Advice Line with Vicky Tsai of Tatcha (September 2024)

0:01 Hey everyone, it's Guy here. So we're taking a quick break this week while we work on new episodes for you. So we want to share one of our favorites from the archives, our advice line conversation with Vicki Tsai of Tatcha. And we'll be back with brand new episodes starting next week. I'll be joined by some amazing guests, including Travis Borsma from Dutch Bros Coffee. and Lyndon Cormac from Herschel Supply. Uh and I can't wait for you to hear these episodes are super fun. And thank you to all of you who have already called and we have so many calls, so we will try to get to most of you over time. And uh we're super excited to hear what you guys are building. So uh Enjoy the show. Hello 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. Each week, I'm joined by a legendary founder, a former guest on the show, who will attempt with me to help you. And if you're building something and you need advice, give us a call, and you just might be the next guest on the show.

1:10 Our number is 1800-433-1298. Send us a one-minute message that tells us about your business and the issues or questions that you'd like help with. You can also send us a voice memo at hibt at id.wondery.com and make sure to tell us how to reach you. And also don't forget to sign up for my newsletter. It's full of insights and ideas from the world's greatest entrepreneurs. You can sign up for free. at gyros.com. and we'll put all this info in the podcast description. Alright?

1:43 Let's get to it. Joining me this week is Vicki Tsai. She's the co-founder of Tacha. It's a skincare company rooted in Japanese. Beauty rituals, Vicky. Welcome back to how I built this. Thank you. It's an honor.

1:57 It's so great having you back. So today we're uh gonna talk to founders who are taking you know, a lot of them are taking some big career moves to bring their their business ideas to life. And uh we thought you would be the perfect person. You started Tatcha after making this

2:14 really big pivot in your career. You worked in corporate finance, you worked for Starbucks. Um, but you kinda became disillusioned with that world after a while. Not Starbucks, but just kinda corporate life. It burned you out and you're getting dermatitis and you took a trip to Japan and you met a geisha and you started using r skin care products that they had and it just kinda changed your life and inspired you to to build this company. And this was back in two thousand eight. Um, and you struggled for some time to build Tatcha, but of course now it is a

2:45 huge multimillion dollar company um now owned by Unilever. Such an awesome story. We are gonna put a link to it In the show description. But Vicky, before we get to to our callers, um I was hoping to ask you uh a couple of questions. At what point did you feel like you could jump fully this? Because you went to business school, you got the brass ring jobs, you were on the path to sort of corporate success and you come, you know, you came from a family that really emphasized success and achievement. I remember you talking about this and

3:18 Wha at what point did you feel like I I don't it doesn't matter. I just can't do this anymore. I've gotta do this other thing. I didn't have an idea and then decide to quit my day job. I quit my day job without any safety net. Because I was just um I felt that corporate life was so soul crushing.

3:37 And I just thought If I continue doing this, there's a one hundred percent chance I'll be unhappy. If I try something new, there's a fifty percent chance. I'll be happy. And so um I left with no plan and no Idea. Yeah.

3:51 I didn't think I was gonna start a company. I just knew I couldn't keep doing what I was doing and then I stumbled upon Tatcha. That's awesome. Um, one of the things I remembered a after our interview in twenty twenty, um, is that And at the time you had let you kind of step down.

4:07 S CEO. And then you actually came back. And to lead Tatcha as CEO in twenty twenty one, Uh a little bit like Howard Schultz, who's been back and forth as CEO three times. Can you talk a little bit about the decision

4:22 the original decision to step down and then the decision to Come back. Yeah. Um I stepped down After we brought in private equity in twenty eighteen.

4:32 Yeah. Because They recommended that we bring in A seasoned leadership team. And it really triggered this uh impostor syndrome in me that I I had carried for my career.

4:45 Um And I thought I don't want to be the kind of founder. that ends up limiting the potential of their business. Because of their own leadership.

4:54 um limitations. So I stepped down and I welcomed with open arms a new leadership team. And then a couple years later, Unilever asked me to come back. Um so twenty twenty one in the midst of Covid and in the midst of API hate. We also did a turnaround. It was an honor to be able to step back in and um it gave me the opportunity to lead in a different way that I never thought possible. Um and then at the end of that year I actually put in place a new leadership team.

5:26 Including a new CEO. It was a first diverse leadership team. In beauty. At any scale. Um, and so they leave the company now. I'm no longer CEO.

5:36 But I'm proud and and honored to continue to support them and be an advisor to the company. It's an awesome story'cause I remember we talked about it when you were on the show, you know, and and you know, you you trusted these investors and they were, you know, basically doing what they thought was in the best interest of the company. But for you And I think a lot of people feel this. I and I do too. I mean I I I think, you know, obviously I think Women. tend to experience this more than men, but I think

6:01 lots of founders experience this this feeling of like okay now We're really big, maybe I'm not the right person to do this. And it's a very natural feeling to have. Yeah. said to yourself, Wait a minute, no, I can do this. Yeah. Yeah.

6:17 It it forced me to be curious about where those ideas came from in the first place. Why? Had I believed that I didn't have what it took because mm I had the experience and I had the track record, the numbers were there. But

6:31 I think I had internalized a lot of feedback over time. And when you're an entrepreneur as you know You get so many no's and so so many um People doubting you. that you have to become your own hype machine in your head and every day you have to be like, I can do it. I can do it. But

6:48 Some part for me. Crapt in. And it and that that little bit of leakage um eventually was enough to overflow my sense of self worth and self confidence. Um and then I had to

7:03 Watch the company Disintegrate. For two years. From my perspective. And um

7:10 That was what caused me to come back and say, Mm I don't know why I doubted myself like that, but it's time to get to work. There's there's not really time for doubt right now. That's a bit of a luxury I don't have. So let's let's finish what we started. And it was a joy. It was a joy. Yeah.

7:27 Yeah. Your your Steve Jobs moment, you know, coming back to To leave the company. Um or Howard Schultz moment. Um, Vicky, why what do you say we take our Go ahead and take our first call.

7:36 I can't wait. All right, let's do it. Hello, caller number one. Please introduce yourself. Tell us uh where you are calling from And a little bit about your business. Hi Guy, hi Vicky, thank you so much for having me here. Hello. My name is Jessica Liu, I'm calling from Newport Beach, California, and I'm the founder of Petite On Jew. I design and handcraft demi fine and fine jewelry with a playfully sculptural aesthetic.

8:01 Amazing. Okay. And and uh f first of all, uh tell us a little bit about about the business. Do you buy the jewellery from somewhere else? Do you make it? Do you ha t tell me about it. Um now everything is handcrafted by myself. I'm a self taught metal smith. Um I tend to gravitate towards making organic and flowy designs with a bit of texture. Um, but I also really struggle with sensitive skin. I know Vicki, you can relate. Um and so I made a vow to only work in precious metals. I don't use brass in my studio, so most of my pieces come in Stirling Silver or 18 Carat Gold Vermee, and I'm in the process of rolling out a fine jewelry collection as well.

8:39 Okay, so you are a metalsmith, which is awesome. I mean'cause you know, I think you think of metalsmithing and I think of like the nineteenth century, like a guy in a hammering away at a horseshoe. Do you have an art background, a design background, is that Where this this comes from? No Completely different. I actually um come from the corporate well, I used to be an attorney. Um but I I always had a creative streak and I've been listening to the show for ages. I was always so inspired by the female founders in particular.

9:05 And so um I wanted to create my own thing and I f read the story about this woman who made uh jewelry business curating designs and I thought I could do that. But I couldn't find designs that resonated with me. So I decided I was gonna make my own what I couldn't find out there. And so I taught myself. I watched YouTube videos, I bought all the books. And pretty much after my kids would go down for the night, I would stay up late at night um teaching myself.

9:29 I'm I'm like kind of blown away. I mean you were a lawyer who taught yourself on YouTube and now I'm looking at your website, Petty Anjou, and these are Really beautiful, complex designs. I mean Congrats on on the business. And and what's your question for for me and Vicky today? Um, so as you can probably imagine, jewelry is a super saturated industry. And so I'm wondering how I can increase visibility and brand awareness, especially coming as a brand that has higher price point products.

9:58 Where it's not always feasible to give out samples or, you know, do gifting to influencers or editors as part of a marketing strategy. And roughly what are what's the price ranges of your products? Um, they start at around one ninety five and go up to about sixteen hundred. Right,'cause you're dealing with gold and silver. Okay, fair enough. All right Vicky. Let's let's see what we can do here. Um Jessica's got she makes everything. They're beautiful products, handmade, high quality.

10:23 But it's challenging, right? You're this is all direct to consumer. Jessica, right? You're not selling the stores. So F first of all any thoughts, Vicky, about her approach. What do you think?

10:33 I I love what you do. I love the intention and the craftsmanship and the quality. I think your brand is exactly the kind of brand that people are looking for these days. They're sick of stuff that just falls off a factory line somewhere else in the world and that doesn't have a heart and a soul and a purpose for being. And I think people don't buy products these days, they join brands.

10:54 If I were in your shoes a couple ideas. One is I would let people into the craftsmanship piece of your of your work. You're not competing with um Someone who's buying stock jewellery. putting their brand name on it and selling it on their website. um you are looking for a client that cares about craftsmanship.

11:14 And wants to know their maker. Yeah. So I don't know if you're doing this already, but really allowing people to see the the work that goes into crafting your products from the design to the making. Um, TikTok is a really great place for that. Um, the other thing is

11:30 Inventory. Are each one your each of your pieces one of a kind, or do you sort of make a little inventory of each? I do have an inventory of each, um, so there is I do maintain stock of each design. Got it. So

11:45 to just manage your overall Capital outlay. One potential is to Only make one of each design, show it to people. And then if they want it, then they get part of the drop.

11:56 And say I'll make ten So if you want on and you eventually scale from there. So just sort of shifting the product development cycle will help your capital cycle. Um And then in terms of gifting, I actually have the same problem.

12:10 Our things are Handmade in Japan. And so when we when we send people four pieces, it costs about the same, I'm guessing, as as one of your pieces. And so you can sample yourself out of business. Mm-hmm. We didn't do

12:25 broad sampling the way that Um most beauty brands do. And we also did not do heavy celebrity sampling the way that most beauty brands do. Instead, we thought about how to turn our best clients into

12:40 advocates and ambassadors for us because Um we found that they really loved gifting. Our products. And so um I don't know if you have a really passionate group of clients already. But talking to them and asking them about how

12:54 Um you can serve them more. And then you know what they're looking for that might be Something that's giftable. and let them become the people who who

13:05 Yeah, get the word out for you. I love that because something I've really grown to appreciate as a small business owner is the sense of community and people really do buy into brands. That's what they're interested in and being part of a community and part of the experience. And so I do try to showcase um the craftsmanship on my Instagram page. Um But you're right, I do think that I could do more of that, maybe even on the website. That's that's actually a great idea, um, to showcase that more. I think it's all TikTok. Yeah.

13:31 Yeah, if you go to the about. page on on your website. It's awesome. You've got these photos of you in the in the shop and with a soldering iron or whatever it is and and they, you know basically melting down metal. It's so cool. And I think about Do you make videos of you making jewellery? I do. Um I to the best of my ability with my iPhone. It's not great cinematography, but I do try to capture the process because I think people love to see

13:58 where their pieces are coming from. You know, you like you said, Vicky, it's not off the off of a conveyor belt. You know, each piece is handcrafted and I think people want to see their peace being made right in front of them. How are you how have you tried to build awareness so far. So um actually when I first started I did hire a PR agency. I used them for a few months before quickly realizing that it wasn't gonna be economically viable as a startup.

14:23 Um, so I do my own PR at this point. Um I've Reach out to editors, I'm part of an affiliate link program. Um And so I've landed a few editorial mentions and T V spots. Um, but you know, it's Like I mentioned, it's tricky'cause I can't give them samples to try in person. So it's kinda like, Here's my jewellery, you know, it's great, just trust me on it. Um Also, I've been trying to do more in person shows. Um, I love live events because it lets me meet the my audience and

14:52 see what they gravitate towards. Um it's almost like market research for me too. Um, but the trick with that, the tricky part has been that a lot of my local events tend to be like craft shows that are at a lower price point. And so I'm not sure if my audience is really there shopping for high end jewelry. So it's kind of been a balancing act navigating that. Jessica, did you hear uh we did an episode a few years back with um on M LeFleur, with Sarah LaFleur, who founded this this um apparel brand. And Essentially the the idea in her mind

15:26 Um, because Sarah came from, you know, sort of a a business background was to make clothing Um You know, sort of a wardrobe, a uniform. So women wouldn't have to like spend hours every morning f trying to figure out what to wear, but it was clothing designed for professional women. It's an amazing brand. I found out about it like I often do for my wife who would go and buy their clothing. And I feel like there's something

15:47 to that idea with what you're doing. And I I mean, given your background as a lawyer and what you are creating. I wonder whether There's a way to kind of tap into Um You know

16:00 this sort of a pr network of professional women who are going to the office and because The the the pieces that you create are very timeless and very Um They're just very class and and so I I I don't know, I d have you

16:15 Explored that at all? Yeah, no, you're absolutely right. Um, you know, I think my pieces are timeless and elegant and my audience is looking for something like that, but they want something that's unique and different. You know, my audience is not interested in blending in with everyone else. And um like you mentioned, they are um they're very professional, they're accomplished, they're strong women. And so they are looking for something that's gonna make a statement that they can wear every day, um, be comfortable in. Um, so that is something that that is you know, that I'd I would love to pursue further. Um

16:48 kind of promoting that. Angle of Something that you can live in every day. Guy makes a really great point. You because of your castmanship.

16:56 You're not looking for a hundred thousand clients get. Um, you want like a thousand great ones. And so being clear on who your bullseye is, both demographically and psychographically, will help you stay super, super focused. Um I think you're right, trunk shows will be better for you than craft shows. I wonder whether to Guy's point whether you could partner.

17:18 with a complimentary clothing brand or bag brand where you can help each other. uh where your ethos is the same and then you can sort of share lists and email lists with each other, do trunk shows together. I love that and that's actually something that's been suggested to me before the collaborations because you share each other's audiences as well. And um that's something I I'm looking forward to pursuing.

17:41 For sure. Congrats on on what you're building, Jessica. Um it's so cool. I mean j jumping out of the the corporate world as a l as a lawyer and Going into something totally creative is really courageous. And um and I I we I really I can't wait to see what what you do with this.

18:00 I agree. I'll be buying everything and sharing with my friends. So keep going, keep going. I appreciate it. Thank you so much. I'm big fans of both of you. Thanks, Jessica. Bye. I can't believe that she didn't know how to do this. Until twenty twenty.

18:14 I mean I remember during COVID because I remember during that time just thinking, there are gonna be so many businesses that come out of this moment because people are just like, okay, this is the sign from the gods. Like this is the time for me to just I I was too scared to to do. Mm-hmm.

18:34 I love talented people. Incredible. Stay with us because after the break, we'll talk to another founder working to take their business to the next level. That's after the break. I'm Guy Raz, and you're listening to the advice line. Right here on how I built this lab.

19:03 Welcome back to the device line on how I built this lab. I'm Guy Roz, and today I'm taking calls with Vicky Tai. So, Vicki, let's get right into it and take another call. Let's do it. Welcome to the advice line. Please tell us your name, where you're calling from, and uh uh just a little bit about your business.

19:19 Hi Guy, thank you so much for having me. So excited to meet you, and I'm calling in from New York City right now. I'm the founder and CEO of Baya. Bea's premium vegan skincare that addresses intimate concerns, so think sweat. Odor. Body blemishes that affect our confidence.

19:38 Wow. Okay. And um and tell us a little bit more about how How you started this. So I actually wrote in my second grade journal uh that one day I'm going to Second Grade. Second grade. I wrote in my journal that I was going to have a beauty company one day. And at sixteen years old, I Asked my grandma for an investment of a I think a five hundred dollars, which was a lot of money, and I started Belo Cosmetics. Which was a mascara brand and

20:08 I very quickly learned how hard it is to start a beauty business at Wait, when did you start B Low Cosmetics? How old were you? I was sixteen.'Cause I didn't have business courses in high school. So I was like, I think I love business, but I have no idea like will I actually like it. It's a great name. Ploque of Mascaria. Your name. You're n it's awesome. And and did you make mascara? Did you sell it? I did. So I it's it's hilarious to look at my emails with his contract manufacturer. I was like, I would love to meet with you. I would love to share my vision with you. And he took me so seriously. I think I ordered I forget what the minimum was. I think it was twenty five hundred mascaras. It had the logo on it. Um and It was amazing, but we still probably have like ten cases cases of mascaras at my parents' house to this day.

21:01 I can't believe you're sixteen to this. Okay, so Obviously you were on a mission from a young age to start a beauty brand. And how did you get I mean, tell me a little bit about about Baya. How did how did that idea come about? So I ended up graduating from Babson College and I had a full time offer with L'Oreal. But again, I wrote my second grade journal that I was gonna have my own company. And so I was like, Wait a minute, I gotta do my own thing, but where's the white space in the product?

21:30 world of beauty because it's so saturated. And I honestly couldn't come up with a good enough idea. And that's when Dry Bar and a lot of these beauty services were popping up. And so I was like, if I don't know where the white space is, the next best thing is creating a service company where I work with real women to understand their beauty pain points. So then I could build this product business. So I ended up turning down L'Oreal and starting my first company, Butini. And so what was fascinating is we really do specialize in weddings and events. And so it would come in and be like, listen, I'm getting married in August. I sweat like crazy. Is my makeup gonna melt off? Or like when I sweat, I smell, I'm gonna be hugging my guests, let alone let's talk about my wedding night. Yeah. What do you do? And I was like, Wait, that's kinda I've never heard these questions. I guess it's a beauty question, but I honestly have these insecurities of like smelling and being around people, and I just thought that was a me thing. And so that's when I was like, Wait a minute, well fast forward pandemic, there were no weddings, there were no events, so there was no business for butini. So rather than just sitting around, I r realis it was my perfect opportunity to start.

22:40 Bea and our whole philosophy is like taking moments for yourself. So whether it's like Taking deep breath and just rehydrating your face and body, or you know, going into the bathroom and refreshing so you feel a little bit more confident. That's like the whole ethos of the brand. It's so awesome. I'm I'm thinking about how much I'm smell I smell right now'cause I took a run. And before this interview, and I'm so happy that I'm in a separate studio from you because I would need Beya right now. I wish I could teleport them to you right now. Um and what uh what's your question for us today?

23:15 So my question is Um If you were building a skincare brand, say Tatcha, in twenty twenty four, what would be like the top three things that you would be Focusing on right now, knowing that You know, you want to be on KVC, you want to land a retailer like Sephora, like what there's so many things to do as a founder. What would be your top three um areas of focus?

23:40 All right, Vicky. Yeah, let's start with you. Well, I really love that you're focusing on Fem Care. Um, because this is a a really hot new area.

23:51 So when you go to a category that's growing, you get to sort of ride the wave up and and I I get tapped a lot for um advice or investment in growing fem care brands. So this is of the moment. So Good job on timing. So to your question about how to break through These days

24:08 We were talking in the last one about how people don't buy products now, they join brands. So your point of difference will not just be your products and your formulary promise, but your intentions. Why do you exist? When you break through, particularly in social media. Then those retailers come to you. So you can pitch Sephora all day long, but they get pitched all day long.

24:29 What you really want is for them to come to you. And they're gonna come to you when you break through with your clients. So I I would almost say Don't worry about the retailers, you know, build it and they will come. Just focus on your client and make sure she understands. Why

24:43 Why she needs this. Why to believe in you and why you care so much about her. Oh, that's really great advice. I I love that. And honestly, we've had a few Um

24:54 Dream retailer, like reach out and it's interesting because You can get into a retailer and that's great, but that's when the hard work I found out happens, right? Like if people don't know about your brand and don't understand your mission. it's not gonna s succeed in store. So I think that's like that's very valuable insight for me to really implement. Yeah. Brittany, um can you talk a little bit about your sales right now?

25:18 Wh where you guys are at? So we're about hop um we should be ending this year about a million. Um And so we've had some great um beauty um subscriptions that have we've gotten a big deal with that. Um we're named yeah, like a top 25 Indy Beauty from CEW, which is a beauty professional organization. Um, so it's still small, um, but w I'm self funding, so just like Vicky, just really make being very mindful because my like n life mission is to empower women to feel confident in their own skin and I wanna be able to figure out those pain points and that storytelling that resonates with people um before we

25:57 Think about investment and whatnot. And how many people do you have working with you now? So it's myself and one full time employee One part time and then we have a handful of um

26:09 Freelancers on the right. You know, one of the cool things about this product is um as as you say, um It's it's an opportunity to show people how to use it. I think of Two brands we've had on the show in the past. One is uh Dollar Shave Club.

26:26 One is liquid death and these brands what they did early on when they had no money No budget. was to put like a thousand, two thousand, three thousand bucks and make into making a very low budget.

26:40 low quality, but h very funny video. that would go vi that would eventually go viral. You can imagine I can imagine you or somebody Putting something like that together. around I mean, you've got you know, these wipes for example to refresh wipes or

26:58 um you know, I see body and intimacy serum. Like there are lots of fun things you could do with with the products you have. And so I wonder whether Um Whether you've you've thought about doing something like that, trying to create like a a low budget video

27:12 that's fun and funny in that sort of dollar shave club. Way. Would you say like just do one where you're really storytelling and thinking it through versus let's make a TikTok and see what sticks? I try I try both, but I would try to make them funny. If you can, because you're talking about Your story about

27:31 talking to people getting ready for weddings and you're thinking, Wait, I'd be freaked out about if I smell, not if my my my makeup was running, you know, and I feel like Smell and scent is so funny. And it's we all smell. Human beings smell. Like th there's no way around it. There's no human that does not smell. I feel like there's a lot of fun around that. An idea. I love that. And I think well my personal need for these wipes was because I was dating in New York City and or at a hot sweaty bar and then maybe, you know, you meet someone and then I would be so self-conscious about my smell. So I do th I love that idea of like storyboarding something that's really funny and hopefully relatable um

28:13 to be able to resonate in like a lighthearted way, um, but hopefully get some virality behind it. I love Guy's idea. The fact that this started from your dating moments, it would be fun to partner with like a tinder. Or well me I don't know, what do people use these days? Bumble coffee meets bagel. I don't know any of these anymore. You could put together like a little kit called like

28:36 In case it goes well. And you know, just sort of do a a co marketing event to try to to try to get into that kind of audience. But I would try to First of all, a million dollars on that small of a team is amazing. Congratulations. The first million's the hardest. By far. I thought the first million was harder than the first hundred million.

28:53 Um really? No way. Yeah. I really do. I really, really do. So um but then when you it comes to a retailer Don't throw anything against the wall, but if you don't climb rank very quickly you're out. And then Then it's like a stain. It's like a scarlet letter A. Then you can't raise money. Then you can't get other so I would really try to

29:16 get the fire in the buzz going before you go to a retailer because there's also fixed costs capex that goes with going into retail. Um And in an ideal world, you're on fire. They come to you. They take a few items, they put them on an indie wall, and they fly off the shelf. And then then the party starts. Mm-hmm.

29:35 And would you say that QVC is considered a retailer, or would you say that's also part of like that brand awareness build because you get to storytell. QVC is interesting because they are If I remember correctly, their consignment model And you have to build a lot of inventory to To test it out.

29:54 And if it doesn't sell through. You own it. But you have to repack it. А косто фала. In order

30:03 to even be able to resell it. Do you also have to look at different retailers have different customer bases with different return profiles. And so

30:13 If on a successful run, fifty percent of your stuff gets returned. And that's That stuff that you trash. You got to look at your margins. So

30:22 I would say some retailers They're great for awareness when you can handle that level of Risk. And as a self funded business, that's probably not what we can afford to do at this point. So I agree with you that maybe like I think

30:38 Guy, what you're saying is like build up like the storytelling in a really fun, relatable way. And you are the perfect person to do this. You're second grade. Yeah, I I agree with the guy. We just need you all over TikTok. Yeah. That's awesome. It's awesome. The brand is called Bayer um Britney Congrats. Good luck. We're gonna be cheering you on and we'll be following up.

31:01 Thank you so much for your advice. Can't wait and and I'll be manifesting Beya being next to Tatcha and Sephora one day. So thank you so much. Love it. Okay. Thank you. Okay, next up after the break, another collar with another business challenge. I'm Guy Raz, and we're answering your questions right here.

31:23 The advice 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 Vicki Tai, she's the co-founder and former CEO of skincare brand Tatcha. Vicky, we are down to our last caller now. And hopefully.

31:51 hopefully I mean, i it's i you know, s I was thinking and I said this which is during the pandemic, I really I was like there are gonna be so many businesses that come out of this. And now I'm thinking with advice line, like who You know. We might be talking to some of these people on our show. Like like we interviewed you.

32:10 in the next couple of years. Like there might be a billion dollar business here. I hope there is,'cause these these are great entrepreneurs with great ideas. I hope so too. All right. Let's take our last caller. Hello, welcome to the advice line. You are On with me and Vicky Ty. Hello. Please introduce yourself, tell us where you're calling from, and a little bit about your business.

32:29 Hi Kai, hi Vicky, thank you so so much for having me. Hello. My name is Devin Clymer. I am calling in from Cleveland, Ohio. And I am the co-founder of Muggsy Bakes. We make single serve gluten free mug cake mixes designed to spark dessert joy, no oven required. No oven recovery oven? A microwave. But no like real oven. Right. Yeah. And these are c this is like mug

33:00 cakes, right? You see these things on Instagram. So but this was this is specifically like a packet, like a hot cocoa type packet that you just pour into a mug and add water and stick it in the microwave? Exactly right. So we like to say that making a mugsy is as easy as one, two, three. You literally just add in the wet ingredients Pour in the mugsy dry ingredients, mix it up and pop it in the microwave and you're done. And then you get a cake in a mug. Exactly right. It's a beautiful thing. Uhhuh. And dairy free too, actually. And dairy free. Wow. Um Tell me about How how how this started. Is this uh w w were you are you in the food business?

33:38 No, uh, not at all. And neither is my co-founder. We are actually both health care providers and professionals. I'm a clinical speech pathologist, and my co-founder, Nina, is an occupational therapist, and that's actually how we met is working in a hospital system together. And you know We watched is a lot of Our patients, you know, struggled with with chronic illness and often due to, you know, a broken food system. And so food was just very much so a part of our day in and day out. And ultimately, you know, it is that that inspired us to create our better for you, uh, but super. you know, vibrant celebratory baking mix brand. How did you guys um decide to come up with it? Like w tell me the story. Were you sitting down in like the the cafeteria at the at the

34:32 Whatever the hospital where we guys work. Like let's make mug cakes. You know what? At the time when we, you know, kind of went in on this together, we were actually both had our own private practices. And so we would do a lot of co-working together. We would meet at coffee shops and and talk. And I am a very avid listener of how I built this. And I just I truly am and and really, you know, just after listening to, you know, so many of the episodes and I relate to you, Vicky, as well, you know, just with making a pivot and doing something different and feeling like I am doing something that you know is really adding to my happiness is something I had just been thinking about. So I

35:16 Um have been making mud cake mixes myself for for years, and now that I have children too, they've become they've become a staple in our household. And I just got sick of pooling all the ingredients and leaving my kitchen a mess for something that's so small. Like why should this be so complicated and messy? And so I started talking to Nina about this idea, and she's like, Oh my gosh. I love this, uh and and the rest is history. We just jumped in together. And just to clarify, do you sell them the it just comes in a bo like a box, like like a hot cocoa

35:52 packet uh where you would it with individual envelopes inside. So we do stand up pouches. They are single serve stand up pouches. So think of almost like You know. a a pancake mix pouch but smaller and so it stands up on its own and we use a recyclable uh one as well. And do you use sugar or sugar substitutes?

36:12 So we use organic sugars, organic cane and coconut sugar, uh and and you know, really priding ourselves on, you know, the high quality ingredients that we are are using uh is is really important to us for sure, especially, you know, given our health care. uh background. And and what's your question for us? Today. Yes, so my question is we are currently pre launch, you know, we're kind of soft launching our minimum viable product at the moment locally in in markets and shops. In Cleveland. In Cleveland, correct, yes.

36:48 And we will soon be launching direct to consumer. We are very close to having our finalized packaging ready. So my question is, what would be your Top. Hip. For a new brand, you know, looking to generate buzz and more importantly, build a community when we have essentially. you know, a no following or a very little following.

37:12 Yeah. Vicky. Your thoughts. I love how everybody who's been on has such a pure and uplifting intention. Um, and their products and their brands are expressions of how they'd like to make the world a little bit more beautiful, a little bit more confident, a little bit more joyful. I think we need so many more businesses like this. So yes.

37:34 Um What do you think the use case is for your customers? to want to purchase this. There's the health component, but There's it's something to do with your kids, is it something used at parties? Is it a snack? What is it? Yes, so really it's the convenience factor that we are hypothesizing will be, you know, a big draw and it's meant to just serve as that, you know.

37:57 simple pleasure, you know, that moment of of joy after a long day. You know, I enjoy mine after I've gotten my kids to bed and you know, while my husband is doing the dishes or cleaning up the toys. But certainly too, you know, we envision Kids perhaps, you know, with a gluten allergy, going to a birthday party and being able to have something that they can eat as well. So it can certainly serve multiple purposes. And also just for us being Allied health professionals, we think this would be a wonderful product as well for for senior citizens who maybe can no longer cook um like they used to, but really it's the convenience, the ease factor to it, uh that we think is is you know a a big part of our value proposition. For when you absolutely need cake, which I love. Yeah.

38:46 Feel like I need take every bit. Yes. Yes. Did you do you remember I I I think it still exists. It must still exist. I just haven't made it in so long, but Uh one of my great pleasures as a child was when my parents would come home with a jiffy pop pan. And you would take the pa the thing off and put it on the stove top and shake it and then that big foil would just blow up and then you'd rip it open, you'd have popcorn. Did you ever do that? Yes, and it was so fun. I remember it being like such a fun thing to do with my parents and my siblings and uh we're going after the same the same type of thing with Muggsy. But you know where I'm going with this now, which is is there a world where there's like a microwave safe.

39:30 I don't know, maybe disposable or recyclable mug that you could sell it in, so then you just pop it in and it's like the jiffy pop of cakes. Yes, I love that. And that actually is uh you know, something we we toyed with at the very beginning. Um, but I love that you brought that up because that does, you know, certainly Add to the experience.

39:54 Yeah, it can even be a reusable mug. Maybe you just do like a limited series and you sell them at gift shops and the mug says something like Yeah. Dad is the best. I don't know. I'm just trying to think of a lame Yeah. But you know, everybody I so so that could be kinda kind of a cool cool thing to try. Um

40:12 I love that. Who do you imagine I think this is a another version of the question Vicky asked, which is who do you imagine using this? Like you mentioned senior citizens or but but like a a at the end of the day, there is gonna be a core type of user. It's gonna be kids, it's gonna be You know, sort of women between the ages of twenty and thirty. It's uh it's gonna be There's gonna be a certain type of user. So in your mind who do you envision Buying this product.

40:39 Yes, so we are really envisioning it being perfect for, you know, that modern millennial consumer. mostly female, you know, a women with really bustling personal, professional lives, uh, who are really going after that convenience factor. Uh, you know, whether they're preparing it for their kids or even for themselves, you know, because she's tired. She, you know, has a lot on her plate and and at the end of the day doesn't even want to be mixing up a cake out of a, you know, traditional box mix. Uh so that's really our target that we're going after.

41:17 Vicky, I know that that Devin's question was about how to build buzz. I think And I'd be curious to get your take on this. I think that she's she's got a Instead of thinking building buzz sort of nationally, she's really gotta build buzz in Cleveland first. And and I feel like This is the perfect opportunity to start

41:36 really showing people how this works. Like literally have a microwave oven at a farmer's market. And just make these. Like Uh like And and just sort of start that way. I don't w what do you think? Yeah, I'm getting my head around it because I've never m made cake in a mug before, but I do love cake.

41:54 So food operates on very low margins and it's low price point. And so you In time the goal Unless you Do you want it to stay a small business? And I shouldn't assume. Do you have dreams for this to become a billion dollar business or or is it a jewel of a business that you want to create?

42:13 Yes, we have big dreams. You know, we really want to take this uh As big as we can. Yeah. Mm-hmm. So Your end goal is grocery distribution. And then what you have to do is reverse engineer a strategy to get invited into

42:28 Grocery distribution. I think con convenience is definitely one of your um main selling points, but I think your point of difference is probably additionally the the form factor and the the health piece of it because you're both healthcare workers. So I think Guy, you're right. This is one of those situations where you throw spaghetti at the wall Um

42:51 Whether it's food fairs. And um Farmers markets for local buzz as well as um social media content. That shows your intention. And your thoughtness behind the ingredients.

43:04 Um on your own website that's where you'd want to build the business first and these are um Lightweight. And uh easy to ship. So you might even want to create like a gifting program online. I'm going back to

43:19 Guy's idea about the mugs. And my original question about occasions If you have birthday kits. Or I love that. Yeah. I almost want you to do something like really unexpected too. Like sorry you had a bad day at work. Sorry your boss boss sucks. Sorry about your celiac. You know, like

43:37 Things that that will kind of move. Sorry he dumped you. Yeah. I love that. Or like or like make your own mug cake birthday party packet. Like where everybody gets their own thing and they can make their own cake and then you'd have like a squeezy little tube of frosting that you could Frost it with. I love this and that is just

44:00 getting my mind buzzing and those are wonderful recommendations. So thank you for that. Do you know what I've become obsessed with, um, on social media. For some reason I get fed these videos of like bread in an oven baking. Basically, you're looking at inside of an oven, like through the glass, and you just see the bread like it goes in, you know, the dough and then you just see it grow, grow, grow into this beautiful baguette or croissant. And I could just watch those all day with like beautiful you know, like the music from Amelie behind it or something. You know, it's just eh and so I can imagine just like the sound of like a two hand like a hand like

44:39 Ripping open the packet. Pouring it in the mug. Putting in the w whatever it is, is it water and butter, I don't know. And then putting in the microwave and then just watching it grow into this like Pop over cake.

44:51 Yes, I love that and I think that's definitely an avenue we will go down. I I know, you know, myself and and Nina included, uh we're we're ready to get more comfortable on social media,'cause truthfully that's an area that I'm, you know, don't have a ton of experience in, but uh I love that idea getting creative with our videos and and really showing You know not only what this product is, but how you could use it, how you can make it fun and different and unique to you. So thank you.

45:22 Devin Clammer Uh your the brand is called Muggsy Bakes. Good luck. Um congrats on on the launch. Thank you. Now I want some mugsy. Now I feel like I I need

45:34 A cake and a mug right now. Thank you. Yes. Thank you both so much. Thank you, Vicki. Thank you, Guy. This was truly amazing. Thank you. Yeah. You can make cake in a mug. You didn't know. I feel like I haven't even lived.

45:52 Vicky, before I I I let you go, um, can you I'm I'm curious And you now with Everything in in the rear view mirror, you know. And having built what you built and knowing what you know. Yeah.

46:05 What do you think that w what do you wish you you had known in two thousand eight when you were Starting Your business that's not. That you think might have been helpful for you to know or to be aware of?

46:15 In two thousand and eight. Mm. two thousand and eight. I'm trying to put myself back in that spot. Yeah.

46:25 If I could do anything over again, if I could sit down with my younger self. I would say The entrepreneurial Is So thrilling.

46:36 But so intensely difficult. Don't make it harder on yourself by Carrying around self doubt. It's like carrying around a backpack full of boulders. It just makes everything harder. And it's unnecessary.

46:52 Um, and it gets a lot more fun if you let go of the idea of can I do it? And you just say I will do it. Awesome. Vicky, thank you so much.

47:03 Thank you, guy. I can't wait to see you and have a cake in a mug. I'll be wearing fabulous jewellery and I'll be smelling good. Ha ha ha. That's Vicky Tai, co-founder and former CEO of Tacha. And by the way, if you haven't heard Vicky's original How I Built This Episode, you have to go back and check it out. You can find a link to it in the podcast description and Here's one of my favorite moments from that interview.

47:27 We ran out of money over and over and over again. I couldn't afford a salary, my partner couldn't afford a salary. I couldn't afford rent anymore. And my parents had bought a h place near the airport at that point. And they let me m move into there.

47:43 And uh we had Just really, really incredible high end clientele and um And I was I was working on my mom's garage.

47:54 Thanks so much for listening to the show this week. Please make sure to check out my newsletter. You can sign up for it for free at gyras.com. Each week it's packed with tons of insights from entrepreneurs and my own observations and experiences, interviewing some of the greatest entrepreneurs ever. And 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 about your business, the issues, or questions you'd like help with. and hopefully we can help you with them. And make sure to tell us how to reach you. You can send us a voice memo at hib at id. wonder.com or

48:32 or call us at one eight hundred four three three one two nine eight and leave a message there, and we'll put all this in the podcast description as well. This episode was produced by Catherine Seifer with music composed by Ramtina Rablui. It was edited by John Isabella. Our audio engineer was Cina Lafredo. Our production staff also includes Alex Chung, Carla Estevez, Chris Massini, Devin Schwartz, Elaine Coates, JC Howard, Carrie Thomson, Neva Grant, and Sam Paulson. I'm Guy Raz, and you've been listening to how I built this.

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