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and welcome to the... advice line on how

2:01

I built this lab. I'm Guy Roz.

2:03

This is the place where we help

2:05

try to solve your business challenges. Each

2:08

week, I'm joined by a legendary founder, a

2:10

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2:12

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2:15

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at guyroz.com. And we'll put

2:50

all this info in the podcast

2:52

description. All right, let's get

2:54

to it. My guest today

2:57

is Mark Ramadan, the co founder

2:59

of Sir Kensington's. It's a condiment

3:01

brand that he launched with a

3:03

college buddy and with no prior

3:05

food or business experience. They

3:07

took on the giants of the food

3:10

industry like Heinz. Mark, welcome

3:12

to the advice line. Thank you,

3:14

guy. Great to be here. And it's great

3:16

to have you back on the show. We had

3:18

you on the show back in the fall of

3:21

2023. And you

3:23

and your co founder Scott told the

3:25

awesome story of how when you were

3:27

in college at Brown, you decided to

3:29

invent a fake British aristocrat,

3:31

you call them Sir Kensington. And you

3:34

made them the face of your ketchup brand.

3:36

And you basically started making small batches of

3:38

ketchup in your apartment for

3:41

friends for college friends, right? Absolutely.

3:43

He started as a fake character, but he

3:45

became very real to us. It

3:47

was quite the journey. Yeah. And, you know,

3:50

I remember Sir Kensington started out as a

3:52

specialty ketchup, right? But but actually, the business

3:54

didn't really start to take off

3:56

until you went a branched out you went to

3:58

Manny's. And And then

4:00

a bunch of other condiments. And

4:03

actually, crazily enough, I mean, the ketchup

4:05

was eventually discontinued in 2023 because

4:07

the mayonnaise and other condiments were doing better.

4:11

What kind of lesson did you learn from

4:13

that? You know, sort of being willing to

4:15

pivot or to really branch out from the

4:17

original product? Yeah,

4:19

we spent three hard years doing nothing

4:22

but making and selling ketchup. And

4:24

there were many times where we felt like the

4:26

business would die that way because the traction on

4:28

the ketchup was not as fast as we wanted

4:30

it to be. Or, you know,

4:32

the adoption was not where we expected. And

4:35

getting into mayonnaise was partly because we felt like we

4:37

had to do something to try and pivot and save

4:39

the company. Also because we were

4:41

getting requests from it, from retailers. And

4:43

as soon as we launched it, it really took

4:45

off on its own. I mean, we were selling

4:47

more mayonnaise within six months than we were selling

4:50

after three years of selling ketchup. And

4:52

one of the things that I think we learned from that is maybe

4:55

the most obvious lesson, you don't know what your best-selling

4:57

product is gonna be until after you make it. Yeah,

5:00

it's such a good point. I mean, especially with

5:02

something like mayonnaise. You know, we had Mark

5:04

Sisson on of Primal Kitchen and they were making

5:06

a competing product and they also had

5:09

a lot of success with mayonnaise, right? And

5:11

you guys were using avocado oils and really

5:13

like you were making a product that wasn't

5:15

available. I mean, it's just, I mean, mayonnaise

5:18

was but not the kind of mayonnaise you

5:20

were making. Yeah, and I think

5:22

the other thing is you sort of form

5:25

opinions about the category and about the

5:27

competitors in the category that are sometimes

5:29

informed by fact, but often they're informed

5:31

by emotion. So for example, we

5:33

had this expectation that people were more

5:35

just as or more brand loyal to Hellman's

5:37

and Best Foods Mayo as they are to

5:40

Heinz, simply because it's just as

5:42

dominant from a market share position. But it turns

5:44

out that wasn't the case, that people were not

5:46

as emotionally connected to mayonnaise as they were to

5:48

ketchup. Ketchup is associated with all

5:50

of these like childhood memories for people,

5:52

whereas mayonnaise is just not. And

5:55

so that was just a big learning that we had,

5:57

which is really forget about all the assumptions that you

5:59

formed in the future. category and price

6:01

was a big one too. Avocado oil mayonnaise,

6:04

like you're talking about, ended up becoming ours

6:06

and Primal Kitchens and others' biggest products, but

6:08

that was $10, $11,

6:10

$12 a jar, which would have been unheard of

6:12

at the time that we started the company. So

6:14

you just, you know, you never really know what

6:16

boundaries you're able to push and what's going to

6:19

resonate with your consumers. I

6:21

know that you're not going to hold this against me

6:23

because you're not part of the company anymore, but you

6:25

know, I have a, I think you know this, I

6:27

have this thing about buying mayonnaise. I think everyone should

6:29

just make it, just get the food processor and just,

6:31

you know, pour the oil into the egg, go in

6:33

with the processor. I'm with you guys.

6:36

I mean, for those who have the courage and the

6:38

time, you should do it.

6:40

It's so delicious. I can eat

6:42

it. I know this is going to sound disgusting. I can

6:44

eat it by homemade mayonnaise by the spoonful. It's delicious. Oh,

6:46

I've done it. I've been there. Delicious. Yeah.

6:48

I just made some the other day. You would have

6:50

been a welcome guest at the Sir Kensington's Mayo tasting

6:53

parties, of which we had many. I would love to

6:55

have gone, I would have brought artichokes with me. Yeah.

6:57

Just dipped artichokes in there. Mark, I

6:59

am so excited and happy that you're here because

7:01

we've got some really, I

7:03

think complex questions heading our way. Let's take,

7:05

should we take the first call? Would

7:08

love to. All right. Caller, you

7:10

are on the line. Hello. Is that Pat? Hello.

7:14

Yeah. Pat Early in Helena, Montana. Pat,

7:16

welcome. Tell us a little bit about your business. Yeah.

7:19

So my business is Dripsey

7:21

LLC. We manufacture the Dripsey

7:24

Kitchen Sink strainer. I'm the co-founder and

7:26

inventor of that product. And

7:28

we feel it works significantly better than pretty much

7:30

any other sink strainer on the market. I don't

7:32

know if many businesses have put a lot of

7:34

thought into sink strainers in the past and

7:37

I put a heck of a lot of thought into it.

7:39

Yeah. So yeah, we

7:41

sell mostly online and also on QVC and

7:44

we actually just surpassed our one millionth

7:46

happy sink that has been supplied with

7:48

the Dripsey. Yeah. And what's

7:50

your question? So

7:52

my question is, we've had

7:55

good success online and on

7:58

QVC and those platforms, but We've

8:01

been trying our hardest to get into

8:03

retailers for some time now and we

8:06

have gotten into quite a

8:08

few smaller mom and pop, Ace Hardware,

8:10

True Value, that kind of store. Pretty

8:12

much every buyer we talk to at the

8:15

store level, that kind of buyer, they like

8:17

our product. But

8:19

they say you have to pass it

8:21

through the regional buyer or it has to get

8:23

on the Ace truck. So they

8:25

don't wanna have to order from us, they wanna

8:28

be able to order it out of the catalog

8:30

and whenever we reach out to those

8:33

higher level corporate buyers,

8:35

they don't really give us the time of day and I

8:37

don't know if that's something that I'm

8:39

doing on my end or if it's something

8:41

about our brand. And I guess I'm just

8:44

looking for advice on how we could have some

8:46

more success with buyers to get into retail stores.

8:48

All right, so we'll get to your question in a moment. What's

8:52

different about your product than the metal

8:54

strainer that comes with the garbage disposal?

8:57

Yeah, so this all started to

8:59

take it back a little bit, I guess. I was

9:02

in a house that was on septic so we didn't

9:04

have a garbage disposal. We had

9:06

a metal strainer that broke

9:08

and I had to go to the store to get a new

9:10

one and it was nine or

9:12

10 bucks and it broke after two

9:14

weeks. And I guess it

9:16

annoyed me enough that I decided

9:19

to, I was like, I think I could probably do

9:21

a better job at this but

9:23

my idea behind the design to get to your question

9:25

was I wanted it to fit below

9:27

the rim of the sink so food and things

9:29

don't get caught or go under it and I

9:32

wanted it to not clog so you don't have

9:34

to empty it out five times while you're doing

9:36

the dishes. And

9:39

we achieved that. It fits inside the

9:41

drain nice and snug, nothing sneaks past

9:43

it and it actually, it can fill

9:45

up completely because the hollow central

9:48

stem drains water if the basket's full

9:50

and it just keeps rocking, man. It's nonstick

9:53

so it empties into the trash can, no

9:55

problem. And it's significantly different

9:57

than any other strainer. I don't know of

9:59

any fully. flexible sink strainers out there.

10:01

Yeah. And are you, are you like

10:03

an industrial designer? Is that,

10:06

how did you, how'd you design it? No,

10:08

I'm an emergency medicine PA. I have no

10:10

experience with anything like- You're a

10:12

physician's assistant even now? So this is not your

10:14

fault. This is your side hustle. Yeah, no, I

10:17

wish it was my full-time job, but no, I

10:19

just learned how to use 3D design software over

10:21

the course of, you know, six months and we

10:23

prototyped it and then found a

10:25

manufacturer here in the US to make it for

10:28

us. I

10:30

think this is maybe related to your bigger question, but

10:32

do you have other products in your innovation pipeline that

10:34

you're working on, like other problems in the kitchen you're

10:36

trying to solve or not right now? No,

10:39

we do. And that's, that's

10:41

part of the feedback we've heard from

10:43

buyers is that they want somebody that has

10:45

a line. They don't want to just

10:47

have to pick one product to bring into their store. They

10:49

want somebody to come in that has

10:52

20 products that they can just hang on their

10:54

shelves and it works out. And we

10:56

don't have that. And I, you know, I've gone through

10:58

it in my head and thought, hmm, maybe I should just

11:00

bring out products that are, you know,

11:02

status quo. They're not anything special, but they're

11:05

just more products to have in a line.

11:08

But I don't know if that I don't know

11:10

if I want to branch out into being a, into

11:12

being a, you know, kitchen utensil

11:14

brand, right? I think we want

11:16

to be an innovative kitchen and

11:18

plumbing brand. So I'm

11:20

designing right now a hair catcher for

11:23

a bathroom sink. We do have a

11:25

stopper. And

11:27

yeah, I mean, I've, gosh, it's hard because

11:29

I don't want to dilute our brand because I

11:32

think what makes this so special is that the

11:34

product is actually better. You know, it's a better

11:36

mousetrap, if you will. And I

11:38

don't want to come out with a spatula that's the

11:40

same as every other spatula because I feel like it

11:42

doesn't, you know, it's not really what

11:44

our brand is about, but maybe that's what we have to

11:46

do to be able to break into retailers. Well,

11:50

take a quick step back. If you think

11:52

about how do retailers make money, what's

11:54

the retail business model and why might

11:57

they be frustrated with a single, single

11:59

skew brand? Ultimately, they're not

12:01

really in the business of solving consumer

12:03

problems. They're in the business of making

12:05

money. And so for every vendor

12:08

that they work with, there is some

12:10

amount of fixed costs associated with that,

12:12

right? Communication time, invoicing, chargebacks, and so

12:15

on. And so the easiest

12:17

thing for Ace or for True Hardware to

12:19

have is like three vendors to only work

12:21

with OXO and two other ones, right? A

12:23

good, better, best model, which is why like

12:25

if you take the catch-up category circa 15

12:28

years ago, there was a good, better, best

12:30

brand. That's it. There was the

12:32

value brand, there was Heinz and maybe an expensive one because

12:34

the fewer brands you have in the same amount of space,

12:36

the less work it is to manage your shelf and to

12:38

make money from your shelf. So

12:40

from a retailer's perspective, it's always

12:42

easier to have fewer, bigger providers.

12:46

So that's probably why you're getting pushed in that

12:48

direction. For your specific brand, I mean, I looked

12:50

at it online. I think it's beautiful. I love

12:53

that you're solving a specific problem in a different

12:55

way. So it's not obvious to me

12:57

that there's anything wrong with your brand. And

12:59

I would strongly recommend you don't breach your

13:01

own brand values there, right? I'm 100% in

13:04

agreement with you that if your brand is

13:06

about solving problems in a way no one

13:08

solved it before, then you have

13:10

to stay true to that brand commitment that you've made

13:13

and not to make it all about condiments.

13:15

But when we launched mayonnaise, it would have been

13:18

really easy to just say, well, let's just launch

13:20

like a mayonnaise that looks like every mayonnaise in

13:22

Whole Foods, but we didn't. It took us a

13:24

long time to say, well, how would Sir Kensington's

13:26

make a mayonnaise in keeping with the quality of

13:28

the ketchup? And that was by creating a supply

13:30

chain for certified humane free range eggs. We were

13:32

the first company in the country to use free

13:34

range eggs, and that took longer. It was harder,

13:36

but it was a unique solution that suited us.

13:39

So I think the equivalent here is true. Don't

13:42

just come out with 10 things and be like

13:44

a slightly more expensive oxo because they already have

13:46

oxo. Right. As you're thinking about

13:48

product development, one encouragement I would have for you is

13:51

as much as you are focused on solving a

13:53

real problem, and that should be your starting point,

13:56

there's lots of different sizes of

13:59

categories. store that you're

14:01

playing in, right? And I don't know what

14:03

the relative size of a sink catcher is

14:05

versus a hair catcher for the bathroom versus

14:07

XYZ product that I could go buy from

14:09

Ace. But as much as you can

14:11

figure out what are the category sizes, what

14:14

is the depth of competition, what is the

14:16

turn rate on these items, what's the margin

14:18

that the manufacturers and or the retailers are

14:20

making, those should all be factors as you're

14:22

going through the process of figuring out what

14:25

do we make next. And Sir

14:27

Kensington's was no less brutal and ruthless about

14:29

going through that qualification, there's a million things

14:32

we could make. We ended up in

14:34

mayonnaise for lots of reasons, not just because it seemed

14:36

like an obvious adjacency, but also because it was bigger

14:38

than ketchup and the turn rate was faster and the

14:40

margin structure was better and our co-packers could make it.

14:43

And so, I would go through that same

14:45

check, create the checklist, and if you don't have any

14:47

money to buy data, which I

14:50

assume you wouldn't necessarily be buying data

14:52

here, you can go to your local

14:54

stores, whoever you're selling Dripsey to today,

14:56

just bag borrow, you know, plead with

14:58

the store managers and say, help me

15:00

out, like what sells well? You

15:02

know, what would, do you think your customers would

15:05

be excited to see a new version of and

15:07

cross reference that with your own problem solving interests?

15:10

And that should land you somewhere that

15:12

is both a good idea and is

15:14

a good business. Yeah, yeah, that's great

15:16

advice. I wanna see

15:18

that like, I wanna see

15:20

a commercial and advertisement of like,

15:23

the garbage disposal guy, repair guy,

15:25

just like bored, like swatting flies,

15:28

waiting for the phone to ring, and

15:31

then, you know, Dripsey, keeping your

15:33

drain clog free since 2019.

15:37

We're the company that makes water flow. Do you make

15:39

water flow? You

15:41

make the water flow. I

15:43

like that, that's it. I like it too. We

15:46

just did this, been a think group, I like it.

15:48

All right. Cool. Pat Early, the brand

15:50

is called Dripsey. Good luck, thanks for calling

15:52

in. Thank you so much. Take

15:54

care. Thanks. Bye.

15:56

Cool, I like that. You're nailing

15:59

the slogan. Yeah, right. I

16:01

mean, you've had to call a plumber before. Yeah.

16:03

I've had that exact issue. I've had a bad

16:05

sink catch. Yeah.

16:09

Yeah. I don't do the cooking

16:11

in the house, so therefore I do all the

16:13

dishes in the house, and I've definitely... I'm the

16:15

one who's cleaning out that sink trap three times

16:17

during a wash. And I

16:19

have... This is not about... I love plumbers. My

16:21

grandfather was a plumber, so I love plumbers, and

16:23

I want to give you guys business, but I'm

16:25

just saying, you know, it's the call,

16:27

it's the wait, it's the being at the house

16:29

between noon and 8 p.m., and then you're

16:33

like, I met the house from noon until 8, and

16:35

then it's 7.45, and then he arrives, and he's

16:38

like, yeah, I gave you an eight-hour window. Yeah. And

16:40

you're like, are you kidding me? And

16:42

you're like, I'm in the middle of making my man his.

16:44

I can't stop this now. Yeah. I've been waiting for you

16:46

since noon. So I'm just

16:49

saying, all I had to do was put in

16:51

the dripsy, and that would never have happened. I

16:53

see a short-form video. It's not just an ad. This is

16:56

a whole series of content. It's a

16:58

whole bunch of content. All right. Yeah. Okay, Mark, we're

17:00

going to take a quick break, but when we come

17:02

back, a taco shop owner

17:04

who's about to get a very

17:07

competitive neighbor, Chipotle, stay

17:09

with us. I'm Guy Roz, and you're listening to the

17:11

Advice Line right here on How I Built This Lab.

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Robinhood Financial LLC member SIPC

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is a registered broker-dealer. Welcome

21:30

back to the advice line on how I

21:32

built this lab. My guest today is Mark

21:34

Ramadan, co-founder of Sir Kensington's. So

21:36

Mark, let's go ahead and take another call. Yeah.

21:40

Hello. Hello, Lucas. Welcome.

21:42

Hello, Mark. I am honestly

21:44

honored to be here. I've

21:46

been listening to your podcast

21:48

for like ever. Thank

21:51

you so much. Tell me what, where are you

21:53

calling from and, and, and your business.

21:55

What's the name of your business? So my name

21:57

is Lucas Manteca. I'm originally from Argentina.

22:00

I've been living in KMA Courthouse,

22:02

South Jersey, and a small seashore

22:04

community right by the

22:07

beach. As a chef and entrepreneur,

22:09

I'm the proud owner of Taco

22:11

Shop, the quick service restaurant with

22:13

focus on made

22:15

from scratch tacos and plus. Got

22:18

it, okay. And tell me what question you brought

22:20

for us today. So what

22:22

are your thoughts on tackling

22:24

Chipotle as a

22:27

competitor? Like should I try

22:29

to attract some investors to scale

22:31

my business, you

22:33

know, to piggyback on Chipotle's strategy

22:37

to establish locations that capitalize on

22:39

their customer base and market influence?

22:42

Got it, okay, we're gonna get your question

22:44

in a minute. So right now you've got

22:46

one taco location, one taco shop, which is

22:49

in KMA Courthouse, New Jersey, is that right?

22:51

Correct, that's correct. And you

22:53

opened this in 2022, from what I understand.

22:56

Correct. And tell me

22:58

about how it came about, how that restaurant

23:00

came about. So I've

23:02

been in the food industry for about

23:05

30 years, pretty

23:07

much, I've been a chef, I

23:09

opened multiple restaurants, I started, you

23:13

know, hot dog stands, I own

23:15

a sea salt farm. So I'm

23:17

a naturally like entrepreneur and chef,

23:19

right? So after the pandemic, we

23:22

kind of like shrink

23:24

our businesses, keep the things that

23:26

they made sense for us financially

23:28

and concept wise. And

23:31

we decided to put, you know, all

23:34

our gains pretty much into one concept

23:37

that was taco shop. So

23:39

we opened this concept as, you

23:42

know, the idea of a QSR, quick

23:45

service restaurant, and we are doing great,

23:47

you know, we serve in a small

23:49

community, a very seasonal community. Because KMA

23:52

is right on the Jersey Shore there.

23:54

KMA is right, yeah, we're about

23:56

five minutes from KMA. Our

24:00

concern, with the price

24:02

increase in food and

24:05

restaurant industry as tough as it

24:07

is right now, our concern really

24:09

is having a competitor

24:11

as Chipotle coming into town. Is

24:14

Chipotle in town? Are they near you? They

24:17

are about 150 feet. They're

24:20

supposed to open this summer, about 150 feet.

24:23

Wow. Okay. At

24:25

a taco shop, it's a one-off and

24:27

Chipotle is about to open up there. And

24:32

so, besides tacos, it means

24:34

tacos, burritos, just

24:36

what you would find, similar to what you would

24:38

find at Chipotle? So

24:41

from an starting point, me being

24:43

a chef, I did a huge

24:45

market study before I started this

24:47

concept and I wanted to differentiate

24:49

ourselves from any competitor, including Chipotle.

24:52

So, we thought

24:54

focusing on tacos was the smartest thing

24:57

to do. We don't have an assembly

24:59

line. We do like kind of a

25:01

cook to order, but we're

25:03

really fast, right? So everything, it's

25:06

been designed to be out within

25:08

five minutes. And I'm looking

25:10

at your website and so you do like quesabereas

25:12

and you're doing fish tacos

25:14

and fried chicken tacos. So

25:17

you're really doing different kinds of tacos here.

25:19

I mean, things that Chipotle would not offer.

25:22

Correct. And as well, I'm so

25:25

passionate about food that I keep up

25:27

with the trend. So ramen, it's pretty

25:29

big right now within the market. So

25:31

we have a maxi ramen and the

25:33

same with poke. So we have a

25:35

variety of items to add on to

25:37

our mix of tacos and

25:39

as well what the other competitors, they

25:41

do. Mark,

25:44

you faced a giant competitor, Heinz,

25:46

with your ketchup with Sir Kensington's.

25:48

And of course, Lucas is

25:50

facing the impending

25:52

arrival of Chipotle 150 feet from his taco shop,

25:57

which is a obviously a

25:59

massive. of multi-billion dollar empire.

26:05

Any initial thoughts before we dive into his

26:07

question? Well, first of

26:09

all, I'm happy to hear that you made it

26:11

out of the pandemic and you have a concept

26:13

that's working. So congratulations, because a lot of restaurateurs

26:15

and chefs did not. So you should feel at

26:18

least proud of where you've gotten to. I

26:21

think the, you know, at the highest level,

26:23

like competing with a monolith, like any major

26:26

company, you just have to recognize there are

26:28

some things that they do very well and

26:30

some things that they would just never do. You

26:32

know, and the things that they do very well are systems,

26:35

routine, predictability, dependability, and

26:38

usually cost and price,

26:40

right? So that means they're

26:42

very good. Chipotle is an excellent example of

26:44

a restaurant that has managed to maintain the

26:48

expected level of quality at significant scale,

26:51

but no one would call it their local taco spot, right?

26:53

I mean, what Chipotle is not good at

26:55

is they're not good at creating a

26:58

local integrated community feel in any of

27:00

their stores. And so, you know, my

27:02

initial instinct is don't

27:04

compete with Chipotle doing what Chipotle does Chipotle is going

27:07

to out Chipotle you 10 days out of 10, right?

27:10

They've built the machine to do that. But

27:12

when you go into a local restaurant, you expect to have

27:14

a local feel there, whether

27:16

that's, you know, local performers or

27:18

musicians, local additions to the

27:20

menu, or even a little local market

27:23

there. These are just random examples of

27:25

how do you make your store not

27:27

feel like a competitor to the chain

27:29

restaurant next door, but actually its own

27:31

completely new thing. And one

27:34

part of that equation is you, it's the

27:36

personalities behind the counter, right? It's the people

27:39

because what is a hospitality experience, if not

27:41

people. And then the second is the

27:43

environment. I mean, the food, you maybe

27:45

you both serve tacos, but that's almost incidental

27:47

to the emotional experience you're delivering. Right,

27:50

right. And to be honest, it's the

27:52

idea behind taco shop as well. It's

27:55

like trust the chef behind the scene,

27:57

you know, that is going to

27:59

offer you. the best experience that

28:01

we can and fast. And going

28:04

back to the atmosphere is my

28:06

wife, she's a designer and we take a

28:09

lot of pride as well about the atmosphere.

28:11

It's like we make sure that we didn't

28:13

copy absolutely anything that it was

28:15

already within our

28:17

competitors or marketplace. We

28:20

created a very, very unique concept.

28:24

Lucas, I'm looking at your website and you just mentioned

28:27

this idea that like, hey, trust a chef

28:29

and also I

28:31

know this because I just looked, I was looking at

28:34

your bio. It's just not on your website or it's

28:36

not easy to find. You're a nominee,

28:38

you're a James Beard nominee. I mean,

28:41

like, I mean, you have this incredible

28:43

pedigree and I wonder why

28:46

on the website it doesn't say tacos

28:48

from a James Beard nominee or, you

28:50

know, or chef driven. I mean, Steve

28:53

Ells who started Chipotle was

28:55

a trained chef. He did go to culinary

28:57

school and his dream, we did him on

28:59

the show many years ago, his dream was

29:01

to build a Michelin three-star restaurant.

29:03

That's why he started Chipotle, to finance it. He

29:05

never built a Michelin restaurant,

29:07

but Chipotle was a result. But it was

29:10

chef driven. I feel like just from the

29:12

entry point, you know, whether it's a website

29:14

or coming into the restaurant, you

29:16

need to tell me this is driven by a

29:18

chef, a James Beard nominee.

29:21

Right. Right. And you're correct. I just,

29:24

you know, I, it's

29:26

really hard. The perception of tacos

29:28

is always going to be tacos

29:30

are cheap food. Correct.

29:32

So, um, the

29:34

fact that I'm a chef, I'm, I'm always

29:36

afraid that we're going to scare people away

29:39

thinking that, you know, we're too upscale or

29:41

even over the core, you know, we, we

29:43

made it as simple as we can because

29:45

we are concerned that, you know, people are

29:47

not going to be feel comfortable when they

29:49

walk in the door and feeling like they're

29:52

going to pay a higher price that they

29:54

can right around the corner. And,

29:57

you know, we stand behind our quality,

29:59

but, And the first perception

30:01

really for a guest to

30:03

walk in through the door is so important

30:07

that it's tough. It's

30:09

all these elements that we try to balance to

30:12

make sure that we can cater to everyone.

30:16

I mean, this is maybe a contrarian opinion,

30:19

but I think

30:21

that the word to focus

30:23

on in terms of your guests is

30:25

maybe less price or cost and more

30:27

value, right? Value is like

30:30

price meets expectations. That's

30:32

just one definition, but you

30:34

could raise your price and also raise

30:36

the experience that you're delivering or raise

30:38

the ante on expectation and people may

30:40

well be willing to pay that. My

30:43

fear for you, again, I haven't been

30:45

to your restaurant so I don't know

30:47

if this is the case, but my fear is if you

30:50

engage in a price war with Chipotle,

30:52

you will definitely lose. You will never

30:55

have the cheapest, most profitable tacos, right?

30:57

And so that's a losing fight from day one. What

31:00

you really wanna do is figure out what is

31:02

the community center that your guests are looking

31:04

for during this summer season in

31:07

Cape May, right? Right. And I can think

31:09

of so many little beautiful seasonal shops out

31:11

in the North Fork of Long Island or

31:14

in the Hamptons or all the

31:16

beach communities around the US and they're

31:18

all sort of like multi-factor places. They serve

31:20

coffee in the mornings and then they have

31:22

delightful sandwiches in the afternoon and there's also

31:24

a bookstore and maybe they also sell toys

31:26

for kids because people

31:28

wanna buy toys in the summer and there's

31:30

probably also ice cream in the afternoon and

31:32

I'm not saying you should do any of

31:34

those necessarily, but if you shift your thinking

31:36

from we are a taco restaurant competing with

31:39

Chipotle to we are a community destination for

31:41

summers in Cape May serving great

31:43

food, which happens to be Mexican food,

31:46

I think you can really change the

31:48

value expectation people have of your restaurant.

31:50

If I go in and I'm faced

31:52

with beautiful design objects

31:55

and you have comfy chairs and there's

31:57

a James Baird nominee behind the counter and

31:59

you say, well, the tacos aren't eight bucks, they're 12

32:01

bucks or 13 bucks. Maybe it's

32:03

a very different story. Right.

32:05

Right. Right. For sure. You

32:08

know, Mark, I think that you're onto

32:10

something really important here, which is, because I

32:12

know Lucas, you're wondering, should I bring on investors? How do

32:14

I, you know, how do I sort of grow this? Cause

32:17

ultimately your idea is to grow

32:19

this and to scale this, right?

32:21

But initially the immediate threat is

32:23

this Chipotle coming and let's

32:26

be honest, Chipotle is a great

32:28

chain and it makes high quality

32:30

food. But here's where Chipotle underperforms and

32:32

here's where I think Mark, you're exactly

32:34

right about the community thing. Here's where

32:37

you can really differentiate and that is

32:39

hot sauce. If you go

32:41

to Chipotle, there's Tabasco and there's Tabasco

32:43

Chipotle. You could create,

32:45

you could just get a wall. Like

32:48

right now you could just

32:50

have a wall of a 200 hot

32:52

sauces at taco shop. Right. I

32:55

mean, there's gotta be people in New Jersey

32:57

making hot sauce. I know there are people all

32:59

over the country. Well, that's me

33:02

guy. That's we have four

33:05

different sauces. We have Holly Camoli, Chimmy.

33:07

Well in New Jersey making hot sauce.

33:09

I know there are people all over

33:11

the country. Well, that's me guy.

33:13

That's we have four

33:16

different sauces. We have Holly

33:18

Camoli, Chimmy Chimmy, Jesus Mary's

33:20

hot. I love it. JMJ.

33:23

We actually make our own hot sauces

33:25

and that's the only hot sauce that

33:28

we serve at the restaurant. You know, it's,

33:31

you know, and again, it's, uh, we,

33:34

we never thought that we were going to

33:37

be put on the field to compete in

33:39

such a big league and we

33:41

didn't choose this, it happened.

33:43

And, uh, now Chipotle coming in place,

33:46

you know, we know that they're going

33:48

to take 30% our

33:50

bottom margin, you know, and

33:52

that is our concern because being

33:54

a seasonal business where, you know,

33:57

our summer months are incredible and

33:59

our, winter month or disaster,

34:02

you know, 20%

34:04

will really damage the business. So it's,

34:06

we're in front of a situation that

34:08

we need to take action and that's

34:10

our concern. I

34:13

would just say on the fundraising side, I

34:16

would not recommend raising funds until

34:18

you have a concept that you

34:20

feel confident that is working, not

34:23

only because I think it puts you in

34:25

a position where you now are suddenly

34:28

owing people money and you don't necessarily

34:30

have the runway ahead of

34:32

you to pay them back, either through scaling

34:34

or through selling the business. But

34:37

I think it distracts you from what should be

34:39

your core mission now, which is how do you

34:41

deliver something that's valuable to your community rather than

34:43

how do you pay back your debt facility or

34:45

pay back your investors. I work with a lot

34:47

of restaurants and those that are

34:49

loaded up with debt can't focus on operations and

34:51

those loaded up with equity

34:54

investors also are distracted

34:56

from finding opportunities with their operations.

34:58

So I would definitely focus on, I mean, I'm

35:00

not saying don't raise money in the future, but

35:02

typically you would want to wait to do that

35:04

until you have the concept that's humming and buzzing

35:06

and you feel like I can't help it open

35:08

a second location. And I think you

35:10

get there by creating a cult following, right,

35:13

I mean, Chipotle scaled, Sweetgreen scaled, all of

35:15

these businesses scaled because they first had a

35:17

home base that had a cult following. Yours

35:19

will look different than Chipotle's, but

35:21

again, not to repeat myself, but I'd

35:24

encourage you to really think about how

35:27

do you deliver a service that is not tacos

35:29

to your guests? You may serve tacos, but what's

35:31

the service? What is the environment

35:33

they're walking into? Why are they coming there? And

35:36

if the answer is because your tacos

35:38

are better, I don't think that's a

35:41

long-term sustainable differentiation from Chipotle. Not

35:43

to say yours aren't delicious, but it's tenuous if

35:45

they're a hundred feet away, right?

35:47

But how do you create something that's more, that's

35:50

emotional, that's cathartic for people, you

35:52

know? That's the beauty of local

35:54

small businesses. And I think you

35:56

can do that through products, like I was saying with the hot

35:58

sauce. I think you can do it through. integrations,

36:00

whatever's fresh from the farmers market, Chipotle will

36:02

never do that. And I think you can

36:04

do it in ways that are cheaper free

36:06

to you, like I mentioned this earlier, but

36:08

invite a local musician to perform every Thursday.

36:10

Yes. You know? Have a band

36:12

there, a local band. You

36:15

go in there to hear great

36:17

music and have great

36:19

food. Yep, that's a great

36:21

idea. Chipotle is never going to compete

36:24

with that, ever. Right. And the other

36:26

thing is the quality of what you're

36:28

producing, the quality of your ingredients, your

36:30

pedigree. You're making the hot sauces. I

36:32

didn't know that until you told me

36:34

that. Yeah, we make our hot sauces.

36:36

We make fresh tortillas

36:38

every morning. In the house. I

36:41

mean, this is not, this is, I don't

36:43

see this on your website. Maybe you're advertising

36:45

at the restaurant. But man, I mean, I

36:47

feel like as part of your

36:50

brand Bible, we make everything

36:52

in house. You make your tortillas. I'm

36:54

eating that. You make your hot sauce.

36:57

Like you steep the chilies

36:59

and vinegar and you're making it. I want

37:01

to try that, but you have to tell

37:03

me that. Yeah, that's a good point. Mark,

37:06

any final words of wisdom for Lucas?

37:09

I guess I would only say do whatever

37:12

you can to keep track of

37:14

the community that you're building and stay in touch

37:16

with them. You know, whether you have a newsletter,

37:18

which costs you nothing, right? Or even

37:20

just like some sort of way to keep track of

37:22

who's coming in and out, to actually stay in touch,

37:24

to let them know the events that are coming up,

37:27

to let them know what kind of specials you're doing.

37:29

Again, these are like the super low cost ways

37:31

to stay close to that community and remind them

37:33

that you're still there. Right, right.

37:36

All right. Lucas, thank

37:38

you so much for calling in. Thank

37:41

you so much, guys. I appreciate it. It's Taco

37:43

Shop. Good luck. Thank you so much. I

37:46

mean, homemade hot sauce. Sounds great. And four

37:49

different kinds. You know that one of those

37:51

is going to be really fiery.

37:53

And I'm like the one who's I'm always

37:55

like, I'm going from the

37:58

mile to all the crazy. dragon

38:00

fire breathing one because I just he's

38:03

making it. You know, though, your idea of the

38:05

wall of hot sauces was great. There used to

38:07

be a restaurant in Hudson, New York, up in

38:09

the Hudson Valley. It was a Mexican restaurant

38:11

and they had like literally

38:13

a hundred hot sauces that you could

38:15

pick from. And it was so fun

38:17

because every meal was completely different. I

38:19

remember there's a barbecue joint in Washington,

38:21

D.C. that has the

38:23

same thing. And it's so fun.

38:26

Yeah. Mark, you

38:28

launched, of course, into this

38:30

incredibly competitive space. Not crowded

38:32

because ketchup is not crowded,

38:34

but it's very competitive. Obviously

38:37

dominated by, you know, and managed too

38:40

by big multi-national brands.

38:43

How did you guys think about competing

38:45

with those brands? Or did you think

38:47

that we're not even competing with them

38:49

at all? We're not going after the

38:51

same customer. We definitely

38:53

recognized that there was competition, but

38:56

I don't think we saw Heinz

38:58

as the big scary competitor, if

39:00

that makes sense. If anything, we

39:02

saw inertia as the competitor. People

39:04

are on, you know, they're

39:06

not impulse buying different ketchups every week. And

39:08

so the real competitor was habit. And

39:11

so we thought about how do we break a habit

39:13

rather than how do we switch people away from Heinz?

39:16

And so most of what

39:18

we did at the very beginning was get in front

39:20

of people so they could taste it. So that was

39:22

doing demos and stores, most of which at

39:24

the beginning, Scott and I did ourselves. Or

39:27

we would be on restaurant tables or hotel room

39:29

service trays because those are opportunities for people to

39:31

actually taste it. Because at the end of the

39:34

day, what we were really trying to build was

39:36

a taste, an emotional taste

39:38

experience. And if it's just sitting on

39:40

a shelf and it's one jar out of 50 and

39:43

people are on autopilot anyway, that's no way to get

39:45

someone's attention. We really had to cut through the noise.

39:47

And so everything we did was about how do we

39:49

cut through the noise? Hmm. All

39:53

right, Mark, we're going to go ahead and take another quick break.

39:55

But when we come back, how to

39:57

keep your baby from freaking out.

40:00

a dinner, a new kind of

40:02

placemat. Stay with us. I'm Guy Raz,

40:04

and you're listening to the Advice Line right here on

40:06

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for 30 days audible.com slash

42:09

built. Welcome

42:18

back to the advice line on how

42:20

I built this lab. Today I'm taking

42:22

calls with Sir Kensington's co-founder Mark Ramadan.

42:25

Let's take our next caller. Is that Beth? I'm

42:28

here. I'm here. Oh my gosh. I've

42:30

been a fan of the show since the very

42:32

first week I had my business. Welcome.

42:35

Thank you for listening to the show. Beth, tell us

42:37

where you're calling from and just a little bit about

42:39

your business. Yeah. My

42:41

name is Beth Benneke. I am from

42:44

a little town outside of Rochester, Minnesota,

42:46

and my business is Busy Baby. We

42:48

have the first ever interchangeable system of

42:50

food grade placemats, tethers, and accessories that

42:52

keep babies things within reach and

42:55

off the floor at home and on the go. All

42:57

right. So tell me the question you brought for

43:00

us. What guidance would you have

43:02

to offer a company that's navigating

43:04

the messy middle phase where you're

43:06

outgrown the startup tactics, but

43:08

you're not quite ready for big brand

43:10

strategies yet? All right.

43:13

Cool. I believe, Beth, you

43:15

were on how you

43:17

built that, this segment that we used to do back in

43:19

the day where we would have two minutes

43:21

about a small brand. You were on our show back in

43:24

the day, right? Busy Baby was. I

43:26

was. Tell us a little bit. See, it's

43:30

like a placemat that you

43:32

put on like a high chair, right, for a baby, but

43:35

it's got a bunch of strings or

43:38

things that you attach to baby

43:40

toys? Yeah, it's really simple. It's

43:42

a silicone placemat with suction cups on the bottom so

43:44

you can stick it to any smooth, clean surface, and

43:47

then it has a tether system of silicone kind

43:49

of bungees. We call them toy straps, tethers, that

43:51

you can hook to the mat and then you

43:53

can loop them through or around pretty much any

43:55

toy you've already got for your baby. All

43:57

right. I can only imagine how this started.

44:00

as I remember even though I've got a 15 and

44:02

a 13 year old but I remember losing

44:04

my mind when they just throw things off

44:06

the high chair like carrots

44:09

and banana peel now that you

44:11

can't tether but but but everything like the rattles

44:13

and the bottle and we was just all all

44:15

over the place. We used to drive me nuts.

44:18

I eventually learned how to cope with it. I

44:20

have to imagine that's how it started for you.

44:23

Yeah, I mean, it starts out innocent enough. It's a

44:25

lack of fine motor skills. Babies just can't hold on

44:27

to things. They drop them but then when they they

44:29

learn quickly, it can be a very fun game of

44:31

fetch with mom and dad. And this is is this

44:33

what was going on with you? You were a parent

44:35

and and you saw this happening? Yeah,

44:37

kind of. I had my first child when I

44:40

was 40. So I was a little bit later

44:42

in life and I was working a corporate job.

44:45

And when I went back to work after maternity leave, I

44:48

went out to lunch with a couple of my stay at home

44:50

mom friends and they brought their daughters with them. And while they

44:52

were super cute, they were very

44:54

distracting. And we couldn't honestly finish

44:56

a conversation. So while we were sitting at the

44:58

table, I went on Amazon to buy something so

45:00

that when my son was big enough, he wouldn't

45:03

be that distraction at the table. And

45:05

there was nothing? Nothing. There was, you

45:07

know, there's pacifier clips, there's always been, you know, hook

45:09

a pacifier to their shirt. But there needed to be

45:11

a place to put food and a

45:13

way to keep the toys off the ground. Okay,

45:16

so now you're at a point where you're not a

45:19

startup, but you're not massive. Do

45:21

you mind sharing roughly what your your revenue is?

45:23

Yeah, I mean, in the five years we've been in

45:25

business now, we've done just over $14

45:28

million in sales. Wow. So

45:30

this is pretty great. And are you still growing or is

45:32

the growth slowed down? Well,

45:35

that's kind of the sticky spot right now is,

45:37

you know, along the road, I grew very fast.

45:40

I was on Shark Tank in my third year.

45:43

And also during the pandemic, we

45:45

saw a ton of growth because everybody, you

45:48

know, that's when I started marketing on Facebook

45:50

and Google and everybody was stuck

45:52

at home and everyone needed something to keep

45:54

the baby busy while they were homeschooling the

45:56

other kids or taking a zoom call for

45:59

their job. So anything that was like

46:01

keeping the baby occupied, even just for 20 minutes,

46:03

so you could get through these things, it just

46:05

blew up. And so at

46:07

the time, I was still working my full-time

46:09

job. I didn't have many expenses other than

46:11

the inventory, really, and then

46:14

the Facebook ads. So

46:16

at that time, I convinced my brother

46:18

to quit his very stable full-time job

46:20

to join me in this very unstable

46:23

rollercoaster of entrepreneurship. And,

46:25

you know, I took on his salary, and then I

46:27

ended up quitting my job and took on my salary,

46:29

and then we needed health benefits. So the company paid

46:31

for health benefits, and before I knew it, operating

46:34

expenses just kept creeping up and up. And

46:36

the more you sell, the more general liability

46:38

insurance costs, and the more all these other

46:40

things cost. And cashflow

46:42

was never an issue in the first few years,

46:45

and so I didn't pay close enough attention, and

46:47

now cashflow is an issue. But

46:50

we have several large opportunities this

46:52

year. We just launched

46:54

on target.com, and we are onboarding right now

46:56

with Walmart. And Walmart

46:59

really loves our products, and they love

47:01

our innovation, and it's an amazing opportunity

47:03

that's going to cost a lot of

47:05

money and just scares me to death.

47:08

So that's another big part of the story that is

47:11

where I'm kind of stuck in this messy middle. Yeah,

47:14

so getting to the messy middle is still

47:16

an accomplishment, by the way. So

47:18

congratulations. You

47:20

know, 14 million of sales means there's a real product

47:22

market fit. There's something, there are families that love this.

47:26

That is an important part to not get

47:28

lost in the question. One

47:31

sort of high-level point is that retail

47:33

is a blessing and a curse.

47:36

It can be a blessing because large customers can

47:38

mean large orders, and large orders can give you

47:40

certainty and predictability. It can give you

47:42

leverage with a bank facility, which I'll get to. But

47:46

the downside is that they are more expensive to work

47:48

with, and you get your cash much less quickly. So

47:50

when someone buys online, you get their credit card payment

47:52

right away. When Walmart buys, it might

47:54

be 30, 60, 90, 120 days, until

47:58

you get paid. often you'll get paid

48:00

for 100% of what you ship because in retail

48:03

there's all sorts of markdowns and deductions. So

48:05

one thing to just keep in mind is

48:07

almost inevitably if you launch in retail, things

48:09

will get messier before they get better in

48:12

terms of your cash and inventory position. One

48:14

question I had is do you have, I heard that you have

48:16

a home equity line of credit separately

48:19

for inventory financing. Have you ever spoken

48:21

with a local bank or debt provider

48:23

to help finance your inventory? Yes,

48:26

we have actually a fantastic hometown bank. So

48:28

I've since closed the home equity line of

48:30

credit and we've opened inventory lines of credit

48:32

with the hometown bank. They're currently maxed out.

48:35

Last year Q1 was the biggest quarter we ever had and

48:37

so we ordered a lot of inventory to support that growth

48:39

for the rest of the year and then

48:41

Facebook and Google ads started underperforming

48:45

and the year kind of fell apart. And so

48:47

we ended up being stuck with a lot of

48:49

inventory and not being able to pay down those

48:51

lines of credit yet. Understood. And

48:54

your inventory doesn't have a shelf life to it, right? You can.

48:57

Right. And

48:59

then another question is from a gross

49:01

margin perspective, do you feel like

49:03

you are covering in a normal

49:05

world, is your gross margin high enough to cover

49:07

your costs on an ongoing basis? Yes.

49:10

In a normal world, our gross margins

49:12

are fantastic. I think we took a

49:14

lot of missteps with marketing in the

49:16

last year that helped put us in

49:18

this position. We're correcting that this

49:20

year and that's kind of how I'm looking at the

49:22

retail opportunities is not only is it maybe

49:25

some bigger orders, but we're getting in front

49:27

of more faces because people are going back

49:29

to stores and the online marketing is not

49:31

working as well as it used to. So

49:34

I also look at Walmart and Target

49:36

as just sitting there on the

49:38

shelf or being in the baby section is

49:41

marketing. Certainly

49:43

true. It's marketing

49:45

and then obviously it broadens your

49:47

exposure to a huge audience. What

49:50

about all of the little retailers in between

49:53

online and Walmart and Target? Have you spoken to like

49:55

local retailers? I don't know who your big one would

49:57

be in where you live, but what about all those

50:00

smaller ones. We're in about 400 independent

50:02

retailers right now. And that's just mom and pop

50:04

shops that have reached out to us saying, you

50:07

know, we love your products, we'd love to sell

50:09

them in our shop. I'm actually sitting right now

50:11

in a VRBO in Vegas because we're at the

50:13

Baby Expo. It's the big retail event of the

50:15

year for baby stores.

50:17

Great. Well, so I would say there's

50:20

no silver bullet because what you're

50:22

describing, it's a very common issue.

50:25

If you're growing quickly and you don't

50:27

have a pile of investor capital, then

50:29

financing your inventory growth will always be

50:31

a challenge that you face, right? Unless

50:33

your gross margins are, you know,

50:35

70, 80, 90%, and even then,

50:38

depending on how quickly you're growing, you're

50:40

always gonna have needs that outstrip your current cash,

50:42

right? So there's

50:44

a silver bullet answer. I would

50:46

say that one thing that you can

50:48

explore depending on how excited the buyers

50:50

are for your products at these various

50:52

stores is negotiate an agreement so

50:55

that you can get your first few payments sooner

50:57

than normal. So, you know, if you have set

50:59

payment terms of net 30 or net

51:01

60, whatever it might be, you could

51:03

ask for exceptions for the first couple of

51:05

payments to finance the large initial order. You

51:08

know, that's one thing you could do. You could negotiate

51:10

some of the discounts they take a little bit more

51:12

aggressively. I'd also say almost

51:15

every brand that I work with, including

51:17

the ones I used to run, dramatically

51:20

reduced investment in e-commerce,

51:22

Meta and others, because

51:24

the problem you're facing is the same problem

51:26

everyone's facing. It's just not efficient. And

51:29

so a lot of people move those funds out of

51:31

online into point of sale marketing. So making

51:34

sure that people are aware that it's in

51:36

Walmart, for example, or Target. When

51:39

you get into those stores, really focusing on

51:42

services like Instacart, I've seen

51:44

that have a much higher, I'm talking like

51:46

two to three times higher ROI than

51:49

spending on Meta. Wow. Yeah. So

51:52

not just maintaining your dollars, but

51:54

actually shifting your dollars into more profitable

51:56

retail marketing. I do what I do.

51:58

I'm seeing a commercial. I know on

52:00

your website you've got a video

52:03

of a baby, you know, just kind of playing with

52:05

it, but I have this vision of like

52:08

a row of babies, of like 10

52:10

babies, and some of them are just

52:12

quietly playing, and some of them are

52:14

screaming and crying and freaking out

52:17

and throwing things, and some of them are

52:19

doing other things. It's just like a line

52:21

of babies in high chairs, and

52:23

that's just a static shot of

52:26

it's like just watching babies play

52:28

with this, and just chaos. I

52:31

invite you to go to that photo shoot and

52:34

last more than 20 minutes. It

52:38

just sounds so funny. It's

52:40

like a bunch of monkeys at the zoo

52:43

just looking at babies for,

52:45

you know, just, it would be, anyway, I watch it.

52:47

Maybe I can find a daycare center that'll let me come

52:49

and do that. Yeah, yeah, absolutely.

52:52

You know, promise the parents a free mat, you

52:54

know? Yeah, lifetime supply of baby products.

52:57

Let me see your kids. Have

52:59

you thought of also making, I know you sell accessories,

53:02

but also making the toys,

53:06

you know, the tactile things. I know you make

53:08

a couple things like a spoon, but

53:10

other things like noisemakers, the things that

53:12

you guys make that you would attach

53:15

to the tray. Yeah, I

53:17

mean, we've done some teethers. We've done,

53:20

our training spoon is like really, really

53:22

popular with the feeding specialist. One

53:25

thing we've learned is the safety considerations when

53:28

you're making baby products are just really painful.

53:30

And so we want to stay away from

53:32

moving parts and magnets and too much of

53:34

that stuff while we are still so

53:36

small. But we were hoping

53:38

to find some new items at this event we're

53:40

at that we could maybe just private label, find

53:42

something that already exists that complements our product line

53:44

that we can just put our brand on. Yeah.

53:49

This is maybe just going back to the

53:51

OpEx for a second. I just

53:53

wanted to share a perspective on this, which is just that in

53:57

the messy process of Sometimes

54:00

you have to invest before growth and sometimes

54:03

you invest too much before growth. And I,

54:05

in both businesses I've run multiple

54:07

times, have we been faced with

54:11

the reality that we have invested too much

54:13

in anticipation of sales that never came or

54:15

came but came much later. And I've been

54:17

through incredibly painful moments where we've had to

54:20

let members of the team go because,

54:22

you know, my fault in

54:24

hiring too quickly or putting too much fixed

54:27

costs on the business, not always people, sometimes

54:29

it's software and services, whatever. And

54:31

we had to retrench, you know, and in

54:33

a world where money is limited and

54:36

you aren't taking investor capital and

54:38

debt is scary because you have

54:41

covenants and you have restrictions, something's

54:44

got to give. And so I would

54:46

just make sure, you know, it's something

54:48

that everyone's had to go through in right

54:51

sizing OpEx as revenue catches up and

54:53

it's hard, but it's often the thing

54:55

that you must do to get through to that

54:57

next phase of business in conjunction with others. So

54:59

it's often not, let's cut OpEx and lose people

55:01

and therefore everything will be saved or let's

55:04

invest over here and we won't have to

55:06

cut people. Sometimes it's both. And

55:08

sometimes it's not about cutting, it's about, you

55:10

know, reducing the raises or reducing the healthcare.

55:12

There's all sorts of, you

55:14

can do this with a fine tooth comb and it's

55:17

very hard. And so I would just make sure, you

55:19

know, it's something that

55:21

everyone's had to go through in right

55:23

sizing OpEx as revenue catches up. And

55:26

it's hard, but it's often the thing that you

55:28

must do to get through to that next phase

55:30

of business in conjunction with other things. So it's

55:32

often not let's cut OpEx and lose people and

55:34

therefore everything will be saved or let's

55:37

invest over here and we won't have to cut people.

55:39

Sometimes it's both. And sometimes it's

55:41

not about cutting, it's about, you know, reducing

55:43

the raises or reducing the healthcare. There's all

55:46

sorts of, you can

55:48

do this with a fine tooth comb and it's

55:50

very hard and it's very depressing, but it is

55:52

very normal. Thank you for

55:54

saying that because it is very hard and that's a

55:56

lot of the things we're doing right now and it

55:58

is very depressing. I should be

56:00

such a success story right now

56:02

with the numbers that we have and the journey

56:04

we've been on, but it doesn't feel that way

56:06

in this moment. And so I'm hoping that all

56:09

the efforts we're making right now will soon come

56:11

out on the other side of that. It

56:14

feels good to know I'm not failing, that it

56:16

is something that companies go through. I

56:18

mean, I know it seems scary, but you've

56:20

come a long way and it's awesome to

56:22

see the progress that

56:25

you've achieved so far. Beth Benneke,

56:27

Busy Baby, congrats. We're gonna

56:29

be following you. Thank you guys. Good to

56:31

meet you. Thank you. Bye. Wow.

56:36

Mark, I mean, some serious

56:38

weighty questions. Yes,

56:42

big ones. I mean, all

56:44

of these are classic business issues, right? How do

56:46

you compete with the incumbent? How do

56:48

you make it through a period of high cost?

56:51

How do you think about product development and innovation?

56:53

How do you get retailers to listen to you?

56:55

How do you build awareness for something that's brand

56:57

new? These are all the challenges

56:59

to virtually every business worth building. So

57:02

yeah, absolutely. It all felt, all

57:04

the categories were different, but all the problems were

57:06

very familiar. So I think, I

57:09

forget who said this, but someone more famous

57:11

than me said, every time your business doubles,

57:13

it breaks. And so running

57:15

into these issues is something that everyone has

57:17

to deal with. And being open and vulnerable

57:19

to talk about it and get feedback is

57:21

also okay. I felt like I was

57:23

constantly putting on some sort of suit of armor

57:25

every day, like pretending things were great, pretending

57:28

that everything was going well, including

57:30

with investors, even when they could have helped. And

57:32

so I think being aware

57:35

that problems are constant and that people

57:37

are desperate to help you if you ask for help, that

57:40

would have been helpful to me. Yeah, for sure.

57:42

Makes a lot of sense. Mark

57:44

Ramadan, thank you so much for coming onto the Advice

57:46

Line, coming back on how I built this. Thanks,

57:49

Guy. This was great. And

57:51

by the way, if you haven't heard

57:53

Mark's episode of how he and Scott

57:55

built Sir Kensington's, go back and check

57:57

it out. It's an incredible

57:59

story. You can find it in the podcast.

58:01

You will also put a link in

58:04

the podcast description. And also, don't forget to

58:06

sign up for my newsletter at guyroz.com.

58:09

We put a lot of great ideas and advice from

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see you next week. This

58:46

episode was produced by Sam Paulson with

58:48

music composed by Ramtin Aroblui. It

58:51

was edited by John Isabella. And our

58:53

audio engineer was Sina Lafredo. Our

58:55

production team at How I Built

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This also includes Alex Chung, Carla

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about yourself by filling out a

59:34

short survey at wonderyplus.com.