Advice Line with Joe Gebbia of Airbnb

0:00 and welcome to the advice line on how I built this lab. I'm Guy Raz. This is the place where we help try to solve your business challenges and each week I'm joined by a legendary founder, a former guest on the show, who will help me try to help you. And so If you are building something and you need advice,

0:27 Go ahead and give us a call, and you might just be the next guest on the show. Our number is 1-800-433-1298. Send us a one minute message with your name, a Bit about your business and the issues or questions that you'd like help with. Or you can send us a voice memo at hibt at id.wondery.com. And make sure to tell us how to reach you. Also, don't forget to sign up for my newsletter. It's filled with insights and ideas from the world's greatest Greatest entrepreneurs, you can sign up for free at gyros.com or on Substack, and we'll put all this info in the podcast description. Alright, let's go. Joining me this week is Joe Jebia, co-founder of Airbnb. Joe, welcome back to the show. Welcome back to How I Built This. Guy, thank you so much. It's it's great to be back.

1:12 Alright, so you were one of our very first guests on the show, as you know. Back in twenty sixteen, OG came on to tell us uh the origin story of Airbnb, which many people listening uh will know. Um so it's just great to have you back. Well thanks for having me, Guy. That was uh a memorable conversation and I can't tell you how many people have come up to me since saying that was their favorite episode.

1:33 I love it. Um, by the way, we'll put a link to that original interview in the episode description if you if you haven't heard it. And you can also easily find it. just by searching how I built this and Joe Jebia with a G Lots of really great and valuable insights in that episode. Um including Uh, why you guys had so much conviction in an idea that that a lot of people were skeptical about originally. That's right.

1:57 We wanted to build a website where People would post pictures of the most intimate spaceside their homes on the internet. And then complete strangers would book their homes and pay them money to stay there. Now t today you look back on it like who w no brainer, but of course that wasn't the case in two thousand seven and eight. Um I know that today you are an advisor to Airbnb and and more recently you launched a new startup.

2:21 that I'm very interested in talking to you more about builds backyard guest houses or or ADUs accessory dwelling units that um are, you know, popping up, certainly all over California because of the housing crisis and people are putting them in their backyards and renting them out. Um the company's called Samara. Tell me a little bit more about it. Well, it was a genesis that started actually inside Airbnb. I had this R D group that was thinking about ideas for the future. And in California, as you mentioned, ADUs are one of the fastest growing housegments that exist.

2:52 And hosts on Airbnb were actually Listing these places. And I thought, that's interesting. Who's staying there? And it's actually people for thirty sixty, ninety day stays, people coming for months at a time, rotations at the company they work at.

3:05 Excera. And I just thought like You know, there's gotta be a s certainly a high end version of these ADUs, a prefab factory made version. When I looked out at the market There was nothing. It was all uh I in my mind fairly cheap.

3:20 Uh not well designed. And I at this point I was also in the market for one of these myself. And I thought well s I'm just gonna wait around until the the Tesla or the Apple of this product category emerges.

3:31 Guess what? It didn't emerge. And so why not build it myself? Solve your own problem. I've been looking at the website. It is awesome. Um and

3:40 It makes so much sense for you to do this because you've a design background. I mean, that was really what you did at Airbnb was your Focus was around design. Well, and design is I define it in a very specific way. A lot of people think design is the way that something looks. Design is actually the way something works. Mm. Like when you look on Samar's website, design is certainly

3:59 The piece of architecture of the home that you're looking at. But design is also the process of How do we handle the ordering process? How do we Take care of all the permitting. How do we pour the foundation? How do we Actually bring the home into the land where it's being installed.

4:15 And so it's a design is actually a very end to end way to look at something, a very holistic approach. to designing a product. Or service. It's so cool. And these houses range from

4:25 four hundred square feet to about a little under a thousand square feet, I think, right? That's right. Yeah. We've got five different models from the studio at four hundred square feet all the way up to two bed, two bath at uh nine hundred and sixty square feet. And they're ready to go. They're turnkeyed. Once they're they're done, like you just it's got the kitchen, it's got Everything in the bathroom, it's all in there.

4:45 Guy, our last install in California. From the time it arrived on the truck and we Took it off. But the crane to the time it got installed on our foundation was twenty three minutes.

4:56 Wow. I love it. It's so cool. I'm gonna talk to you about this because I've got a little bit of land in California that I'm thinking about do anyway, we'll talk about that later. Joe, before we bring on our our first caller Um I wanna a just a uh Well one thing about about your story when you originally came on, you mentioned this idea that Great ideas usually start out as polarizing.

5:16 Right, which is what Airbnb was. Some people just couldn't understand it. And some people loved it. Um, you know, we're gonna be talking to people who are starting businesses now and there's gonna be skepticism around some of their ideas. When a founder hears criticism, right?

5:30 Sometimes it's warranted, sometimes it's right, sometimes it makes sense. Um From you know, sort of from your perspective, when do you know that you should stick to your vision? Rather than versus like Completely adjusting. course or massively pivoting to it.

5:45 A completely different m idea or model. I think I this is one of the toughest things about being an entrepreneur. You have to like You gotta nurture the connection with your heart and with your gut. Because there are times where the It gets really tough and the world is against you and really smart people are telling you you're crazy.

6:03 And if you don't have Some signal coming from Yeah, deep within you. A conviction. You know, you you're gonna get sucked into what other people think and what other people say.

6:13 And I think you know. Look, I'm no expert at this. This is Something that's honed over a lifetime. I think it's it's just about listening to your body, listening to your your heart. Um and you know, in the Airbnb's case, that's that's what we did.

6:27 And I can't explain there's no Scientific method behind it, it's just a feeling. That we had something and I'll tell you why, guy, it's because We experienced it firsthand. We had those three guests. Stay with us that one weekend in San Francisco.

6:42 And for every person who said that will never work at scale. I just thought to myself. No. They haven't experienced it yet. Yeah.

6:50 We did. It's absolutely amazing. I mean, especially what's happened since then, and even since when we spoke in twenty sixteen. I mean Absolutely amazing. Anyway. We should probably take our first caller. Um Joe, why don't we why don't we bring her on? Our first call, you ready?

7:03 Let's do it. All right, hello, caller. Welcome to the advice line. You're on with Joe Jebia, co-founder of Airbnb. Uh please tell us your name, where you're calling from, and a little bit about your business. Hi, Guy and Joe. So excited to learn from you both today. Thanks so much for the opportunity. My name is Marina Little and I'm calling in from Austin, Texas. I am the founder of Lufian Friends, where our mission is to get kids excited about learning a second language through the power of music. In our flagship collection features board books that sing, which we currently offer in French.

7:35 German, Italian, Russian, Spanish, and Ukrainian. Wow, so these are board books that when you open them up There's like a computer chip and speaker in there and it plays a s it sings a song. Yeah, essentially. So each of our books has six different songs, and each song has kind of an illustration to accompany it, and then the kids will Sing along, dance along.

7:57 Kind of thing. Cool. And and where are the books sold right now? We primarily sell our books on our website. Um Luffy and FriendsWelcom. And we also sell a little bit on Etsy. Um, we previously sold on Amazon. My question is a little bit related to that, but um about ninety percent of our sales are through our website. We do a few local bookstores, but um

8:20 We've really focused on on DSC. And when did tell me a little bit about the the origin story of the business. Yeah, absolutely. So, um My husband is from Argentina and I was born in Russia and immigrated to the US when I was about four years old. So when we had kids, we were super excited for them to be multilingual, but we very quickly discovered that it was much harder than we expected. uh to get them excited about it. But we noticed is that music really resonated with them.

8:48 But as many new parents are, we were pretty much terrified of exposing our kids to TV. Two phones. et cetera, and we wanted to find a different way for them to engage with music that didn't require a screen. Uh, so we kinda took Joe's Solve Your Own Problem approach and we developed uh books that sing so that they could learn through music and at the same time develop a love for books. We started with a Kickstarter campaign to fund our first run of Spanish language books and

9:15 Um yeah, here we are today. Awesome. Marina, are you tell me are you is this your full time job? This is not my full time job. This is my uh nights and weekends. This is your side hustle. Yes. What do you do what do you do during the day? I am a user experience researcher.

9:30 I actually work for Meta, um which has been very valuable for me. Um as just uh a way to learn too about how ads work. Um so That's been awesome because Facebook ads are actually one of the best ways for us to generate um revenue and attract new new consumers to our brand. So that's been kind of an added bonus.

9:51 What's the goal for the business? I mean, do you do you see this as sort of a fun side business or do you do you see this as something that you can Maybe shift and you know transition into full time. Oh, that's a very tricky one. Um Yeah, I love my job. I actually really enjoy my day job. I

10:10 I love my night job as well. Um It's You know, it's so interesting. I think maybe this comes from kind of the way I grew up, but I have a very unique combination of like entrepreneurial spirit and risk aversion. Yeah. And so it's very hard for me to to take that kind of like a leap. Um You know, growing up with my parents

10:32 moving here when I was four and kind of seeing like how hard all that was. Um I do think maybe someday down the line that would be something I'd love to explore, but it's not in my Kind of like. Immediate plan. And so are you and your husband writing all these books?

10:47 Or or doing all the design and yeah, everything. So that's actually been one of the most rewarding pieces of this is um no one wants me to be singing in any book. I can promise that that would not keep any babies happy. We'd be like lots of crying babies. Um, but we work with artists and illustrators from around the world and musicians from around the world. And we work together to select songs that um resonate that um people can connect with and then kind of have them bring them to life, bringing in some of the unique um aspects of their cultures and and of those songs.

11:23 I l I mean, I love it. I've got a bilingual family, so we're My kids both speak French, but but we did that'cause we forced them into French schools from the time they were little. But this is a great way to expose kids to language. There's no question about it. It's awesome. What tell tell me your question for us today. Yeah, so my question is um we used to sell on Amazon But we moved away from it actually this year. Um as a mom, I love Amazon, you know, life saving. Yeah, we found that the fee structure at our volume levels just didn't pencil um and it was cannibalizing our website sales, which is where we can actually generate a little bit of margin, where we can get better feedback from people because we get kind of that two way conversation. Um, but I know that when a competitor comes up on Amazon, people are likely to gravitate towards that option because of just how easy Amazon makes everything. So my question is how can we build a brand to withstand potential Amazon competitors?

12:15 Or should we embrace Amazon and just focus on finding ways to thrive there? And if so, how might we approach that? Oof that is a very Tough question. And specific one. Thoughts about first about uh Luffy and friends. Yeah, it's very cool. I was just looking at the website.

12:32 Um this is a very cool idea and Um, you know, there's a a lot of people out there. Who are looking for things to get their kids that don't have a screen. So I think you're you're in the right space. Now you made a comment just now to Guy which

12:45 Hurt me up. About potential and competitors. Are there competitors today or are there potential competitors? There are competitors in the Spanish language and there are obviously books. That are musical in English.

12:59 And um we did really well on Amazon the first year. And then Saw a number of Spanish language competitors come up. Um so our Spanish language performance hasn't been very strong, um, since then.

13:13 Mm, sí. Is your customer I'm gonna guess their moms. Um, we do obviously have a lot of parents, but one of our um big Customer segments is actually grandparents. So we have a lot of grandparents who um maybe

13:29 immigrated to the United States and had kids here who are wanting to pass the language along um to their grandkids. The the books really resonate with them because a lot of our books feature traditional songs. And then we do also have a segment of um parents that are just interested in exposing their kids to second language even though they may not have had that exposure themselves or maybe had it later in life. They are very excited to share a piece of um their culture with With the next generation. Can you give us a sense of w roughly like what your sales are every year? Are you selling more than Ten thousand, twenty thousand dollars worth of these a year.

14:04 Yeah, actually um so We took it slow the first few years, but this year we are on track to hit two hundred thousand dollars. Wow So very excited. We've had a good year. Awesome. Obviously our margins, you know, could be better. But we're you know, we're profitable and and there's room for growth, I think. So you have a really nice so so you're you've got some traction and and have you sort of I mean, I I'm assuming you're gathering information or or at least emails from the people who are ordering. Yes, absolutely. When they make a purchase, they can join our newsletter. We also have um other ways of collecting at different stages in their journey with us online. And you're so you've got newsletter and you're communicating with your users, with your customers regularly. Regularly would definitely be a stretch. Um

14:50 The gold. Yeah, I mean I mean because you want to remind people that there are other languages and there are other kids to buy these for, right? I mean it's it seems to me that that custom retention That is often more valuable than than customer acquisition. Right, that that that's really where where you you actually grow and expand by retaining Customers.

15:11 Initially and then And then keeping them happy and then of course pursuing an acquisition strategy as well. Yeah, that's a that's a great point. And I think something we definitely need to put some more effort behind. Um, I do find that people will connect to that one language and kind of not necessarily think of us on other occasions, so we definitely could do a better job of of giving them a nice little nudge.

15:33 Joe, what do you think? I mean, I think that she's gotta be on Amazon. I it seems that way at this stage. You know, in I think the idea is that eventually over time you build build a brand that people recognize and you grow out of your reliance on the on a platform like Amazon and Have your own distribution channels.

15:49 That are independent. Um but I think at this stage, you know, if it's about reach and sales and growing the company. I would wouldn't be too picky about Where somebody wants to buy my book. You go everywhere, right?

16:00 I think I'd go everywhere. I would try to like figure out how do I get this in front of my core customers. If that's the grandparents or the the parents, obviously it's like You know, is it on like one of the morning shows or somewhere where they're like consuming content and you get to appear and And I think um No.

16:18 As I'm looking at your brand I'm reminded of um One of Seth Godin's books. Uh it's called All Marketers Are Liars. And this was like

16:27 Like my template early on when I first read it back in two thousand five. Two thousand six, somewhere in that time. I think it's probably worth reading that because it would really might spark an idea. of how you can take the brand that you already have, which is already in a great spot. and elevate it to the next level to get people's attention.

16:44 And The kind of thing that like, what would get you on a morning show? Yeah. And there's a way to do that, Joe. I mean I've got a I'm not going to trying to promote it, but I've got a whole kids podcast and and and a whole kids um science

16:57 business and we just release like Toys. So we've got exploding volcanoes and Stomp rockets and they're sold in in in shops and on Amazon. And we basically did Um

17:09 a whole day, two, three days of just back to back to back local news interviews. Me and my my partner, Mindy Thomas, you know, you just basically hit up every local news channel talking about this thing. I mean your story's great. And local news needs to fill time. I promise you that. You can go to every I mean, from South Carolina all the way to Eugene, Oregon and beyond. I mean, it's gonna take a little investment, not as much as you think, though.

17:35 Great. Yeah, definitely we'll look into that. I know we we looked at it a little bit early on and it felt like it was a huge investment, but maybe we're ready for that. Yeah. Got invest in marketing. But those that money will come back to you. One thing real quick is I'm thinking about the Seth Godin hat on of

17:50 you know, the purple cow of making something that's really distinctive and really stands out. The songs I saw in here are expected songs, which is great because that's maybe how you want your kid to learn. But what if they weren't expected songs? What if they were like very unusual? Like something that would you know, be very unexpected to be in a children's book and and translate into another language that people turn their head and go, Wait, what was that?

18:14 You stop people in your you need something that's gonna think in the stop people in their tracks that would get you very easily onto Good morning, America. For example. Yeah, I love that idea. We we experimented a little bit with creating our own songs for our Spanish language books and we have like songs about routines. Um, but that doesn't that's not like a uh stop in a tracks kind of thing. So I love that idea. It's very Inspiring.

18:36 Thing. All right. Uh the business is called Luffy and Friends, um, books to teach kids how to Thing and Foreign languages. Uh good luck. Thanks so much for calling in.

18:47 Thank you so much, Gaionjo. I just really appreciate all the inspiration today. Always. Can't wait to to put these ideas to life. Good light. Take care. Bye bye. Yeah, you could do like uh I I when you said like weird songs, I was like like

19:00 You know, like Shell Silverstein, he has some weird poems. Like people think of like where the sidewalk and like the giving train up, but like you go into his back catalog, there's some weird stuff in there. Mm-hmm. Like he was super countercultural, like some of that stuff. And so I'm thinking like what if he had a song that was super weird like that? You know? Right. Yeah. Or something I don't know, like something iconic.

19:22 That You just would never expect in a children's book. Yeah, and there's a lot of iconic stuff that is does not require any license anymore. Mm-hmm. So Worth a try.

19:33 We're gonna take a quick break, but when we come back, another caller, another question, and another round of advice. I'm Guy Raw, stick around listening to the device line on how I built this lab. Welcome back to the advice line on how I built this lab. I'm Guy Raz, and my guest today is Joe Jebia. He's the co-founder of Airbnb. And we are taking your calls. Let's bring in our next caller. Hello, welcome to the advice line. You're on with Joe Jebia, co-founder of Airbnb. Uh please tell us your name, where you're calling from, and a little bit about your business.

20:17 Kai and Joe, thank you so much for having me. My name is Ray Ricky Rivera. I'm the founder operator of Norwal Brew House, a self-distributed craft beer brand. Uh we launched in January of 2022. Nice. Breweries.

20:37 to produce our product and then we wholesale direct to retail. And I handle all of the sales, distro, marketing, branding, all of that. Everything. Everything. You are you are the you're the you're the company. You're the whole company. I I am. I I can you call one person a company? Yeah, absolutely. Okay. I I'm from a one man company. But you know on your business card it should say account executive. So then people people think that it's a really big company. I'm Ray, I'm uh an account executive with Norwalk Brew House. So my brother in law did that when he started his business.

21:11 like thirty years ago. It was very smart idea. All right, so tell me about the beer. What what kind of beers are you making? So we're a I what I like to call a Latino forward. brand. So I like to tell the entire world that this is owned and operated by a Mexican American. uh because there's not that many of us in the craft beer industry or in the beer industry rather. Um but we make uh

21:33 Light lagers, uh Mexican style lager. Our flagship beer is called BeDBlan, which is a Blonde Ale. Um, so you know, in in general it's it's your typical uh beer styles that um tend to do well in the market. Awesome. And um

21:50 Before I d we dig in a little bit more, tell tell us what your question is for us. So obviously I'm I'm tiny. Um But I've been having some success in my local market. Uh I have decent demand. This in the LA in like LA area. Yeah, in in l Los Angeles County.

22:06 Uh little bit of Orange County as well. But I've been struggling with scaling, um, I've had some great opportunities to land bigger retailers. But I haven't had the proper capital to scale and really uh take advantage of these opportunities that have been coming my way. Ah when I launched this brand The seed money I gathered

22:27 From selling off old DJ equipment, I launched a small uh Indiegogo crowdfund campaign. And um off I went. And My issue is I don't have any established credit. I don't have bad credit. I don't have any established credit. So I can't get a loan. I've been applying what feels like for over a hundred grants.

22:48 Back in twenty twenty two, I managed to land one, which was amazing. Um but other than that, it's bootstrapped, um, super lean, super scrappy. And I need help or ideas in that area, like what are my options for Finding funding.

23:05 Mm. This is an interesting challenge. Okay, before we get to tackling this question about cash, right? Tell me how you got'cause you mentioned that you sold DJ equipment. to finance this business. So I'm assuming you were at one point making some money as a DJ. How did you get into brewing? Like how did this start?

23:25 So I have like a solid twenty years of being in the music industry. Nice. And Back in about twenty twelve, thirteen ish, I was managing local bands here in the city of Norwalk. And I noticed that there was no local venue to book these live acts. So I thought, Hey, maybe I'm

23:43 I'm the one to open up a venue. And book local. Live entertainment. That sort of led to me thinking that it could be a a Bar and grill serving California craft beer.

23:55 Fast forward to 2014. Uh my wife was giving birth to our daughter. There was some issue there at birth and we found ourselves Forty five days. At the hospital. Picked up some books. One of the books was Uh Brewing Up a Business by Sam Khan. Yeah, yeah. Dodd Fish Head. It was on the show. Yeah. That's right.

24:15 I love that episode. Anyhow, um That book really inspired me. To think about Um Potentially

24:23 building something more than a bar and grill. Um and in twenty fifteen I co founded A homebrew club called the So Cal Cedos, which became the largest Latino based homebrew club in the country. Nice. So as I'm Diving deeper into the uh homebrew hobby, I'm starting to realize there's this huge void in the industry. There's not very many Latinos on the ownership side. Um so I saw there was like

24:52 a potential opportunity there for a brand to come To come out and um really speak to the la Latino consumer. Um and during all this time I'm managing and I'm DJing on the side. Um So when the pandemic hit, any DJ work that I had happening was completely gone. So I just

25:10 Figured hey Here's an opportunity. I might as well go after it. Started selling off my equipment, microphones, mixing boards, and speakers. I I made a few thousand bucks. Uh launched a Indiegogo campaign. And I think

25:24 I I got somewhere around twenty grand and launched this brand. Amazing. I love that story. Joe, all right. Ray is at a crossroads, there's demand, but he's gotta raise money, he's gotta raise capital in order to try to you know Scale is saying. Uh, but he hasn't any luck with loans and he you know, he's

25:45 Trying to figure out what to do. I have some thoughts. What do you w where should he where where should he start? Yeah, hey Ray, uh great to be with you today. Um my question is what percent is um selling for tap to bars and what percent is Uh retail.

25:58 And cans to consumers. Well, if if I'm selling a cake to a bar They're purchasing that from me for about One eighty. Uh, it's probably costing me between one twenty and one thirty a a cake, depending on the style.

26:15 Um At retail. It's Can't only And I think my margin there Uh somewhere between forty and sixty percent.

26:26 Right, right. Yeah, I just want to get a sense of you think there's uh more upside. in the future on the B to B side or Is this more of like a get to the get to retail stores? And expand there.

26:38 Is that the real opportunity? I I feel the real opportunity is to be in direct to consumer. Um, and long term that has been my my plan. I really want to open up Norwalk Brew House the physical location. And you know, if we're selling beer direct to consumer over our bar, then our our margins are the biggest there.

26:57 Um so the reason why I chose to go the contract brewing route was because it was lower risk. lower uh investment. Um, but it's a really tricky time right now. Uh when the pandemic hit, everybody went from um on premise to off premise. So retail sales were through the roof. Yeah. Now a lot of that has has shifted. Um and on premise or going after draft accounts, it's super hard. It's it's a challenge. 'Cause you know, I've had experiences where I've managed to land accounts and then the bigger distributor will come in and remove my cake from the tab. And in and with what you're doing.

27:32 You gotta work with a big distributor, otherwise you can get swallowed. And just out of curiosity, are you in or have you have you approached like some of the retailers like in California, like Bevmo or Total wine or any of those places? I have not, and it's mainly because I I'm I'm confident that I could land those accounts.

27:48 But if I do land those accounts, then I'm gonna have a huge purchase order that's gonna take significant, you know, capital up front that I don't have. Yeah. So I I've been slow to go that route. Well, you know, I I think R Ray, I I I look at you now as a you're a food and beverage entrepreneur. And Yeah, that's a that's gonna

28:06 a attract a certain type of investor that's, you know, not a tech investor. It's not Silicon Valley, but there's There are investors for food and beverage, obviously. So I feel like that's the space that I would go network in and explore. And really try to surface some names of like Who's out there, who's you know

28:23 even local to you kind of, you know. regionally based, um, or or expand beyond that. And I don't know, I would start reaching out to people. I would start to find uh connections to food and beverage uh um investors. Probably at the angel level, but maybe at the V C scale. And um

28:41 I would start to have conversations with them. To just put your idea in front of them and and start to make pitches. Right. So what you're saying is Find somebody

28:50 who's in food and bev of uh maybe another a founder like somebody who created the O Obama O's, somebody like that? Something like that, maybe yes. Somebody with definitely more experience than the guys who created the Obama's. Touchet, Joe.

29:05 I think that's really good advice. You know, Ray, um we did An episode you may have heard not too long ago about Athletic Brewing, which is a non alcoholic beer. And nobody wanted to work with him, you know, he couldn't even find a brewmaster to work with him because it's not an alcoholic beer. Um and he went around to every single person he knew, teachers, friends, family friends, anybody, ask anybody to invest in the brand.

29:28 You're now working on a product. I mean look. Let's be honest, Mexican beer's having a moment. Um and so There it seems to me like there's an opportunity here with what you're what with what you're doing. you know, you're doing it Mexican style beers Loggers, IPAs.

29:44 Um, I don't even know if anyone's doing Mexican style IPAs in the US, right? Technically. That's not a a thing, like a style. Yeah. But we can make it a thing. Right. Exactly. Yeah. Like my flagship BD BD Blan Blanc. And for all the Latinos listening, they'll they'll understand that reference. BD BD blonde blonde. Um We market it as a Mexican American blondale. Technically that's not a

30:07 Actual style. Yeah. But we're s I'm saying, Hey, I'm a Mexican American and this is our beer. So There you go. This is our beer. You're making a style, right? You're making the style. Look, the reality is

30:22 Everybody has a network, even if you think you don't. And it's It's you know, the person that that you see at Starbucks or um, you know, a friend of a friend or someone's parent or someone at your like church or what community center some somebody

30:40 There are people that you can talk to and and find out if they'd be willing to put in A small investment. 'Cause I I get it. It's hard to ask people for help, but he here's a trick I use. If you think of what you're doing

30:53 Which it is as a mission. It's not about Ray getting rich or Ray serving himself or his interests. It's about the the mission that you're that you are pursuing, which is building this brand that you believe in. that you believe a lot of other people will believe in and get value from. And just putting yourself in that mindset might actually help a little bit when you're

31:14 Asking people for help. I mean, it's the hardest thing about fundraising. It's asking. Most people have a hard time asking for money. But um it's if you can get Past that. Um and just

31:28 Be prepared to hear, you know, ninety-nine no's for every yes. Um It's Eventually gonna succeed. Yeah, I think you'll eventually find that person.

31:38 And I don't have the sense that Ray, you have you have an issue. With Asking people for help. You're on this call with us right now. As an example. I'm I'm definitely getting better at it. Um I I do struggle with

31:50 Asking for money, to be quite honest. Um, but I know it's it's definitely necessary and it's something that I I just gotta do. Well, right, this is your your call to adventure here, because if you're gonna be an entrepreneur in this space, you gotta be comfortable asking. For money. And look, you're gonna go a lot of nose.

32:07 And you gotta I will share an equation with you, actually. This is one I learned back at school. I might snuck into a entrepreneurship weekend at Brown University. This guy was giving a presentation on failure. And he put up this equation S W squared Plus W C

32:23 equals M O And he broke it down and he said, When you're selling a product, you're asking for money In this case. Some will want to give you money, some won't. SW squared.

32:34 Plus WC, who cares? equals M O move on. Man, like And I think you just gotta get out there. And start cold emailing people.

32:47 Showing up at events. Like Yeah, this is where the hustle you gotta get into hustle mode. to cross the bridge between where you are now and where you want to get to. With regards to fundraising.

32:57 That's good. Thank you for that. Yeah, that's helpful. Brand is called Norwalk Brew House. Ray Ricky Rivera. Um good luck, man. We're rooting for you, turning you on, man. Guy and Joe, I appreciate. Thank you so much. Cheers, Ray.

33:10 Thanks. Thanks, Colin. I gotta say, looking through their website, he's he's got He clearly has authorship, you know, he knows how to create something distinctive. These cans are really nice. He's got the loteria's uh the ha from the cards from that you know, the Mexican uh game loteria. Uh it's cool.

33:27 There's authenticity to it, which It's working in his favor. I feel like he's He's not too far away from you know, reaching like he you know, there's there's cult brand status for him out there somewhere. I think so too.

33:39 If you can just get to the right investor. Yeah, I think so too. And that's how it starts, right? For sure. All right, we're gonna take another quick break, but we'll be right back with another collar. Stay with us, I'm Guy Roz, and you're listening to the advice line right here on how I built this lab. Welcome back to the advice line on how I built this lab.

34:13 I'm Guy Raz, and today I'm taking calls with Airbnb co-founder Joe Jebia. Uh so Joe, let's uh let's bring in our next caller. Hello welcome. Please tell us your name, where you're calling from, and a little bit about your business. Hello, guy Joe J L Thorpe. Founder and CEO of Game Day Social Apparel. Thank you so much for having me on the show. I'm excited to be here.

34:33 Um the company's based in Sioux Falls, South Dakota. We launched in twenty twenty one to produce top quality. Trend forward. sports apparel exclusively for women and to date Um were featured in around two thousand retailers across North America.

34:50 Wow, and these are just to be clear, these are sport sports for College, professional both. Our licenses are with universities currently. Universities. Okay. So you have licenses with universities and you make sports apparel Primarily for women. So so like if you uh it's Michigan, it would be like Michigan sweatshirts for design for women. Yes, yes, precisely.

35:11 That was probably a massively underserved market. When you ga tell me how you started this business, how'd the idea come about? Yeah, well no big time. So my background is small brick and mortar retail. I really cut my teeth in the fashion industry owning a women's boutique. And through that. I started producing few graphic Ts for a local university and that really came about there just was never anything that my friends and I wanted to wear to games. What was the what was university, by the way?

35:40 South Dakota State. Nice. Okay. So you started making them just for you and your friends, like cool shirts and sweatshirts that 'Cause a lot of them are really kind of a designed for the male fan, right? Yes, you understand my industry perfectly, it sounds like. Um

35:56 So I owned these two women's stores in South Dakota, and so I started producing shirts to sell through the stores. And I think pretty quickly I recognize there just was a much bigger opportunity than what we could sell to South Dakota State. Amazing. And um tell us, um, before we ask you more questions, what what's your question for us today?

36:16 Yeah, absolutely. So Like I said, we're about four years in and we've experienced a pretty incredible sustained growth rate. And so as we get the right people and the processes in place to just create stability and to continue to grow.

36:31 I keep looking at the next stage and I just know that that Scrappy. mentality that got us from Zero to hear

36:40 is not gonna get us from zero to fifty million. And so as we consider growth I would just love to have a conversation with both of you on how you recommend that we assess the opportunities that come our way. Before I bring in Joe, just can you Brief g give me a sense of what what is your revenue right now?

36:57 Around ten million. Ten million dollars. You must be the biggest small business we've had on the advice line. That's amazing That's incredible. Congratulations. I mean m most of the businesses are doing, you know, ten to fifty grand a year. Okay, Joe, I want to bring you in.

37:14 Um First of all Amazing story. It really is. It really is a Well I still have plenty, plenty to learn. That's why I'm here. So uh jail, like when you think about um

37:26 What I'm I'm always curious about. when people think about their company and their brand. What do you think is the core idea? behind Your brand.

37:34 I mean really Guy kind of summarized it. It's product built exclusively for women and so I mean what I love about you and your background and what you built and the disruptive nature of it is that the whole idea was design, a lot of where that started. And so to me It's all about design and quality. And

37:54 As we scale that obviously gets more difficult to preserve that design and quality, but I think that's I mean that's our Uh secret sauce is just creating products that are so unique and distinctive that they stand out. That that all makes sense. I want to push a little bit further though. What is it about?

38:11 Game Day Social That A woman buys from you and not somebody else. Who also makes for women, women's wear. Well I think

38:19 One one area that we spend a lot of time on is the fit. And the silhouette. And I think that's really what it comes down to for women is when you pick up a piece, it's all about how it And a lot of the sports apparel out there is

38:35 Really men's garments. With A little bit. Different spin. Mm-hmm.

38:40 So when you talk to your your customers, um I'd be curious, like what are they saying? They feel like what is wearing one of your garments do for them. Emotionally.

38:51 Like what have they said to you over the years? Yeah, no, I love that question. We say that so our tagline is we're for the social fan. And the reason that that I picked that is because I personally am not I'm actually not a sports fan, which is kind of funny that I wound up in this industry. Um, but honestly that's kind of really part of what makes us special is that

39:13 I wanted to be able to go to games and feel like part of that. environment, part of that social experience, but I'm I don't know anything about the team. I'm not paying attention necessarily to what's always happening on the field. And so I think really what we're able to bring is this just sense of of belonging in that community to a female fan, but also just in an elevated way where she's Representing her own personal aesthetic.

39:36 I feel like I'm looking at your website here and looking at all these different universities and the designs are missing. I uh my assumption was you would just have these cookie cutter designs with the different school names. Every single school has different designs. Which is Pretty remarkable. Thank you. Really cool. And are they sold um or are are you selling uh

39:57 Uh what's your main channel? Are you d mainly wholesale or D to C? were very predominantly wholesale. That was the strategy that We start it off with. We'd love to grow the D to C side, but that's a slower build. And you are so you're sold in like

40:12 shops on campus or or around the campus. Campus stores, um, we sell to a lot of boutiques, small mom and pop shops. That's my roots. So I'm I'm faithful to that customer base that we also work with. A lot of national retailers as well. Um and Have you taken on any investment yet?

40:30 No, I've been able to get to this point by without diluting The equity. So The goal is to keep it that way. So you own a hundred percent of the business? That's correct.

40:41 Wow. So now all right, so you're talking about where to go next, right? Because obviously you want to grow. Joe what do you think about I mean there's a lot of a lot of different directions you could take this in. Like do you do you seek out uh investors, right, at this point. Do you slow down growth? Do you speed it up? We we're about to have an episode where I interviewed Michael Rubin, founder of Fanatics, right, biggest sports apparel brand probably in the world. Um and you're gonna it'll be a lot for you to learn from that episode. But

41:08 you know, m multi billion dollar business. Um, Joe, when you think about About growth at this stage. Eight million dollar brand. Uh really. good category. College sports, it just seems like it there's endless growth. What do you think? What should she be thinking about?

41:25 Well, Jay L, you've you've already done the thing that I I would have advised, which is to bootstrap as long as you can. You know, that was one of the best things that we ever did at Airbnb. Is that we built up value. You know? Scraping by.

41:38 Without giving out. Yeah. Too much of the company too early. And so as we went to fundraising, as we knew it was time to scale. As we proved out our model.

41:47 On our own dime, effectively. Um it allowed us to go into investor conversations having a real seat at the table. having a full hand of cards to to work with, uh as we got into discussions with them.

42:01 And it seems like you may be at that time. You know, you've got years behind you, you've got clear Yeah, success. You've got Yeah, real revenue. And

42:09 I'll give you one other piece of advice which is The best time to go raise money is when you don't need it. Hm. And so If you're in a position where you've got, you know

42:18 Ramen profitability where you're able to cover your expenses and your costs. And It's effectively unlimited runway. you have a unique advantage to go out to seek investment at this point. And so I think it's really where I would start is what where do you want to end up? Like what is the your biggest dream for where you could take this company?

42:39 And I'd work backwards from that. Yeah. And and honestly, that's I mean, I would love to hear more from you about that. process of, like you said, when you got to that point where you had the hand of cards and you had the seat at the table of Also just looking at what what what did that what

42:55 What were you guys looking for in terms of that investment? What did that How did you weigh those opportunities? What did that kinda look like? Well, we needed a seed round so that we could hire people. It was still just the three of us working out of our three bedroom apartment. And so we went out to to uh meet a couple of investors and

43:13 Sure enough, one of the the first Two that we met with Wanna take a big bite of the apple. And

43:20 You know, the fact that like we didn't necessarily have to take their money, it's not like it was sink or swim, our life didn't depend on it. Yeah. It gave us some leverage in those conversations. It sounds like you may be in a similar position. Yeah, no, that's that's extremely, extremely helpful.

43:36 You know The other thing that I was thinking about when I was just thinking about you and your story and that like diversification and looking at new revenue streams or categories, I was I would love to hear you talk about your decision as an organization to add experiences. What was the decision making process for let's add experiences to the platform and not

43:56 Vehicles or office spaces or Something else. If you're willing to share that. The experiences was born out of

44:04 Us. uh listening to our customer base and also our own vision for Um wanting to offer more than just a place to stay, a trip. is many things. The stay is just one of a dozen things that people need.

44:17 In order to have a great vacation. What are all the things that we could do through our lens of Providing local authentic accommodations or local authentic experiences. How could we extend our platform?

44:31 to allow hosts to offer those experiences when you travel, really just answering the question that people have of Okay, you helped me get here. Now what can I do? And let's answer that in a very on brand way. by when we are hosts to host.

44:43 Yeah. That's awesome. I think that makes a lot of sense. Jill. I think and and and sort of Um you know. Doubling down Joe's.

44:51 point here. I mean I you know You have h how many employees do you have now? Uh, we're a team of about twenty. Twenty people. That's awesome. Okay, so twenty people. And um I'm assuming you are are you profitable?

45:04 Yes. Yes, okay. But probably your margins are not um they're probably Not super high. Not quite yet.

45:12 Yeah, correct. Yeah. apparel's tough, it's tough business. But with um, you know, bringing a a good strategic investor and you're gonna you're gonna want to think really carefully about who that is, right? You're gonna want somebody who has experience in apparel if you bring somebody on or experience in licensing. uh that that gives you the opportunity to really scale up the designs, right? Because I'm sure that's a um

45:37 That's a challenge, right? Is it you probably don't have enough designers. You know, that's actually something that we've really managed to create processes around outsourcing to be able to Scale that out, which I'm I am proud of because again, that's so critical to our brand is the design. I would say though the piece to that that we need to scale out that that's

45:57 Just taking time is to diversify our manufacturing base. We really need more manufacturers and that's a long process and so yeah, I would say those would definitely be would be p important pieces. Yeah, and of course, um, given the the political sort of winds of change, you may have to think about where you get those manufactured, of course, if there's

46:18 Issues around tariffs and things like that. So that could that could pose a challenge. But c you know, there's there's all obviously solutions to that as well. Yes, we've been talking a lot about that. And yes, a lot of our manufacturing right now is happening in China, but we've added a great partner in India and But again, that's a lift. I mean that just takes time and cash and

46:38 So yeah, I know this is super helpful. Cool. JL Thorpe, the brand is called Game Day Social. Uh congrats It's looks like you're doing a lot of things right. So good luck. Keep keep keep it going. Thank you so much. This was such a treat, guy. My ten year old son, a budding entrepreneur, and I love to listen to your show together. You're just so exceptional at what you do. And Thank you.

46:59 Joe, really enjoy your perspective and just love that you took the time to do the show. So so good to meet both of you. Take care. Thanks, Jay. Thanks.

47:08 Awesome, I love it. That business. I love that idea. There's a product it's serving uh uh A lot of people, right? I mean sports Apparel, college sports apparel, it's such a massive business. And it f seems like it just never stops growing.

47:24 No, there's always more alums graduating from schools that want to stay connected. And people spend so much money on we had a whole Episode on a a hotel company that you you may know of the graduate hotels, you know, it was really started out In college towns. He just Ben Wepron just w started a hotel. He's like, Hey, you know parents, alumni people kinda visit. Why don't we make a hotel in the college town but decorate it with the college like colors and themes and sports heroes and now there's like fifty hotels I they sold it to Hilton.

47:53 Yeah, so people love college, but they're so committed to it. So Well, there's probably more more out there besides college, W N B A and and others, you know? Exactly. Um, Joe, before I let you go, um it's a Version of a question I ask everybody who comes on to help me out here, which is You've got Samara and you've learned I mean

48:12 I'm sure because you learned so much with your experience at Airbnb, you probably Went into You're you know, into this business with obviously a lot of experience and perspective I'm probably still made mistakes, uh everybody does, you know. Um, but if there was something that you could have told yourself

48:32 back in two thousand eight, you know. when you were building Airbnb that that might have made things a little easier or could would have given you some perspective. Is there something that you can think of that Mm. Would have been helpful. Mm-hmm. Well I'm gonna answer that by saying

48:47 I the piece of advice I give myself is to Have more mentors. Mm. Because Starting something.

48:55 As exciting as it is and sounds, it's also at times extremely lonely. Especially if you're doing it for the first time. And especially if you Aren't exactly sure what you're doing. And

49:09 I eventually found mentors, of course, along the way. I just wish I had found them earlier. I feel like they they once I did find them, they they really helped me avoid some pitfalls and some Some landmines on the road of entrepreneurship, and I'm like, Man. I wish somebody told me earlier on.

49:26 Take the time. Go reach out to people. And Find some some folks who have seen the movie play before.

49:35 And can provide advice perspective so that you're not Yeah on your own. Joe Jebby a co founder of Airbnb.

49:44 Thanks so much for coming on. Guy, it was a pleasure. Um, and by the way, if you haven't heard Joe's original How I built this episode, you've got to go back and take a listen. We'll link to it in the podcast episode description, and here's one of my favorite moments.

49:58 From that interview. We ended up going from zero to eight hundred homes in a matter of four weeks. And I have to tell ya, I thought that this was it. Like this was Our Rocket ship to the moon. You thought, We made it, we're here, we got it. Right. If if you build it, they will come and look what's happening.

50:16 And so we get introduced to twenty investors in Silicon Valley. Ten of them reply to our email. Five of them eat us for coffee. Zero.

50:27 Invested in us. Hey, thanks so much for listening to the show this week. And by the way, please make sure to check out my newsletter. You can sign up for it for free at gyros.com or on Substack. And of course, if you're working on a business and you'd like to be on this show, send us a one-minute message that tells us a little bit about your business and the questions or issues you are. currently facing because we would love to try and help you solve them. You can send us a voice memo at hibt at id.wondery.com or call us at 1-800-433-1298. You can leave a message there and make sure to tell us how to reach you. And by the way, we'll put all of this in the podcast description as well. This episode was produced by Carla Esteves with music composed by Ramtin Arablui. It was edited by John Isabella. Our audio engineer was Jimmy Keeley.

51:18 Our production staff also includes Alex Chung, Chris Massini, Elaine Coates, JC Howard, Devin Schwartz, Katherine Seifer, Carrie Thompson, Neva Grant, and Sam Paulson. I'm Guy Roz and you've been listening to the advice line. On how I built this lab.

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