“That’ll Never Work” — Now It’s a $270M Brand (w/ True Classic CEO)⏐Ep. #218 - The Koerner Office - Business Ideas and Small Business Deep Dives with Entrepreneurs

Episode Transcript
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(00:00):
You can do it with virtually no money.
If someone who has failed through life as many times as I
have was able to figure it out, quite literally everybody can
figure it out. I remember like it was yesterday
because you get that little cha ching sound on your Shopify and
it is so addicting. Everyone in the world is doing a
7 out of 10. If you're 8 out of 10, you take
the whole market. We did 15,000,000 and then we

(00:21):
did 90 the next year and we werelike, oh, we're going to be
billionaires. We got into Costco, Target,
Sam's Club, TJ Maxx, Kohl's. The world is giving you clues
every single day on what you should be doing.
It's up to you to really cancel out the noise and listen to
those clues. It is so easy to make money
working with other businesses and charging them a flat fee and

(00:42):
just stacking those retainers up.
My life took off when I started thinking about stacking up
retainers. If you're a 20 to 50 year old
man that's been on the Internet over the last six years, you've
probably seen ads on Facebook orInstagram for True Classic.
Did you know that that company was started with only $3000 from

(01:03):
a guy with no apparel or e-commerce experience and that
just six years after founding it, it's doing $270 million in
revenue without ever being venture funded?
This is one of the most incredible stories that's never
been told. I had to have the founder on and
talk about how he built this andwhat we can take away from it.
I promise you this isn't just like a how I built this type

(01:24):
episode. This is a how can you build
something similar to this type episode?
Very tactical lots of business ideas.
I mean you know my style. Come on guys, you're.
Going to love it. Music took up a decade of my
life. I went to school for audio
engineering and so I thought that was going to be it because
everyone told me you're so good at music, you should do that for
a living. And I just followed and went
down that path, went in debt, didn't work out, gave up, went

(01:46):
into poker, put another 10,000 hours into that thinking it was
going to be my future. Went broke, gave up on that.
Then I went into digital marketing and that's when my
life started to take off for thebetter.
And I built an agency over a decade, another 10,000 hours.
So between, you know, exercisingthe creative muscle with music
and learning risk tolerance and how to bet on yourself through

(02:08):
poker and then learning digital marketing and building other
people's businesses. It was kind of like the perfect
third, a third, a third of DNA to really make true classic
work. So the idea originally, I had a
bunch of ideas, as most entrepreneurs do, and you just
don't know what's going to hit. And so I had always been
tinkering around with like, the apparel industry is boring, It's

(02:31):
archaic. No one's really crushing it on
the innovation side. I felt like men's clothing was
under doing it. I felt like the premium market
was overpricing it. So I was just like, let me just
focus my energy on one thing, the shirt, the T-shirt for men.
Let me just build the perfect shirt.
Let me tighten it up on the shoulders and arms to accentuate

(02:53):
the guy's body, make him look, you know, buffer than he really
is. And then let me make a premium
garment that isn't $100 a shirt like some of the Nordstrom
people that you go in there and see.
And I also knew that, like, I had to solve a real problem,
right? Yeah.
Like most people that I talk to that come to me nowadays, these
like young entrepreneurs, they're like, I want to build a

(03:13):
lifestyle brand. I want to do.
And I'm like, buddy, solve a problem.
Like, yeah, I know you what you want to do.
But like, if you're not listening to the market and what
they actually want from you, you're building it the wrong
way. You're building something for
you, not the market. Solve a problem in the market
and your life will be a million times easier, right?
So I went into solving the premium over gouging problem,

(03:37):
the fit problem, and then just the comfortability problem of
just like building clothes that were all comfortable, not just a
couple things, but like everything we make is wildly
comfortable. Yeah, because it's like as a man
your age similar, like I buy a shirt and I just don't know how
it's going to fit. Is it going to flame out at the
bottom? Is it loose?
And so when it comes to the problems you were trying to

(03:59):
solve, was it more about the fit, the the comfortability or
the price if you had to pick one?
If I had to pick the most important, it was the fit first
and foremost because everything I would put on, I just felt
pretty underwhelmed. And I remember asking my wife
like, why is everything in your side of the closet like
perfectly made for you? Like why is it all tailored and

(04:21):
why? And, and what I found was that
like, I think they just thought that guys didn't care.
And you know, largely we don't for the most part.
I wanted to prove that thesis out and I was like, look, if
there's just a small group of guys that love true classic for
what it is, I'm happy with that.I don't need this to be
$1,000,000 company. You know, I didn't anticipate it
to get this large, but the Tam was much bigger than we

(04:42):
realized. I think so.
Now, did you go into this thinking like, all right, men
are struggling with XY or Z problem?
And then you put all these hundreds of ad creatives out
there and you learn, wow, actually this problem is the one
that they're clicking on. I thought that this problem was
the biggest, but this is the onethey're clicking on.
So I want to make more ads like this.
Did that ever happened? That's exactly how it happened.
So I tried everything, as most entrepreneurs do.

(05:04):
You just like, you know, throw it against the wall and see if
it sticks. And what I found very early on
was the women would give us feedback in the reviews and they
would say, you know, I don't know what you guys are doing
over there, but all of a sudden I spend $50 and my husband's got
this air of confidence when he leaves the house.
And that's when I made the connection that like, oh, we're

(05:25):
selling confidence. We're not just selling T-shirts
now. And when you make that kind of
emotional connection with people, you are on to something
unbelievable. Now it's bigger than shirts,
right? And So what I started figuring
out, because I'm a skinnier guy,I'm like, you know, 62175I, I
float right around there. And yes, the shirt made me look

(05:47):
better. But what I didn't anticipate was
that for the bigger guys, the large, the XL, the two XL, it
made these guys look wildly better.
Like it made them look like theyliterally lost 10 lbs overnight
just putting a shirt on. And that wasn't even a problem
you were trying to solve. No, I was just trying to solve
like, let me just have it look alittle bit better for everybody.

(06:07):
The skinny guys look a little bigger, the big guys look a
little slimmer, and so on and soon.
And so once that popped, I was like, oh, we got to go all in on
this dad bod thing and that's when it really started to
explode. So I just leaned into what was
working. Well, I think the timing is also
critical because in an age of social media, like confidence

(06:29):
has never been lower. If we could measure confidence
in society, it isn't an all timelow.
And you're coming in selling that with the same social media
tools that are taking their confidence away, right?
So product market fit textbook definition right there, right?
Yep. And the product had to be great
early on because the marketing really wasn't that great.

(06:50):
It took me a while to get there.So to get to the, you know, 100
million in two years that was onthe backbone of just building
unbelievable product market fit and having the product stand on
his own because you know as wellas anybody that without the
retention in the repeat buy, there is no business essentially
it has to be great. And that drives all the

(07:10):
profitability because we are, you know, largely a, you know,
break even on 1st customer acquisition company as most
startups are. You're just trying to get them
to come back and either buy denim or underwear or long
sleeves or whatever it is so. In any business, retention is
the name of the game in your business.
What does that look like? Are you after the first order?
I I imagine there's an e-mail marketing sequence that what?

(07:33):
Yeah. What does that look like?
Well, first of all, before they even stop converting, before
they even get to the checkout, we're already doing what's
called a gift with purchase, which is tremendous for the
business. And So what we do is we get them
in other categories before they even check out.
So yes, you're going to buy T-shirts.
We're also going to throw in active wear.

(07:54):
We're also going to throw in underwear because these are
killer products and we know that.
So when they get them for free, they're like, and they get them
home, they're like, oh wow, I wasn't even anticipating this.
I thought they were the T-shirt company, actually.
They sell amazing goggers, they sell amazing underwear, and then
they start getting into these other categories very quickly.
So that's kind of the first component before they even
literally convert. That's not something you

(08:16):
probably just tested that, right?
Or you've heard of someone else doing it.
So it's just like, that's like the slogan of this whole podcast
is test everything except drugs.And this is what happens.
Like how much has that one little hack added to the value
of your company? Like if you were to include the
retention improvement and all that.
Dude, it's everything. It's everything as long as you
are being thoughtful about the product that is going into their

(08:39):
basket, as long as you're doing that thinking and through that
like because I could have just thrown anything in there, right?
But it wouldn't have made sense.I did it specifically well #1
boost AOV. That's like the obvious thing,
right? Like.
Average order value. Yeah, because they get excited
to see something for free. So they want to hit those
thresholds because when you get to 100 you get free ship and you
get to 150, you get a free shirt, you get to 200, you get

(09:03):
free underwear or whatever it is.
And so it boosts AOV up because they want to keep hitting those
tiers. So that's number one.
That's the obvious thing. But the not so obvious thing is
cross category and getting them into the newer markets.
So once we figured that out, I think we figured that out around
year 3 and it was because I was,we launched activewear and it

(09:24):
wasn't doing great right off thebat.
And I was like, how can I get people into this category?
And I'm like, well, I already had people converting.
Why don't I just force them intothese categories with free
product? Like let me just, it's that good
of a product to where I know once they get it, they'll buy
it. And that was the thinking.
Well, you just kind of gave me anew framework to think of and
it's like you heard of a chickensalad Chick.

(09:46):
The restaurant chain, It's a franchise that sells chicken
salad. That's it.
I love that. And the franchisees do hundreds
of thousands a year of net profit.
It was founded by a woman. Incredible, incredible startup
story. Anyway, I'm relating what you
just said to this because it's the framework is and I'm making
this up on the spot. It might sound dumb.
What if the side dish was the main dish, right, That's it.

(10:08):
So you were like, I have an e-commerce brand.
We throw in free crap sometimes.And I'm ashamed to admit a lot
of times it's just the overstockcrap or the stuff that's
expiring or the stuff that we'regoing to throw away and
liquidate. And it's like, sure, let's give
them some pickled okra because these go bad in two months
anyway. And that's like, that's the
norm. And people kind of when we do
that, we pat ourselves in the back like, yeah, good.

(10:29):
Hey, I'm doing what I learned about in that Facebook group.
I'm pretty smart and you're overhere like, OK, what if that
afterthought was like the whole strategy?
What if we took something that was really good, like based on
our reviews, like a really good jogger or something, and gave it
to him for free? And then we just wait and see.
And we might lose $7.00 on that first order instead of $0.70.

(10:50):
But let's just wait and see if it plays out.
And then when it plays out, you're like, wow, I just added
$10 million a year to my business.
Right. Yeah, because you have to grow
these other categories. I think that's like we had to
get beyond just T-shirts and they're and still even to this
day, six years later, people, a lot of people only know us for
the T-shirts because it's what we've sold the most of.

(11:11):
But you really have to get them in the other categories to make
the allow the business to keep growing beyond T-shirts.
Yeah, I mean, it's like like Lululemon, any brand Nike,
right? Like, what if Nike still sold
sold shoes today, right? They wouldn't be in the Fortune
500. That's exactly right.
You have to go above and beyond and there's a lot there.
Obviously it's beyond marketing,but like you just have to

(11:35):
continually provide real value for people in the form of
product. And it can just be like what I
normally see in these other brands is everything is an
afterthought versus their first killer product that they crushed
with. And that's something that Lulu
has done really well. They came out with a leggings
and they were a legging company,but then they have a lot of
other amazing products, which israre and that's how you get to

(11:56):
Lulu's level. So what most companies do is
they go, oh, that crushed. Now let's do just a bunch of
other stuff because we need to just keep boosting top line and
we need to do it. And then they don't put the same
intentionality that they put into the original product into
everything else. And that is a huge miss.
I've seen that with a lot of thebig brands too, and they just
cannot crack that nut. But you have to take that

(12:18):
original DNA that you put there and spread it out.
It has to really go into the same.
And that's what we did. Like with denim, that's what we
do with activewear. We took the same idea of problem
solving and then started going category by category and saying
what are we solving in denim? What are we solving in
underwear? And so on and so on.
Yeah. Instead of saying what can we
launch in denim, what can we launch it?

(12:39):
Like how can we be opportunistic?
You're saying this is what you said originally.
What problem are we solving? We have to solve a problem.
I imagine there's been categories that you asked that
question and you thought, you know, I don't, I don't really
know what there's to solve righthere.
Let's just pass on this one, right?
Yeah, I would say the, the one problem you're always really
solving in apparel for us is that the premium market is still

(13:01):
gouging everybody. So even if, let's just say for,
for argument's sake that the denim doesn't solve the fit
problem like it did for T-shirts, at the very least you
can get, you know, page level orAG or rag and bone level denim
for half the price. Like that's a real problem.
That's a problem that everyone'sfacing.
They want the premium mark, but they can't afford it.

(13:23):
And so that is in the absence ofsomething like fit, we lean in
heavily on like, well, it's going to be the same fabric as
the the top guys and you're going to get to pay literally a
quarter or half the price. And that's a big win for
customer. OK.
So what was the month and year when you first originally
started? So I started on the journey of

(13:43):
like thinking about it in 2018, but it wasn't till late 2019
that I started it. It was like August of 2019.
OK. And was there like when you
first started thinking about it,was there a triggering event, a
conversation, something that yousaw out there in the market that
really because you probably you're like me, you're an idea
guy, you have a lot of ideas. What kept you on this one?

(14:05):
You know, ironically, and I toldthe story a few times, my
brother texted my mom not too long ago and reminded or
reminded me of a story that I had told him when I was 19
about. There was a store called Care
Aloha that sells these like really comfortable bamboo
T-shirts and Bahamas. And we used to go to Bahamas
every year as a family. And I went in there when I was
19 and they didn't have my size and my color that I wanted.

(14:27):
And I told my brother I was so pissed off.
I was like, someday, and this isvery entrepreneurial to say,
it's just like, I'm gonna build my own T-shirt brand so that I
always have my favorite T-shirt.And he told my mom that story.
And I looked back. Even back then, I was thinking
about this T-shirt concept. Now, of course, I waited 20
years to execute on it because Ihad forgotten about it.
But what it brought me back to was like it was always there.

(14:50):
It was always stewing in me. And so while I had a lot of
other ideas, like I wanted to get into the lab diamond
business, I thought what an amazing value for the customer
in that business. Or there was a bunch of ideas,
but the T-shirt one just kept staring me in the face literally
every day as I would go into thecloset.
And at a certain point, I'm really good at like accepting

(15:12):
what the world gives me kind of guy like I just, I take in and I
take it for more than face value.
I always take it as like a sign that I'm I need to be doing
something. That's what I tell entrepreneurs
too. I'm like, the world is giving
you clues every single day on what you should be doing.
It's up to you to really cancel out the noise and listen to
those clues, whatever they are. But it's very difficult in the
midst of our lives in the chaos,to listen to those voices, the

(15:35):
inner voice. So I just kept coming into the
closet and feeling the same thing every day.
And then finally, as I'm going on this journey of drop shipping
in like probably 2017 and just learning ECOM because I didn't
know where I was going to go product wise, I was selling a
million different products on these drop shipping websites.
And finally I asked my wife, I'mlike, what if I just did

(15:56):
T-shirts? Like, I know that sounds so lame
and like incredibly commoditized, but like, and she
was like, well, like, what are you going to do?
What's your angle? And I just started kind of
peppering her with the value props and what I thought I could
do. And at the time, she thought I
was insane. It was just something that was
really hitting me consistently. And I just finally decided to
like, well, what it's going to cost me like a couple $1000 to

(16:19):
try this. What's the big deal?
I don't. It's not going to bury my life
if it fails, you know so. I've got a question about that,
but I want to go back to drop shipping.
What types of things were you drop shipping and how much
success were you finding? If anything, because drop
shipping gets a bad rap. What I love about your story is
that you start with drop shipping and I tell people to

(16:39):
try that sometimes because it's like you're not going to finish
there, right. So 11 school thought was like,
oh, drop shipping is over over saturated.
It's dead, and it's for sure a lot harder than it used to be.
Yeah, but I give people advice like this to start little things
like this because it it gets them in the game and it gets
them going. Dude, it's the perfect training
ground. I try to get like I had two guys

(17:01):
come into my office couple days ago and they were like Harvard
grads, like young guys. They just graduated and they
wanted to sell clothing. And I'm like, trust me, you
don't want to do this industry. What you should do is go on
Aliexpress and find some productand, and drop ship it and see if
you can create winners out of that before you go on this
journey, right? And then we're like, their mind

(17:22):
was blown because they're thinking they're going to burn
through all this cash and like, this is like, right, Do we spend
on Facebook as before we give up.
And I'm just like, dude, you don't have to worry about any of
that here. You just go straight to the
manufacturer. They'll ship directly to the
customer. You don't even have to be
involved. So I just think it is, listen, I
am very thankful for my drop shipping journey because it
taught me all the inner workingsof e-commerce, taught me how to

(17:45):
do customer service really well.It taught me operational, you
know, logistics and know how on the supply chain side.
It taught me marketing. It told me how to find winners
and how to do customer research and how to care and how to
really dig into the reviews and find those golden Nuggets that
means so much to the customer when you take it and you
implement it into a product and you give them what they're

(18:06):
actually wanting, not what you think they want.
Big disconnect between. The data speak.
Yes, dude, and the data is all there for the taking.
And I always, I always go back to Amazon when people are like,
I had this idea. I'm like, if you validate it on
Amazon and they're like, no, I'mlike, dude, it's all sitting
there for the taking. I don't know what you're waiting
for. Even to this day when we want to

(18:26):
do a product, my product team, listen, they're like wildly a
successful apparel people in theindustry for God knows how many
years, right? And I'm like, have you looked at
Amazon? And they look at me like I'm
insane because it's just, it's the drop shipper in me being
like over customer centric and going like, guys, please, just I
know WWGSN trends tell you this or that or the industry this

(18:49):
like forget that dude. Go validate please on Amazon and
come back to me with something really tangible and then I'll
feel much better about investinginto product.
But to answer your question, yes, dude, drop shipping is the
answer in my opinion. And someday I'm going to get my
kids drop shipping if they want to get into ECOM because it
teaches you everything you need to know.

(19:10):
And it's listen to your point. It's not, you're not going to do
millions of dollars necessarily,but it sets you up.
You learn how to find winners, scale those winners on Facebook,
and that's now you're on your way.
Yeah, it's a lot of surface areafor building different skills
that you'll need in any business, whether E com or not.
What kind of products did you drop ship?

(19:31):
Dude, everything. It was very much a.
Just testing stuff. Yeah, it was like I basically
took the only two winners that Ipulled out of a sea of like
products on a website was the these were really popular for a
while, but the fidget spinner things you I used.
To sell those too. Yeah, yeah.

(19:52):
So what drop shippers do really well is they go, they're like
the Amazon. They're just like, let me throw
everything in there. And then they start narrowing
and narrowing. Narrowing, right.
So like the fidget spinners keptwinning for me.
And so I took the fidget spinnerand then I just made a whole
website around fidget spinners and that way you keep the focus
and then you learn that that's how you do it.
You just that's the model, test everything, find your winners,

(20:13):
scale the winners. Another one was like this
backpack. It was like a tech backpack that
had like a charger adapter thingto get into the side.
You probably know from like doing like it's a lot of the
same stuff that everyone does, but it works and people love it.
So like those were just a coupleof my early winners that.
I yeah, I had this company that that sold iPhone parts wholesale

(20:36):
and my iPhone repair shop customers were selling fidget
spinners on the counter. So we would order them by the
10s of thousands of dollars for like a dollar each and then sell
them for $1.50 each. And then they would sell them at
the counter for $5 each, something like that.
But it was a good little business for a while.
Yeah. OK.
All right, so you take $3000. What are?
What are first steps? When you were talking earlier

(20:59):
about like, why T-shirts, why T-shirts, this can really apply
to anybody. So you have an idea, I think
this thing could work right. What really got me to take the
leap from idea to execution overthat year was that the more
research I did on the competition, the more confident
I got. By the time I got to executing,

(21:22):
I was like, this is going to be a billion dollar business.
Like I'm this is going to be insane.
I am going to come in thrashing and making huge impact into the
market, out market. Everybody else like I'll, I'll
develop better product, I'll do better marketing, I'll do
everything better across the board.
It was like everyone was doing asix out of 10 and I was
convinced I was going to do a 10out of 10 across the board.

(21:44):
What were you learning that gaveyou that much confidence
specifically they like? Well #1 the products just
largely sucked and they were overcharging.
So that was like the first learning, which is like, OK,
everyone's gouging. So what, what do I do about
that? So I had to go down the journey
of like, what do cogs look like?Like what does it take to
basically make a bamboo shirt for cheap?

(22:05):
And then I very quickly realizedthat like, I couldn't do bamboo
because bamboo was hard to make.So I ended up going with like
this 6040 cotton Poly blend thatwas perfect.
And so I could get that for likea couple bucks essentially on
cogs. And I was like, like, how are
these people getting away with charging?
Because I could do the math of their product margin And I'm

(22:25):
just like, dude, they are just making too much margin here.
Like let me just take that margin away and see if I can
build the business on the littlemargin I do have and give it
back to the customer. Well, you know what Jeff Bezos
says about that? He says your margin is my
opportunity. It's great.
So was that like the 8020 of your opportunity here?
Was you, you found out where they were sourcing this, You had

(22:48):
an agency background, so you roughly knew what their cost per
acquisition was on Facebook ads.You're like, all right, they're
selling this shirt for $29.00, They're paying $3 for it.
They're paying $3 to ship it. They're paying $6 for a
customer. These guys have 60% net margins,
not even including the retentionand reorder rate and
subscription. What are we doing?
This is no brainer, yeah. And I knew that like once I

(23:11):
started testing on Facebook, I was going to see what the ROAS
looked like. Like, was it 1 1/2 to one?
Was it 3 to 1? Was it 5 to 1?
Like I couldn't wait to get in there because I had already
scaled up Facebook ads across these other Tchotchke products.
And I, I knew what like good ROAS looked like.
So I was just like, let me get in there and see what happens.
And sure enough, what I landed on was like my break even ROAS

(23:35):
was like somewhere in like the one 6 mark and my super
profitable row as was like 2 to one, like anything over 2 to
one. My days looked unbelievably
profitable. That would always come from like
an ad hitting or something happening on Facebook.
Like Facebook back then was wildto like someday would crush.

(23:56):
Other days they do an update andeverything would tank and I
would like open up my dashboard and be like I'm going to lose
the business this month like it would it was it was brutal, but.
You just got to keep keep the faith, right?
You have those bad days and row as it's cut in half.
Well, you also have to diversifybecause even to this day, you
know, like the last couple years, we would spend 6070
million on Facebook ads a year. I mean, it's just mind blowing,

(24:19):
right? It's not until this year that we
built a big enough brand through, you know, Costco and
Target and all these big initiatives that we've done to
be able to pull back on Facebookand not see the business take a
hit. Because in the early days, you
pull Facebook back, the whole business reels back and you're
just like, wow, am I? If Facebook goes away, we're out

(24:42):
of business. Like diversifying sooner than
later is incredibly important tothe success of your brand.
Just so the the viewer has an idea of ROAS, like you're
talking about spending $10 to acquire a customer that places a
$20 order and after you work outyour cost of goods sold and all
that, you're not really profitable.
You're just hoping and praying that they come back and order

(25:03):
more, right? That would be a 2 to 1 ROAS.
Right. Correct.
Yes. OK.
OK. So you start doing research,
you're like ordering from potential competitors, trying
the quality and all that. Yeah, you have to do a
tremendous amount of market research and then you have to go
while they're under doing it here and they're sucking at this

(25:23):
and they're not doing good that like you have to just keep
picking apart their deficienciesand then over indexing and being
better than them at everything. Like I said in the early days of
before I started, it was the customer service.
It was like I would see the way they would interact through
e-mail and with their flows and I'm just like, God, they're
missing it on literally everything.

(25:46):
Like it was nothing that I didn't think I could do better
at on that side of the business.So.
Well, that's what happens in high margin businesses is you
don't have to be creative, you don't have to try.
You can be lazy, right? Which creates the opportunity.
Like why do you think Amazon, it's a very low margin business
on the retail side of things. They're amazing at customer
support. They're amazing at all these

(26:06):
things because it they have to be constraints.
Equal creativity, right? Right.
And that's good news for anybodythat's starting anything because
everyone always goes well. It's so commoditized.
I'm like, dude, they're all under doing it guys.
Like, so you know, everyone in the world is doing a 7 out of
10. If you're 8 out of 10, you take
the whole market over time. That is the punchline.

(26:29):
OK, so I assume you start with Shopify?
Yep, there was no you're ordering that we didn't Shopify
because I even though I was a WordPress guy my whole life, I
wanted. No problems.
There's no second place, no to Shopify, no.
So you're ordering samples from overseas.
I imagine you find something that fits and no designs to
start, right? So you don't have to worry about

(26:50):
design. Even to this day we don't do any
designs. OK.
OK. That was very strict business.
I I just wanted to be playing everything I wanted.
No logos, which is very counter intuitive, but it just goes to
show that like again, I was thinking about the customer.
I'm like, does a customer reallywant a logo?
I don't think they do. I think it's important for any
business owner to remember like,the customer doesn't care about

(27:13):
you. You take up 0 space in your
customer's brain, which means like, probably e-mail them more
often than you think you should because they forgot about you,
right? Probably don't really worry so
much if you have a mistake on your website because they don't
care. They're not thinking about you
when it comes to putting logos on your website or on your
shirts. Like they don't care about you.
They just found you from a Facebook ad.
Like, what does that add to to you, right?

(27:35):
It's like, well, it's viral marketing because no, they're
not going to buy it. There's no viral marketing if
they never buy the thing in the first place.
Ironically, viral marketing is just creating amazing product.
Right. Yes.
Everyone thinks everything's a hack and it's like, dude, it
goes back to like the basics andit's so boring to go back to the
basics. No one wants to hear that.
They're just like, what is the Facebook hack that gets me to a

(27:57):
billion? It's like making amazing
product, buddy. Like that's it.
Do something amazing and and themoney follows.
It's that simple. All right.
OK. So you go to Shopify, How many
skews, How many products do you start out with on day one?
One? Product the T-shirt, six colors.
How many different sizes? Small through 2 XL.

(28:19):
OK. Did you end up adding to that
three and 4X? Yes, we added on my.
Bucky's website we sell up to 4X.
Yeah. It took us a while to get there.
In hindsight, we probably shouldhave done those inclusive sizes
a little bit earlier. We also should have done a lot
of things that relates to the T-shirt which were incredibly
accretive to the business, like doing the curved hem, which is

(28:42):
like so obvious now, doing the Pima, incredibly obvious now.
It's like we should have done a lot.
Like I probably left 50 million or more on the table not doing
the versions of those T-shirts earlier, right?
Like we tried to go, well, now we got to do polos and now we
got to do this and that. And like all the other
extensions of apparel. Going back to what I we were

(29:03):
saying about like leaning to what works and then do all your
iterations against that winner. Like a fidget spinners doing a
smaller fidget doing a bigger fidget doing it like like all
the iterations versus like let me come out with a net new
product and then see what peoplethink.
Yeah, I love that. It's important.
OK, so you start Facebook ads day one like this business does.

(29:26):
You're not even launching without Facebook ads, right?
What do those first few days look like?
How are you feeling? Because you've got that the
through of disillusionment. Like are you still hyped when
you see those first numbers rollin?
Oh yeah, dude, I remember like it was yesterday because you get
that little cha ching sound on your Shopify and it is so
addicting. And so the first couple days
were slow. It took us a little while to

(29:48):
start generating some sales, butwithin a couple weeks, dude, we
were already doing like, I remember like the first week we
hit like an $800 day, and that was like blowing my first week.
Yeah, we couldn't believe it. I was also, like, being really
aggressive on Facebook ads. Like, I wasn't scared to push.

(30:10):
I think most people would have just kind of let it ride and
build slowly, but I was in this like I gotta go mindset.
Everyone wears AT shirt. And like I was already coming
from a place of like I'd watchedso many drop shippers scale
aggressively. So I was like, let me test the
upper limits of this. Now if I push and I look

(30:31):
tomorrow and row as is like .2, I'll pull back, right?
Like that's how I thought about it.
So I was, I wasn't scared to like really push on the needle
on ad spend because it was just working.
And also this was pre iOS 14 when where we lost all that
customer data. So it was working even better
back then. I don't know how what it would

(30:51):
have looked like post the data loss, but things were amazing in
the early days of Facebook. How many creatives did you start
with that first month? Not many dude.
I probably came up with 10 static ads.
We didn't even do video for likeI wanna say 6 to 8 months.
It took me to do a like a video ad shoot with like a couple

(31:13):
models walking around and it wasn't great.
I look back at those ads and they're so cringy.
It was amazing. I made any sales to be honest
like you just I had no idea whatI was doing.
What did like the format of yourfirst like big winning ad look
like? Like a static?
What was your offer? What did the pitcher look like?
The first static ad that crushedand it kind of led me down this,

(31:35):
this journey, which was like really highlighting the value
prop and going back to like, what problem are you solving?
No wonder that, and I knew this from drop shipping, which is
like the ads that always crushedwere the ones that were solving
a problem very quickly in like probably 1015 seconds that you
had to really do the full thing from start to finish.

(31:56):
Like if it was a kitchen appliance, you had to show the
kitchen appliance doing the thing and like, like, oh, I can
just, you know, disassemble an orange very quickly with this
tool. And yet you had to get that
across. You probably drop ship something
like that. I did, dude.
I did. I think one of the popular
products was like, yeah, like the the thing you put in an
orange that squeezes out the juice whenever.

(32:17):
Like there were so many of thosekitchen products that crushed on
drop shipping. Because they they demonstrate
themselves so well. Right.
And they saw that's the whole thing.
Yes, like if a couch could demonstrate its value as well
as, you know, an orange squeezercould, then couches would crush
that's. Exactly right.
So you have such a good framework.
Show that journey to people and the sooner you can do it, the

(32:38):
better. Once I like figured out the
three value props that we kind of live and die by, which is
like just fit, price and comfort, things started really
going off the right because thenI was telling the right story to
people. It wasn't just like, hey, I'm
T-shirt guy amongst a sea of other T-shirt guys.
It was like, oh, that's that T-shirt that makes me look
better and it's like half the price is premium market.

(32:59):
Like I love that. So once people started catching
on to that, it just took fire. What was your daily ad budget
that first week, first month? And I want to know how that
scaled, how quickly that. Yeah, I was, you know, I should
go back and really look at the early days on Meta, But I do
remember starting out at a hundred a day.
That was kind of like my starting point.

(33:20):
And within a week I had tripled it.
I went from 100 to 1:50 to 202 fifty to 300 in like no time
like a week, week and a half. I remember getting and my, my
founders were like, this is going to get like really
expensive, just so you know, andI'm like, I know and, and plus
we didn't have all the math worked out yet.

(33:41):
So even though, because you know, like when you look at a
ROAS, that's not really the trueROAS.
That's the attributed ROAS from Facebook, which doesn't take
into account your operational expenses.
And like all the other line items after your, you look at
your PNL. So it was a little scary, like I
didn't know you're. Not making money yet?
You're not making a profit yet. No, we were taking all the money

(34:02):
and just putting it right back into Facebook ads.
That's another really important point.
And one thing I had an advantageof was that I didn't need to
live off this business. I could just put S every cent
back into the business and that propelled its growth way above
and beyond what it could have been had I been sucking money
out early on. Where was your income coming

(34:23):
from? From your your ads agency.
The agency, yeah, it was still Ihad already hired out for like
my position as CEO, like I just I handed it off and I let them
run the agency and even to this day it's still alive despite SEO
crumbling around us with ChatGPT.
So. How big was your agency at that
point? It was a little over a million a

(34:44):
year. Yeah, it was a great business.
Dude. I always tell people to get into
the service based business. It is so easy to make money
working with other businesses and charging them a flat fee and
just stacking those retainers upover years and years and years.
And if you do great work, you'renever going to lose them as
clients in a sea of scam artiststhat are just constantly ripping

(35:05):
people off in those industries, when you're the ones actually
providing value, you never lose them.
Or if you lose them, they come back after they get ripped off
by somebody else and they realize, oh, the grass is not
greener. I try to take a price cut but
I'd rather pay you more and get great service.
Were you charging like 1 to 5K amonth or were you doing it like
charging a percentage of ad spend?
I was charging 500 to 5 grand a month because it was mostly LA

(35:30):
market so even the five hundredsI should have never started
there. That was way too low.
I would say my sweet spot was like 1500 to 3000 a month and it
was like a lot of lawyers and dentists and chiropractors and
those industries where a customer is worth an insane
amount of money for them to acquire.
Yeah. Would you agree that just
starting an ads agency today, just like you did back then, is

(35:53):
still a big opportunity? Enormous dude.
I I think people just underestimate it and they don't
know even where to start. But my life took off when I
started thinking about stacking up retainers and how a little
bit of like, I think for people that aren't comfortable in
sales, you have got to figure that part out if you're going to

(36:13):
be in that business or. You find the Co founder that
hasn't figured out. Or that 100%.
But like, you need to be obsessed with sales because you
need to know how to relate to people, You need to know how to
listen. You need to know how to not
oversell and just really sell the value you're going to bring
them, right? So that was an important skill
that I was lucky enough to learnyoung.

(36:34):
My dad was a great salesman and I learned a lot from him them
growing up and he always told meI should like do sales in some
capacity. Ironically, like here we are
doing all these crazy numbers and I still do an immense amount
of sales. I'm selling, you know, potential
investors or acquirers or or customers or you name it, like
I'm still out here selling so. Also, when you have an an ads

(36:57):
agency you have so much surface area for learning all the secret
insurance and outs and workings of what your customers are
doing. I mean, you never even would
have considered starting this business had you not had an ad
agency. No chance, because I wouldn't
have known how to not spend. Like I wouldn't have known that
Facebook was the answer. I really would have like,
probably spent money and just sprayed it all over the place

(37:19):
and lost a bunch and then given up.
But like going through the process of watching lawyers,
dentists, chiropractors spend onthe wrong things and seeing that
and having that insight gave me such a huge competitive
advantage because I was like, Oh, well, this is just a
Facebook business. I love how like you can, you can
give opposite advice and both ofthem be true.

(37:41):
Like you said, you were looking at lab grown diamonds.
I'm assuming one reason for thatis because it's very high
ticket, but it's very it's a very high value for the price
that they're paying. You can use paid ads.
So if you're a master at paid ads, why not pick something
that's high ticket? So on one end of the spectrum,
it's like if you can really learn paid ads, find something
high ticket. And on the other end of the
spectrum, it's like if you can really learn paid ads, go to a

(38:01):
commodity, something boring but huge and like over competitive
like apparel, like you're going to win no matter what.
Like because because the first principles are swapping your
creative like good customer service, good product, all this
the boring stuff, right? It's true whether it's high or
low ticket. That's exactly right.
And like, dude, to live through an era of where we even have the

(38:23):
ability to run Facebook ads is unbelievable.
Like it really is. I could have not built true
classes without Facebook ads. Like, it just, I have no problem
saying that because that's the truth.
Like what's really lucky to be alive in this ecosystem where we
have these tools because, you know, 30-40 years ago they
didn't exist, dude. People were doing door to door

(38:45):
and billboards and mailers and all this archaic crap that they
had to do. So it's like, if you're not
using Facebook ads, boy, are youmissing out.
And even how we talk about, you know, AI and, and all the
implications of what that does for business.
What an unbelievable time that we're all living through even
that true classic dude. You'd be shocked at how much

(39:05):
tech and AI we use with everything we do because we're
realizing that it just makes everything so incredibly
efficient and better for everyone.
Yeah. All right.
So first four months you do a quarter million in revenue.
What does your first year look like as far as revenue, profit
and like a daily ad spend look like?
Roughly, yeah, I would say. So we did 15,000,000 the first

(39:28):
year and that's when we were like, wow, work, we're really on
to something. Oh my gosh.
But it wasn't until the next year that we were like, because
I remember when we did 15,000,000, we're like, guys,
someday we could sell this company for like 50 million.
It would be insane. And then we did 90 the next year
and we were like, we're gonna bebillionaires.
This is gonna be insane. Like we're.

(39:50):
Gonna sell us for see where thisis headed.
It's just then we started looking at like, we're gonna be
Haynes. We're gonna be like, you know,
5-6 in a year. And so it very quickly changed
and it became our life. We just stopped everything we
were doing after that first. Year there's so many inspiring
things about this story, but oneconcept I've been obsessed with
lately is that of like chasing product market fit.

(40:11):
You were 37 when you started this.
You've done all kinds of random things, drop shipping, all kinds
of things. You could argue that a bunch of
those different products that you drop ship, we're all kind of
different businesses, right? I've started 75 businesses, but
if people get stressed about like, oh, shiny object syndrome,
I need to stay focused on one business.
Yeah, chase the product market fit, chase the energy.

(40:31):
Because if you look at someone like Mark Zuckerberg, he's been
doing the same thing for 21 years, right?
And on one hand, it's like, man,that guy is so focused, He's so
driven. And on the other hand, it's like
he would be an idiot if he ever thought of taking his eye off
the Facebook ball, because Facebook has had product market
fit from day one until today. He's not like some like super

(40:53):
driven, like of course he's amazing, He's brilliant, he's
driven and all that. But he he doesn't have above
average focus is what I'm saying.
He just has, you know, product market fit, in my opinion, is
like being chased down the hill by a rock and those rockers that
rock is a customer and you just cannot even sleep because you're
fulfilling orders. You have so much demand and it
never lets up. Whereas most businesses, not

(41:14):
that this is a bad thing is you're pushing a rock up a hill
and it's hard and it rolls back if you rest on your laurels and
it's but that's OK, right? But like when you just keep
chasing product market fit and then once you find it, stay on
it, you won't lose, right? Let's say like with my content,
I see product market fit every month.
Like I just keep growing. And so like, I would be dumb to

(41:34):
stop doing content because it's there.
I'm still doing other stuff, I'mstill launching businesses.
But if I ever found another business idea that kind of
looked interesting, but I didn'tknow if I had product market fit
yet, and I said I'm quitting content to go all in on this,
I'd be stupid. You did all these things for 15
years and then you pivoted and you've been doing the same thing
for six because you still have product market fit, you still

(41:56):
have that energy, you still havecustomers beating down your
door. Yeah, and I'm also just like
obsessed with providing value and that just that journey kind
of never ends. Now it comes in the form of like
philanthropic initiatives that I'm obsessed with, like this
teacher initiative where I pay off all their wish lists or, you
know, the LA fires were here last year and I gave away like 6

(42:17):
million in inventory to people that lost everything.
And now I'm finding ways to makeimpact in the world outside of
just T-shirts and apparel. And that's what really moves me
and doing things like this, likegetting to talk to other like
minded entrepreneurs and show them that you can do it with
virtually no money. You can scale a big business.
You don't even have to come fromthe apparel industry.

(42:38):
You just got to be obsessed withwhat the customer wants and
telling these, you know, storiesto people to show them that
like, listen, if someone who hasfailed through life as many
times as I have was able to figure it out, quite literally
everybody can figure it out because it was just came from an
obsession with what is the market need.
How can I fill that void? And then what do I got to do to

(43:00):
scale that up? OK.
So year one, I'm just going to go through your last six years,
15 mil, 90 million, 150,000,200 and 6,000,212 million, 270
million. And your profit per year 2%,
four percent, 5 percent, 8%, eight percent, 16%, yeah.
So you doubled profit over the last year, Yeah.

(43:21):
This year's gonna and that's really because of wholesale.
We got into Costco and Target and they and Sam's Club and TJ
Maxx and Kohl's and a couple other ones.
But profit margins are unbelievable in those
environments because guess what,you're not paying to acquire a
customer and you're not break even.

(43:43):
You're suddenly just wildly profitable.
And so this is a huge growth year.
You do hit a saturation where you have to go beyond the
digital world, right? Like if they're not on social,
how you going to find them, Right.
So you have to start thinking a little bit more grassroots.
That's where the wholesale comesin.
Because now people walk into Costco and they see us and

(44:05):
they're like, Oh yeah, I saw them online.
These guys are legit. That's oh, that's a.
Whole new level of credibility too.
Dude, that was one thing we didn't anticipate.
So we knew that yes, we were going to hack CAC in those
environments and get them to buybecause there's a big portion of
people that just don't trust online, period.
They just don't. Our generation, our younger
guys, we all all grew up in it, so we trust it.

(44:28):
But like past our age, they're still in this weird limbo land
of like, well, I don't, it's just marketing now.
When they see you in Costco, it's almost like they just
immediately check that box of like, well, Costco's done the
work to vet these guys. This must be legit now.
And so get that confirmation thesecond they walk in the door and

(44:48):
it becomes a no brainer for themto purchase even wildly
successful in Costco. They are amazing partners.
I, I love them to death. I'm always obsessing about like,
what can I do for your, your, your Costco members?
Like, what are some thoughtful things I can create for them?
Like I'm always working to try to figure that out because I
just appreciate what they've done for the business and you

(45:10):
know where it goes. It's interesting the perspective
that you have going into Costco coming from e-commerce.
Most people don't realize how hard e-commerce can be and how
like not free cash flow rich that it is, right?
Because you're putting money into ads and inventory and some
of that inventory just dies, right.
But when you're going into Costco from that, you're like,

(45:31):
I'm in heaven. This is luxurious.
Whereas I've talked to other founders that went into Costco
compared to other channels that they've been in and I'm like,
dude, I don't make any money with Costco.
I just don't make any money. But not only do you not have to
pay to acquire a customer, you don't have to spend 3 to $4.00
to ship AT shirt. You're spending like $0.06 to
ship a pallet full of T-shirts. Yes, not just that.

(45:52):
Like we're one of those productswhere like we're not a SAS
product. Like you actually have to touch
and feel it to understand all the marketing because the
marketing could just be the marketing in a lot of ways.
So people are like, oh, I need to actually get my hands on it.
Which is why when people say like, well, why don't you do a
Super Bowl ad? It's like, dude, we're already
getting, you know, 14,000,000 impressions a day on our ads.

(46:15):
I don't need more visibility. I need people to actually get
the product in their hands so that when they touch, they go,
oh, now I see why? And that happens in those
environments like Costco. They see the stand of the walk
over, they feel it. You watch them interact with the
product and then they immediately it all starts
sinking in. So like I had this idea of like,
let me take the 10 million it would cost for a Super Bowl ad

(46:36):
and let me just spend 10 millionon product and just give it away
to every single person in the US.
Wouldn't that be such a better hack than let me just do a funny
commercial? So that's where I'm at.
Oh man, oh, they're so. This is so good.
So. Kale, by the way, going back to
what you were saying about like difficult environments, we tried

(46:58):
to scale retail and it is very difficult and for a couple
reasons. So we have 16 stores now.
We could have had over 100 had we ramped at the level we were
going to ramp originally becausewe were so bullish on it,
because we were like, Oh well, they just got to get in their
hands. They'll love it.
What you don't anticipate is that if people don't know that

(47:20):
you, it's like Old Navy. When you go to a mall, you know
there's an Old Navy there, right?
When you go to a mall now, you're not assuming there's a
true classic there. So unless you are like have the
best store visibility on the planet and you're right next to
a Lulu or an Apple Store or somewhere where people are
always going in and out, it is so tough to make that PNL work
inside of four walls. Plus, how many people are going

(47:42):
to walk by that sign, see us go Oh yeah, true classic and then
leave and then buy online three months later.
Like you're never going to attribute that sale that they
bought online to the store, eventhough the store was the
Billboard that made it all come together for them.
So like you see this gap in the PNL for retail and you're like,
oh, we're just losing money. Like this just isn't working on

(48:03):
the surface. That's what you would say,
right? And you take all the nuance of
the advertising in those malls and if you were be able to put a
multiplier or something, attribute something to that, it
would all net out plus some and you would be scaling to the
moon. So that's the hard part of
retail. You almost have to just make a
bet that like it's doing more work for you than you realize,

(48:25):
even if they're not walking in the store.
Lift. So there's lift and it's hard to
put a definition on lift, but you just you know what when you
see. You have to assume it on some
level and then help that fill the gap.
But like, imagine scaling retailand then having it not net out
on the PNL across like half yourstores.
What that looks like on the balance sheet, you're just like,

(48:46):
this is wildly unprofitable and like we should pull back.
And so that's why retail is so difficult.
So when it comes to like just pouring money into Facebook ads,
how did you grow the business without because you didn't raise
any money, right? How did you bootstrap this?
Because you got to pour money into inventory, into
fulfillment. We're using a third party

(49:06):
logistics provider. Or are you doing it yourself?
No, we were doing 3 PL. from theget go.
We we knew like there was no waywe were gonna be able to.
Yeah. Actually, how many Shipping
ourselves? You probably have some three PL.
horror stories. I imagine because I've owned a
three PL. It's hard.
No, it's it. Most of them have gone out of
the business. The ones we use in the early
years, no big surprise, like software would like break and

(49:27):
you would be like split shippingstuff accidentally.
And if you know what sports ships are, you're paying double
for every or talk about crushingyour profitability on a nuanced
software application and you're just like, dude, what do I got
to become a software developer to like figure out your software
for you? It's just a nightmare so.

(49:48):
So you've always had a three PL.from day one till today?
Yeah, dude, we knew not to even mess around with that world.
We were like, you know, let's just take that off our play from
the get go. So here's some hacks that people
can do to minimize cash. Number one, you have to have
really solid retention plays to be able to supplement all the

(50:10):
acquisition cash that you're burning.
So that comes back to like Clavio e-mail flows, post
purchase upsells and abandoned cart flows, welcome flows,
optimizing the crap out of all of that.
So that's number one, that'll help you a lot on the cash front
because you'll get those people back.
Beyond that, what people need toreally do, and I never see

(50:31):
people talk about this stuff, which is like negotiating is so
incredibly important to the lifeof a business, negotiating with
your manufacturers, negotiating with banks and really telling
the story of what it could become for them if they invest
in you. So one thing we did really well
early on, this goes back to likeMatt, my kind of makeshift CFO

(50:53):
partner who was an amazing negotiator and and I was as
well. And we would get on these calls
with these manufacturers and we would sell the dream of what
true classic could become for them.
And through that dream, our ask was give me 20,000 in credit,
right? Give me terms on that credit,
give me 60 days, give me 90 days, whatever it is.

(51:15):
And dude, that was a game changer.
And that allowed us to not have to put more money in because the
3000 went against, you know, 2000 went against Facebook ads,
and the other thousand went against actually building the
shirt to make it great. Yeah.
So we didn't actually have to put any money up for inventory,
you know, because there's alwaysMoqs on that stuff.
So we otherwise we would have had to put some significant

(51:38):
money in. But we convinced them to bet on
us. And look, you have to have some
sales skills. It goes back to negotiating.
Like it just you got to find theright partner too.
Like I bet you had we knocked on10 doors, 9 of them would have
slammed in our face. But we found the one guy early
on that was like sure I'll I'll I'll bet on you.

(51:58):
And now the guy's making insane amounts of money off of us
because he helped us in the early days.
So that was a big one. Volume negates luck, yes, right.
The more bankers you talk to, whatever, the more quote, lucky
you got. It's a numbers game, right?
Absolutely. And then, like, would you guys
even be here today if you weren't like diligent about
negotiating everything you could?

(52:20):
No, it's the whole thing, especially once you scale
because we are really tough in negotiations when it comes to
SAS contracts and vendor contracts with three PLS and and
even COGS pricing with our manufacturers.
If you don't scrutinize that andyou look back after a year of
what that could have cost you, it's unbelievable, dude.

(52:42):
I mean, we're probably saving the company excess of 40 to 50
million a year in fees and COGS.And I mean, if you really
tallied it all up, it would be so astronomical.
Even on the SAS side, we're probably saving in the low
millions a year in just pure negotiation.
Just really telling them, look, if you do great work with true

(53:02):
Classic, we're going to be your best case study of all time,
right? I'm gonna get on a camera.
And if I really believe in the SAS, I'm not just selling them
that story like it's actually amazing SAS, then you deserve
the world to know about it. And I will be your biggest fan.
And I will tell the world because I want, I want to send
people down the right roads, right?
Like young business owners that want to learn this stuff.

(53:25):
I really want to tell them that Shopify is the best platform in
the world because it actually isright.
And I will go to bat with Shopify.
And that goes for triple whale on analytics, that goes for
after sale, on post purchase upsells.
It goes for like all the really great pieces that we love.
We really tell them that story and and of course they're going
to buy into that and give us a tremendous discount on the

(53:48):
monthly retainer because they see the upside and what it means
for their business. Yeah.
I mean, well you said like it you're saving 4050 million a
year on everything you've negotiated and that's about what
your profit is. Yeah.
So like in a in a commodity business, in a cutthroat low
margin business like this, you have to negotiate.
I mean you've had single digit profit margins for most of your

(54:08):
history, right? Yes.
And I'm sure you notice over time, because I've noticed this,
if I'm in the middle of like a super high growth business, my
vendors are going to start to like get a little greedy and
they're going to rub their paws together and say we could come
up a little on price. They're not going to leave.
They're not going to leave us, right?
And if you're not on top of that, you won't catch it.
It should be going the other way, right?

(54:29):
Like you should be catching a break as you scale, not like
getting taken advantage of. And plus like there's listen,
there's so much competition withthat stuff that you can always
go somewhere else and they know that.
And so now where there's not a lot of competition at our scale
is the volume. There's not like all these
factories doing like unbelievable volume for

(54:50):
everybody. So like it does start to dwindle
down towards the top. I will tell you that.
Like I don't have as much room as I used to on cogs.
Like it used to be wide open andnow it's like, well, you know,
we need hundreds of thousands ofunits in a particular style.
There's only a couple manufacturers that can do that.
And so we don't have as much leverage there as we used to.

(55:13):
Yeah, OK, let's say heaven forbid, wave a magic wand.
Your business is gone. All of your experiences there.
Your business is gone. You remember everything you have
3 to $5000. You have to create true classic
all over again. What do you do differently?
What are What are your first five steps?
With the first thing I would do differently is go even more

(55:35):
narrow on the expansion that I did.
So what I was talking about earlier about like just really
leaning into the T-shirt and notthinking I had to do the polo or
the other excess categories. We would have even gone even
faster, if that's even possible.I would have also, if I could go
back, I would have invested moretime and energy in the creative.

(55:57):
You know, I wasted, you know, a good amount of time on really
average creative. And yes, we were able to do a
lot, but that was really on the product.
It wasn't the creative. Had I like found comedy early
on, it would have gone even faster.
And you know, I didn't find comedy till about a year and a
half, you know, almost two yearsinto the business.

(56:21):
And then once I started leaning into that, it just like took
over my life and and now I stilldo it in my comedy.
We got to talk about comedy because that's the question I
meant to ask you. Tell me about comedy in
advertising and why it's so important.
Oh. Man, you know what's funny is
that when I started doing it, the reason I loved it so much
was because I realized like, oh,remember how I always say like

(56:43):
you got to be customer of Centric and you got to provide
value. This is the one part where you
provide value in advertising outside of telling people about
value props. That's not, that's not a ton of
value. That's just education, but like
comedy, it's actually value because you're making them
happy. Like the Dollar Shave Club
commercial? Yeah, dude, you're, you're

(57:04):
changing it from like I'm forcing you to watch this thing
about my company to like, let mecreate a skit that you're just
going to laugh at and you don't need to even buy my product.
But if I make that connection with you and you Remember Me,
someday it may make an impact and you may buy us or you might
see someone that knows the product and then you'll remember
that story about the comedy ad and then you'll tell it and

(57:25):
it'll help someone else buy or whatever it ends up going into.
But dude, when I started thinking about like that is who
we are on the advertising front,I became obsessed with finding
the most funny guys I could to work with.
A lot of that was the Greg Tube guys very early on who have been

(57:45):
phenomenal. And I give them all the credit
for really being our go to guys.And you know, I just have so
much love for those guys. They've done such tremendous
work for us over the years. And then Nicholas, our in house
guy who did a lot of the comedy early on and we tried to do a
lot of it ourself, but you got to find some people that are
just hilarious and really do great stuff and then just lean

(58:07):
into those guys. So even to this day we're
creating tons of comedy at scaleand it's still, it's just like
it's so much fun to make people laugh.
And even when I meet people in the world, a lot of what they
remember is just that thing. They're not like, Oh yeah,
you're that guy who makes a shirt.
It's like you're that guy that made that funny ad about this
thing. And because the comedy sticks

(58:28):
with him forever, dude. And you, it's like, you know,
when you watch a Super Bowl ad, the ones that always are the,
the takeaways were the funniest ones.
And basically you forget about everything else.
You think back to like early BudLights or whatever it is.
It's like, that is the equalizer, my man.
That's The X Factor. And if you can, it's really
hard, by the way, to figure comedy out.

(58:49):
People try. To.
Do it and it's really hard to do, but once you crack it, it's
as good as it gets. What's been your best performing
like comedic ad and what does that look like with regards to
return on ad spend or ROI? Really hard to calculate return
on ad spend in ROI because what happens is that what you realize

(59:09):
is that even if something's really funny, it's not Dr. It's
not direct response necessarily.It is just funny.
And that funny can have a long life cycle.
It could be. Yeah, you're just looking for
the lift. Dude, we have some people in our
post purchase survey. By the way, another incredibly
important piece to this whole thing is obsessing about the

(59:32):
post purchase survey to figure out where people are actually
finding you and whether the money you're spending on
marketing is netting out or not.If it's not showing up in the
post previous survey, guess what?
It's not netting out like peopleused to say, like, oh, snap is
like the new thing. And we'd spend a bunch of money
on Snap and it would be like 0% of responses.
It's like, well, look, if it's working guys, it's going to show

(59:53):
up in the sales. If not shut it off.
So now it's just like source of truth.
Like I I I just looked at my source of truth for literally
everything. You know, we were talking about
return on ad spend and yeah, it goes back to just the lift.
The best comedy that we've ever done was 2 videos.
One of them was the very early Greg tube video where the baby

(01:00:13):
carriage goes out in the street and it's just like a really
quick like if you go to the trueclassic channel, you'll just if
you just sort by like highest views, you'll see I'm.
Going to play this real quick, let's see.
This is the one Gary Vee put in his book, by the way.
Jab, jab, right hook or something different?
No, the day trading attention. Oh, I haven't read that one all

(01:00:34):
right. Let's do this, Johnson.
You're fired. Why?
It's not you. It's your shirt.
But it's casual Friday. Well, you've taken it too far.
Look at Jimson. He's wearing a true classic tee
if it's a tight in all the rightplaces, but leaves the perfect
amount of room in the front. God I hate that guy.
He looks so good in that shirt. He can basically do whatever the
hell he wants around here. Jimson.

(01:00:56):
Yeah, boss, you're a stud. Thanks boss, True Classic is
designed to enhance the male physique in all the right
places, right Jimson? That's right, boss, I have
strong arms but also a little bit of a gut.
But you wouldn't know because I wear true classic.
But if you're a skinny guy, trueclassic fits tight around the
arms and accentuates your biceps.

(01:01:16):
But how can Jimson afford premium T-shirts?
He's the worst salesman here andI don't even think he can read.
Johnson We all know Gypsum can'tread, but at least he knows that
True Classic is completely affordable and if you buy right
now, you can get 20% off your first order.
I don't need to know how. To read, to know that over
200,000 people gave true classicA5.
Stars. Good job, Jimson.
That's right. Five stars.
Five stars. Let me try one on.

(01:01:40):
Johnson I don't know how I nevernoticed before, but.
I want a raise. Consider it done.
But wait a minute, are those true classic pants?
That's right, I just got them off the website and get this,
they even have activewear, polos, long sleeve Tees,
fleeces, and even socks and underwear.
Incredible. Jepsen, why can't you be more
like Johnson? What should I do, boss?
Jepsen, you sexy. Isn't it obvious?

(01:02:00):
You need to go to the True Classic website and buy all of
those items right now. Click.
Click it. Click it.
Click it. Click it.
Now click it. Oh my gosh, so good.

(01:02:30):
Oh my goodness, that is so good.I've never seen that.
Breaking a little bit of the 3rdwall at the end.
So 35 million views, was that organic or did you put paid
behind that? Well, it was both.
The organic was probably a few, let me see, it was like probably
5 or 6,000,000 if I remember correctly.
And then the rest was propelled by spend.

(01:02:51):
We just like pushed it into the and that's how you know, if it
crushes an organic, you got to amplify.
Yeah, OK. So like, I love that you've got
some first principles, like justovertly funny comedic things,
right? And then you break all the rules
in some other ways, right? Like YouTube wants retention.

(01:03:12):
They want you to get to the point as soon as possible and
then to end the video right thenyou've got like 30 seconds of
awkwardly click it, click it, click it, like, and the fact
that it got millions of views Despite that means that people
stayed and they stood there and like felt weird in their body
watching these two guys sit on each other's lap in an office

(01:03:33):
environment. Like, oh, man.
And I also love that it's not a lot of times you see funny ads
and like you don't even catch that it's an ad like until the
end, right. That is overtly an ad from like
second seven to the very end, right, But you just keep
watching. You just keep watching, which
makes it so effective at actually selling product and not

(01:03:54):
just making people laugh and remember you right.
That's like the Holy Grail, likethe Venn diagram, all of the
circles are overlapping in there.
Did you use the Harmon brothers for this?
Because they're like the best atthis type of stuff.
Aren't they? No, dude, the Harmon brothers
are way too expensive. Are you kidding me?
It's like 500 grand for that, isn't it?
More than that, it's in I wantedto use those guys early on, but

(01:04:16):
that's why you have to go find your own guys.
When I first found Greg and Nate, they were just making
TikTok videos. They weren't working with like a
bunch of other brands. And I found them and I'm like,
why aren't you? Everybody's doing ads, This
stuff could be great. And then I tested them and like
their first ad with me and any brand they worked with, like
just crushed right off the gate.And we were like, OK, we are on

(01:04:37):
now. They work with everybody, which
has been really great for their careers.
Are they very expensive? They are now they.
Weren't earlier. But they give me listen, they're
owners in the company. So they, yeah, they've earned
it. They they have ownership.
They in. Your company?
Yeah, they still have. That's awesome.

(01:04:57):
You know, they still give me like good pricing compared to
everybody else, like they grandfathered me and obviously
because they're part owners. So they're amazing guys and I
love them to death. They really have done great
things for us. OK, so more people need to use
comedy in their ads. Period, End of story.
It's hard because you got to be comedic, you got to be creative,
but it's worth it. You're saying it's?

(01:05:18):
Worth it if you can nail it. It's I would also just say like
it's going to take you a little while.
Our first couple in house ads were not amazing.
They were decent, but we just got better and better and better
and better. And we learned from it too.
We learned that like if you really break down that ad, one
of the biggest components that you'll notice is that there's

(01:05:39):
this reveal moment where it goesfrom wearing a schlubby looking
T-shirt to like this amazing T-shirt.
And that is wildly impactful. What we found is that in any
comedy ad that we did, if we didn't include that transitional
component, which is really very Dr. that the ad really suffered
on ROAS. Like it just we were never able
to scale it. And so you have to have that

(01:06:02):
component. Another thing like that you'll
notice in that ad is that he talks about a bunch of other
product categories. So you know, originally we would
do a lot of ads just around the T-shirt.
And what I started realizing waslike, we've got to branch out.
And a lot of what you'll see in that ad is my voice in the
production phase going, guys, this has got to be bigger than
T-shirts. Like we have to talk about the

(01:06:23):
jeans we have to talk about. And that's why you see them
write that into the script when they talk about everything else.
It's so important that people know that we do other things
otherwise, like how you going togrow the business.
I know this is impossible to answer accurately, but how many
millions of dollars did that onevideo bring?
True classic if you just had to guess.
My gosh, probably 10s of millions.

(01:06:47):
I would say it's hard to say though, because it's one piece
of the journey in a broad journey.
Like everyone always acts like you do one thing and you do one
thing. It's like, no, it starts with,
hey, how you doing? Nice to meet you.
And then it ends with like, I'm going to marry this woman
because she's so amazing. And when I met her, I didn't

(01:07:09):
realize. But like in between all that is
so much nuance in the journey. So like, let's see, let's say
someone saw that ad. Right from there, they go back
to their lives, life, and they're not thinking about
anything. And then two months later, they
see a true classic ad. And then they make the
connection and they go, Oh yeah,that's that thing.
And then they go back to doing whatever they're doing.
And then they walk into a targetand then they see it and now

(01:07:31):
they're alerted. So like to say that one video
created 10 million isn't really fair.
It's like, yes, it was a cog in the wheel and it was part of the
journey. Did it make an impact on getting
their attention 1000% It's not like 1 to one necessarily.
Right. Well, it just so happens that
person in your example, like they buy all their shirts from
Target. And that had to be true because

(01:07:52):
if they saw you at Target, but they just don't buy shirts from
Target, they're still going to keep walking.
Yes. And you're going to have to get
them on like your 17th touch touch point with them instead of
your ninth touch point with them, Right?
Exactly. Oh man.
It's a long life that we all live and just because you made
an impression doesn't mean you made a sale.
It is just one piece to the muchlarger picture.

(01:08:14):
And that really is like why you need to just keep coming correct
in all assets because you don't know where you're going to pick
them up at, in what part of the journey or the funnel.
Well, I think that your marriageanalogy is so perfect because if
you meet someone, you're attracted, you know, years
later, you, you get married. Oh, she's, they love me.
I, she loved my personality. She loved my riz.
Well, she loved your background.She loved, you know how you hold

(01:08:37):
the door open for her. She loved that you came from the
same area. Like she loved that you did this
when your tire, you know, poppedon the side of the road.
It's all of those things. It's not because you're fit or
you go to the gym. It's hundreds and thousands of
things and decades of compounding all paying off in
that one moment. And they don't exist in a
vacuum. That's exactly right.
Because the person you are todaytook a long time to get there.

(01:09:00):
They didn't see the upbringing, they didn't see how your parents
treated you. They didn't see all the struggle
you went with and how much you had to do to get here to be the
person that you are. So it's that's the same way with
product, like it starts in one place and you didn't convert on
day one. Big deal.
You made an impression. Congratulations.
Now just keep showing up for that customer until they do

(01:09:23):
convert and now you're really onto something.
Hey guys, if you're still listening to this, it's probably
because you haven't had a chanceto take your air pods out,
You're still mowing the lawn, you're still driving, what have
you. If you're still here with me, I
would really, really love and appreciate a five star review on
Spotify, Apple, or wherever you get your podcast.
It would mean a lot. If you want to go the extra

(01:09:43):
mile, share this episode with a friend that might have an
interest in starting a business.It would mean a ton.
Hope you have the best day of your life today.

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“That’ll Never Work” — Now It’s a $270M Brand (w/ True Classic CEO)⏐Ep. #218

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.css-14f5ked{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:2;overflow:hidden;}“That’ll Never Work” — Now It’s a $270M Brand (w/ True Classic CEO)⏐Ep. #218