficiency that you can get on small teams is pretty insane.
Oh, it's unreal. I was literally thinking how
much money I would have saved ifI started my business.
Like five years. Don't we?
All right. Seriously, So you know, I kind
of go back to like the main ethos of, you know, how do
businesses fail? Like the first one they fail
with Co founder fights and the second one they fail is running
(23:31):
out of cash. So I think those two things need
to be optimized like do not fight so far that you ruin a
relationship and do not run out of cash.
And I think it's, you know, you always need to have some sort of
a conservation capital because it's very easy to get swept up
into what investors are saying or what your advisors are
saying, what your customers are saying and just tailspin without
(23:52):
having a reserve. And I like to just say you, you
always need to have fuck you money just to be able to walk
away if something tailspins and you're like, shoot, wait, wait,
we are too far. This did not work.
And you don't want, you know, something to destroy the
business. I think that's very important.
You need to just make sure you always have certain amount of
capital reserves. And it's just it's it's like a a
rainy day fund, right? You just, yeah, you don't ever
(24:14):
want to do anything that puts your livelihood at risk.
But that's my more conservative approach.
And I think a lot of people havewinning stories is going the
opposite way. I think in 2025 that's smart.
We see so many companies at least in the last 12 to 18 month
cycle run out of money. So being a little bit more
conservative is, is, is the right way to go.
And then pairing that with smallteams and leveraging tools and
(24:34):
AI is, is smart kind of on the other side of this when it comes
to doing good while also doing well financially.
How do you think about social impact metrics and community
building as you, as you look at like a brand to invest in on the
mentors fund side or or just youknow, looking at a brand and
thinking about their retail strategy, How do you, how do you
(24:55):
do that? How do you do good and not
dilute the ROI side of it? Well, it's, it's very easy to
get carried away on doing totally divergent things like,
oh, this is what's going to makeus money.
And then this is what's going to, you know, make us, you know,
sound great. And this is what's going to do
all this. But ideally, the consumer
experience is completely interlocked with that.
So for example, we launched a lingerie brand during Breast
(25:18):
Cancer Awareness Month and we had an experience where
consumers could come up and write notes to, you know, people
fighting cancer to like a heartstring moment where we're
able to establish a community impact, be able to establish
feel good moments for people, and also give that brand a way
to identify with their communitymembers in a totally different
(25:40):
way. And then from there, you know,
we donated a variety of different skews toward to UCLA's
Cancer Research. So I think it was, I think if
you can find moments to really tie in your brand ethos to the
consumer experience and do something that people actually
care about, it's very important.I think brands you try to do it
and you know every week or everymonth like you know.
(26:01):
Not authentic, yeah. Yeah, it comes a little too far.
I mean, if you can do any more, power to you.
I'm sure AI will give you a great solution of all the
different events you can attack,you know, just stay authentic
because now more than ever, it'svery easy for consumers to to
pick up on this. But yeah.
Looking back, you talked about AI, but what would you have
automated earlier or what would you have been like the first
couple things that you would have automated to accelerate
(26:22):
growth and just make building, you know by revealed easier?
Everything. No, I think training, training
and logistics. So that was something that took
a huge amount of time. And I think if you think about
think about the best salespeople, the best
salespeople in retail and eventsor whatever it is, they are on
their feet 18 hours a day. They are running around, they're
speaking a mile a minute. They do not learn by sitting in
(26:45):
front of a Zoom for an hour and a half session like on a
PowerPoint. Like that is not the best way
they learn. So if you can use AI to be able
to take like, hey, look, here's this training manual and here's
all this brand data I need this person to absorb.
This is their, you know, personality skew test, whatever
Myers break, whatever it is likegive me a video sequence of all
(27:05):
this information that they can listen to while walking, you
know, or doing their morning run.
Done. Like, I mean, we would have had
such a higher rate of high quality people being able to
absorb super custom information.So yeah, that would have been
amazing. Awesome.
So thinking about the folks thatare listening and giving
yourself advice, kind of reflecting back like you just
(27:27):
did. If you could talk to your pre
MBA Megan what what is the pieceof career advice, the one piece
that you would want her to know about navigating the
intersection of design, business, technology in.
I would say if it's annoying, fix it.
I love that. I kind of, you know, I, I went
straight through from my undergrad into my MBA.
So I was the youngest of my cohort and I spent a lot of my
(27:50):
time just trying to look at other people and be like, oh,
wow, they were like 5 years of consulting firm.
Like, oh, they did this. Like I should try to be more
like that or I should try to think like this.
And at the baseline, like, look,if it's annoying, just go fix
it. There's no reason why these
legacy system, just because they've been around for 30-50
hundred years should exist. If it's annoying and you don't
like it, so just, you know, forget about how things have
(28:11):
been done historically and just go fix it.
Go do something better. Megan, this has been fantastic
work and listeners. Find you online or learn more
about your work. I think like LinkedIn right now,
I think that's probably the best.
So we'll include that in the show notes.
Just really fun conversation. And thank you so much for
sharing your insights with us onFounder Mode my.
(28:31):
Pleasure. This is a lot of fun, so thank
you and keep it up. I'm excited to listen to your
future episodes. Wow, that was a master class for
Megan Berry on DE risking brick and mortar.
Absolutely. So many actionable takeaways.
What stood out to you Kevin, from what Megan shared?
Yeah, a few things. So I think first pop up retail
is this kind of low risk bridge.So to go from like your online
DTC all the way to brick and mortar.
(28:52):
I think the flat pack kiosks of like keeping it less than 8
feet, you know less than 50 square feet.
This sort of gets around the building permits like that's
true founder mode right there interms of figuring out, you know,
how to how to get it done. And then those core KPI's like
when to scale up, you know, unaided brand awareness, sort of
high dwell time, really understanding that.
And I think, you know, COVID obviously being a big thing for
(29:13):
for sort of in person and understanding like what is that
frictionless design, like contactless checkout, minimal
inventory. And I mean a big one for me.
It's like if you're going to be shopping all day, I want to have
a place to sit and play on my phone and kind of hang out.
Where are we sitting, you know, while you're shopping?
And so and then finally, I mean this just notion of how AI is
impacting Omni channel and sort of of aligning the sort of
tracking or cadence across that customer journey from online to
(29:35):
offline. Yeah, couldn't agree more.
It was a great a great interviewand a great conversation.
So if you're a founder that's navigating these waters or knows
someone who is, this is definitely an episode to share
with them. And if you haven't already
subscribed to Founder Mode, it'syour favorite podcast on your
favorite platform, Apple, Spotify, YouTube, and you know,
leave us a review if it helps and would love to share the word
with others. Yeah, you can find links to
(29:57):
Megan's LinkedIn and everything else we discussed here in the
show notes today. And coming up on our next
episode, we're going to shift gears back into the tech side of
things. And that's right, we'll have JJ
Zhuang, my long term partner, 27years, joining us to talk about
how to bootstrap your tech team using AI.
It's going to be a fantastic discussion, leveraging AI to
build and scale your engineeringefforts efficiently.
All right, that's a wrap for this one.
(30:17):
Remember, when it comes to retail, don't just follow the
foot traffic, follow the data and de risk your dream.
And so then I started looking atthe permit and I realized that
if something was under 8 feet and under 50 square feet,
technically it was not a building.
Therefore, it did not need to meet building codes or building
permits. It just, I just needed a sales
permit and all I need to do is like the business and that it
was in front of they needed to approve it.
And then I needed like a seller's license and I could
(00:21):
pretty much go anywhere I wanted.
So I was just trying to hack thebuilding permits and that was
how I designed the kiosk to be able to fit within.
Yo, welcome back to Founder Mode.
(00:43):
Where we unpack how founders crush it.
Jason, DTC brands going physical, I mean, big move.
I mean, when you're like sort ofgoing from that online thing.
I mean, me as a software guy, I've been doing a lot of
software and so very rarely do Iwork at or sort of participate
in startups that end up with, you know, a physical office.
And so super interesting to learn about like when is it time
to make that shift? And I mean, even for e-commerce,
(01:03):
right, where they've, you know, spent all their time building
their brand online, like when dothey go, you know, IRL?
Yeah, it's a. It's an important question.
I think if you're selling physical goods, your DC brand
and you're making money and you're like, man, I wish my
stuff was in that store. Just think, think carefully
because there's a lot of stuff that you don't see behind the
scenes happening, whether you'regoing wholesale into a big
(01:25):
channel like the Costco's and Targets and Walmart's or you're
like, I'm going to stand up my own flagship store.
It is expensive, right? It is very expensive.
And it's so this this one's exciting because we're going to
talk about how to do it on the cheap and kind of test the
market much in the same way we run all sorts of experiments
online to best if something's working before we go and make a
big investment. Yeah, let's talk about, let's
(01:46):
talk about your, your experienceon this.
You know, your software guy, right?
But, you know, any brands come to mind that that you've seen
make that the make that leap into the physical world?
Good, good, good or bad vibes? Yeah.
Nightmares. I was thinking back like I, you
know, I'm kind of like thinking back when was the last time I
walked in with a box from the mailbox versus when did I walk
(02:07):
in with a bag that like came from a store?
Yeah. And and I would and the
literally thinking back, it's been a few months, but it was
AII brought some shorts at brewery.
I'm like a huge brewery guy. And it was literally sort of
serendipitous. We were just walking to the mall
in Vegas and I was like, oh, those are really cool.
You know, kind of saw it and it's a brand that I've already
had and worn. In the window you saw it.
Yeah, like saw some and I was like, that's a cool different
(02:27):
color or whatever. And then, you know, I was
basically like going to just take a picture with my phone and
then just order it online. But for whatever reason, we
walked in and started chatting. I was like, let's see, what else
is there because that color was cool.
Ended up not getting the one in the window, but one that was on
the raft and they had my size, which is rare to be honest.
And like, you know, and the linewasn't crazy long, like, you
know, so it kind of required, like I would say a lot of the
(02:50):
times you go to a store perfect Storm where I actually purchased
a pair of shorts and then I camehome and I ordered like three
more of the same time online. And that's, you know, they came,
you know, three days later. So today we're diving into DTC
brands, hitting physical retail,doing it smart and not crashing
and burning. There's huge upside here, but it
is a different beast. You need a tight playbook.
Yeah, so we're sitting down withMegan Berry to break it all
down. Megan is a beast.
(03:10):
She founded by Reveal, which wasacquired in 2021, and now she's
a partner at Mentors Fund. She's got Harvard and Washu
degrees, and she LED Starbucks first Reserve store.
Yeah, she knows Retail Insider now.
All right, let's talk to Megan. Megan, welcome to Founder Mode.
(03:31):
Thrilled to have you and you know, want to talk of all kinds
of things, brick and mortar, DTCand yeah, just excited to have
you and the energy on the pod this morning.
Awesome. Glad to be here.
Love what you guys are doing. So it's very exciting.
Yeah. So let's let's dive into it.
Megan, your background, which issuper interesting, you know,
from architecture and founding by reveal to your work with
mentors fund, you have such a unique perspective on the on the
(03:54):
topic of de risking brick and mortar for DC brands.
So we're we're excited to dive into it.
Let's let's kind of hit you withsome questions.
You ready? Always, always ready.
Let's go. So what was the like initial or
single insight that sort of convinced you that this pop up
model could disrupt traditional refill?
I mean, we've talked in the pastand it was just amazing to see
how that journey. And so I'm curious, like, what
(04:15):
was that kind of first spark that in your mind sort of kicked
off but became of it? Yeah, so it was, you know, over
10 years ago, I was working on my graduate thesis, and I was
just so amazed that with literally a credit card and
Internet connection, people could launch a website, a URL,
and then all of a sudden test and learn immediately.
They could look at click maps, they could test out skews.
(04:37):
They could sell their goods globally.
And it was just such a smooth sale to be able to test and
learn, to be able to get your products out there.
Meanwhile, I'm in Graduate School for an architecture
degree, looking at these projects that take north of 10
years to do. I'm like, Oh my gosh, in my
entire life, I'm only going to be able to work on five or six,
you know, monumental projects. And so there was just like such
(05:00):
a disconnect between the lifespan of how we build
buildings versus how quickly technology was evolving.
And I just, I was like, Oh my God, this is totally diverging 2
totally different paths. Like there needs to be some sort
of a middle ground. Yeah, it it was, it was just
kind of mind blowing too, because you know, you're 20
something and you're just like, I'm going to change the world,
you know, like, oh wait, how am I going to do this?
(05:20):
So. Idealism, right?
We all, we've all, we've all been there.
Now we're now we're here. Let's talk about let's talk
about your architecture training.
How did that inform the way thatyou designed the, the customer
experience when you when you built by reveal?
And maybe just for those who aren't familiar, just like the
quick, quick kind of hit on whatwhat is by reveal?
What was it? So by reveal was a pop up
(05:40):
company. He basically did small format
kiosk that got deployed pretty much anywhere consumers were.
So sidewalks, hotel, corporate lobbies, malls, public plazas,
parks, pretty much anywhere. And it was this small format
boutique that could get deployedin under an hour where consumers
could come touch and feel products and then transact
directly on site. So I was pretty much just trying
(06:03):
to hack it and I was like, OK, well, it needs to be something
flat packed and be able to be able to just, you know, in a
truck. Basically.
I was like, I need to be able torent a U-Haul and be able to
like get it in there and then get it out and set it up.
And so then I started looking atthe permit and I realized that
if something was under 8 feet and under 50 square feet,
technically it was not a building.
(06:25):
Therefore, it did not need to meet building codes or building
permits. It just, I just needed a sales
permit and all I need to do is like the business embedded was
in front of they needed to approve it.
And then I needed like a seller's license and I could
pretty much go anywhere I wanted.
So I was just trying to hack thebuilding permits and that was
how I designed the kiosk to be able to fit within those
(06:46):
parameters. So good.
And so like what was that sort of KPI that sort of triggered
like OK, pop ups there it's activated like when is it ready
to scale into a permanent store?What is that indication that
like, well, it's ready to go to the next step?
Well, my business was pretty much all on only pop ups, so I
was just convincing clients thatthey always need to test and
learn and just keep on going. But what we did get to is
(07:06):
realizing that once you had aided brand awareness with the
customer and wherever that was, whether if your target market
was on the East Coast, on the West Coast, in vacation
destinations, etcetera. Once you had that, then you were
ready to deploy that large amount of capital which to do a
good flagship it's a couple $1,000,000 and you're, you're
set and done. So a lot of it would came down
(07:28):
to just how can you test and learn in these hyper local
markets and then create nuances that you could potentially scale
online with targeted specific marketing campaigns.
Makes total sense. And for these early D2C brands,
you know $1,000,000 ARR, how do you think about and you know to
give them talking to them now founders that are doing this,
(07:49):
what's the kind of budget and timeline for that first pop up
to, to de risk the move before they you know, go spend
2,000,000 on a flagship store? How would you how would you
advise somebody wanting to do this today?
Yeah. So I think it's really important
to understand what are you trying to test and then how can
you design an experience or piggyback off of an experience
that is already has some sort oflike a time bound initiative
(08:12):
around it. And so that's why I think a lot
of these festivals and conferences have really blown
up. So you think of Coachella, you
think of South by Southwest, ArtBasel, Miami, you know, those
are areas where you already haveyour demographic selected, you
already have these time bound experiences selected.
And for us, it we found that it was great to be able to
understand where could we insertourselves, you know, and insert
(08:32):
our clients into these experiences.
So for example, if you spend allday listening to music at South
by Southwest and you come back to your hotel, you have a couple
hours to kill before you go out to dinner.
What do you want to do? Well, the number one thing you
want to do is you want to sit, you want to relax, you want to
have a drink. And so we launched a series of
different beauty brands in hotellobbies at South by Southwest by
giving people, you know, a complimentary glass of bubbly
(08:55):
and they would sit down, they would try on a face mask, They
would, you know, engage in a product, they would get a Mani,
pedi, whatever it was. And then we'd be able to give
them like some sort of gift bag where then we could measure the
bounce back after the activationor after South by or after, you
know, those different areas. So I think a lot of brands
struggle because they decide to go into brick and mortar with
(09:17):
this idea of this beautiful 4 walls and they're like, oh,
we're just going to open up a store and then they will come.
Not necessarily. So you need to be very, very
hyper specific about who you're going after, why, why you're
doing it, and then what you're looking to test ideally with
almost like a teaser, like a subset of the product offering.
So then you encourage people to come back to either your site
(09:38):
or, you know, follow you on Instagram or whatever, whatever
it is. Yeah, it's in fascinating.
And so how do you judge like a digital native brand
storytelling? Like how do you know that that
will translate to a physical space?
I think you said that it's like you're not just going to go and
build a flagship, you're going to do something.
How do you sort of know? Like, hey, they've got a set of
storytelling that's going to make sense for something IRL?
Well, a lot of times it doesn't because we usually, I mean, if
(10:02):
you think about your phones, which is where a huge amount of
mobile converse transacts, you have two eyeballs and most of
the time 2 hands and you're completely focused on that
thing. And when you're walking down a
sidewalk or you're in a mall or you're shopping in some cute
little St. you are so distracted.
You're constantly looking up. Maybe you're with your kids,
maybe you're with friends you'remeeting there.
So I think a lot of times peopleneed to understand that you need
(10:22):
to really sort of optimize everysingle square inch of that
physical area. You know, a consumer may just
walk by the front store and be like, oh, that's interesting.
They'll pull it up on their phone, or they may just walk in
and be like, oh, this is nice, this smells pretty, I'm gonna
look at this later. Or they may come in and try
something on and then decide they want to buy it later.
So I think those elements are really important and understand
(10:42):
the consumer journey and knowingthat it's not going to be
sequential, like how you're scrolling in a very sequential
way online. So it comes back to just picking
something hyper specific that you can test and say, OK, what
is the message? If somebody glances at us for
three seconds, what are they going to receive from that?
And then are we aligned with what the current mindset is of
that particular location? You'll notice there aren't a lot
(11:06):
of great retail stores next to banks.
Why? Because banks are boring.
You're never in a good mood whenyou go to a bank.
Well, maybe you are, but I'm not.
You know, it's like I'm trying to get in, trying to get out.
But you know, when you think about like the best restaurants,
you think about, you know, greatexperiences, whether it's
cultural or what have you, that's where great retail is
because people are in that mindset of taking a moment to
(11:26):
pause and they want to walk and they want to see like, oh, what
is that? What is this?
And then that's where you have those opportunities to kind of
insert your brand in a in a great way.
Is there a non obvious signal that you look for to say, OK,
we're ready to go to a physical retail presence for a brand?
Is there something that's like, oh, if this if this bit flips
now I know we can green light that that physical store.
(11:48):
Yeah, I think a huge amount of it is dwell time and figuring
out a particular location, if there's the dwell time that
supports it. You know, a lot of brands,
because brands that succeed nowadays, it's beautiful
pictures. And if you could put together
beautiful pictures and captivating videos or things
like that, that's what helps yousucceed on online, on
(12:08):
e-commerce. But in physical retail, it's not
like that. So sometimes I'll have brands
where they say, oh, you know, wereally want to go to this little
area and we just think it's so beautiful and quaint.
And I'm like, yeah, it's quaint,it's quiet.
That's not good. So we don't want that, you know,
we want, you know, busy and bustling and things like that.
So if you can figure out if a location has, you know, a high
dwell time where people are hanging out there for a long
(12:30):
time, whether it's groups of people or, you know, families or
things like that, then you more likely have an opportunity to
help have your brand discovered in that moment.
But the in and out transactions,those, those are very difficult
to be able to have a have an experience that's horrible.
What assumptions are like sort of brick and mortar CAC like our
founders getting wrong in 2025? Like what, what, what did you
(12:52):
mention like the dwell time? Like, are there other things
that, you know, founders are sort of getting, you know,
wrong? Yeah, a lot of it is just it's
matching the consumer experiencewith the cadence of of purchase.
So for example, you know, if you're selling socks, you know,
how many times a year do you want consumers to buy your
socks? That is probably a lot lower
(13:12):
rate with a higher quantity versus a aesthetician or some
sort of a spa service. Ideally with spa service you
want people coming back every. Week that recurring, sort of,
yeah. Exactly.
So it's like if you want people to come back every single month
or every single three months, like how are you designing that
consumer experience in order to match that?
And I think Zara does this really well.
(13:33):
Like they want people coming in their stores at least once a
month, so they swap out their merchandise every two to three
weeks. It gets people coming back in.
Then you look at some of these department stores and these
legacy department stores and they're like, gosh, we don't
understand what's going wrong. It's like, well, you know, you
don't switch out your merchandise.
You know, it's like 3 to 6 months.
It's like, well. The same suits, the same pants,
the same shoe. Like literally nothing new.
(13:55):
Right, great. It's like you don't, you've seen
it once, like you'll come back in three months when they swap
it out, you know, so, so matching that cadence and if you
can get the cadence of purchase aligned with a consumer
experience, then you can really start to see your CAC dive down.
But a lot of times people get false hope from a pop up or from
a short term activation because they get a huge amount of people
(14:16):
coming in and huge amount of people buying, but they're
buying one time and they haven'treally designed an experience or
helped people understand the value of building a relationship
up with that brand. And that's where sometimes
things don't translate well intoa longer term, longer term
store. Let's talk about COVID so, you
know, contact, I mean. Where I cried every day.
(14:38):
So many of us did you know, Contactless retail talk about
how your playbook has shifted tode risk.
You know, on the flip side, the physical store world in a world
where you know, the shifting between D to CE com and and the
physical world, and this idea ofthe pop ups is kind of a step
step function there. How do you think about it now
(14:59):
post COVID? And what's that playbook that
you would articulate to the founders that are trying to do
this? Well, I think there's a lot of
things that have stayed with us.I mean, I think if we think
about these QR codes, which we all just thought was so ugly,
really, really another QR code like tapped onto a gift bag,
really like how are we doing? But most restaurants still have
the QR codes, like it's still kind of working, right?
(15:21):
So I think that when you think about contactless retail, it's
really about how can you have the lowest friction experience
and the least amount of barriersto entry to help the consumer
get what they want, when they want it in that little micro
moment, They have to be able to pop into your store in and out.
And so that really comes into one, the sequencing, which we
spoke about, but also understanding, you know, a lot
(15:42):
of storefronts are designed likea shotgun.
And so you only have, you know, 1015 foot feet of frontage and
then it goes back 30 or 40 feet.And traditionally that was
because people had a lot of inventory.
They had a back of house inventory.
Now people don't really need that back of house inventory
because ideally if you want to have a, you know, low CAC, high
ROI store, you want to ship to the consumer so you can get more
(16:03):
data. So you ideally want someone to
come in, try out all these products and say, you know what,
ship it to me and then you get all that information, all that
data. So with stores now it's about
how if somebody comes in for if somebody just walks by, are they
going to have a good experience and is the brand message going
to resonate? If they come in for two minutes,
are they going to have a good experience?
Is the brand message going to resonate?
(16:23):
And then, you know, if they stayfor 10 minutes, if they stay for
20 minutes. And one thing that we also
realized is, you know what taints an experience and
gentlemen, not to not to scrutinize on you, but most of
the time it's the spouses that taint the experience.
Where's? The chair I.
Need to sit. Down, yeah, need chairs you need
a good place to sit and sit on your phone.
I need. To look at my well.
(16:44):
My wife takes as long as she needs.
Yes, so don't. Bring me.
Right, right, right. Exactly.
So you know, it's, you know, thecontact list is just one area of
reducing friction, but also, youknow, making the whole group of
the shopping group, you know, and spouses and children
comfortable is also like anotherway of, of reducing the
friction. What do you think about like
(17:06):
emerging tech like AI or some ofthe new insight stuff and how
will that kind of reshape? I mean, you talked about
analytics and what can happen inthe store, but how do you think
that will just change how physical retail works over the
next coming years? Well, ideally it will solve one
of the things that has still notreally been cracked.
And that's just understanding the consumer journey right now.
You know, consumers are getting educated on so many different
(17:28):
platforms and it's it's all overthe place.
So you think about just buying acar.
You know, traditionally you justgo down to the dealership, you
talk to Joe Schmo and you say, Hey, I'm looking to buy a car.
He would talk, you're off for like 45 minutes.
And then you'd be like, all right, fine, I guess I'll get
this one. But nowadays when you walk in,
you're like, hey, I want to testdrive this one and this one, and
(17:49):
these are my questions. Like tell me the answers right
now. So consumers are so much more
educated on what they want because of that.
They're dancing around all thesedifferent channels and all these
different platforms. They may have walked into a
department store and then walkedinto your flagship and then
scrolled on Instagram and then went to your website.
And right now where the analytics are, we can't trace
that. So we're guessing about how
(18:11):
educated a consumer is and we don't know if was it a
billboard? Did they get lucky?
Someone message it to them on Instagram?
Did they see it, you know, at a department store and then they
tried it on, but they didn't have the colorway.
So that now they're in our store.
We just have no understanding ofthe entire, you know, collage of
the consumer. So ideally with all the
(18:31):
different tags and cookies and you know, all the analytics are
coming in, ideally we'll be ableto sync that much more and be
able to provide much more specific and accurate consumer
profiles and understand that consumer journey a lot better
because right now a lot of us are guessing at the wall.
No one, I'll admit that, but that's the truth.
Another one I'm interested in is, you know, how does, how does
like AI revolution and ChatGPT changes?
(18:53):
Kevin and I talk about this a lot, but you know, next time I
want to buy something, I'm I maynot be going to Google, I may be
going to ChatGPT and it's then how are those are those results
optimized to send me to your brand or somebody else's?
Right. So continue looking into the
future. What is the optimal Omni channel
footprint look like for a consumer brand that has
successfully de risked its physical presence?
(19:14):
How do they how do they set themselves up for success?
I think it's it's going to be even more channels than we have
now. I think it is going to continue
to be a really solid mix betweenthe social media and the
websites, but also these flagship stores and these pop up
stores and these activations as well as the department stores.
I think you know, right now a lot of brands because of how
(19:36):
it's set up, you have to hit a certain revenue mark in order to
get to the department stores in order to even have a sit down.
And so that's why a lot of brands started with pop ups
because they need to kind of proof out that concept.
Now there's going in order to grow because it's so expensive
with the custom, you know, the acquisition cost with marketing
and all of that. Brands need to push like on all
cylinders, all of the channels. And so I think, you know,
(19:57):
growing ideally, you know, when you spoke to a brand, you know,
seven years ago, their goal was just to have three to five
flagship stores and that was it.You know, and then it started to
change and now hands are very much like they're trying to push
the hotel partnerships, they're trying to push any sort of
Pilates partnership, whether you're a Wellness company, a
nail company, whatever. It's like we are in the studio
(20:17):
and you're also trying to get tothe department stores.
You can have that long term kindof business continuity of like a
clean buying cycle. And then you're also trying to
have these small short term leases, which now are a little
bit difficult to get to be able to be wherever you want, be
wherever the consumer is. So I think it's just going to be
consistently evolving and the dream mix of what it was 10
(20:38):
years ago and five years ago andtoday is it's all changing
because the consumer is changingbecause how we shop is changing,
how often we leave our house is changing.
You know why we leave our house is changing.
And that all impacts, you know, our discretionary spend and
where we're spending in our mindshare.
Super good. I mean, shifting gears a little
bit in your work with Mentors Fund, I think, you know, now
when you're like looking at a pitch and sort of thinking about
(20:59):
that, like that first 30 seconds, whether they're
considering physical retail or not.
Like what is it that you as you think about like these shifts
that we've seen over the last decade?
And what is it that you're like,wow, when you heard this, that's
like something that's exciting and makes you want to lean into
that pitch and feel like you want to hear the rest of the
Founders story. Yes, well, I, I think as much
as, you know, so many founders having extreme amount of passion
and I'm just like, oh, I love this, this is great.
(21:21):
But you really have to take a step back and realize like, is
this a fad or is this something that's durable and that is kind
of, you know, the investor's jobof figuring out like, OK, can
this scale, is this just a one off thing?
Is this just a short term fad? And so I think, you know,
understanding if they can cross that mark and make sure that
there are certain indicators andcatalysts that are not just
(21:42):
today's headline, Like that's super important.
And sometimes we get carried away and we have to catch
ourselves like, OK, no, this is definitely a fad.
We love the fad. We're on the fad, but it's a
fad. It's not going to be around in
in a year and a half. Cupcakes, cookies, Donuts,
anybody OK, no, so what's what'sthe the red flag deal killer?
Like what's something that you, you hear this in a, in a pitch
(22:03):
in it, you know it's dead and you think they're not going to
make it. Yeah.
You know, it's, it sounds clicheto say, but the passion, so many
founders try to be so serious and just so like this is our
solution and it's going to be great.
And we know it's going to be great because of this.
And I think sometimes people come off of not being very open
minded. And I think it's very difficult
(22:25):
because you're trying to raise money and you're trying to show
that like this, we've figured itout, we've cracked it.
All we need is your check and like then we're good to go.
But I think now more than ever, you need to be super nimble and,
and just just very open, super passionate, but very, very open
and a little crazy, right? Like you don't be a good
entrepreneur and even a little bit nuts.
So you know if you're too, you know, monotone and you know
(22:48):
it's. Like you embrace the crazy here.
Unfounded. Definitely into the crazy thing,
like that's kind of a first and foremost first principles.
Yeah, yeah. You know, if you knew how hard
it was, nobody would do it. So.
Exactly. So I mean, when you're coaching
portfolio CEO's or talking to founders, like what is your sort
of viewpoint on, you know, balance of like this speed and
execution versus saving cash? And sort of, I mean, just the
(23:09):
difference in building teams with AI these days where like
the efficiency that you can get on small teams is pretty insane.
Oh, it's unreal. I was literally thinking how
much money I would have saved ifI started my business.
Like five years. Don't we?
All right. Seriously, So you know, I kind
of go back to like the main ethos of, you know, how do
businesses fail? Like the first one they fail
with Co founder fights and the second one they fail is running
(23:31):
out of cash. So I think those two things need
to be optimized like do not fight so far that you ruin a
relationship and do not run out of cash.
And I think it's, you know, you always need to have some sort of
a conservation capital because it's very easy to get swept up
into what investors are saying or what your advisors are
saying, what your customers are saying and just tailspin without
(23:52):
having a reserve. And I like to just say you, you
always need to have fuck you money just to be able to walk
away if something tailspins and you're like, shoot, wait, wait,
we are too far. This did not work.
And you don't want, you know, something to destroy the
business. I think that's very important.
You need to just make sure you always have certain amount of
capital reserves. And it's just it's it's like a a
rainy day fund, right? You just, yeah, you don't ever
(24:14):
want to do anything that puts your livelihood at risk.
But that's my more conservative approach.
And I think a lot of people havewinning stories is going the
opposite way. I think in 2025 that's smart.
We see so many companies at least in the last 12 to 18 month
cycle run out of money. So being a little bit more
conservative is, is, is the right way to go.
And then pairing that with smallteams and leveraging tools and
(24:34):
AI is, is smart kind of on the other side of this when it comes
to doing good while also doing well financially.
How do you think about social impact metrics and community
building as you, as you look at like a brand to invest in on the
mentors fund side or or just youknow, looking at a brand and
thinking about their retail strategy, How do you, how do you
(24:55):
do that? How do you do good and not
dilute the ROI side of it? Well, it's, it's very easy to
get carried away on doing totally divergent things like,
oh, this is what's going to makeus money.
And then this is what's going to, you know, make us, you know,
sound great. And this is what's going to do
all this. But ideally, the consumer
experience is completely interlocked with that.
So for example, we launched a lingerie brand during Breast
(25:18):
Cancer Awareness Month and we had an experience where
consumers could come up and write notes to, you know, people
fighting cancer to like a heartstring moment where we're
able to establish a community impact, be able to establish
feel good moments for people, and also give that brand a way
to identify with their communitymembers in a totally different
(25:40):
way. And then from there, you know,
we donated a variety of different skews toward to UCLA's
Cancer Research. So I think it was, I think if
you can find moments to really tie in your brand ethos to the
consumer experience and do something that people actually
care about, it's very important.I think brands you try to do it
and you know every week or everymonth like you know.
(26:01):
Not authentic, yeah. Yeah, it comes a little too far.
I mean, if you can do any more, power to you.
I'm sure AI will give you a great solution of all the
different events you can attack,you know, just stay authentic
because now more than ever, it'svery easy for consumers to to
pick up on this. But yeah.
Looking back, you talked about AI, but what would you have
automated earlier or what would you have been like the first
couple things that you would have automated to accelerate
(26:22):
growth and just make building, you know by revealed easier?
Everything. No, I think training, training
and logistics. So that was something that took
a huge amount of time. And I think if you think about
think about the best salespeople, the best
salespeople in retail and eventsor whatever it is, they are on
their feet 18 hours a day. They are running around, they're
speaking a mile a minute. They do not learn by sitting in
(26:45):
front of a Zoom for an hour and a half session like on a
PowerPoint. Like that is not the best way
they learn. So if you can use AI to be able
to take like, hey, look, here's this training manual and here's
all this brand data I need this person to absorb.
This is their, you know, personality skew test, whatever
Myers break, whatever it is likegive me a video sequence of all
(27:05):
this information that they can listen to while walking, you
know, or doing their morning run.
Done. Like, I mean, we would have had
such a higher rate of high quality people being able to
absorb super custom information.So yeah, that would have been
amazing. Awesome.
So thinking about the folks thatare listening and giving
yourself advice, kind of reflecting back like you just
(27:27):
did. If you could talk to your pre
MBA Megan what what is the pieceof career advice, the one piece
that you would want her to know about navigating the
intersection of design, business, technology in.
I would say if it's annoying, fix it.
I love that. I kind of, you know, I, I went
straight through from my undergrad into my MBA.
So I was the youngest of my cohort and I spent a lot of my
(27:50):
time just trying to look at other people and be like, oh,
wow, they were like 5 years of consulting firm.
Like, oh, they did this. Like I should try to be more
like that or I should try to think like this.
And at the baseline, like, look,if it's annoying, just go fix
it. There's no reason why these
legacy system, just because they've been around for 30-50
hundred years should exist. If it's annoying and you don't
like it, so just, you know, forget about how things have
(28:11):
been done historically and just go fix it.
Go do something better. Megan, this has been fantastic
work and listeners. Find you online or learn more
about your work. I think like LinkedIn right now,
I think that's probably the best.
So we'll include that in the show notes.
Just really fun conversation. And thank you so much for
sharing your insights with us onFounder Mode my.
(28:31):
Pleasure. This is a lot of fun, so thank
you and keep it up. I'm excited to listen to your
future episodes. Wow, that was a master class for
Megan Berry on DE risking brick and mortar.
Absolutely. So many actionable takeaways.
What stood out to you Kevin, from what Megan shared?
Yeah, a few things. So I think first pop up retail
is this kind of low risk bridge.So to go from like your online
DTC all the way to brick and mortar.
(28:52):
I think the flat pack kiosks of like keeping it less than 8
feet, you know less than 50 square feet.
This sort of gets around the building permits like that's
true founder mode right there interms of figuring out, you know,
how to how to get it done. And then those core KPI's like
when to scale up, you know, unaided brand awareness, sort of
high dwell time, really understanding that.
And I think, you know, COVID obviously being a big thing for
(29:13):
for sort of in person and understanding like what is that
frictionless design, like contactless checkout, minimal
inventory. And I mean a big one for me.
It's like if you're going to be shopping all day, I want to have
a place to sit and play on my phone and kind of hang out.
Where are we sitting, you know, while you're shopping?
And so and then finally, I mean this just notion of how AI is
impacting Omni channel and sort of of aligning the sort of
tracking or cadence across that customer journey from online to
(29:35):
offline. Yeah, couldn't agree more.
It was a great a great interviewand a great conversation.
So if you're a founder that's navigating these waters or knows
someone who is, this is definitely an episode to share
with them. And if you haven't already
subscribed to Founder Mode, it'syour favorite podcast on your
favorite platform, Apple, Spotify, YouTube, and you know,
leave us a review if it helps and would love to share the word
with others. Yeah, you can find links to
(29:57):
Megan's LinkedIn and everything else we discussed here in the
show notes today. And coming up on our next
episode, we're going to shift gears back into the tech side of
things. And that's right, we'll have JJ
Zhuang, my long term partner, 27years, joining us to talk about
how to bootstrap your tech team using AI.
It's going to be a fantastic discussion, leveraging AI to
build and scale your engineeringefforts efficiently.
All right, that's a wrap for this one.
(30:17):
Remember, when it comes to retail, don't just follow the
foot traffic, follow the data and de risk your dream.
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