Advice Line: Scaling Strategies

0:00 Hello and welcome to the advice line on how I built this lab. I'm Guy Raz. This is the place where we help to try and solve your business challenges and pain points, and each week. I'm joined by a legendary founder, a former guest on the show who will attempt with me. Help you. And this week we have a bit of a special episode. It's kind of a mashup, three callers and three different former guests, but all tackling some version of the same question, which is What's the next move to scale my business? And by the way, if you're building something and you need advice,

0:35 Give us a call, you might just be the next guest on the show. 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 would like some 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 is full of insights and ideas about running a business and hopefully even some inspiring messages. You can sign up for free at gyros.com and we will put all of this info in the podcast description. Alright, let's get to it.

1:15 My first guest today is Travis Borsma. He's the co-founder of Dutch Bros Coffee. Travis was first on how I built this back in 2023 to tell the story of taking Dutch Bros from a single push cart in a small town in Oregon, actually in a parking lot of a supermarket. to a national chain now valued at over nine billion dollars. It is such an amazing story and you can find it in the link here in the show notes. And as you'll hear, Travis was the perfect person to help our callers think about how to scale a business. Hi Guy, hi Travis. Uh my name is Andy Atkins from Nashville, Tennessee, and I'm the co owner.

1:55 An operator of the Bad Luck Burger Club? We're fast casual smash burgers concept. operating out of two food trucks and uh I'm stoked to be on the show. Thanks for having me on. Awesome. Welcome to the show. All right, so you're doing Bad Luck Burger Club in Nashville Two trucks, so congrats. How when did you start the business?

2:13 Uh we started in the pandemic, uh May of twenty twenty one was our first go around and me and my partner, Cody. We started up. Uh yeah, it was a tent. And a couple of griddles. No business plan. Uh just a couple of dudes kinda like throwing parties in parking lots around town.

2:32 Uh with Really just trying to get through uh you know, we're all wearing masks sitting in our houses. You couldn't be out and about and then like Once the C D C was like, Oh, you can hang with like ten or less people in parking lots and social distance, like The whole vibe was just

2:50 Yo, let's go through some parties, let's have a good time. Let's sell a cheeseburger. Um, try to make the money back that we uh spent on food at Groger or whatever. And uh it really was not a plan to start a business. Uh but

3:06 It was just a perfect storm of people needing a place to be and needing a community. And we happen to make a pretty good cheeseburger And so they were just large lines coming, um, and we were selling out every time. And uh that eventually turned into a food truck that then eventually turned into a second food truck. And now it's our full time thing.

3:30 I some and where you guys uh are coming from food, you and Cody? No, uh no, not at all. Cody and I met uh back in the day when we used to both travel in bands. Uh I played as a professional musician for about a decade, same for Cody. So we were just in bands touring around the world, we'd see each other at different festivals.

3:50 uh just you know making friends and then uh he moved to Nashville Where I lived and you know You just start growing a friendship. seeing each other around town. Neither one of us have Any hospitality or service industry experience before this thing.

4:10 Um Uh yes and no. So I started my career out as a actual musician playing in a metal band. And the underground metal and punk rock carcore scenes. I wouldn't think that you would know anything about about that. That's a really specific niche. You might be surprised. Okay. Keep going. Yeah, possible. But uh then after that Uh, I went into a ten year career of tour in the production side of touring.

4:37 in arenas. So I've worked with like Panic at the Disco and Penatonics and Zach Brown band and A bunch of stuff like that, you know, and you're just setting up stages and arenas all over the country. Yeah, yeah, for sure.

4:52 Andy, what's your what's your question for us? Yeah, so we've grown organically over the past three years. Uh the tent and the griddle's paid for the first food truck. The first food truck paid for the second food truck. We've been cash flow positive since day one. And we've just always operated that way.

5:11 We're living in a world right now where Our decision has to be going into brick and mortar. And Uh securing finance for that. Or do we keep trying to replicate the current model of food trucks

5:25 In various locations. But Travis, as you would know It takes a lot of operations. To run a food truck. uh at the at the level of success that we're doing.

5:39 Uh so it's like, you know, the uh the big goal is Brick and mortar now. Talk to financial people about giving us some money. Or uh, you know, keep uh bootstrapping. Through mobile unit, mobile unit until it makes sense.

5:54 So bootstrap, bootstrap, bootstrap, and then build through cash flow or raise money and go right into brick and mortar. Doesn't seem like those are the only two options here, but uh Travis Um, love love to hear your thoughts on that. I mean there's There's something super fun and cool.

6:11 And sexy about a food truck. You know, there's it's it's trendy. You have some flexibility with where you go and what you do and And your hours and where you're gonna invest time and money. When you look at brick and mortar Are you

6:26 completely aware of all the costs that you're gonna incur that you don't today with overhead. And I mean, you know, like From rent. To you know, maintenance on the buildings to

6:39 investment in the kitchen with the equipment uh the cleanliness that has to occur with bathrooms and people that may have, you know, kids that make a mess at everything in the kitchen and and now you got an order there's a lot of dynamics that are Much different than your food truck. So I you know I

6:57 If if that's your overall objective and and if If it is. Then You gotta figure out. Well

7:04 Yeah, I'm the name Kirkas. How am I gonna offset that? I would think you gotta do a lot more volume. You know, and volume is probably the name of the game for you guys if you go in to more You know, brick and mortar side with

7:17 Overhead. For sure. Um yeah, I mean we're pretty aware of uh it will be quite a bit more uh expensive to run, you know, monthly compared to what our overhead is now. Uh we have a pretty decent amount of revenue. Our margins are pretty good. Um and

7:35 With Uh being able to open up a brick and mortar and add alcohol to our program of having a bar That's going to be able to open up a revenue stream that we don't even have access to Being in a food truck, you know?

7:51 Um'cause right now, like we have one standalone food truck that stays outside of a bar that's Seven days a week, open every single day. And you know, like we have a great relationship with them, love working with them. But also understand that like based off of the numbers that we look at between our two companies, we would have twice the Revenue in a day.

8:12 Just out of how much alcohol is being served in their building that We don't have access to sell. In a food truck. Right. So you're saying that part of the brick and mortar, the big part is that you have the access to sell alcohol. Insurance. Yeah, absolutely. Got it. I and you know what? I think I I mean honestly that I that's something that I think you gotta consciously think about is

8:31 How do you offset those costs? Volume, yes, but if you're able to bring in product line or a revenue stream that you don't capture today. And you've got a model of somebody who already does. It's pretty easy to look at that and try to figure out how you could replicate it or or

8:46 Take it to another level. Yeah, for sure. What's it what's the vision? Like you're looking five, ten years down the road, Andy. I mean, do you want to be the you know the Smashburger joint in Nashville or do you have have visions of like Beyond that area.

9:02 Uh I think we have a model that could r be replicated in other locations. at least throughout the south east. Yeah, I mean I think we've already got a good uh footprint in Nashville. We are like We're voted best burger in town, the best food truck in town. We got some pretty good eyes and and uh, you know

9:22 acclamations going on around town or whatever. I think being able to have a brick and mortar would for sure solidify us as a brand that's You know, here to stay.

9:32 H how long do you think it would take you To save enough cash. To finance it yourself. A brick and mortar shop.

9:42 Oh gosh, I'd have to say probably another Two years. I mean it's something to consider, right?'Cause the minute you bring in an outside investor, especially with you, what what can you give us a kinda ballpark of what your revenue is, your annual revenue? For sure. We'll just uh get over eight thousand K this uh year. Uh thousand dollars.

10:03 Total and eight hundred thousand, sorry. Eight hundred thousand. Eight hundred thousand. Yeah, yeah. So it's pretty good. But you're gonna bring an investor and they're gonna say, look, you're gonna need a million dollars to do this and I want fifty five percent of your business. And so the question is, and maybe you can talk'em down to thirty or forty, but you know Then at that point you've got an investor's access to your books and and which is fine, but you know, they're they're a shareholder. So

10:28 You now have a boss, and you're your own boss. And so it's a big question as to whether You know, if you if you want to kinda speed this up, there are advantages to it. If you could find the right partner But it's

10:41 it it's a risk, right? If you're willing to try and make a go of it on your own for another year, year and a half to see if you can fund it yourself. You retain the control. It's as simple as that.

10:54 Yeah. And are you married? Well yeah, I'm married, yeah. Yeah. You got compromise and then relationship sometimes.

11:03 Oh, for sure. I I that's uh I feel like my strongest suit with both my life partner and my business partner is I'm the I'm the one that compromises, dude. I'm down to just say, Okay, I'm not gonna die in this hole, you know? Well, you know what, I I you probably I mean, you bring a partner in and it That's a whole nother dynamic and and you can count on a lot more compromise.

11:26 I think what you're doing is amazing and and man, what Guy just said, I think is spot on. If you can just Keep that snowball building. Maybe take a little bit less to live on. Keep that money rolling into the business and let it do its thing and

11:41 And Have some fun with it, but I could see uh Bad luck burger and brew is real easy. Oh yeah. For sure. I could see that.

11:50 Yeah. Heck yeah, guys. And I mean those are that's that's pretty good. That's pretty I mean eight hundred grand for two food trucks It's pretty great. I mean I I would imagine you guys are

12:00 doing a nice, nice profit there. And to be voted the best burger. In that. Best burger, best food truck. We're about thirty percent profitable. Wow. Um, and that's with one of those food trucks. Uh so the the second truck that we have outside that bar

12:17 That started in January of this year and so we pretty much shifted all of our focus uh on to getting that running seven days a week, like nonstop. So like The other truck. kinda sat around for a while for us to be able to get that operational. So there's

12:34 There's a whole nother revenue stream in that truck that didn't really get utilized that well this year. Yeah, I feel like you guys are doing something right here. Yeah, the mo I mean the model sounds Perfect. You know, you maybe want to make minor tweaks.

12:47 To make a major impact. Um the brick and mortar scene and bringing on alcohol and the liability and everything that goes with it. I just be mindful of everything that comes with that that's new and different. than what you do now. For sure. Yeah, it's definitely a big learning curve for Like I said, we're

13:03 Learning something new every single day, making it up as we go. But we know a lot more now than we knew uh May twenty twenty one, you know? Yeah. Burgers look awesome, they look delicious. Congrats, man. Heck yeah, thanks guys. I really appreciate y'all.

13:17 Andy Atkins of the Bad Luck Burger Club. Thanks for calling in. Good luck, Andy. Thanks, guys. Yeah. Looks looks like a good burger, man. I I I have recently s very sadly

13:29 Travis. Given up. Mostly. I'm not gonna say entirely. But I would say ninety nine percent of the time given up. Burgers.

13:38 Just'cause I'm I'm on uh like a low, low carb. diet. So I you know Take my kids in and out and I just sit there wistfully watching them eat. Well, I I have not done that. Yeah, I'm ready to go, man. I know they look delicious.

14:01 We're gonna take a quick break, but when we come back, another caller with another question for another former guest. Stay with us, you're listening to a special mashup episode of the advice line. Right here on how I built this lab. Mm. Welcome back to the advice line on how I built this lab. I'm Guy Raz, and our next return guest, Michael Prazman, started the online clothing retailer Everlane, and Michael shared that story on the show back in 2023, and we'll put a link to it in the show notes below. Michael caused quite a stir in the fashion world when he publicized his company's production costs. at every step along the chain. Over time, Michael ended up building a multi-million dollar business with a focus on sustainability and social responsibility.

14:51 And when Michael joined me on the advice line, he offered some really great advice about growing a fashion brand through retail partnerships. Hi guys, I'm Tiffany Narbonne, the founder of Teach is L and first I have to say, Guy and Michael, I'm so excited. I feel very grateful for this opportunity. Guy, I've been listening to you for so long, Sush and I be on the road heading to appointments to my brand, and it was always just the fuel to me. So I can't believe I even have this chance. So thank you. Um amazing. Well okay. Tell us a little bit about about um about your brand. So our brand it's an inspirational jewelry brand and it's all about spreading positivity, being able to wear your story through timeless jewelry. We use all precious gemstones, sterling silver, lifetime guarantee, and all handmade right here on Cape Cod by women and

15:40 You know, our brand it's just really, I say to wear your story. Yeah. Tiffany, um I I may have missed it. What's the name of the brand? T Giselle. I get all excited and I just say the name. So my first name is Tiffany and my middle name's Giselle. And when coming up with the name of my brand, I made I started creating jewelry and Something came over me I never felt. I never had um you know, uh vision of being a jewellery designer, just something brought so much joy to my heart when I made a bracelet. And so

16:14 Everything's always had a meaning and my middle name is with my my mom also shares it with me. And so she's such an inspiration to me. She's such my rock and Um yeah, so it's just another piece of me. And and tell me a little bit about the products. I mean, it uh mainly bracelets, right? And they're They're like um made from they're like they're they're spherical. They're made from like a stone and they've got a charm on them. Okay.

16:40 Yeah. Yep, so they're all we use all precious gemstones, so all different semi precious stones from like amethystes to rose quartz, blue aquamarine. And with that, I really created like a dual message. So not only do stones hold meanings and energies, which I've always been into, but charms all have a meaning. You know, you never know what something could symbolize to someone. So y with the bracelets, I really kind of combine both those messages and we have an array of styles. So you know, for instance, like maybe your mom loves rose quartz and you want to get her our family tree, but you could get your sister, you know, maybe she's a blue girl, something for Serenity, you can get her that option with the heart. So I say like you create the story, you know, and there's lots of options, so it's definitely turned into a stackable um our returning customer they want to create, you know, their stack, you know. Yeah. And you make and you

17:31 Basically make it on Cape Cod. Yeah, yep. I have a whole team of women, which is amazing. I love my crew, I couldn't do it without them. And they put so much love into every piece, and I believe that's a piece of it that comes out when you're wearing it. And you and you have a shop too, right? We do, yes. We have a store right on the Cape. It was when we first opened, we thought it could be like a showroom for our retailers we work with to come like check out the brand. But then we were like, you know what, we're right on Cape Cog, we're in a popular location destination for the summer and it's been great. And so we have just one location. on the Cape and then we work with retailers across the country that carry our brand. I love Cape Cod. It's so fun. I haven't been there a couple of years. It's the best. So all right, a c a couple of questions. First of all, this is self funded, right? This business? Yes. And and are you guys have you guys broken um half a million dollars in sales yet?

18:24 Yeah, we actually have hit over five million. Wow. Yeah, how many years have you been around? Thank you. I founded it in twenty twelve. So I literally was a baby. Yeah, so it's been a minute. It's been a little bit. And so um now I'm a mom, so I say I'm a mom preneur. And you know, our during COVID, our brand literally we were so blessed it like took off. Um, we I built the brand through doing trade shows and wholesale, but It was so special because I started going live on Facebook and our website.

18:58 And then I ended up getting reached out to from QBC. So it's been just Word of mouth has really built our brand. Um All right, so you're doing about five million revenue. That's great. Congratulations. And um And your question what was your question for us? So my question is, you know, really I wanna be able to share more of our broom with like bigger retailers. Like we have a few

19:23 big independents that we work with um in like QBC, but kinda how to get in the face of some of these bigger retailers or partnerships. J just out of curiosity before we get to your question, um, what are you guys uh I mean, roughly what are you spending on marketing every year? On marketing, we're spending a about like I think like

19:44 Ten percent. Okay. Great. Okay, great. So very reason. Very reasonable. Yeah. Very reasonable. Okay. So um Michael Um

19:52 She's got a great brand and you know, got some momentum, got a store in Cape Cod Clearly there's it r is resonating, but on QVC So a lot going for her, but um you know, she wants to take it to the next level from five million to twenty five million or or beyond. Um Where we're I mean, at this point this is a now a mature

20:14 Small business. Um so now so now what? So what I'm thinking about is In my head as I see this is like You've done such an amazing job telling your story.

20:25 And even when I go onto the site. a little video pops up of you and starts I get to hear your story. And then what you said is you know, when the pandemic happened, I went live and started telling the story. Q V C You're telling your story and it's live. What is it about that story?

20:42 That's resonating. with people when you tell the story that gets him to go I wanna buy P just L'cause it's so personal, right? It's your name. So clearly there's something there that's happening. I think it's just, you know, I'm a very believer in, you know, being kind, what goes round, comes around. We all have a story. And when I started my business, it's so crazy, my dad

21:04 pass about a year in and I wanted to quit. I wanted to stop and It was like a piece of then Megan Trainer ended up tweeting my bracelets and this was when one of her big kits came out from it was such a Mantucket. Megan Trainer from Mantucket. I've interviewed her before. She's a lovely, lovely person. Oh my God. I never met her, but it literally was I felt like it was a sign from my dad. I'm very in a signs where he was like, You're not quitting. And so I then threw myself into my business. I began doing a lot of events, pop ups, just Cold calling, whatever it took, and it ended up becoming an outlet for me. And now it's more than jewelry. And I think that's really where We strive, you know, and I do it'cause I love it and I feel grateful for my consumers and you know, just being able to connect to the story.

21:55 If that makes sense. No, it it does. And I I guess what I'm trying to figure out is how do you take the story you're telling and start to make it into words that make it very clear for people because you can't show up everywhere. You know, Q V C's one place where you can show up, but Eventually you have to turn this into words on the packaging and everything so that when it's sold in other retailers You stand out.

22:17 Because it is about That spirit. And capturing that spirit. When you've gone to Big retailers has

22:24 How has how I mean QVC obviously has been successful, but like what's your dream and how has it gone? So um basically with our retailers, you know, my my biggest independent is about a hundred and twenty retailers they have. And we've been a great brand with them. I do training, so they're one like, you know. kinda like you're saying, like I try to be able to share my brand to get them to really understand it what separates me from the other brands. Like why do they want to share my jewelry with their customers. So you know, I am getting back into doing trade shows. I took some time off from be being a a mom and just trying to figure out like, you know, where to put that time or how to get into those

23:05 Like Connect with that. The one the thing I would say is as you start to scale Again, I go back to the amazing storytelling that you have, and you're gonna have to find a way as my Yes.

23:18 To simplify. And it's finding what does the customer care about when they buy from you. You know, one of the things you said early on that really resonated with me, but I'm not your customer yet. Um was uh that it's Made in Cape Cod.

23:33 That it's made by these amazing women. That's such a simple story for retailers to tell. You know. Made in Cape Cod for women by women. It doesn't have to be for women, but made in Cape Cod by women.

23:44 Yeah. There's the story about uh you know, your father. There's the story about um every Uh Every bracelet. Tells a story.

23:53 And here's you know Merchandising by stories. Um that makes it special. So I think it's I I just think that's sitting down with your team and your customers and and and diagnoses about me now is like What do you love the brand for?

24:08 And it has to be Your personality's so compelling. I'm already compelled. I'm like, I wanna go buy these right now. Oh, but you can't you can't show up everywhere. So the exercise of taking you and bottling it into packaging. So that

24:24 When they have that display at retail. They can say and Less than five seconds. What makes it T Giselle so special.

24:33 Yeah. You know, I was thinking I'm I looking at your website. Um I notice that you it's it's organized basically based on the collection. So like Black Agate. Is it Agate is that how it's pronounced? Yeah.

24:47 Um and then you go and then you sort of go over each one and it tells you what the charm's name is. It like, for example, Cladog, is it was that how it's pronounced? Clada. Clata, sorry, forgive me. And everyone knows it's that it's that it's like that heart with the you know, you see a lot of Irish Irish folks wearing it, right? It's the heart with the crown and Yeah. But what but but the thing is is that that that symbolizes love, loyalty, and friendship, right? A compass rose, um symbolizes uh, you know, kind of knowing

25:16 knowing who you are and listening to your own inner voice. And I think instead of Focusing on the charm. I would focus on what it's about, what it with the story that it tells. It's kind of doubling down on what what Michael is saying. Yeah. And then backing into The

25:33 the actually the charm, right? And maybe even a way to kind of organize the collections around um you know around a spirit of feeling a mood A a personality attribute or trait, you know, like the the kindness bracelet or you know the The

25:51 the fear fearlessness bracelet. I mean so you get that Bracelet. And you know that the person knows you. Because they got to the bracelet that defines And reflects who you are.

26:04 Right. And it and with that I even I even see you building on, you know, again, I'll just go back to the made in Cape Cod. Uh by you know Handmade. By w handmade. Handmade in Cape Cod by women. Yeah.

26:18 uh to inspire a more, you know, joyful or more powerful or a more uh connected world, you know? And And something that simplifies it and then starts to go down to each of those not The skull charm, but the strength.

26:33 You know, for those who have strength. Here's this charm. Yes. For those who have this, here's this charm. So exactly what Guy's saying. And And in a few days of just going through this, and what you'll do is you'll you'll start to write it down and then you'll show retailers and customers and say, Does this resonate? Do you like this? Yes. Yes or no. What do you like about it?

26:51 And it's bottling all of the goodness of Tiffany into A box. That is so simple that people can just repeat. And get excited about. I love it. Yes. Yeah, I I think Yeah,'cause it makes it so s then it's it's a clear

27:09 Right. Meaningful connection, right? If that's then like the part tying that all together, like you're saying, bottling that all into the story. And when somebody gives you something like this, like a bracelet or a necklace that is isn't just a random thing, or even just just but it actually There's a symbolic meaning around it that was for you. It's like they're not just gifting you this thing. They're they're gif They're showing you that they really put time into thinking about getting something specifically for you. Yeah.

27:41 And what they see in you. What they exactly, what they see in you, yeah. Oh my God. Thank you guys. I love it. I feel so good. Awesome. All right. Well the brand is called T Giselle Tiffany Good luck. Thank you so much. Congrats on building this business so far. Cool. It's really cool. Thank you.

27:59 That's a feel good story. It is. You know how I buy my my wife jewellery? She sends me links on the internet. Yeah. And says buy me this.

28:09 That's how I do it. I'm about the opposite. I I go vintage shopping on auctions and bid for jewelry for my wife. So it's like we could not be more opposite. I cannot do that,'cause then I'm like, is this r did I pick the right thing? Did I get what you were looking for? I love it. Yeah. We're gonna take another quick break. We'll be right back. Stay with us, you're listening to a special mashup episode of The Advice Line right here on how I built this lab.

28:45 Hey, welcome back to the device line on how I built this lab. I'm Guy Raz. So my next return guest, Chris Ruder, turned the game Spikeball into a massive brand with a global following. Chris was first on the show back in 2023, and he told the story of taking a game that he and his friends played as kids. and marketing it as a competitive sport. and he found traction. With some unexpected

29:09 tribes of people that became evangelists for the brand, including Christian youth groups and PE teachers. And if you want to hear that story, we'll put a link to it in the podcast episode description. When Chris joined me on the advice line, He offered some great guidance on how to grow another US sports brand. internationally. Hi there, uh hi guy, hi Chris. My name is Peter Hauk, uh from beautiful Sioux Hall, South Dakota. I'm calling today to talk to you guys about Rink Rabbit. uh direct to consumer e commerce figure scanning company.

29:42 Uh we currently have two products, a rinktote that we launched the company with and a figure skating backpack that we rolled out about a year ago. We've seen a lot of growth in the last twelve months. Mm-hmm. Wow, okay, well congrats. Thanks for calling in, Peter. Okay, so thrink rabbit. You make uh accessories for ice skating. You don't make ice skates. Yep, exactly. That's a big point of confusion. Yeah, we we make bags. Okay, so bags and what else for for ice skate ice skaters? Yeah, so we make a a backpack that physically holds your figure skates again. We have a tot. Uh and the tote sits on the boards that go around the edge of the ice rink and it holds all the things a skater needs while they're on the ice. So they don't have to hop off the ice to go grab a drink of water or blow their nose. Ice time is expensive, so we try and make that as yeah, efficient as possible.

30:26 Alright, I live in Northern California, so I don't I don't not aware of many ice skating rinks. directly in my area. But you know, Sioux Falls, South Dakota gets pretty cold in winter. I and I think You know, right, there's a more of a a scathing culture there. How big is the Is is is the opportunity.

30:44 Yeah, it's difficult to determine. You know, I've done a ton of research to try and figure out how many figure skaters there are, s especially in the US. Um, there's there's a a bunch of people, there's probably m over a million people that that are figure skaters, you know, it's an Olympic sport, so it's very widely, uh widely accepted. Give me a sense of h of wha how you're doing, like w right now, what's your what's your r revenue roughly? Yeah, so over the past few uh years we've we've grown pretty substantially each year. Um our first year, you know, our first couple of months we we launched in October and from October to December we did like a thousand dollars in sales and then It's October of twenty twenty three. Twenty twenty one is actually the year that we launched yeah. Okay. And then uh we did thirteen thousand in twenty twenty two and then twenty three thousand in twenty twenty three, and we've done a little over a hundred thousand

31:29 dollars uh year to date in twenty twenty four. Congratulations. That's it. We're building the brand. We're we're you know, our the one of the benefits of our product is that when skaters see it, they know they want it. So obviously when we started, uh and nobody knew who we were or what our product was, it took a little while for us to gain some speed. But that's why I'm excited to be talking to you today, Chris, because uh Uh you know, it seems like that's kinda how Spike Ball grew, uh was was by having people see uh you playing Spike Ball in the game. And Spike Ball even more more niche than figure skating. What um Peter, what what's your question for us today? Yeah, so um figure skating is obviously an international sport and we see great potential for our brand to become an international brand. You know, we've we've seen a lot of growth organically uh in the United States as people have become more and more aware of our product, and we have people right now that are spending quite a bit of money to ship our product to them internationally. We've sold products in in sixteen different countries and those people are paying about the equivalent of the the value of the product in the first place to ship it to them in, you know, Australia or Canada or the UK or wherever.

32:34 And so we think that there's this big opportunity if we were to to tackle the international market. Uh, but we don't know if if that's the right thing for us to be doing right now or not. Should we focus on rolling out more products, or should we focus on trying to address this international market where a significant number of of figure skaters exist. Got it. Let me bring you in, Chris Schröder. Uh w what do you think I mean f before we answer answer Peter's question, um any thoughts or questions that that you might have for Peter? Number one, I love it, this story. Uh although our products are wildly different, the stories, uh this this is really bringing me back to our early days. Not only is it a niche audience, uh, but also

33:14 When you first mentioned international I got a little uncomfortable because I know a lot of entrepreneurs in the early days like, oh international, the opportunity could be massive. In my experience, the only time I shouldn't about the only time, but the time where it makes the most sense to really consider it is if you have that existing demand. If you don't, then man, it feels like a really heavy lift. But I love that you've got the demand. I love that people are spending just it you know, it's funny, Australians in the early days, they would spend just as much on shipping as they would for a spike ball set and we're like, Oh wait.

33:49 That is the marketplace talking to us. Peter, let me let me ask you a question about the main product now, right, which is the bag. And the bag g very specifically designed for ice skaters. How Protected is your product. I mean I mean spikeball is patented. You cannot make spikeball. People have uh try to do fakes, but they get shut down.

34:11 when when you guys can shut them down, Chris. But um can I mean is this something that that could be like replicated in China and and and sold in on Amazon? Yeah, so we we uh we have our name trademarked, first of all, so Rink Rabbit is is trademarked, and we also have patents on the design of both of our products. Um, and we just filed our our patent for our backpack. relatively recently and with that one we uh we did it in in other markets as well. I'm not sure exactly all the ones that we ended ended up uh including, but we we filed a patent across a a wide array of of

34:47 European countries especially. Um, and the thing about Amazon is when you have that uh patent protection and that trademark protection, you can strike down other Amazon listings that that are uh confusingly similar. So that's a big part of the reason why we why we opted to spend that money early on. um as a brand is to kind of protect ourselves from the get go. Mm-hmm. I'm cu I'm curious, Chris, from your perspective. I mean you when you started spike ball. I mean it was really I mean you had to explain to people you still do to some extent, but really you had to explain to people what this was and it was weird and people you're you're on the shores like Michigan and you're like, what is this weird thing? I mean uh figure skating, ice skating is not weird. Like people have been doing this for a long, long time. This is a

35:29 a a sport that I imagine probably skews more more female than than male in the United States. Is that fair to say, Peter? Yeah, that's that's really accurate. And actually one of the issues with other brands in the figure skating space is that they treat skaters more like little girls rather than the serious competitive athletes. My wife was a national champion figure skater when she was in high school. Yeah. Yeah. So she had five concussions that she got. Concussions? Wow. So she was a very serious athlete. Yeah. Um and going to the rink six to six to seven days a week for four hours at a time. And the products that were out there weren't built for someone to treat them like an athlete. They were pink and sparkly and fuzzy and and not really designed to be

36:12 super useful. So our whole brand ethos is to design products that are really well made, really, you know, aesthetically pleasing and and highly functional. You just said something that kind of blew my mind that I I did not know. Your wife was the US national figure skating champion, this is that should be screening that from the front of your webpage. I mean that it it's it's all it's like You are giving me a reason now, if I'm a figure skater or an ice skater, to buy your product'cause it's like Hey, I'm Allie. I mean no no shade to you, your wife Allie, I would have her face on there saying

36:48 Uh I was a national champion and I wish I had something like this, so I didn't, so we designed it. Like I feel like that's gotta be right at the center of your brain. I know this wasn't your question, but I don't know, Chris, what do you think?

37:01 Uh yes, it sounds like you may have the Michael Jordan of figure skating uh on board and the world doesn't know it. So absolutely. Yeah, she was on a s a synchronized skating team that won US national twenty fifteen. That sounds okay. You know how many journal former journalists I know say their poolets are prize winners, but ten people won the award? She's a national champion. Yeah, I think she's incredible, so yeah, that's I appreciate it. I feel like that's needs to be a bigger part of the story here. Um in in terms of international, um, is it what what's the challenge of of of selling these uh international mean what w wha what is the Issue for you. Why are you kind of hesitating about this?

37:42 Yeah, so when you when you ship a product internationally, A, it's it's much more expensive. So when we ship our products, we're based out of South Dakota, which is in the center of the country, which is really convenient for an e commerce perspective. Um, but most of the time our product costs ten or twelve or at the most fifteen dollars uh to ship to our our end user. Uh, but when you ship internationally it's it's double that. It's it's twenty to thirty dollars and it takes five weeks to get there. Um and then on top of that, when it shows up at their door, uh they also have to sign and pay another thirty, forty, fifty dollars, depending on their country. um to to make up for that. And so, you know, for a a hundred and twenty nine dollar or a seventy dollar product. that those those expenses become pretty prohibitive. But we ha still have people buying them from us anyway. And so I'm wondering, is it worth it for us to try and go set up international distribution centers or uh something like that? Do we try and partner with wholesalers who who are in other countries and ship product directly to them from our manufacturer? Or how do we how do we go about tackling that demand that we see out there?

38:45 But what percentage of the of the of the purchases are coming from abroad. I mean is it more than five percent? Is it more than ten percent? It's about three and a half percent last time I ran the numbers of our sales are international. And US growth is strong, that's ninety seven percent of your growth? Yeah, ninety seven percent of our our ninety yeah, six and a half percent of our sales are are US. Um and we're we've grown in the last year by about eight hundred percent.

39:13 Um you're over. Yeah. Ah, given that perspective, I may Change my answer a bit on my excitement about international. Um It sounds sexy to tell people you're shipping to sixteen countries or however many countries.

39:29 Um I think the one thing most business owners struggle with and I do is focus. If you've got a rocket ship. That would you say eight hundred percent, six hundred percent or something like that? This year, yeah.

39:44 Uh Wow, that is where your attention needs to be. Um as long as you've got your trademarks elsewhere. You're still in control, even if you're not selling a single set there. So yeah, I'd encourage you to make sure the US machine

40:00 Can continue that. And when it is time for international You know, don't go buy your own warehouse, of course, or do whatever. There's plenty of companies all over the world that you can ship fifty units to them, they'll leave it in the corner and they'll Tide are you on a Shopify site or something like that? We run on Shopify. Yeah, so you can tie that into um

40:24 a lot of back end suppliers where order comes through, you port you forward it, and it's done. Yeah. Um but man, if your US is growing that fast, I I think that's where your attention needs to be. I have to agree with that. Uh, Chris. I I think that that you know For the odd. Australian or or you know

40:43 Someone from the UK that's writing in. I mean there are there are ways around that. Like like i if if you're getting a bunch of orders from people in London or Sydney, like it might be worthwhile partnering with a a a skating shop in London and just flying there twice a year with a Leave'em there. Yeah. And have them s have them sell it in the meantime. But I to me it seems like the most fertile ground. The most fertile territory for you is right.

41:09 in your h in your backyard. I mm s k the United States and Canada. Yeah. Which is where I think your primary C customers are gonna be living. Yeah.

41:21 Yeah. And I think, you know, I do think that there's a lot of uh room for us, you know, we our ultimate goal is to be one brand that sells figure skaters everything they need, uh, to to practice the sport of figure skating. You know, hockey as a sport has bower as a brand that will sell you everything and Golf has titleists, but in figure skating it's really a bunch of mom and pop shops that all sell one or two or three products at most. And so we see a big opportunity for us to come in and roll out nine, ten, eleven, twelve, whatever, however many products it is, um, that that are all aimed specifically at our target market of figure skaters and to to be the name brand uh for figure skating equipment in the country. Peter, you gotta put your wife's picture right at the front and center of this brand.

42:06 National champion figure skater. I mean I she might be reluctant, but What it's like how how much better can you be in terms of Offering expertise. Yeah. Peter Hawk, the brand is called Rink Rabbit.

42:20 Thanks so much for calling in. Good luck. Yeah. Thanks for taking the time. I appreciate it. Thank you Peter. Nice. I mean I I I mean ISKate, there's no lifestyle brand around ice skate. Like this seems like a big opportunity here, right? Absolutely.

42:36 That's Chris Ruder, founder of Spike Ball. Hey, thanks so much for listening to this special mashup edition of the Advice Line this week, and a special thanks to Travis Borsma of Dex Bros, Michael Praisman of Everlane. And Chris Ruder of Spike Ball for joining me on the show. And if you haven't heard their original episodes or their full episodes of Advice Line, you'll definitely wanna check them out. We will put links in the show notes. And by the way, please make sure to check out my newsletter. It is full of ideas and advice on how to run a business, and hopefully some inspiring messages as well. Every week we put in tons of insights from entrepreneurs and my own experiences and observations interviewing some of the greatest entrepreneurs in the world. And you can sign up for that. on Substack or at GyRaz.com

43:20 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 and the issues or questions that you'd like some help with, and hopefully we can help you with them. And please make sure to tell us how to reach you. You can send us a voice memo at H IBT at ID.wondery.com or call us at 1-800-433-122. And we'll put all of this in the episode description as well, so don't worry. This episode was produced by Carrie Thompson with music composed by Reptina of Louis. It was edited by John Isabella. Our audio engineer was Neil Rauch. Our production team also includes Alex Chung, Casey Herman, Carla Esteves, Elaine Coates, JC Howard, Catherine Seifer, Sam Paulson, Iman Maani, and Neva Grant. I'm Guy Raz and you've been listening to The Advice Line.

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