How I Built This with Guy Raz - Advice Line with Jeff Raider of Harry's

Episode Date: August 1, 2024

Harry’s and Warby Parker co-founder Jeff Raider joins Guy on the Advice Line, where they talk with three founders grappling with strategic decisions.Today we meet Uli, who’s trying to balance multiple revenue streams for her Los Angeles-based gelato business. Then Travis in Boulder, who just hired his first employee for his upstart package delivery service. And Karly from southern California, who’s launching a children’s book subscription that makes the full moon more magical.If you’d like to be featured on a future Advice Line episode, leave us a one-minute message that tells us about your business and a specific question you’d like answered. Send a voice memo to [e-mail] or call 1-800-433-1298.And to hear the founding story of Harry’s, check out Jeff's first appearance on the show in 2023.This episode was produced by Alex Cheng with music by Ramtin Arablouei. It was edited by John Isabella. Our audio engineer was Neal Rauch.You can follow HIBT on X & Instagram and sign up for Guy's free newsletter at guyraz.com.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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Airbnb.ca.com. Hello and welcome to the advice line on how I built this lab. I'm Guy Raz. This is the place where we help try to solve your business challenges. Each week, I'm joined by a legendary founder, a former guest on the show who will attempt with me to help you. And if you're building something and you need advice, give us a call and you just might be the next guest on the show. Our number is 1-800-433-1298. Send us a one-minute message that tells us about your business and the issues or questions that you'd like help with. You can also send us a voice memo at hibt at ID.wondry.com and make sure to tell us how to reach you. And also don't forget to sign up for my newsletter. It's full of insights and ideas from the world's greatest.

entrepreneurs. You can sign up for free at guyraz.com. And we'll put all this info in the podcast description. All right. Let's get to it. Joining me today is Jeff Rader, co-founder of Harry's, now one of the best-known shaving brands out there. Jeff, welcome to the show. Thanks so much, Guy. I appreciate you having me. Thank you for coming back onto how I built us, of course, this time on Advice Line. The last time we had you on your co-founder, Andy Katz-Mayfield, and you told us about how you found this brand and how you created a competitive advantage by selling Razors direct to consumer online. And by the way, for those of you listening, if you haven't heard that episode yet, it's an amazing story, the story of Harry's Razors. We'll leave a link to it in the podcast description.

Jeff, today we're going to be talking with founders who are in the early stages of starting a company or they're in the process, you know, of some major pivot. And either way, they're thinking about growth, right, and how they should be investing their time and research. And early on at Harry's, you must have felt pretty overwhelmed, right, at times, because you're the co-founder. You were involved in basically everything managing, you know, all the day to day. Totally. But ultimately, that wasn't, presumably that wasn't sustainable. And this is something I think a lot of founders struggle with as their company start to really grow. So how did you figure out where to prioritize before you guys had the capacity to really hire people and bring more people on?

Yeah. You know, it's a great question. And I think one of the things also that I certainly feel as a founder is I like new things. I like new ideas. And actually in our very early days at Harry's, we had so many ideas. We had built a barbershop in Lower Manhattan that was doing well. Yeah. We wanted to build a brand that helped women with shaving and hair removal, you know, kind of for all over their bodies.

We were building content and I wanted to double down there. And it got to the point maybe six months in where I felt stretched really thin. the few folks in our team were stretched too thin. And we had to take a step back and say, like, what is our core business? What are we really great at? And at the time, the thing that was working best in our business was, you know, selling our products, direct to consumer, getting to our customers, learning from them, improving their experience.

And when we were spending time on other things, you know, we were shortchanging that kind of core of our business. And I think because Harry's is such a big brand, people probably assume that when you introduce a new product, it's like a slam dunk. And I say this is somebody who I use Harry's every day. I shave in the shower. I got one of those fogless mirrors. And every few days, I change the blade.

And then I also use a deodorant product that you guys have called Mando. But just because you have one big product, it's not easy to scale the next one, right? Totally. Totally. And that's where I think direct consumer is so powerful. Because as opposed to just making millions of something and trying to assume that everyone's going to want it, what we can do is start under to consumer, start to sell to a few people, see what they like about it, what they don't like. If we have to make changes to it, we can figure out how to talk about it, understand if we

build a set of products, which ones people like the most, and then lean into those and learn in that experience. And so when we started, Harry's as an example, we got a ton of feedback from customers that they wanted a precision trimmer on the back of their razor blade. We have five blades in our cartridge, but precision trimmer helps get to these hard to reach places like under your nose, square off your sideburns. We didn't have that. Yeah.

We didn't have that when we started. And so we said, oh, wow, like, customers seemed to really want that. And so we went back to the factory in Germany, and we said, this is a feature that lots and lots of customers really want. And so we were able to build that into our next generation of products. Yeah. All right, Jeff. We've got several callers waiting patiently to ask us for some advice.

So hopefully we'll give them some good advice. Are you ready for our first caller? Fingers crossed, of course. All right. Let's bring in our first caller. Hello, caller, please introduce yourself. Tell us your name where you are calling from and a little bit about your business. Thank you for having me.

My name is Uli Nasibova. I'm calling in from Los Angeles, California. I'm the founder and chief everything officer at Uli's gelato. I make great-tasting gelato with locally sourced ingredients. Nice. And I used to sell my product in my two brick-and-mortar gelato shops that I closed during the pandemic. And today I sell Lee's gelato pints and single serving cups in grocery stores. Okay, amazing.

And what's your question that you brought for us today? So my question is the following to you, Jeff, and to you Guy, as the brain trust of the American entrepreneurial experience. Oh boy. Here we are. Awesome. There it is. What questions would you be asking yourselves if within your business, you kind of had

two revenue channels that were constantly competing against each other, but were also very necessary at this point in my entrepreneurial journey. And I can expand on that a little bit too. Yeah. Can you just briefly expand on it? Where are the competing revenue channels? Sure. So I sell my pines and single serving cups to grocery stores. It is a very capital heavy process because I have my own small manufacturing facility. I have staff. I have to manufacture my product from zero, package it up, deliver it to distributors or to grocery stores directly. I do both and then wait to get paid. And then at the same time to fund my business's operations, I do a lot of catering and I do a lot of kind of high touch, white glove catering

requires a lot of email, phone communication. It is a very difficult situation to be in. It's a great situation to be in because, you know, I lost my two gelato shops and now I have these two great opportunities in front of me. But every week when I'm putting together my production plan for the week, I have to make very difficult decisions about whether I'm going to be dedicating my and my staff's time to catering, which pays up front, or to manufacturing these large orders and then, you know, wait 45 to 60 days. Got it. To get paid. All right. So let's talk a little bit about the business.

When did you, how did you get into this business? How did you get into the ice cream business? Great question. I love food and I am an immigrant. I came to United States as an international student. And my biggest culture shock was how bland everything tasted when I went to markets. Where did you immigrate from? I am from Baku, Azerbaijan.

Oh, wow. Okay. Cool. Yes, I came to United States at 17 because I got a full scholarship to go to a wonderful liberal arts college, Colorado College. But one of the first grocery store experiences that I had in United States was at Walmart. And at the time, at least in 2001, the taste quality maybe wasn't there. I love ice cream. And a lot of times when I would buy a pint of strawberry ice cream, I would be eating it and saying, well, where's the strawberry?

I'm searching for the strawberry. I can't find it in there. And I started making it myself. And then I was working in investment management, and I wasn't very happy with my career path at the time. It was necessary, doing the necessary thing to fund what you really, really want to do. And eventually I quit my job and used my savings to build my first gelato scoop shop in kitchen. Amazing.

What a cool story. Okay, so you make gelato under your name, Uli's gelato. start the business? I started my business 12 years ago. Nice. All right. So tell me a little bit about the scoop shops. I mean, it's a tough business. What happened? Was it the pandemic? Was it, what was going on? So what happened was that during the pandemic, the foot traffic in my two specific locations really suffered. And a lot of my business was the lunch crowd, people who worked in nearby offices, and then, you know, they would get a sweet treat. Also at night, we would get a second rush, people after dinner looking for dessert. And the food traffic never recovered. In fact,

a lot of the buildings in my neighborhood would file for bankruptcy because they still have a lot of trouble with their occupancy rates. Wow. So you had to shut those down. And then at that point, you pivoted to wholesale? Yes. I shut my stores down. It was a very difficult decision for me. I probably took a little too long to do it because I was just so attached to the idea of I'm going to make it. I'm going to make it. And then when I finally shut them down, I wasn't really ready to quit. I got a ticket from an industry contact to Expo West in Anaheim. And I walked the floor and I looked at all the different products. And I said, mine is so much better. Sorry. Sorry, not sorry. I can do this. I am not ready to quit. I can just package it differently.

I can sell it to grocery stores. I can do whatever it takes. But I'm just not ready to quit quite yet. Got it. Okay. Jeff, questions for Uli about the business? What's the relative size of the catering business versus your new grocery business? I would say last year catering was more than half of my business. And this year, it will be just under half. I'm on your site right now. Willie, what are your favorite flavors? Or what are the bestsellers? My bestseller is my fresh mint strachatella, which is my take on mint chip. I pick mint leaves off the stem. I do not use mint extract. But my business is scalable. We just, you know, do a little bit of more prep on the front end. Because customers

deserve to have great tasting gelato. That's my mission. Yeah. And sometimes that means a little bit more work. I mean, I'm looking at your website. Really nice design. Love it. And I see you voted best gelato and best ice cream in Los Angeles two different years in a row. And I'm looking at the flavors, like, you know, just really interesting. I mean, you know, bee pollen gelato and saffron gelato, yogurt, cherry gelato. I mean, olive oil, there's some really speculous cookies. Espresso with waffle bits. I mean, it's some really cool stuff in here.

I don't see anything on the site that tells me that you pick the mint leaves for six hours and steeped them in the milk. I don't, I want to know that. I want to see something. I know this is not exactly your question. But if there's a way that I can just see something right away on the landing page, like a little video of you like steeping the things or just or just like a little, I don't know, infographic explaining like what makes your ice cream different because clearly this is this next level ice cream. We're not talking about Baskin Robbins here. You're absolutely right. My website, I did it as quickly as I could.

Yeah. And, you know, there was this whole thing during the pandemic when everyone was going into DTC. and thought they were automatically going to be the next unicorn. It's a little trickier when you have to ship with thick liners and dry ice and all of that. But, you know, that's what we threw together with the resources that we had. But it could be better. I probably haven't mastered the messaging as well as I could. How many people do you have working for you?

So there's only three full-time employees, including myself and two part-timers. for catering. Got it. And do you think you could make your catering business bigger? Oh, yeah. Like if you doubled down there and said, hey, we want to triple the size of our catering business, make it really profitable. Do you think you could do that?

Oh, yeah. In the beginning, I would probably have to invest a little more into catering equipment and, you know, viral covering. Yeah. The one thing that is nice about the catering business is that you have a sampling opportunity for hundreds of people in that environment. I guess like it sounds like you've got a couple challenges. One is like a just total capital challenge. How do you make this business really make money? And then it also sounds like you have a financing

challenge. Like how do you finance your orders? Where my head was going a little bit. I don't know, this might be silly idea. And so take the input as just just that as input, which is if you're able to really scale your catering business, could you hire someone to run that for you? And if it's a very profitable business, presumably you could have someone who took that and really grew it for you. And that became kind of a sampling and profit engine for your business. But you could spend 10 or 20% of your time there. You know, like, and then in the interim, the huge opportunity is making this a national gelato brand.

And so then the question is, well, how do you finance that? And, you know, there are two ways to finance it. Well, three. One, there's profit from your catering business if you can scale it. and scale it without spending much time on it, right? So like have someone come in and really own that for you, which is an exciting job. People love ownership of things.

Like, hey, here's a huge mandate. We have a catering business. It's crushing it. Triple it. You're the CEO of the catering business. And you really let them go build that for you. So you can finance it with profit from your catering business. Or you can raise outside capital.

And outside capital can come in one of two forms. You can come in equity capital. And this has a tricky market right now to raise, you know, outside capital. capital. So unclear on what terms that comes and how much you need or could come in debt capital. And what's kind of interesting about what you said is the financing that you really need is receivables financing. It's, you know, you have orders. They've been placed. You just haven't been paid. And there are a bunch of people out in the world that do just that receivables financing. Now, the bigger your business, the more likely it is to be able to get that receivables financing.

So I get you have a bit of a chicken and egg issue. But I would imagine that there are people out there that are willing to lend you money at some rate. And you might not love it to start, but it'll come down over time as you get bigger for just that receivables financing. It's an issue we struggle with that Harry's. You know, we sit on a bunch of inventory and have a bunch of receivables from large retailers. And the way that we pay for that is with debt financing.

Because people know at the end of the day that like their money good. Like, their risk is that Whole Foods defaults on their payment to you, which is a very low risk. And therefore, they're willing to lend at pretty attractive rates against things like that. And so that might be a thing to consider just to unlock more capital for you to be able to go scale nationally. Okay. So I think that I'm going to disagree with that. I'm going to take a slightly different position to Jeff. Because Jeff suggests maybe you look for some, you know, some loans.

And I'm, and you could do that. But I think, because one of your questions is, how can I get another one of me willing to hustle like a maniac? And I think the answer to that question is, find somebody and give them a part of your business. And the person you find, if you can find somebody who has experience working at an ice cream brand, you know, a Jenny's or, you know, Ben and Jerry's or something. I don't know if you heard our advice line a couple weeks ago. We had this, one of the co-founders of Kava, the Mediterranean Foods brand. And it was one store in Rockville, Maryland. You know, when the three original founders found their fourth co-founder, he came in and he saw this as a national chain.

He saw this as something so much bigger. You've got this really cool brand. You make great ice cream. But you need, I think you need somebody who has some experience working at a bigger brand. Is that something that you would consider doing? Absolutely. Absolutely. I would love a co-founder.

I know my strength. I know what I'm good at. And I know areas that need help where I'm just not enough. For what it's worth, I totally agree with what guy said. And I'm not sure that our suggestions are mutually exclusive. No, I was just trying to create some tension in the conversation. I love it. I totally love it.

And I'm just saying yes and. Like, but you should totally do that. And someone who knows how to work with these retailers, too, to build scale and big programs and sell the right products and all that's like there's a lot of know-how there that you could hire or bring on to your team as a co-founder or whatever the right title is. I think that would be hugely valuable. Absolutely. And then eventually figuring out the partner will help you figure how to scale it, right? Because the value proposition here is this is special because it's a premium product and you have to, you have to screen. that from the rafters. Every time you see Uli's, you need to know that this isn't just another

ice cream brand. It's like really special. I think so. All right. And if this happens, if this goes national, me and Jeff get at least 10 pints each. Yeah. That's it. I thought you were going to ask for 1%. Oh, yeah. I got you. No, no. I just want some espresso gelato with waffles. Easy. Maybe some California pistachio. Yeah. done i could make that happen in a dry-iced box tomorrow all right uly thank you so much for calling in it's uli's gelato good luck and uh yeah keep us posted thanks really congrats thank you guys yeah the brand look to your point the brand looks really good i think just that's really good right storytelling around it and then real support and scaling that was such a good idea around finding someone who's seen

the next evolutions of the business to help her get there because that'll be so invaluable. Even if she gives up half of the business, it's worth it because this is really a turning point. And if you find the right person who understands the opportunity here, I mean, this is a, and you know, ice cream is a pretty crowded space. But people said water was a crowded space and look at liquid death, right? They understood that you can figure out how to position it in the right way. I mean, if people see this, I think there's, there's an opportunity there. Totally. And if you've got a great product, that should do so much for you. You know, and it seems like she has a really great product. All right, Jeff, we're going to take a quick break, but when we

come back, an upstart package delivery service that just brought on employee number two. Stay with us. I'm Guy Raz, and you're listening to the advice line right here on how I built this lab. Welcome back to the advice line on how I built this lab. I'm Guy Raz, and my guest today is Jeff Raider, co-founder of Harries. Jeff, let's take our next caller. Hi, guy. Hi, Jeff. Hello, welcome.

Tell us your name. Tell us where you're calling from. And a little bit about your business. My name is Travis Leahy. And I am the founder of Bundle. Bundles of Boulder, Colorado-based business. And we are a service provider for large multifamily properties. And we provide on-site package management and deliveries for those properties.

Cool. And Travis, what's your question? So as I'm bringing on new people to the team, I have been solo for so long now. And I'm trying to adjust to that. And I'm not going to be the one serving all 500 plus of our residents anymore. And so how does Bundle deal with that change as the business grows? All right. We're going to get to your question a moment, but some questions about Bundle. So basically you deliver packages at like apartment buildings or condo buildings? That's correct.

So as Amazon and UPS and FedEx each day, they show up and they can deliver up to 100 packages a day for these properties. And it overwhelms the staff, residents aren't happy, packages get lost. So bundle comes on site once a day and actually manages that problem for the property. Got it. Okay, a couple questions. I mean, aren't big buildings already doing that if they've got like an association board or if you're paying monthly fees to live in the building? don't they already have a staff that just gets all the packages into it into the mailroom and then just like distributes them? Yeah. So kind of that 100 to 300 unit complex is our target client. And for the most part, those properties, they have two leasing agents and they have two property managers.

And where we're at is the ownership groups, they don't want those people to be managing packages. So maybe in an 800 to 1,000 high-rise unit high-rise building, they might have a staff dedicated to this. But the smaller properties do not. So they're willing to pay you a fee, which means that the people living in the building are willing to pay you an additional fee to handle that job. That is correct. Got it. Okay. Jeff, any questions for Travis? One more clarifying question just in terms of how the actual flow of goods works. So they deliver to a bundle location.

and that's like a bin or something in the building? It is a room for the most part. A room? Yeah. So we take a utility closet or something and we retrofit it. Got it. And then you have someone come, take all the packages, and drop them at the individual doors.

Exactly. Makes sense. And how many employees do you guys have now? So, Bundle, I actually just onboarded my newest employee. His name is Hunter. And he's going to be our COO and he's the second employee. Nice. So he's a C-O and also your other delivery guy.

That's correct. I love that. And you're the CEO and delivery guy. That's correct, yeah. And when did you start this business? So bundles started a year ago in May. And so for about a year, I was managing all 388 of our units by ourselves doing door-to-door deliveries. Cool.

You know, Jeff, this reminds me a lot of 1-800 got junk. We had Brian Scudamore on the show years ago and was so beautiful and elegant about that business. was their very low startup costs, right? It was just human labor, a truck. He would buy a truck for $6,700, $700. He'd haul people's crap away. After five or six of these jobs, he would have paid for the truck. And so it was really a smart business because he could scale it as he did more jobs. He could just hire more trucks and more people. And so it's a really interesting idea. I wonder, Travis, how much does this cost people living in the building? What's our fee? So the fee to the residence, it is typically around $15 per door per month. But that is totally up to the building, how they charge it back, because our contract is with the building.

All right. So you are trying to figure out how do you keep the high quality standards of your service when you've just onboarded another guy and it's your baby, it's your business, and you put a lot of care into it. And presumably you're delivering these packages, white glove with care. And so the question is how do you maintain the quality of the service? I think another way to ask this question is, how do I delegate, right? And so, Jeff, do you want to take a crack at this first? Sure. Maybe one just clarifying question, because I think that thing that guy mentioned was super helpful around quality is how do you evaluate quality?

Is it timeliness of service, completion rate, the personal relationship with the person? Like, I guess how do you think about what a great service experience looks like? So if I'm being honest, as a small business, we haven't really set those quality metrics yet. However, with me being the primary service provider, I believe what I wanted to look like is for the bundle employee to show up and know the majority of residents by their first name and be able to talk to them and set expectations with them. And then, yes, completion of deliveries. So we have now delivered over 10,000 packages and we haven't had one go missing. Got it. That's great. And so you are, I mean, you're doing a lot of this yourself.

And by the way, how are you, like, what is the value add aside from bringing the package to their door so they don't have to go to the mail room? Is there other, is there like, can they track their packages through you or anything like that? So I would say the primary value ad is our online resident portal. So now that subscriptions and things like that are such a massive part of e-commerce. A great part, I should mention. Absolutely. And definitely something that has helped bundle as well. But we now will accept delivery pause requests.

So residents, we will hold on to their package for as long as they need if they get a box delivered and it's going out of town. Yeah. Great. Jeff, I'm curious on this question of quality standards. Like, did you guys early on build sort of a brand Bible for what it means to represent Harry's? Not in the very, very early days. I think what we were doing was much more like what Travis is doing, which I applaud, which is to be the customer service rep yourself and to teach people what great looks like

by having them work with you, engage with you, follow you, and then hire incredible people who can take that forward. Over time, we totally did. We thought about CX experience across a number of dimensions and then started to measure customer satisfaction. But a couple of thoughts which I was. I think one, I love that you're the first delivery rep. I think that goes a long way and that you're setting that standard.

I think two, the first people that you hire at the company are going to be so pivotal setting the culture of the company. You know, when businesses get bigger, you can have values and behaviors that you really want people to live by, but in the early days, lots of it is like really tribal culture. You know, it's people looking to you and the other early employees for signals of how to act. And so I think taking a tremendous amount of care and who those people are are, are really, really, is really, really important. I mean, I wonder whether there's value.

And Travis, I imagine you are in over your head. You are just so busy all the time. Yeah. But I wonder if there's a world where you start, maybe you do one page a night or half a page a night, and you start to build like a Bible, right? Like a guidebook on what it means to be a bundle representative. And make it granular.

You know, where, I'm looking at your website. I see a video of this dude. Maybe it's you. Is it you in the video? That is Hunter. That is the C-O. That's Hunter. Okay.

You know, he's got like a shaggy-do and he looks like a cool guy. He's got his backwards hat on. He's got his bundle shirt on. So maybe you've got like a thing like, hey, you know, we want to be friendly. We want to look approachable. You know, this is how we talk to people. We smile. We ask people how their days going. Like, you know, Trader Joe's, man. Trade Joe sucks if you're an introvert because you have to talk about your whole life story with the person of the register because they're so nice. And they're like, oh, you're getting making pizza tonight. And you're like, oh, you're getting making pizza tonight. And you're like. like, yeah, you know what I mean? But it's kind of amazing. It is kind of amazing that they've managed to do that. It doesn't matter what trader Joe's I go to. I'm always experiencing that. Chick-fil-A, same thing. They're so friendly.

So to me, there seems to be value in actually writing it down in a document. Absolutely. I agree. And then I think the other thing I might encourage you to do is, you know, before Hunter goes on his own, have him follow you for two weeks. Do it together. Like take a lot of care and onboarding. And then the next couple people that you hire, have them go with Hunter for a while.

That's going to mean you have to grow a little bit more slowly. But I think quality is so important to your business. And then I think if you give it enough time, what you'll start to see is that these edge cases will pop up. Someone will have a experience that's tricky and you won't know how to deal with it. And if someone can see you or a hunter work through that problem, I think that sets culture in a really, really, really important way. Yeah. And then I couldn't agree more with starting to write these things down. just because as you scale, not everybody's going to get to know you, but they can read your words,

just as you've written them in a set of principles that you have. Absolutely. The last thing I would invest in is really measuring its satisfaction. And so how can you systematically start to survey your customers, understand how they view your service and their experience, create some set of standards that you want to sort of live by. And instead of a set of metrics say, hey, listen, we have a 97% percent. customer satisfaction. If there's any building that we're less than 95, that's a red alert and we're going to go jump in. But that I think will enable you to sort of understand how you're doing on a consistent basis for your customers. And that measurement can be very helpful in terms of then

coaching people on your team to make sure that they're delivering at that level and measuring their own performance. That could become part of their performance review for lack of a better term. Yeah, I completely agree. I think that's all amazing advice and things that bundle definitely needs to start working towards is having guides in place and just systems that we can follow and any new person can come on board and immediately take that and be successful at Bundle. Amazing. All right. Well, we're going to be following you, man. Travis Leahy, bundle. Thanks so much. Congrats, Travis. Yeah, thank you both so much. All right. Good luck, man. Wow. Pretty cool. I think what you said about 1-800 junk and the scalable of the model here resonates.

Right, because it's just you're, it's you start with your labor. And then, I mean, I guess they have some fees with, you know, sort of the tracking system they're using. But it seems like it's probably an off the shelf, relatively inexpensive product that they're working with. Totally. Anyway, Jeff, we're going to take another quick break. But when we come back, a children's book subscription with a delivery every full moon. Stay with us. I'm Guy Raz.

And you're listening to the advice line right here on how I built this lab. Welcome back to the advice line on how I built this lab. Today, I'm taking your calls with Jeff Rader, co-founder of Harry's. Jeff, let's bring in our next caller. Hi, guy. Hi, Jeff. Hello, welcome. Please introduce yourself and tell us where you're calling from and just a little bit about your business.

My name is Carly Bonfonte. I am calling from Los Angeles, California. And I am the founder of Full Moon Ferry, which is a children's book series and trinket subscription that's very immersive and interactive and meant to be experienced on every full moon. And we also do a line of premium organic stuffed animals to bring these characters and these stories to life. Cool. And what's your question?

So I am a solo founder. I'm self-publishing. I'm self-funded. I'm trying to do it all myself. And I'm currently gearing up for now a D to C launch. And I really am just wondering how I can create a really magical launch for full moon fairy.com. Cool. All right. Well, a couple of questions before we dive into your question. So this is a, it's a subscription model. There's a book. Yeah. Parents read the book to the kids. But they also get some trinkets. And then when the kid goes to sleep at night, they put it like under their pillow like the tooth fairy.

Yeah. We say in our family, it's you put your shoes out. And the full moon fairy will just come and drop a little trinket in their shoe to be discovered in the morning. And do you do this on the full moon? Yes, yes. So the first book in this series tells the story of Fay, the full moon fairy. And she visits children and brings trinkets for them to discover in the morning. So every month, Fay goes on an adventure with another nocturnal critter friend. And there's this an adventure to be had.

and then the kids wake up to these trinkets that are kind of, there's a nod to something in the book that they'll discover in their shoe in the morning. And are you the writer, the author of the stories? So I actually, back in 2022, when I first thought of this concept, I actually invited a good family friend of ours who is the writer of Toy Story, the first Toy Story, I invited him to lunch. And I told him the concept and I was like so excited. And he got so inspired and excited. And he actually was like, I want to help you write these. This would be so fun, such a fun project to work on. And so we ended up kind of brainstorming back and forth.

He ended up having too many other priorities. But he introduced me to a gal that he'd been mentoring. And so her and I have been really working on bringing these to life together. Tell me what you were doing around the time you founded this. I mean, I'm assuming you work on this full time now. I do. I actually lost my day job back in January. And so, you know, I'd been at this as more or less like a passion project, side project for a little over a year prior to that. And then back in January of this

year, I thought, you know what? What the heck? I should go for this, you know, let's see what we can do here. So I've really been trying to ramp up to really launch soon any day now. And what were you doing? Tell me a little bit about the work you were doing before. Yeah, so I've been in fashion and wellness for a little over 20 years. I've primarily worked on the wholesale sales teams for brands. So if I was working for Manduka, I would be selling to, you know, Nordstroms and yoga works. And then I've worked for other large brands like Seven for All Mankind and True Religion. So my product background ranges quite a bit. And where are you getting the books and the trinkets and stuffed animals made? Do you have, are you working with factories in Asia? Yes. So my books and trinkets are being made in Asia.

And then the stuffed animals are actually all handmade in Nepal. So there's two different factories that I'm working with. And this is totally self-financed right now. Yes. Yes. Which is, I mean, every day I'm like, oh, my God. This is totally insane, you know. But it's a pretty big undertaking.

Jeff, questions for Carly. And Carly, you mentioned you have kids. I do. I have an 8-year-old and a 6-year-old. And, you know, so when I started this a couple years ago, they were really right in that sweet spot of the magic years, is what I call them. That's so cute. My kids are just a little bit older, and the tooth fairy, I think, just died for the last

one of ours, like, but for the longest time, we believed, and it's the sweetest. So I empathize with the magic years. Yeah. And then you mentioned you're launching soon, like imminently? Yeah, so the website actually just went live as like a soft launch. And then I'm really ramping up for an August ship date for the first book. But I have been seating this and kind of selling to my smaller network for a while. I got some advanced copies late last year of the books. And the reactions have been amazing, which definitely fueled my passion and my excitement to really go for this. Great. And so your question, of course, is an important question and a good question for Jeff about customer acquisition and then subscription retention. You're hoping to launch this in August. You want people to subscribe to this so they can get a book every month and then leave a trinket for. By the way, I have blamed the tooth fairy on many occasions when I have forgotten to leave the money under. I know. I was like, wow, she completely forgot us. She, this is personal. I'm going to find out what's going on.

It's tough. We're doing a lot, right? Parents were like juggling it all. And the last thing I want to do is layer one more thing. But the beauty of this is the full moon can last a few days, you know? Yeah. That's true. Yeah.

Oh, it's still a full mood. Yeah. Yeah. Look out there. Yeah. Looks full to me. So, Jeff, let's talk about customer acquisition and then maybe we divide it into subscription retention into two. Where does Carly start? Yeah, so I think in the early days, one of the thoughts

I'd have for you is to start with your own network and your friends. They're the people who are going to be the biggest advocates for the brand because they know you and they know your story. And then figure out how to get them to tell their friends and their friends. When we started Harry's had this crazy idea to build this referral campaign. And I think a lot of other people have done similar things and maybe now it's, you know, many years later and a bit played out. But when we started, we're like, we just want to tell all our friends about this. And then we're going to give them incentives to tell all their friends about this. And then their friends, we turned into a game. Yeah, that's a great idea. What did you give them? What was the incentive?

Graduated, it was like graduated reward. So if you told five friends and they came back and they had like your link that you got free razor handle and up to, I think, 100 friends you got like shaving for a year. And it was this fun game. They're great. And I can't underestimate like, just the importance of doing that and building community. And then I'd imagine there's lots of other communities out there that you could tap into. Rather than spending a lot of money on marketing day one, I think about what are the communities that you can tap into just to build awareness of this around groups of parents that you can just start to spend time with who can get to know you and you tell your story.

That might mean you grow a little bit more slowly in the other days. But I think what you get from that is you get to start to really understand how customers feel about your products and how they talk about your products. And then you can use that as kind of the core of any of your future marketing campaigns. Yeah, I'm definitely looking to create, you know, the super fans, if you will, or the people that are really going to be like long-term supporters. So that's a great, that's really, really great advice. You know, and if you can reach a few hundred people to start and they tell a couple more

people and then you can build this great loyal customer base. And then it gets down to this retention point, which we can talk about a little bit. But then how do you make each of those people have such an incredible experience that they want to go talk about it to others? Right. Yeah. You know, you mentioned that you worked for Manduca, and we had Peter Stereos, the founder on the show a couple years ago. But I remember that the way he got Manduca out there, right, because there were a bunch of yoga mats available, was he got them in the hands of yoga instructors. Right.

And they could see that these were different, that the quality of the material was different than, then students would see the yoga teachers using these mats and they would say, how can I get one? And that's really how they built it out. Now, obviously, you're not, you know, this sort of an apples to oranges comparison a little bit, but not totally, because if you can get it in the right hands of people, certainly, you know, mommy bloggers, I hate that term, but it's still a term that you hear, right? You've got to get it in their hands for free. The other thing, I think, could be really interesting. And Jeff, you could speak about this too, because I know you guys, a big part of your business is a social mission is can you include a charitable element? Like for every subscription, we send a percentage to, you know,

make a wish foundation or some other group that brightens kids' lives, something like that. Yeah. I think there's still such a draw for socially conscious brands that are doing good and giving back. So that's a great call out. Yeah. Harry's, we give one percent of our sales to organizations that support men's mental health, which makes us feel great about what we do every day as a company. But I think to guys point, it also gives people another reason to talk about the brand and to tell others about it. Yeah. The through line in all these books is really taking care of each other and taking care of the earth. So I think there's something there for sure of like, whether it's, you know, we do something on Earth Day or we do something,

you know, along those lines, which could be really meaningful. And when you build that in really early, it's a lot easier than having to kind of start later just because it's part of the business model. And then I love the idea that I had around talking to mommy bloggers and other people, highly engaged people in the community. I think that that's a great audience for you. And as you start to get customers, I think what you'll try to start to figure out is like, who are your best customers? Like who are the people who love this the most? Right. You know, what is it about them that's different from other people?

How old are their kids? What is it about their kids that's different? And then you can go to people like that in the world and say, hey, you're going to be someone who loves this, which I think will then create even more virality because you're going to the people who you think love it. The other thing that we did earlier at Harry is when we started to advertise was we looked at all the things that our customers were saying about us and that press and other people in the world were saying about us.

And we tried to find nuggets of things that were interesting that we could talk about in the world. And, you know, when we launched, we were very fortunate GQ in the magazine of GQ at the time, wrote an article about us saying that your Dopp kit just got handsomer. and we created an ad that said handsomer. We liked that word. We thought it was funny. We created an ad that said handsomer, sharper, or less expensiveer.

And we put razors under each of those words. We put it out. And that was our highest performing ad in the company for our first couple of years. Yeah. So good. And so I think there's like so much magic in learning about how people talk about your product and your brand and then turning that into the messaging that you can put out in advertising communications and on your site, et cetera.

And I think where the world is shifting a little bit today versus where we started is maybe it's not, you know, a banner ad on Google or something. Maybe it's having the right things to say to someone who is a paid influencer on, you know, a social platform who can go out and just talk, tell their own story about the product and the brand in a way that's interesting. And those places seem to be getting a lot of reach right now. Great. Yes. Thank you so much. These are very valuable nuggets. I really appreciate it. Carly, thanks so much for calling in. The brand is called Full Moon Ferry. And we'll be, we'll be watching. Yeah.

Good luck. Thank you guys. Thanks so much. And you got a customer here. Awesome. I love it. Thank you. Awesome.

You know, this question about customer retention, which we weren't able to kind of get into sort of too much depth, in part because I think acquisition is really it's where she needs to put her focus on now. But I feel like a lot of brands learn this lesson late, which is they focus too much on customer acquisition at the expense of customer retention, right? And retention is really where the end of the day, that's really where the value is. Totally. I couldn't agree more. How that kind of math works in any business is higher retention rates are in a customer, the more valued customers are to you. And then the more you can spend on acquisition to acquire them.

At the end of the day, you can only spend to acquire a customer as much as those customers are worth to you. One thing if Carly is listening, I would say, is like, she should be very involved in the early retention efforts. Like, I mean, how cool would it be if the first 100 customers of Full Moon Ferry got on the phone with her? Yeah. And, you know, or she personally reached out and emailed them and said, hey, thank you. Yeah, I agree.

Jeff, thank you so much for coming back out of the show and for being on the advice line first time. Thank you for having me. It's always inspiring to get to spend time with you. And gosh, so cool to hear these different stories. Yeah, it's super cool. And by the way, if you guys haven't heard the Harry's episode, you have to go. go back and check it out. It is so good. You can find a link to it in the podcast description. Here is one of my favorite moments from that interview. We tried to convince them that like we were

legit. And then we committed to buying a million razor blades, which for them at the time was like a meaningful number. But I mean, when you made a commitment to buy a million razors from these guys, did you have millions of dollars at that point to give to them? No. No. Thank you for listening to the show this week. If you are working on a business and you'd like to be on the show, send us a one-minute message. Tell us about your business. Tell us about the issues or questions that you'd like help with. We'll do our best to help you. And please make sure to tell us how to reach you. You can send us a voice memo at hibt at id.wondery.com or you can call 1-800-433-1298 and leave a message there. And don't forget to sign up for our free newsletter at gairoz.com.

It's full of awesome advice from entrepreneurs like Jeff Raider and some of the other amazing people that I've interviewed on this show over the years. This episode was produced by Alex Chung with music composed by Rumpstein Arablewe. It was edited by John Isabella and our audio engineer was Neil Rouch. Our production team at How I Built This also includes Carla Estevez, Casey Herman, Chris Messini, Elaine Coates, J.C. Howard, Catherine Seifer, Carrie Thompson, Sam Paulson, and Eva Grant. I'm Guy Raz, and you've been listening to the advice line on how I built this lab.