Hero Cosmetics: Ju Rhyu and Dwight Lee

0:09 So yeah, I went down the rabbit hole of Of launching this this was probably two tausent thirteen, two tausin fourteen. And then in the end It's a lot of money, is it's a lot of work. Do I know that it's going to work out? I don't know.

0:26 So Yeah, I chickened out, got cold feet. Welcome to How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements. They built. Guy Raz and on the show today how Churu was inspired to create

0:54 The acne treatment mighty patches. Grew them into a six hundred and thirty million dollar business. In just five years. Uh There's a concept in psychology called functional fixedness. Basically, it describes a fixed or limited way of thinking about how to use something.

1:18 So for example If I gave you a shoe you might try to put it on, but you might not think about using the shoe to hammer a nail into a board. The most famous example of this concept was an experiment, where researchers gave people a candle, a matchbox, and thumbtax, and the participants were then asked to attach the candle to the wall. Now, understandably, many people tried to push the thumbtax directly into the candle wax to attach it that way. But they soon discovered that wouldn't work.

1:50 but they tried it anyway because that's what they were asked to do. Anyway, the point of the study was to see if people would think differently, you know, outside the box. So for example, maybe they would melt the candles onto the cardboard matchboxes first, and then attach the matchboxes to the wall with thumbtags. The idea here was to figure out if people can overcome functional fixedness with training. And By and large The answer is yes, because this is a path to creative thinking.

2:21 So What does this have to do with today's story? Actually a lot. Because the product we're talking about, Mighty Patches, by a brand called Hero Cosmetics, were designed for a different purpose. It just took another way of looking at them to figure out that there was a whole other opportunity.

2:39 Now if you don't know what I'm talking about. Mighty patches are small, Round bandages that cover up zit. You can find them on the faces of thousands of adolescents on TikTok. And how do they work? Well, they basically trap, seal, and absorb moisture from the pimple to help heal up the acne spot faster.

2:58 And the thing about them? The technology has been around for decades. In fact, you could have gone to the drugstore in the 1980s and picked up a box of something called hydrocholoid bandages. These are bandages used to heal regular wounds. And it turns out that there was a secret tribe of people who for many years would buy those bandages and cut them up into squares. and use them to get rid of zit.

3:23 But it would take a very observant entrepreneur named Ju Ru to realize that there was a business opportunity here. See, these hydrocholoid patches had been popular in Korea as acne fighters for years. And because Jo is Korean American and spent a lot of time going back and forth as a kid, She had a hunch that these patches could be popular in the US as well. And so after years of working in marketing and dreaming of starting a business,

3:53 Ju linked up with two brothers, Dwight and Andy Lee, to try and launch hero cosmetics. This was in twenty seventeen. And they did it with just fifty thousand dollars all in. And just five years later

4:07 Ju, Dwight, and Andy sold the business for$630 million. It's an incredible story, and we'll hear from Dwight a little bit later, but first to Ju. She was born in Korea in the late 70s, and her family moved to Seattle when she was just three years old. Her dad worked as a broker in the logging industry, sending American wood. Back to Asia for construction projects.

4:32 My dad is a log broker, so he's working in the log industry and He was with this uh Korean conglomerate. Yeah. But they sent him over to grow the business in the US. And Uh a few years after doing that, I think he realized it was better for him to start his own business. So he actually left. And then started his own

4:57 Log broker business. And logbroker is literally the guy, like the middleman between the people who Chop down the the logs and then the people who Sell it on to people who build houses.

5:10 Right. So his so a lot of my dad's customers were based in Korea. And they needed logs for yeah, construction, furniture, uh I mean Cree itself doesn't have a lot of natural resources, so They had to source from other parts of the world. So my dad was actually a buyer's broker. And you know, he would source the logs, he would negotiate, arrange the transportation, you know, book the containers and all that.

5:38 And um Tell me a little bit about about, you know You as a as a kid, I mean, w did your parents um speak to you in Korean? Was Their culture, the culture of their birth. country um something that they really

5:52 Was important for them to transmit to you growing up? Yeah, so I still speak to them in Korean, even though my Korean has progressively gotten worse. P Culturally, yeah. I mean we were very much a Korean household, ate Korean food. A lot of their friends therefore are

6:11 Childhood friends were Korean Uh, and there were still a lot of sort of community You know, amongst other Koreans who had immigrated around the same time in the Seattle area. So When I was young we went back every summer and we spent a good

6:27 month to two months in Korea. I remember staying at my grandparents' house and it just being so hot and me hanging out with all my cousins. So Uh, Korean culture was still a big part of my upbringing. Yeah.

6:42 I guess f from from what I read you were kinda thinking maybe in in high school or as you were getting ready for college of like Becoming a doctor one day. Um and And I was surprised to learn that your parents actually discouraged that. And and this is interesting because

6:58 I I come from an image immigrant family and so many people who've been on the show from immigrant families like that's what your parents tell you to do. Be a doctor, be a lawyer Be an engineer. Yeah, I wanted I thought I wanted to be a doctor and my parents they said Don't do it. It's way too hard. Uh it's gonna be years and years of study. Also, they're probably biased because my dad's a businessman. Yeah. So he doesn't come from like a science or medical background, but for him, there were better ways to make a living that didn't involve

7:33 you know, eight years of grad school and hours and hours of training. But I do remember they they told me, Well if you do wanna be a doctor, you should be a op ophthalmologist because there's no blood and it's gonna be a lot like the hours will be a lot more bearable. So for them I think it was sort of more lifestyle. Yeah. G were you I I know that you went to to Brown University, um, and from what I read you studied history and international relations, and that those are usually p majors like to set you up for like'cause that's what I did. you know, like a career in like law or I went into journalism originally or like publishing or you know, that kind of But even even uh you know marketing and other things. Um

8:18 I have to imagine maybe I'm wrong, that like when you went into college, you didn't really have a plan, right? You didn't know necessarily what you would do after it was over. No, I had no idea. My dad was not happy with my concentrations. He was like, history and international relations. What is this? You should be studying economics, you know? Um but I don't know, I just remember in college always Being drawn to creative things, but then also liking analytic and business oriented things. And so for me it was always sort of how can I do both? So I r I remember I think it was like my sophomore year in college. I was like, you know, marketing might be the thing that um helps me merge those two elements. Alright, so you um you s you finish

9:07 college and and this is I think around two thousand, two thousand one. Um And this was the sort of the dot com kind of mini recession. Um I re I remember that time. I mean it was I had just gr recently graduated too, I got lucky at an internship, but it was a tough time.

9:24 Yeah. Um, but I guess uh you got uh this opportunity to go work for a private school for low income students called Epiphany, which was it was Uh and and w tell me what you did there. It was in development, which is a fundraising role.

9:39 Right. So if we go back a little bit, right after college, I actually spent that summer in Kenya. Uh, and so I did some volunteer work there. And you know, there was always kinda that part of me where I I I wanted to do Something sort of giving back to the community and one of the reasons why I took this job at Epiphany School is because I thought, okay, well maybe this is a way that again I can impact community is by actually working for a local nonprofit and

10:09 um and sort of leveraging my interest in marketing and sales to help out. fundraising for the school. Um So you were there for a few years, but But I think that that

10:21 I think it actually introduced you to the idea of Your next step, right? 'Cause you would from there you went to business school, but you didn't That idea didn't come to you until you were doing this job for the nonprofit. Well h how did that happen? Well, actually the woman who preceded me at Epiphany School, she actually went to business school and so she left. She left to go to business school, right. Right. And so I took her job I basically took her job.

10:47 And so that was sort of the first seed, like, okay, well that could be a path for myself as well. And then having worked there I mean I enjoyed it, but There was um uh an aspect of well

11:01 I feel like I could do so much more. And also there are other ways to I think positively impact the community or society. It doesn't have to be directly working for a charity or a non profit. Um And I started realizing you could do things in business and really make more of a I think positive impact that way as well. So so so I got I started thinking about it uh kind of earlier on and then yeah, I I started applying to business schools and then

11:31 Uh, and then I ended up going to Columbia. So all right, you go to you you you Get your MBA. And um and I guess while you're there you got an internship with craft. Um which you would go uh and that after you graduate, you go and work for craft. Um

11:48 Working on food brands. Right, so I did my internship at Craft Foods, which actually is now Mondeleese, so I worked at the snacks division. on the planters brand. So Mr. Peanut and you know, all the nuts that they have. It's amazing. That's a planter's penis is a like a billion dollar brand. It is. And it's been around forever. Yes. It's unbelievable.

12:10 Yeah. I mean they have in house commodity people who because you know, you're buying commodities really, so I I I always thought those meetings were fascinating because you're tracking like the commodity prices and like you know, the weather patterns and how it's gonna impact the farmers and whether that's going to increase the The the prices of peanuts and cashews and things like that. It's amazing because even a a sort of marginally, fractionally lower price. could be millions and millions of dollars for them. Right if they're buying peanuts as at that scale.

12:42 Right, exactly. Yeah. But I mean that experience is I mean it it really Was very foundational for me. You know, I had a very traditional brand management experience. They they train you in a very specific way. Um So it was you know, it was really great training grounds for me, just learning about retail. And back then like D to C didn't exist, so The only sales channel was selling into retail.

13:08 Yeah. And learning about thinking about the consumer and and forecasting and marketing and brand and all that was Vas-y. you know, really critical too. Success.

13:20 Did you think that maybe you know, this could be the the path that I want to take, like in management and then Corporate leadership eventually. Or already at that point, 2008, 2009, were you thinking, I wanna start my own thing one day? I was always very frustrated.

13:39 Because at that time this was like Two thousand nine, two thousand ten. I saw the world changing very quickly around me, so you know, Facebook had just started and social media was really becoming a thing and you know, in big companies they just move slower. I think that's just a fact. And so I didn't really feel like

14:00 you know, Mondelee's or craft at that time was really moving as quickly as I as I personally wanted to. But also I think Even in college, I kinda always had this entrepreneurial bug. Actually in college, I remember with two other girlfriends, we tried to start a design studio. It was called three P's.

14:20 And So I think that entrepreneurial energy was sort of Always there, even You know, in college. Hm.

14:29 So all right, so you're you're at Kraft for a few years and then I I know that you went to work for American Express for a short period of time. Um, but then I guess around around twenty twelve and and what would be a Pivotal moment. you get a job offer and then you move to Korea. Right.

14:46 Um Tell me a little bit about why and what happened and what what the offer was what you ended up doing there. I joined Sam Sung. In their card division.

14:57 Card like Credit cards. Credit cards. Okay. Yep. So Samsung and Korea, yeah, they they're it's a huge conglomerate. Every vertical you can imagine They probably have a presence there, so uh one of their verticals, in addition to electronics, which we all know.

15:13 is financial services and part of financial services is their credit card division, kind of like Amex. So they had a uh like um overall initiative to diversify the talent pool and one of the things that they wanted to do was bring Korean Americans to their offices in Korea.

15:36 Uh to bring a little bit more like diversity and experience and thought and um So they had recruiters who were based in New York who had actively Scout um the right profile. in all of America to to do expat stents in Korea.

15:56 So I got contacted by one and just you know, I remember just taking the meeting just You know, why not just have a conversation and became more and more serious and they and then they had me meet certain executives who were in town, et cetera. And and then one day I got the job offer. So then I mean then it became real. Like I had to make a decision. And then ended up deciding, you know, why not?

16:21 If anything, it'll be an interesting experience and it was a two year assignment, so at the end of two years I can always come back. So Tell me a little bit about life at Samsung. I mean, e obviously you are Korean American, but I mean You didn't grow up in Korean corporate culture.

16:39 Um very different than American corbiculture. Very uh just a different level of commitment and Tell me what what a normal Day was like. It was um

16:53 Definitely for a foreigner, it is a it a it's a very foreign place. So for example Sometimes, you know. you you wouldn't leave the office until like eight or nine. Just because your boss was still there, and so you had to stay because you can't leave before the boss. Um, so they were worried about people staying at the office too long. And they instituted something called Family Day.

17:15 And family day was every Wednesday and you're supposed to leave the office at six. And it wasn't enough just to have the policy. They literally reconfigured everyone's computers to shut down at 6 p.m. Like 6.00. I I just remember at five fifty nine. you know, I would be writing this email and then you get a message that would pop up on your computer Your computer is going to shut down in ten.

17:40 nine, eight. And and you just, you know, try to get that last email out. But um It's sort of you know, I think the intent was really good and then the way that they would sort of enforce some of these things were very um kind of micromanagey. So it wasn't like it it was m uh I mean, there were like enforcers. Like you were expected to

18:02 at your desk on time and focused and I mean th th it wasn't like We just trust you're gonna do your work. Like people really were literally like. looking out to make sure you were doing that. Another anecdote uh related to that is You know, they had another rule where everyone had to be in their seat.

18:19 At eight a.m. watching what they call Samsung news because they would have sort of like corporate communications at eight. And They'd have people with clipboards walking the aisle at eight oh one, and if you were not in your seat with your eyes on TV, they would like You'd get a little like

18:37 Demerit, you know? Like in your performance review or something. If you yeah, and if you racked him up, what would happen? Uh you would lose vacation days. Wow. Yeah, I Part of me is like I really admire that. Like

18:50 There's a reason why Samsung is such an effective company. I mean it it it became one of the biggest electronics companies in the world in a very rapid Period of time. I mean American companies just couldn't do that.

19:04 put that kind of discipline on their workforce. There'd be there'd be uproar, there'd be Articles or be There'd be all kinds of things. Totally. I know. So on one hand it's You know, you kind of admire it, uh, in some ways. You're like, Okay, well, this is why they've made so much progress, but then

19:22 On their on the other hand I don't know. I mean culture's changing, you know, we're culture's changing. Um Yeah, I wonder if it's still the same at Samsung in Yeah, I don't know. I'd be curious. Yeah. So all right, so you're doing this job and and in Seoul, which is an amazing city. I mean even more so now than it was in twenty twelve. It's just such a cool place I've been there. Um

19:45 But one of the things that you You know, as sort of visitors or expats or foreigners notice when they come to new countries is you just notice things that that people living there just don't notice, right? You just are like, wow, that's interesting. I've n and people living there wouldn't even see it because it's just Part of the the wallpaper. And one of the things you notice was

20:06 These stickers that people put on their faces. Yeah, I mean I just noticed a lot of people walking around with these patches on their faces. And these were like just Like Like flesh colored. They're pretty transparent. They were round. They're like round circle patches that people like band aids on their face. Yeah. People would have them sort of like they would have several of them.

20:28 And they'd go to the office like that. Like No no questions. It was just very normal. And you uh quickly inquired uh or assumed, I guess, put two two together.

20:39 Realize this is for Pimples for acting. Yes, and I at the time was breaking out, unfortunately. I've always had a history of sensitive skin that like at the tiniest thing I would just break out.

20:51 And so I tried it for myself. I went to a pharmacy. I bought some of these acne patches and I mean literally I was so amazed at how effective it was because You know, even just with the first use. It got all the gunk out of the pimple that I

21:09 Put it on and that pimple have flattened overnight. And these patches okay, so just to kind of explain from And help me kind of They're they have an an ingredient called hydrocholoid in them. It's a basically a polymer

21:26 And I guess it extracts like liquid from inside a pimple. So it's it's basically a way of popping a p uh zit without popping it, because that can create a create a scar, right? That's right. And This material Hydrocholoid. It's been around in like band-aids and

21:45 in like hospitals for a long time. But I guess in Korea. They realized hey, this actually works really well on Skin blemishes. Yes, so hydrocoloid the concept.

21:57 You know, originally started as um kind of a new type of bandage or wound dressing. And what they realized was that if you keep the the kind of damaged skin area moist It actually helps with the healing of the skin. Like dryness is not good. So you wanna keep it like well moisturized in a moist environment. And so so that's how it started and then You know, Koreans being very ingenious, um, also realize well, acne

22:26 you know has inflammatory fluid and pus inside and Uh, you know, perhaps if you cut it up and make it round and make it a little bit smaller, uh, it could work on pimples and I mean I think it started getting popularized in Korea. Yeah, probably in the early two thousands.

22:46 Um all right, so you see this and you're using this and you're like wow, these are cool, these really work. They like They You know, get rid of zitz fast. Right. And um Uh you know, but you're working at Samsung.

22:59 Mm-hmm. Help me understand at what point Does a light bulb kinda go off and say, Wait a minute, maybe I can In the US.

23:07 Well, I mean after that first use I was like why is this not more available or well known? Like it works so well, so much better than anything I've used before. And I started doing research and I I just saw all these Reddit threads I remember of people talking about these hydrocholi patches. Oh, you know, I I can't get them here. Uh I just asked my sister who's going to Hong Kong or to Korea, can she pick some up and um And so for me, like reading that showed me that there was actually demand for this type of product and people, you know, people were already talking about it on the web.

23:45 But you know, there was no brand really focused. on the US market. Uh there was I think a Korean brand, even at that time, I think they're probably starting to slowly sell in the US. Yeah. Uh there were some band aid oriented brands that had the big ones and people would comment Oh I buy the big ones and I cut them up into small squares and I just put them on my on my face. But those band aid companies were not marketing it towards skin blemishes. They were marketing towards wound healing. Correct. So people would like just DIY it and be like, Oh, I'll just cut little patches from These hydrocholoid band-aids. Right.

24:21 and put it on my skin. Yeah, and I mean this is where you know, I can connect sort of this insight with an experience I had when I was working at Craft Foods Mondalise. Do you know the hundred calorie packs? Of course. Yeah. So the way that that got innovated or or launched is because they were doing focus groups and they saw

24:40 uh women moms Buy a whole box of Triscits or writs or whatever, and decamp them into their own small ziploc bags for portion control. So when people saw that they were like, Oh, there is an opportunity here. So similarly, when I read that people were buying the big ones and cutting them up into smaller squares and using them for their pimples. I just I thought

25:05 You know, this is it. This is more proof that people want this type of product. Yeah. There's the Triscits right there. Yeah, exactly. Yeah. All right. So you're y I mean

25:16 You get this idea in your head, but you're of course a you know, doing the corporate thing at Samsung. But I mean, as you start to think well, maybe there is something. You go on Reddit boards, chatrooms, you're seeing that there's people are talking about this, but Um But there's you know, there's a lot more to do if you're gonna kind of even

25:35 Think about getting something going. What did you start to do? You know what in Korea Cosmetic manufacturers are required to list the name of the manufacturer.

25:46 Oh, like if they white label it, which most of them do, they have to tell you wow,'cause in the US they don't want to tell you that at all. Right. They want to keep it secret. Yeah, so I just I went to a pharmacy, I bought up like Ten to fifteen different brands. I turned over the box. And I listed the name. Of all the manufacturers that these brands were using.

26:05 And I just I started cold contacting them. Uh, I would call them, I would email them and I mean most of them didn't Right back to me. But there were two, or three, maybe, that did. And I remember there was one where I had to buy some samples, I asked for some samples.

26:23 And so that was sort of the first step in in identifying um a potential supplier to kind of figure out how I would Get this product created. Yeah. So tell me what you Y you find a

26:37 one of these companies is like yeah, th I uh we'll we're open to working with you and Uh, what did that mean? I mean, it it w it was it just a matter of like, okay, just buying a bunch of these things and shipping them over. Like what what did you start to do? Uh so first I got some samples and then Actually, one of them I actually visited their factory. They invited me. They were like, Come, come visit, you know, we'll show you a little bit about you know, how we make these products.

27:07 Uh and then it was just sort of conversations around like, well can this be changed, can that be changed, can I increase this? Can you know can I change that? um to see, you know, if the capabilities were there. to make something um more unique for the American audience. Um Okay, so

27:27 Sounds like a a plan and and and How much I mean, how much money was it gonna take? Did you like'cause some of these places have minimum per buys. Like you gotta well, you know, we're not gonna talk to you unless you spend a hundred grand or What what were they saying? Uh I think it was ten thousand units.

27:42 And so that would probably would have been Probably I don't know, fifteen, twenty grand or something like that. And did you have the cash to do that? You know, I did and I went down the the rabbit hole like I had a name, I hired a designer, I had like a sleeve design that was like ready to go. And then I remember I submitted it to the manufacturer and they were like, they could do everything. They would package it up. They put put your label on the three.

28:11 Right. Yeah. And I remember him saying like oh it's not going to work because it has to be in a box uh to protect The patches because the patches, you know, if there's too much weight on them, like the gel could squeeze out. Um, I remember I had some other colleagues You know, who are in my like social circle, who who are also like wanting to do something entrepreneurial and

28:32 I kept like pitching the idea to them, like oh you know, like what about this? And you know, I think r it could do well. Um So yeah, I went down the rabbit hole of of watching this. This was probably 2013, 2014. Uh and then in the end did not do it. Well why not?

28:53 You know When it came time to submit that P.O., I just, I don't know, I chickened out. This is a lot of money. It's a lot of money, is it's a lot of work. Like, do I know that it's going to work out? I don't know.

29:08 Um So yeah, I chickened out, got cold feet. When we come back in just a moment. Ju finds the courage to launch her idea after joining forces with friend and future co-founder Dwight Lee. Who joins us after the break.

29:25 Stay with us, I'm Guy Raz, and you're listening to How I Built This. Hey, welcome back to How I Built This. I'm Guy Raz. So it's twenty fourteen and Ju's contract with Samsung is over. So she heads to New York and lands a job in the Korean beauty industry, which is how she meets the guys who will be her future business partners. Brothers Dwight and Andy Lee.

29:59 K beauty, Korean beauty was really trending and I was doing a little bit of consultancy. And then I ended up taking a marketing job at a K beauty startup called Peach and Lily. And t just to kinda give me uh like the sort of the basic description of what is K beauty. What is what is what makes something

30:20 Korean beauty. I mean I think there's probably maybe a little bit of debate about the definition, but really it's Korean brands. Yeah. Korean beauty brands that have a Korean approach to beauty in skincare. So that's usually like innovative textures, very interesting ingredients, like You know, one of uh the really popular products is a snail mucin.

30:44 Moisturizer. Snail. Like from a snail. Right. So it's interesting. Like from snail shells or Uh no, they like the snails will just crawl and they leave a little trail of that gunk like stuff. The gunk. That's really good for your skin. Wow, I did not know that.

31:03 I'm going to start collecting snail slime. Yeah. Mm. Um so The American audience just suddenly became really interested in products that were beauty products that were Korean from Korean brands.

31:19 And it spurred A whole industry in the US where there were these e-commerce sites. So peach and lee is one where they would bring these Korean brands into the US and create a marketplace for um the American consumer to access them. All right.

31:36 You're working for the startup. Um but meantime, I think you still have this idea in your head. Right, like this idea of These patches. 'Cause it hadn't no one had br really brought them to the US at this point, and now you're like

31:52 A year, two years. Later, since when you first thought of this. Yeah. I mean it was still nagging at me, it was still in the back of my head, and you know, now I work at this K beauty startup. And I am kind of watching the industry and I see that some of these Korean brands that have these acne patches are

32:12 doing quite well. And I'm seeing this kind of emerging category Take off. And I I just kept thinking to myself, like oh my gosh, like someone needs to do this. In meantime, I guess, you know, sort of you you're working for this startup for some time, but you also end up

32:29 Starting here on Beauty consulting. company doing some some consulting work. Um And this is where I wanna bring in White who's

32:38 been patiently waiting here on this in this interview because around this time is when you meet A guy named Dwight Lee. Um and Dwight, what were you what were you doing at the time and how did you how did you meet you? So uh Andy, my brother, who's the third co founder of Hero and I

32:55 We were running a digital agency called Division of. Mm-hmm. Um, it was mostly production studio. We're building designing and building experiences for screens. So think like websites, apps. Interactive kiosks out of home displays, things like that. Yep. And so

33:11 We had met Jew through Peach and Lily. They they were one of our clients. Um And So we met and we started working on the projects for Peach and Lily.

33:22 And you um I mean I guess at a certain point. Um you tell Dwight about this thing. This idea that you had. Or or this pimple patching. Do I what do you remember

33:33 For when you first heard like what do you remember Jew telling you about it when you first heard about it? We'd we'd meet up for dinner and sort of talk shop. and spitball a lot of ideas. I think there was a lot of interest on both sides to try to get something going.

33:48 And I do remember talking about sort of different cosmetic products and hey maybe we should try this, should we try a moisturizer or a or like a a cleansing balm or stuff like that. Um and She mentioned the patches. And it seemed

34:03 Really interesting to me. I remember, you know Sort of later on, Drew gave me the product and I tried it myself and I was sort of blown away, so that really helped the cause too. So did you I mean

34:15 At what point Did you feel like m maybe Dwight was the person that you You might want to work with did you think that? So this is where I feel like

34:28 We were so lucky in many ways because It was not that I had this idea and I was looking for a co-founder. It really was a very organic discussion where like, oh gosh, like someone should do this. I think it's such a good idea and I just remember Dwight saying like hey if you wanna do it, I'll do it with you. And it turns out, so there's three of us, right? There's Andy, myself, and Dwight.

34:54 It it actually turned out that we have very complimentary Experiences and skills. So you know, I sort of had more of this like corporate marketing experience. And then Dwight is a technical engineer, and then Andy is a creative person.

35:12 And Now in retrospect I'm like, Oh, that's a really good kind of cross section of skill sets'cause we covered big parts of the business just with the three of us. Luckily, I mean it just happened very organically.

35:27 So Twight, what was it about this product that seemed interesting to you? I mean you you were Y I don't th were you selling stuff? Like were you I know you'd worked with brands that launched products, but What Why did you think that this was particularly interesting?

35:45 So In the earliers of the agency, we're always trying to launch our own products internally. Um and I mean. We had like a list of products. I have a list of products that just never took off. Like what were you looking at launching?

35:59 Oh man, I mean We were trying to do uh wedding management software at one point uh LinkedIn for lawyers We launched a web hosting platform to some to some success.

36:12 We started a wine subscription app at one point. I mean Yeah you name it. We were just always building things in the agency. But We wanted a product to sell

36:22 Uh Particularly on Amazon. And the acne patches seemed like a really good product because of, you know, the size, the entry is sort of Low barriers to entry in terms of cost.

36:34 Um and then but there was no market in the U in it for the US. And it just seemed like a real innovative product. But I think more so than the product I was really interested also in working with Ju. And you know, I think when you're starting a business Finding a good partner is sort of like ninety percent of the battle.

36:53 Yeah. And so I think when When you suggest that the idea I was

37:00 I was game. I mean I think if she had suggested vacuum cleaners or something like that, I might be like, well it's maybe. Yeah, okay, maybe, but you know, the I think that patches Uh were a really good product, but also Yeah, working with you was a one of the one of the draws as well.

37:16 Um all right, so you Dwight, your brother Andy and you decide to kinda join forces and to try and See if you could sell these products which you were really excited about. First of all, let's talk about the name that you came up with. Um how tell me about how how you came up with it.

37:36 We started with a product name, which is the Mighty Patch. So that's the Hydrocaleg. uh activates that we were talking about. And I just I remember for me it was really important that the name be emotional because my insight was that acne like it sucks to get acne. Um, no matter your age, you wake up, you have that pimple, you're like, you know, and um I mean I personally know because it happens to me, and so I I knew the power of this product.

38:08 was an amazing product with real results and I wanted a name that was like positive and punchy and emotive. And it's actually Andy they came up with a name. I remember we were like Just w brainstorming all sorts of different names. And I think when he was like, Oh, mighty, mighty patch.

38:26 And we're like, that's the one. And then with Hero, again, like wanted something positive. emotional and the product, you know, I mean, it's a little bit literal, but it literally can save the day. Uh because when you again have When you wake up with that breakout.

38:45 You know, before an important m moment you you panic. And um, yeah, and then it's always like a little bit of like, is it trademark free? Is it URL free? You know, all that stuff. And um But really behind it was more of a emotional Motivation.

39:03 Um and in in terms of like Just startup capital. Also, I mean Um Did you gu you guys were gonna bootstrap this initially. How much money?

39:16 Did it take initially to you know, to do the kinds of things you need to do, which is order the inventory Get the branding and the packaging put together. Um and you know Basically import all this stuff and and

39:31 And use third party logistics or h however you're doing it, like Did you need like a hundred thousand, two hundred thousand, three hundred thousand bucks to get this off the ground? We started with fifty thousand dollars. Between the three of you. Yes.

39:45 And did you go back to that same company that you went to in twenty fourteen? To order the patches. Yes. Um all right. And and by the way.

39:56 Tell me about launching on Amazon because There are million millions of products on Amazon, right? Like type anything in and you'll just find tons of just obscure brands you've never heard of that make the same thing. Um so

40:12 There's a strategy to getting noticed on Amazon too, right? Like Did you set up a store? Did you use other sellers? who are influential, like how does it work? Well, I think the first thing we did was I mean we looked at Amazon as

40:27 The sort of store shelf. So we just Thought about it that way. And we took a step back and said. How can our product Stand out.

40:36 On this digital shelf. And so we designed the package very intentionally. uh to stand out. I mean the th the early thesis was that we wanted to feel like an OTC product. So feel very medical, but also sort of playful. Right. Um so that's why the early packaging was it was white with a pop of color. Uh so it was it felt playful, but still medical.

40:58 You want it to be like an over the counter medicine, but something that was fun too. Correct. And it we also want it to be unisex. Uh we we didn't want it to be solely targeted for females. Acne affects everybody. male and female, and so we want it to be

41:12 Uh conscious of that. Okay, so you have packaging. I think you launch it on Amazon in in September of twenty seventeen. How did you get anybody to be aware of it. What did you do?

41:26 We ran ads. I mean that's always, you know, kinda the Amazon playbook. Yeah. But Gifted influencers, press back then was a big one. I remember back then into the glass. Which is a beauty blog. Sure. was really popular and we got a write up in Into the glass.

41:47 And we only had one channel, we were only selling on Amazon, so I remember that article went out And then our sales on Amazon spiked and and so That was a moment where I thought like we've got to double down a press. Did you hire a PR firm? I mean you had fifty grand. So presumably

42:05 At least a third, maybe half of that, went to that first order, maybe more. So there is a a website where it's almost like D I Y P R So you pay for the service and then you log on and they'cause there are l there are a lot of editors who are doing articles and um they'll submit their requests. They'll say, I'm doing an article on this, so I'm sourcing brands that are in acne or in baby care or in whatnot, you know, and they they share their email. So I took that, I took their emails and I would pitch them.

42:37 How how many roughly how many ema do you think you wrote? Oh gosh, I mean it was just constant. Um but every month a good I don't know, twenty emails or something. And I think leaning into PR was that earned media was was really helpful for us. You know, it saved us.

42:54 from having to dump a bunch of money into Instagram or Facebook or or even Amazon ads. I mean You get You get a a press release or uh an article and What was a big one, like New York Times like early in the day. Uh and that that can really transform your business overnight.

43:10 Um all right, so you've got you know, the middle of twenty seventeen, or I think September of twenty seventeen, you're on Amazon. And How much did that into the gloss or those those like hits?

43:23 on those websites affect sales. Did it d I mean did it did you start to see traction right away? Yeah, we did. I mean I think within ninety days we had run out of our initial inventory. So and I remember before launch we were talking about like how long do you think it's gonna take us to sell through ten thousand units. Would it take us a year or is it gonna take us six months and ended up taking us ninety days, so The traction was there.

43:51 Yeah, from early on pretty quickly. And I think we also benefited from the fact that the category wasn't as saturated as it is today. I mean today if you go to Amazon and you search Pimple patches. You have like pages and pages of search results, but when we launched in twenty seventeen, it wasn't like that. We were one of like a handful, so I think that

44:13 also helped us. Um Stand out of it. Yeah, I mean it totally makes sense. And so I mean because you sold out your initial inventory so fast.

44:23 and you know, you had experience in the in the Korean beauty industry. Were you kind of thinking that the next big push would be into like the the K beauty market. So I actually did not want it to be K beauty. You didn't, okay. Yeah. Um Just because I thought it should be an American brand for this American audience. And that was actually part of the value prop because sometimes when you buy I mean, even today there it still happens, like

44:51 I think there's a little bit of a trust issue because the supply chain of sometimes the products that come from one country that end up in another, it's not always clear and I mean Sometimes there are a lot of dupes or a lot of fakes and things like that. So um us being like this American based brand

45:10 For the American audience. And then adjusting our marketing. You also have to think seven years ago I mean, it's super popular now, but seven years ago it wasn't as popular. It was just sort of coming into its own. Uh, in in terms of K beauty and things like that. And so it was really important that

45:26 we removed all sort of barriers for someone that's maybe not on the coast, that's not familiar with K beauty. to try that product. And so You know, if you go and see a product that has a different language on it, you're almost immediately turned off. Um, and so we just wanted to steer clear that as much as possible.

45:45 Right. And and so you really didn't want people to to I mean some people would have been like, Oh, I know these'cause I went to Korea. But but really you just want people to think, Oh, that's interesting. What an interesting idea. Yep, absolutely.

45:57 Okay, so you you sell ten thousand units by the end of twenty seventeen Entirely through Amazon. And that really proves out this that there's something there. And I guess at this point you're you really want to figure out how to get this onto shelves of of r in retail, how to get this into shops. So what do you do? How do you start that process? Yeah, I

46:17 Also called emailed retailers. So I just shot off a bunch of emails to different buyers at different retailers. Some of them I had had their contact, some of them I literally just I f went onto LinkedIn, found the name of the buyer, guessed their email. pitched the product and why thought they needed it and the first retailer to say yes was Anthropology. Mm.

46:43 Wow, and and it's interesting'cause anthropology Right, it's a fashion. Retailer th I don't think they in lifestyle they don't think they sell men's clothing, right? I think it's mainly women's clothing. Yeah, I think it's mostly yeah, women's in home. Yeah. Um and uh they you know, it's a it's a it's a national chain, but not that many stores, I think. Right. But two hundred. So um it's a c it's a great brand, right? But at the same time, like

47:10 It's not s it's not a shop that like everyone's going into every day all the time, but also influential. Um and were they the only ones initially that that bit or were there others who were like, Yeah, we want we want to do this too. They were the only ones at the time. So I mean we launched September, probably immediately I started pitching retailers, and then yeah, I can't remember exactly when, maybe like October or November, anthropology said, Okay, like we'll test you in 80 stores. And that started in January of twenty eighteen.

47:40 So just a few months after lunch. And anthropology is interesting because their demographic is Right, I mean let's let's just be honest. I I'm fifty, so it's very rare when I get a acne. Just because you're body changes and you just don't develop those

47:56 things that cause that as much, right? But you know, w between the ages of I don't know, twelve and let's say thirty five you are more likely to develop skin blemishes of that type. Right.

48:08 And that's who's going to anthropology, particularly women. Yep, exactly. So it's a great Huge, it's a pretty good place to be.

48:20 Yeah, and I think retailers like that, they tend to be more trend forward too, and they can take more risks. versus like a massive chain that has, I don't know, ten thousand stores. And then I think for us too, like It was good for us to sort of Dip our toe into retail.

48:37 Because we weren't launching again like with a massive retailer. It was eighty stores. You know. And then w we expanded to two hundred. So it was very sort of Thoughtfully approached. Yeah.

48:49 We got that call, I think it was a week or two weeks after the buyer call and said We were selling so well that we're gonna go full chain immediately. Wow. But I I think the size of anthropology was just perfect for us to to dip into retail, like Ju said. Um what we did in those early days with both Anthropology and Amazon was do a lot of

49:12 Updates to the product. You know, how you sell a product in retail is much different than how you sell it online. And so this The box has to stand upright, the text has to be legible from, say, ten feet away, as opposed to, you know, three feet. Uh from your monitor. Um, and so we did a lot of testing, we know, we updated the packaging, we created display packs. There was a lot of learning um that we took

49:36 Uh, and we updated the packaging quite a bit, which set us up for Uh bigger retailers later. So When you you know, when you had that success with anthropology, presumably you could use that

49:50 In your pitches to other retailers. I mean this is like twenty eighteen now. And Ju, uh from what I gather, like you you were still up until this point Consulting. Doing consulting work for other brands to just to bring in some income for yourself, right? Consulting, full time job. Um, so this yeah, this was basically my side hustle.

50:11 And but with the success, I guess, in anthropology That Maybe prompted you to Kind of shut down your consulting business and and leave that behind.

50:22 Well I did that. When I was able to pay myself a salary from hero. Which I wanna say, you know, we launched in September twenty seventeen. I wanna say it was around March or April of twenty eighteen.

50:38 I mean it wasn't a big salary, it was a small salary, but still that was when I decided Okay, I'm all in on this. Alright, so once the anthropology thing worked out, where did you go next? Because you want to presumably go into other retailers. Twenty eighteen was a year of specialty retail. So after Anthropology it was um free people, Neiman Marcus, Scoop, Urban Outfitters, like those types of kind of lifestyle fashion retailers that had a beauty assortment. Cosmetics brands, especially if they work is

51:17 the margins are pr can be really high compared to other products, right? Because To make them isn't that doesn't often cost that much, but you can sell them at a premium. People are willing to pay for good products at work. And and so were you I mean, I guess your sales were financing the business, right? There was cash flow. Yeah, so Amazon for us was a very profitable channel and the money we made from Amazon we put towards launching our D to C site. launching slowly in retail and I mean we were we bootstrapped for the first three years and I think largely the economics of our product and the way that we built the business it

51:57 Yeah, it lended itself to a lot of efficiency. And how I mean You know, marketing is a big part of a success of a brand. But it can take. Hundreds of thousands, millions of dollars.

52:10 Spending a lot on marketing at by this point? Who knows we spent I mean a lot of sampling, again, gifting, gifting to influencers. Um anything free, we would try. I think sampling for us was really helpful. Uh we we got on all these sort of box programs. We had college ambassadors really early on. The key with this product is that

52:32 Once you get it in someone's hand and they try A patch and it works. It I mean That that person is a customer for life. And so for us, we sort of realize that early on. And so we we got samples made, little six packs, and we were just giving samples out to everybody and anybody we could. So that w that was a big part of the strategy.

52:53 What are tell me more about these college ambassadors. Yeah, I mean. We were trying to find people on college campuses that would be sort of an ambassador for Hero. And we'd get we'd send them a box, uh, with some collateral little postcards and things like that, as well as a box of samples. And we're it you know, it wasn't a too complex of a program. It was kind of an honesty policy where we just give'em a box of samples and uh trust that they would give it out to all their friends and people on campus and things like that. But we were really targeting

53:21 I mean college That that age group is uh A big demographic for us, and so we're targeting it pretty heavily. And you know

53:30 Shu, I'm I'm curious,'cause when you were in Korea, right, in twenty twelve, you noticed people wearing these patches on their faces, which was unusual to you because you hadn't seen it before. And so what what's Interesting to me is like How was this adopted so quickly? Bye.

53:46 young people in the United States. I mean all of a sudden People felt comfortable. Just having like A patch on their face, like overnight. Yeah, I mean

53:56 Overnight, yeah, probably took a few years to get there, but I mean, we did a lot of the education. We I consider us a category creator in the US and you know, sampling and talking about uh the benefits. And then also a big thing that we did with Hero was really kind of what we call like normalized acne because I think there's a lot of shame associated with having that breakout or having acne and so Just being a brand that says

54:27 You break out. you have acne, it's okay, like we understand we have it too, and I think That's communication that resonates with people, and so we're seeing I think A whole generation that

54:40 Is okay now with that occasional breakout, sometimes. You know, they kind of flaunt the fact that they have that breakout and they wear the patch on their face and they just they don't care. And I think I think it's great. When we come back in just a moment. Ju and Dwight deal with the challenges of a growing business, whether to expand into new products, take on investors, and ultimately sell their brand.

55:07 Stay with us. I'm Guy Raz and you're listening to How I Built This. Hey, welcome back to How I Built This. I'm Guy Raz. So it's 2018, and Hero Cosmetics is making more and more retail deals. And their online sales are growing. Drew, Dwight, and Andy want to capitalize on this, and they think that new product lines

55:43 Might be the answer. We had one of those sort of like pivotal Moments that really I think in my opinion change the trajectory of the business, but We had this product, the Mighty Patch. It was doing really well. And so logically you think, well, I, you know, you're gonna launch a new product offer something else in your

56:00 product portfolio and We were talking about doing a wash off mask. Um, it was going to be like a clay mask that you mix with water, you apply it to your face, and you rinse off. And then I had a coffee chat with this investor in the space. Showed her Mighty Patch, I said, I wanna do this new product. I think it's going to be a wash off face mask. She said no, you should not do that.

56:24 You should stick to patches, you should dominate this category. Do them in every shape, every size, for every knee, just go all in. And I just remember thinking, She's right. And so we shelved the face mask product. And then we came out with Mighty Patch Invisible Plus. Surface variety pack.

56:44 It was just go all in on on focusing on the on kind of dominating this category of of blemish patches. Yeah, one for daytime or for a nighttime, a bigger one for larger surface areas, any type of like acne problem that we could solve with Our patches, that's what we try to do for a good like two years. Okay. Okay, so you are are

57:08 focused on doing this meantime, around this time when the business is really starting to to take off to um You do something quite unusual, which is you move to Paris with your husband. Um'cause in in the meantime you were married. You got married. I guess he's French and he wanted to go

57:26 Um That's I mean, how are you gonna do uh like I'm if I I my question to to you at the time would have been like well how are you gonna Run the business from France. Like how we can do this?

57:38 Lot of travel. A lot of frequent flyer mines. So Wy were you worried about that when she was like, Oh I'm Moving to Paris. I wasn't worried because shortly after I moved to Seattle. Okay. Wow. Let's and you know what? Let's have a nine hour time difference between us. Let's make it even more Fun.

57:55 Yeah, poor Andy. We left him with the office and all the employees. And we're like So w how did that work? Were you working at like two in the morning and and I don't know and y and Guew, you were working until like eleven, twelve at night? I I was structured my days where uh my meeting started at two PM my time. Yeah,'cause it's a six hour difference um with New York. And New York was really the hub because that's where the team was, the office was. So my meetings didn't really start until two, but you know, in the mornings I would do all my catch up work or my thinking work.

58:26 And then I stopped taking meetings at eight pm, which is two pm eastern. So I mean there wasn't a lot of overlap with anyone Pacific time. But I mean at the time like really Dwight was the only one who was on the West Coast. W how often did you guys meet, given that nine hour time difference? Once a week.

58:45 And then when whenever we would overlap in New York, we would We would get together. But we were on Slack and Zoom. I mean, just all day long. The good part of it was that

58:55 It meant Like when Covet happened, we were set up. Because we were already a remote office. And we already had people You know, dispersed and

59:05 on all the communication systems. So I mean, of course there were other difficulties, but I think we were Pretty used to used to remote working situation. Yeah. Meantime, twenty nineteen

59:17 You guys. get into target and I think it'd have like Uh seven hundred targets, right. Now here's the thing about target again, like You have a product and and now there's awareness around this product. And if Target just puts you on the

59:34 People still have to discover it. Was that an issue for you or or did you already have enough Awareness where You could just send people to Target now to get it.

59:46 I mean the The dilemma that I think the buyer had was They were intrigued. But U didn't have a lot of skiws at the time.

59:57 And then also she didn't know where to put us. Um and so what we decided together was Th they had this new beauty mini section, which kind of acts like a discovery cash wrap type of thing. And they were like, We have this new thing, it's doing really well. Uh, can you do a mini skew version of your Mighty Patch? uh for it and it'll be in around seven hundred eight hundred doors. So that's what we did, we created a special a special skew.

1:00:26 I think we priced it at like seven dollars and it was kind of a sampler. And I mean, yeah, the worry was well, it's one thing to get in and then it's another thing to get people to buy it. So I remember we had queued up S I mean this was twenty nineteen, so we didn't I mean TikTok wasn't even a thing, but we had hired someone who had the foresight to tell us we should be on TikTok. So I remember we made a big TikTok push. Instagram push, just letting everyone know. I mean every channel we had control over, we pushed them to Target because we knew.

1:00:58 It had to be a success. Yeah. So I guess heading into twenty twenty, all right, this is still pre Covid and I mean, you've made like six and a half million dollars in revenue, which is

1:01:11 Pretty amazing. Uh And you've been entirely self funded up until this point. So So like was was that when you thought that you might need Invest your money to scale up?

1:01:23 Yeah, you have to remember I mean we were Profitable. early on. Yeah. The problem with the business was we're always chasing growth in terms of the We were growing so rapidly and the POs were getting bigger and bigger. that even though our top line was really high, I mean, at the end of the day we had so little money in the bank because we're always just cutting bigger POs to have more inventory on hand to fulfill these orders for targeted So the money would come in and go out right away.

1:01:49 Oh yeah, a hundred percent. Alright, so you you start having conversations and And did you get any term sheets? We did. But the term sheets

1:02:00 Or do The week of lockdown. Right. I remember the Dow dropped by a thousand points. Yeah. And then there were a bunch of firms that were interested who suddenly dropped out because they had to do triage on their current portfolio companies.

1:02:15 But we got we did we get we did get some term sheets. Uh and did you take Some of that. Some of those offers.

1:02:24 No. We didn't take any. You didn't take any. The term sheets we got were so bad.

1:02:31 Hm. Possibly because They just didn't have faith in the company, or because they smelled blood on the water with everything that was going on in the market. It's tough to say, who knows, right? But They were just so bad and they seemed so onerous to us.

1:02:44 To the point where I mean the our attorneys at the time. We're on a call and Yeah. The the lead attorney he he said Hey guys, I'm gonna take off my attorney hat right now and I'm just gonna put on my business hat, and I have to say frankly, this is a terrible.

1:02:58 These are terrible term sheets. Like Uh I I would not recommend taking them. What were they I mean, what were some of the the the term I mean, presumably they were looking for huge percentage ownership and things like that. Yeah, and there were just a lot of Lotta little tricks. Lotta trapdoors and

1:03:14 Yeah, onerous pref structures so that essentially w we could sell the business later on and still walk away with barely anything. I mean it they were just Very investor friendly, very founder. Uh unfriendly. So you turn'em down. We did turn them down, yes.

1:03:29 Um, okay, so now It's Covid time. And and there was a pr I mean, around this time there was a r real risk that, you know, everything could go south, right? Of course it that wouldn't happen for certainly for a lot of direct to consumer brands, but You know all of a sudden people are focusing on like buying energy bars and

1:03:48 Uh hand sanitizer. And toilet paper, whatever they are, but hand sanitizer, yeah. Uh so did you see a a a brief dip in your business? No, we didn't. I mean Luckily We were in the channels that were still

1:04:04 like essential retailers, so Amazon was still online, Target was deemed essential retailer. So Um So we really didn't see much impact. What about the supply chain challenge? I mean, with you know, just ships not being able to come in and you were bringing the stuff from Korea.

1:04:24 Yeah, it was a it was a real nightmare. I I mean every day we're trying to just triage an issue whether um There was delays with with ships on the water or the ports were shut down because of Covid outbreaks. Or our suppliers couldn't get

1:04:38 the ingredients for something. I mean it was just every day for probably three years. Was Very stressful, for sure. So how did you keep your inventory? Stocked.

1:04:50 For us the strategy was to just lean into the inventory, which is risky. Uh so We went essentially go from one month of Inventory on hand. with lots of orders to at one point we're up to six months of inventory on hand. Oh you just bought as much as you could get. Oh yeah. Oh yeah. Which is a huge risk, right? I mean if sales dropped at any point, we would have been stuck with just millions of units.

1:05:16 in a warehouse that we would have to gotten rid of. But luckily sales kept up and we're able to sort of keep keep things moving. But for for me, the main thing, the main strategy was Just never going out of stock. Yeah. Um

1:05:32 Okay, so now You get through the first year. Covid twenty twenty. You're in twenty twenty one, which is now the second year of Covid. And I guess you decide to try it re

1:05:45 um engage with some of these investors that had originally gave you terms to see if maybe you could negotiate something A little bit better, is that right? Actually there was one investor that we wanted to work with. Mm-hmm. So

1:05:58 In the first process in early twenty twenty Uh, this guy, Trevor, he was just Really smart, really engaged. Every meeting that he would come to, every discussion that we'd have. with him, he'd leave us thinking about something. And so even in those early days we felt like he He helped

1:06:14 uh contribute and shape the business. The funny thing is, he turned us down the first the first time around, not because of COVID or anything. He just said, You guys aren't ready yet. You know, I see a lot of potential in this business, but you aren't ready yet, so maybe we can talk in a couple of years or something like that. Which

1:06:31 Totally baffled me'cause I was like Look at these numbers. I mean this this brand is exploding, but I mean talk about discipline. This guy, he basically turned us down. We still wanted him, so we kept talking to him, we kept sort of the relationship warm. And then when it came time

1:06:47 later on. I think it was uh October of twenty twenty, actually. We went back to him and said, Hey Here's some updated information about our target sales, here's how the business is doing. Uh do you wanna Do you want to do a deal?

1:07:01 Mm-hmm. And He responded, it came back with a A really Good, clean, fair deal.

1:07:08 Um Alright, so I guess one of the things that that you I mean'cause at this point you must be I think you start to think, hey

1:07:17 We're getting close to acquisition time, right? I mean is that Fair to say and and if so What was the threshold you had to reach in order to become attractive to A buyer.

1:07:29 Hundred million dollars. Hundred million sales, okay. Yeah. Um tell me about about the the process of fi finding an acquire because I mean God, it's amazing. Just Two and a half years in, barely three years in. you start to have serious conversations about

1:07:45 An acquisition. Yeah, I mean the first is sort of you know, are we are we at that scale where we would be attractive to people. Uh and I remember, you know, twenty twenty one it was clear we were going to hit that hundred million dollar threshold. So there was a board meeting and then it was a topic and the question was like, should we start a process? Should we think about this? And then everyone was like, yes, it is time. So

1:08:15 We kicked that off in twenty twenty-two. Mm. You eventually did um Start to engage in in a deeper discussion with Church and Dwight. And I think they own

1:08:28 Man, a bunch of brands. Arm and Hammer and uh Waterpick and uh even on Trojan Condoms. I mean they own a bunch of different brands. And so you engage in a c in a conversation with them and they're I mean this is gonna take a bit of time. Um Tell me a little bit about about that process because

1:08:47 You know, when you sign an engagement letter it's not guaranteed that it's going to go through, either. Yeah, you're right. I mean signing it is just one step and then there's a whole due diligence process. Yeah. Bye. You know

1:09:03 For us when we were selling the company, um Partnership was really critical. Like culture fit was a must. So we wanted someone who, you know, we could trust with the culture and the team and someone who also had the platform to continue to grow and scale this business and Yeah, we got to know the management team at Church and White and Ended up being the one.

1:09:27 The acquisition also meant for us that the brand would have a sort of forever home. A a place that it could live and grow beyond us and after us. Uh, we were really focused on having a place where this brand could live on for fifty years where I could bring my kids to to target later on and say, Hey, this th this brand it's it's still here, it's still flourishing Um, and so that m more so than anything, first and foremost it was really important that the brand had a home. And so Church and Dwight was a good We felt like the best place for it.

1:09:58 The acquisition was announced in August of twenty twenty two six hundred and thirty million dollar I was just amazing for a brand that really launched in September of twenty seventeen on Amazon, so You know, a a little under What five years?

1:10:13 After your official launch. for You know, just a Really incredible exit. Um

1:10:21 At that point, I mean, what did that mean for for you guys? Did that that also mean that you are committing yourselves to working for Church and Dwight for You know. For a period of time. Yeah, for three years.

1:10:34 So Wh tell me a little bit about w what that means now you you have this brand that you started and that you controlled really And now you work for it. So you're not the decision makers anymore. What is what is that like? I mean I I think a founder's role is

1:10:50 It's sort of ever evolving. The three of us, the work that we were doing in two thousand seventeen is different than what it was d what we were doing in twenty nineteen and It's different today. It changes all the time. I mean, like I don't really s oversee supply chain and look at the shi the list of ships coming in and stuff like that anymore. It wouldn't make sense for me to do it when Trish and Dwight has you know, vast infrastructure to do that.

1:11:13 Yeah. The role is evolving, but for us Number one is to make sure that The brand is safe, the brand is gonna continue to grow and uh the culture does evolve in a way that

1:11:24 that we wanted to and you know it it'll be successful at Church and Dwight. Um When when you guys think about you know, where you got in the journey. How much of of this do you attribute to the the work you put in and and how much do you think has to do with Just

1:11:41 luck. Um Dwight, first to you. I think hard work is the baseline for any sort of success. I mean you just have to work your tail off and Make the sacrifices, but

1:11:53 But also I think we're all just floating or or being carried really in a river of randomness that sometimes we call luck. Um I've been blessed with an immense amount of luck in my life and For that I'm

1:12:07 So appreciative and grateful. You? I agree. I mean, I think the hard work is You know. That's what it takes.

1:12:18 Um, really, if you're gonna commit to an entrepreneurial journey, like you gotta work really hard, but I mean I think we were so lucky in many many instances. Like You know, I think the timing of when we launched, the timing of when we sold. You know, me

1:12:36 meeting Dwight and Andy and us Turning out to be a really great team actually. Like There are a lot of I think happy accidents that uh I attribute to Che luck. That's Ju Ru and Dwight Lee.

1:12:51 Co founders of Hero Cosmetics. By the way, she mentioned it earlier in the interview, but a Big way that Mighty Patch really took off was through social media platforms like TikTok. I have watched Preparing for this interview, so many TikTok videos

1:13:07 Of young people showing me their skin up close. And there's it, I can tell you. I should be paid extra just for doing that. Yeah. But I really understand it now.

1:13:20 Yeah. Hey, thanks so much for listening to the show this week. Please make sure to click the follow button on your podcast app so you never miss a new episode of the show. And as always, it's free. And if you're interested in insights, ideas, and lessons from some of the world's greatest entrepreneurs, sign up for my newsletter at guyraz.com or on Substack. This episode was produced by Chris Massini with music composed by Ramina Lui and Sam Paulson. It was edited by Andrea Bruce with research assistance from Olivia Rockman. Our engineers were Gilly Moon and Robert Rodriguez. Our production staff also includes Alex Chung, Carla Esteves, JC Howard, Devin Schwartz, Katherine Seifer, Carrie Thomson, Niva Grant, John Isabella, and Elaine Coates. I'm Guy Raz and you've been listening to how I built this.

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