How I Built This with Guy Raz - Advice Line with Steve Holmes of goba Sports Group

Episode Date: May 29, 2025

Springfree Trampoline founder Steve Holmes joins Guy on the Advice Line, where they answer questions from three early-stage entrepreneurs. Plus, Steve’s tariff navigation guidance for businesses manufacturing products outside of the U.S.First we meet Ikechukwu in Maryland, who’s trying to lean into a core demographic without alienating customers from his activewear brand. Then Cody in Nevada, who’s building a year-round advertising strategy for a largely seasonal product: DEET-free bug repellant. And Kenesha in Ontario, who’s looking to maintain the momentum of a viral moment for her Caribbean-inspired chocolate.Thank you to the founders of Veii Apparel, Grand Tongo, and One More Cocoa for being a part of our show.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 be sure to listen to Springfree Trampoline’s founding story as told by Steve and the trampoline’s inventor Keith on the show in 2019.This episode was produced by Sam Paulson with music by Ramtin Arablouei. It was edited by John Isabella. Our audio engineer was Gilly Moon.You can follow HIBT on X & Instagram and sign up for Guy’s free newsletter at guyraz.com or on Substack.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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walking distance from so much of the city, made it feel less like a visit and more like we were actually living there. Plus, taking a trip is the perfect time to host your space on Airbnb. Your place with all of its personal touches and its amazing location could make someone else's vacation even better. Your home might be worth more than you think. Find out how much at Airbnb.ca.com slash host. 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 have. help me try 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 newslet. letter, it's full of insights and ideas from the world's greatest entrepreneurs. You can sign up for free at guyraise.com. And we'll put all this info in the podcast description. All right. Let's get to it. Joining me this week is Steve Holmes. He's the founder and chief activity officer of spring free trampoline. Steve, it's great to have you back on the show. Hey, it's great to be here. Thank you, Guy. So we first met. You came to San Francisco. We did an interview in person back in 2019. You and Keith Alexander, who was the inventor of the spring free trampoline.

And if you guys haven't heard that story, we'll put a link in the episode description. It's a great episode about invention, about partnership, about building something of real value. You realized it was such an amazing invention when he came across it. And long story short, you ended up buying the patent from him. You went on to launch spring free trampolines around the world. And here we are today. Yeah. And we're still having fun.

You know, our Goba sports group, we exist to inspire joyful moments. And, you know, we have had so much fun over the years watching kids and families have joy in their backyard. So it's been a lot of fun. And I know a lot of people know these trampolines. Trampolines are, they're like, it's one of those things that doesn't have a brand often attached to it. But Spring Free really was one of the first where there was a brand name attached to a trampoline. They're different because they're spring free. You're not bouncing on springs that you can fall through.

And I think your research shows dramatically fewer injuries. The technology is so remarkable because it's made out of material, basically a glass material that allows it to really bend and bounce like springs. You've actually repurposed this technology. You're working on repurposing it for a completely different use case. Yeah. amazingly, and we're having a ton of fun. We've built a very, very large facility in North Carolina and focused on build America and buy America.

And we make rebar out of glass. You make rebar for buildings. Yeah, rebar for buildings, for driveways, and it never rust. It's twice as strong as steel, and it's one quarter of the weight. And it's available in every low store in America. It's called Green Bar 2X. And it is really revolutionizing the construction space. All right, Steve, I know that you are manufacturing this rebar in North Carolina.

But of course, some of your products, Spring Free manufactured overseas. Let's talk about tariffs now because tariffs are posing an enormous challenge for toy manufacturers, apparel companies. Anybody particularly is working and making products in China. Tell me a little bit about what's going on right now for you guys. So you go back to my phrase that I have, and I don't own the phrase, but I keep using it, which is nothing outside of my control will get in my way. So the first thing is when the election was taking place in the U.S. And there was talk of tariffs, we go back to some of the things that I've even shared with you in the past during COVID,

generate cash, preserve cash to invest cash. We had enough cash that we loaded the U.S. market with product. So much so, we were bursting at the seams and everybody was saying to me, are you nuts? Do you know how much inventory we have? I said, we don't have enough. Keep shoving it in. And so we got a lot of product in the United States pre-tariff. We still had a tariff, but it wasn't onerous.

It was 12 percent or something like that. But we got it in and that was good. So now what we're doing, interestingly enough, is we're looking at all of our global channels in a new way. How do we do that? We've made some significant investments in Europe. We've made some significant investments in other parts of the world. But in the meantime, I mean, you can't overnight create a trampoline factory in North Carolina or in Germany or, you know, New Zealand. Look, I'm, you know, we've invested so heavily and their family. Like, I'm not running away from China. It's not that easy. We've done.

too much. So we're really hopeful that there will be some resolution. Resolution, resolution, and simultaneously, you can't just put your head under a pillow and think that this is going to go away. Now, those people who don't have cash and are unable to preserve cash, we will see them as casualties in this marketplace. And that's a sad, sad statement. But it is one of the things that's so hard. I mean, you and I both know Guy that one of the greatest gifts to America is they're entrepreneurs. And I just hate it when I see young entrepreneurs who are so committed facing some of these dilemmas that are preventing them from employing people and driving value. Yeah. Well, we will see how it all plays out. And it's interesting times, as they say.

Well, one last comment on the tariff thing. What I would say to the founders like me, get yourself connected to a group of like-minded people, whether they're in the same industry, opposite industry, and continue to have a dialogue and sound it out. It's absolutely essential. Yes. You cannot solve this alone. Now actually is a great time for competitors to come together. It's a great advice. Okay.

Steve, let's go ahead and take our first caller, bring in our first caller. Hello. Welcome to the advice line. You are with Steve Holmes from Springfrey Trampoline. And please tell us your name where you're calling from and just a little bit about your business. Hello, guys, Steve. My name is Ike Chukuagu. I'm calling from Prince George's County, Maryland, and I'm the founder of Vey Apparel.

We're an activewear brand for the culture, specializing in hybrid designs that merge fitness and fashion to help you look different, move different, and be the difference from the gym to your everyday life. Welcome to the show. Ike Chuku. Yeah, you can call me Ike for short. Ike. Okay, thank you. Awesome. Thanks for calling in.

I like, welcome to the show. So it's V-V-E-E-A-A-A-A-A-A-A-A-V-E-I. And this is a brand that you started. Tell me a little bit more about the brand. Yeah, for sure. So I started the brand in 2019 when I was a student-athlete at the University of Maryland. I actually started it after I met the founder of Under Armour Kevin Plank. He's an alumni of the school, and he also played football. And he came and spoke to my team one time, and he was like 20 years ago, I was in the same seats at the same school, playing the same sport. And like when he said that, when he started the brand, he was in my same position,

it kind of like lit a light bulb in me. And none of my other teammates really paid attention to it. But like, for me, I just kind of saw him as no different from me. And I knew on that day that I wanted to create a brand very similar to Under Armour, but that really represented and authentically spoke for people that come from similar experiences and backgrounds is mine. So that was my mission. And it's interesting because Kevin Plank, like you, was a very good athlete because he was good enough to make a division one football team, but probably already knew in his first year he was never going to go pro.

Yeah, exactly. And probably similar to you. Like, you knew that, but the great advantage is you have all these guys that you're connected with, some of whom will go pro. And you might be able to get your product in their hands. Exactly. Yeah, literally my best friend and my position mate, he now plays for the Buffalo Bills. His name is Ty Johnson. And he was my first model when I started the brand.

And then he got drafted when I started the business. And now he's like one of my, you know, my first investors and he wears the brand and gives it to his teammates and stuff. So it's a, it's a great partnership. So you started this in 2019. It's, it's performance apparel and it's like what? Like shorts, shirts and made from like sweat wicking material. Yeah, exactly. Yeah. So we have a multitude of products. Mainly products that are blended. So polyester, spandex, cotton blends. So like you can work out in them, but then you can also wear them in your day-to-day life as well. And sold entirely D-2-C to your website?

Yeah, so a majority of our sales come from D-2-C, but we also have partnerships with specifically Gold's Gems here in the D.C. Maryland and Virginia area, and we're hoping to expand that across the region and then the country, because Golds-Gim is a great partnership for us. So doing, like, branded stuff for them? Yeah, honestly, we kind of just, we sell our apparel on consignment with the gyms.

We work with the owners of the gyms, and then we'll invoice them on a net 30. I'm looking at your website, and I notice a very prominent lion logo, like a lion main lion's head with a crown. Tell me about that logo. Yeah, so when I was starting the brand, I was thinking of what really felt like represented me

because I knew that the brand would come from my core, and I just felt like the lion is a symbol of dominance and being a leader and just leading from the front. So I wanted to use that logo as a symbol for the brand. All right. Take, tell us a little bit about your pain point, your challenges, and then we'll probably have more questions for you. What's your question for us? Yeah, for sure.

So my main question is, how do I continue to focus on my core audience, which is like primarily African-American men and women without putting the brain into a box or unintentionally alienating other groups who want to support what we're building? Steve Holmes, let me bring you in here. Before we answer Ike's question, any questions for him about the brand? Well, I too am on your website really quick. Looks fabulous. Thank you. Apparel's a tough game. How do you, how do you managing that inventory and that sizing and all of those issues? How are you doing? Honestly, it's just been trial and error. I'm actually like here in my warehouse now. We kind of just, I've been using YouTube University and learning since I started the brand. So just trial and error is putting things in the market seeing what people like and really getting feedback from our customers on a one-to-one basis from texting to calling them and emailing them. What about sales so far? Give me a sense of what you guys did last year. Yeah. So last year we did a quarter million.

It's pretty good. Nearly a quarter million in sales. Yeah. So we've been pretty much growing 100% year over year since I started in 2019. Now on your website, I look really quickly here. And you are premium price. So I mean, so how are you experiencing, like, the gold's gym? Is that the price point they sell at as well?

Like the same price as it's online is also the retail price? Yeah, so I would say we have different tiers of products that we sell. So our hero items, our stealth hoodie and our Infinity Cargo Joggers are our bestsellers, those are like very premium price. And then we have our more entry-level items like our graphic t-shirts that people would wear in the gym. And we bring those down to a price margin that people in the gyms would be receptive to. They wear the brand, people give compliments to them, and then they come back and

purchase more higher-tier items. I'm wondering about, I mean, I'm looking at the cargo joggers, which are, it's a great product. It looks very different from anything else out there on the market. And obviously, look, athletic wear, you know, athletic apparel is a competitive space, right? I don't believe in saturated markets. I believe in really good branding. And so, you know, you're asking, how do you make sure that you're still authentic to to black men and women, but also not sort of alienating other consumers? Like, if you were to guess, like a, like a. competing brand or product that, let's just say, black men at gyms might prefer to use, what would it be? I mean, I'm assuming like any consumer, they're still buying Viori, they're still buying Under Armour, Nike, Adidas. Yeah, for sure. I would say like the Under Armors, the Vioris, even Jim Shark as well as they're taking out

market share in the market, yeah. Those are the brands. And so you're trying to figure out how to kind of thread that needle. And I think, to me, the answer there is to really focus on. values, right? Like, I'm looking at your website and there's images of guys clearly just really into fitness doing CrossFit. These are guys who are strong, but not like crazy Jack, just healthy, you know, lean. And I feel like the values that it speaks to are resilient, strength, excellence, right? Empowerment. And so you're already using imagery well, right? But I think

that you have an opportunity to use it even more effectively. Excellence and empowerment and strength. Like that transcends class, race, gender. Like, it's just excellence, right? And I feel like if you can start to think about those values, it'll start to inform how you present the product, right? How you present it out into the world. Yeah.

100%. That's a great insight. I appreciate that. I think you've got to look and figure out what are the other gym distribution opportunities, obviously, within the scope of your ability to manage consignment inventory, which is a really tough, which is a really painful financial. Like, I don't know how you do that. I actually, because I used to be in the apparel business. So be careful is my advice on consignment inventory. Sometimes you might be willing to give up some margin to eliminate. the consignment because it's a very tough place to be coming from. Do you, by the way, your friend who's on the Bills, is he wearing the clothing?

Yeah, so we actually ended up adding like a sub-brand underneath because he wanted to learn about apparel manufacturing as well. So he wears it to every walkout. We make sure to have pictures taken. We do collaborations and we're working with some partnerships up there in Buffalo to just expand the brand to that die-hard bills mafia demographic. You just got to get the bills to win the Super Bowl. Yeah. It was close last year. It was close last year.

And by the way, you're talking about a real tribe. I mean, those fans are unlike, it's not like L.A. Rams fans. You know, it's like these, and not to disparage them, but, I mean, let's be honest. If you're a Buffalo Bills fan, like, you are die hard. You're like Green Bay Packers fans. Like, you're, it's all or nothing. And I feel like there's a real opportunity to lean into that committed group of people who are going to support their players. Yeah, those fans go crazy.

We've even done like anytime we'll do a pop-up in Buffalo, like, and we'll say the tie is going to be there. Just him being there will bring out wide crowds of people. And that some of his teammates are like, hey, I'm chilling right now. Let me come through as well. And that'll just bring even more people. So we're really going to leverage that with more planning this off season going into the season to make sure that we can maximize that audience's love and infection for the brand.

So I'm going to go back to what guy said earlier, go back to values, get those values right, get that existence right. and then look and make sure you clearly identify your customer segments. So guys just identified a segment that I wouldn't have thought of, you know, which is basically anybody who's a Bill's fan in Buffalo. So look at those segments really, really carefully. And then ask yourself two questions. Do I need a channel to get at that segment or can I build a direct relationship?

So once again, you have a brand partner that actually has the ability to extend a relationship with a large customer segment and that may be very powerful. Ike, thanks so much for calling in. Vey Apparel. Congrats. Good luck, man. No problem. Thank you.

Appreciate you. And thank you as well for having the podcast. I actually, when I started the business, I was listening to the Topayawatona, Calan Lee podcast. I emailed him and he reached back out to me

because we're both Nigerian, both were born in Atlanta, and he's been a good mentor to me. So just the work that you're doing doesn't go and notice. I really appreciate it. Thank you. Thank you so much for calling on Mike.

Appreciate it. No problem. All right. Take care. You know, did a story on the show, Steve, a couple years ago about Zumi's, you know, that skatewear shop in the mall. And the secret to the success of that store is inventory management. They're just obsessive about inventory management. And so it's like, I don't say tricks,

but tricks like that can make or break an apparel business, for sure. Yeah, the scary part for me there was the word consignment, you know, like, because you can get a, a, a, a, a sizing or an item that'll sit on that shelf for a long, long time because there's nobody moving it. And you've got your costs stuck in there. I mean, you can inventory manage could be at the smallest level and it can be at the biggest level. But if you ignore it, if you ignore it, it can be the detriment of you. Yeah.

It's an art. It's an art and a science, in fact. All right. We're going to take a quick break, but we'll be right back with another caller and another round of advice. 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 Steve Holmes, the founder of Spring Free Trampoline. Steve, let's take another call. Sure, that sounds like a great idea. Hello, welcome to the Advice Line. You are on with Steve Holmes, founder of Spring Free Trampoline. Welcome. Please tell us your name, where you're calling from, and just a little bit about your business. Absolutely.

Thanks for having me. My name is Cody Johnson, and I'm the founder of Grand Tongo, which is the great-smelling, powerful, Diet Alternative Bug Spray, which just launched in Target, and 1,180 stores. So I'm calling in from Las Vegas, Nevada, which is where I'm born and raised at. So it's a pleasure to be here with you. Cody, welcome to the show. Grand Tongo, this is a mosquito repellent that is deat-free. Diet is that harsh chemical, very effective at keeping ticks and other bugs off your body. but a lot of people are nervous about using it because of, you know, it's potential toxicity.

So what you have created or you formulated a new, deat-free repellent? We created a new formulation, yes. And we utilized an active ingredient called pecaridin, which is a bit more naturally derived. We really looked at the category holistically. We looked at all active ingredients that were available for repellency, including deed and seeing how we could reformulate them, and just make the experience better. I am, Cody, I'm super paranoid about ticks and Lyme disease. And even though I'm in California, it's less common. And I do use that deat spray, but I hate it because I'm always like, it's just like, this is not, I'm not sure about this.

And so this is exciting. Tell me a little bit about how you got into the bug spray business. I'll tell you, you know, it really has been a journey. I went down the rabbit hole. You know, I travel very frequently to Costa Rica, and I was having to use a deep formulation. and I would use it on my skin, and when I would use it, it would make my skin feel like radioactive. And then I just began to jump down the rival hole of like, there's got to be a better solution to this. There's got to be other options.

I've heard of the essential oils, but I've never really had great efficacy with those. Like mint or peppermints or different, yeah. Yeah, so I really just became an expert, like in the space by digging and asking questions and looking in the EPA database of what was available, what other countries are using. I used something that they had used in Germany, and I brought it here. used it in my formulation. That's pecaridin. Is that what it's called?

Correct, pecaridin. Which comes from pepper, right? Black pepper. Yeah, it's inspired. So it's not necessarily a biomolecule, but it is clear and it's odorless, and it has a nice consumer feel and experience. And more than anything,

it's got a long protection time. So it protects you for 12 hours. Cody, what were you doing before you launched this? I started out working in emergency rooms. I used to be an emergency room scribe and used to do trauma research, but most of my career was spent in pharmaceuticals and working in medical devices. So I just really became cognizant of, you know, the health factor and cognizant of what we put in our skin and the ingredients and the chemicals that we use.

So that's kind of like my niche is in the health field. Nice. All right. So you've got this. It's called Grand Tango. Really cool. I like the labels. Thank you.

You're new. And just very briefly, what kind of sales have you done so far? Any data to share with us? Yeah. I mean, I will share. The first year, you know, we did really small. We only launched in a soft launch of just doing a thing. thousand of each skews, so like 5,000 units. So that was itty-bitty, teeny tiny. We really just

validated the product on Amazon and became an Amazon's choice product, because that's when we felt like we had like product market fit. And in the second year, we were capable of scaling up to like meet a more substantial MOQ. So we were right around a million dollars. And then this year, with Target, you know, we're projecting to be quite a bit higher than that. But of course, with this great opportunity of with Target comes a great responsibility. It's like when you have this partnership with a retailer, like, you need to perform. You know, you're held to like units per store per week. So that's a lot of my focus is, you know, like this just went into store and we're crossing this atmosphere going from digital into big retail. And it's just

uncharted territory. So, Cody, before I bring Steve Holmes on, just tell, what's your pain point? What's your question for us? Yeah, my question's really this is considering my product category, you know, that it's insect repellent, it's bug spray. How do I build a sustainable business with an effective advertising engine with a highly seasonal product. We see a super strong demand during the summertime frame and then the demand tips down, you know, towards September. Yeah. Steve Holmes, I'm going to bring you in. Canada is a mosquito heaven in the summertime. I've been there. It is, you know, it's so anyway, we can, before we answer Cody's question, do you have questions for him? Yeah, first, congratulations. I love the brand. I've just jumped

on the website really quick. I'd love to know one thing. Is there anybody else that uses that active ingredient? So are you having to compare yourself to anybody else or are you just really focused on the deep, deep, deep? Yeah, it's a good question. We're not exclusive the ones only using pecarotin, but there is stratification in the category. I would say most of the category and probably 80% of products today still use active ingredient d. And there's also a small segment on the opposite end of the spectrum, which is a lot of use the essential oils. So you have like people who want grape efficacy, but they like trade off toxicity to be able to use that. And then you also have the essential oils that kind of sort of work, but they also don't really work that well. And they don't

have firm claims. So where we sit, even though pecarotin's not exclusive to us, there's still significant room for us to run with and educate on this active ingredient. We kind of fit right in the middle. We've got the longest protection time at 12 hours on the market. But we've also got more of like a cleaner feel, better for you kind of story about the active ingredient. I guess my question for you, Cody, is, why does it need to be more than a seasonal product? I mean, there's plenty of products that

kill it. Halloween candy. Snow gear. I mean, there are pumpkin patches. I just did a whole thing about a very successful pumpkin patch in Nebraska. They're open one to six weeks a year. I mean, toys. I have a toy line

for my kids company, wow in the world. And we make most of our money on those toys between Thanksgiving and, you know, a couple weeks before Christmas. So I guess my question is, is there a world where you, you plan 12 months of the year for four months of profit? Yes. And that's the environment we're currently living in, the second cycle moving into third, most certainly. You know, we do have that always on approach on Amazon. We just do see a significant uptick during that summer time frame. But when you advertise for big retail, it's a whole other

complex scenario where you're advertising in meta and Google and in these different channels. And oftentimes when the demand or the return on ad spend decreases so substantially, you've got to flip those ads off because you're running red. So when you're doing big retail, I'm just, what I'm finding, you know, and this is my question is like how do we do it to where it's just we can meet that demand, but always keep an always on approach so that the algorithms and those ads stay optimized so that you can find the best consumer at that time that you need it. What I would say to you is as you look at your ad spend, that turn off, turn on, the only other alternative you may consider, and I know you probably have,

have, but you've probably got limited resources, is what Grand Tonga has a brand, you build that package, you build that shelf space, what is that next product that falls under Grand Tonga? I mean, yes, Citronella candles or soothing gels for bug bites. I'm excited because I've got so much in queue to be able to produce and stuff that I just can't share just yet. You'll have to stay tuned. We've got a lot in queue. Well, I would say it's a wonderful thing.

if you look at Chris's, Chris Zook, wrote a book about a profit beyond your core. You've defined your core. You've got a core retail partner. And then the other thing is looking at new products is always a good thing, but they need to come from your core. You know, what are the things that are really critical? Because, I mean, I don't know what it takes to manufacture your product, but you don't want to be diversifying manufacturing processes too much. No, certainly. You know, one of the things, I mean, you're, you know, is that the cycle, the sales cycle,

for this really starts in January February. I mean, first of all, people are still going to warm places in the wintertime in North America. They're going to the Caribbean and Mexico. So if there's a way to create some kind of campaign around, you know, always have this in your suitcase or, you know, when you're, you know, in early spring, you start advertising on Facebook, you know, beat the swarm, you know, get protected before the mosquitoes hatch or something like that, right? As an extension of your comment there, Guy, I have no idea what, I mean, you've now learned so much about retail. You might look really carefully because they have high margins at retail in airports. Yes.

So it's that last minute thing. And typically when people go to those stores in airports, you know, they're not thinking price. So they're not as price sensitive. But they are thinking, what did I forget? I mean, how many times have you guys been in an airport? and said, geez, where's my toothbrush? Three days ago, Advil. I bought a bottle of Advil.

I didn't even look at the price because I needed it. Right, exactly. So I don't know where that fits in your distribution channel. We can do that, no doubt. You know, I think if you look at the business model, Canvas as another tool, there's two ways to get to your customers, either a direct relationship or through channel partners. And you need to broaden your channel partners.

And now that you've launched and got a target as a channel partner, that is always a great way to leverage into other. channel partners. You know, you can use that brand to say we're here. This is what we're doing. We can help you and we can do this. And there are chains that now run, so many of those airport convenience things. I don't even know them. Yeah, Hudson and Canada. There's a relay. There's tons. Exactly. Exactly. And ideas are easy. Guy and I. Of course, implementation is a bit more difficult. Absolutely. Cody Johnson, the brand is called Grand Tongo. Good luck. Ben. Thanks for calling in.

Yeah. Thank you so much. I appreciate it. Thank you. All right. We're going to take another quick break, but we'll be right back with another caller. 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 device line on how I built this lab. I'm Guy Raz. And today I'm taking your calls with Steve Holmes. So, Steve, let's get back into it and bring on our next caller. Well, it's great. Let's do it. Welcome to the advice line. You're on with Steve Holmes.

Please tell us your name where you're calling from and a little bit about your business. Hi, Steve. Hi, Guy. My name is Kenisha, and I am the Chocolatier and founder of One More Coco, a homemade chocolate company based in Whitby, Ontario, Canada. Our chocolates are inspired by our Jamaican heritage of nostalgic flavors. We have creations like a Scotchbonne honey and caramel popcorn. Nice. Well, welcome to the... The show, Kenesha, from Whitby, Ontario. Where is that? Where's Steve? Do you know where that is?

Just east of Toronto. D.C. of Toronto. 35 minutes drive. All right. So these are chocolate. It's chocolate inspired by your Caribbean heritage with, like, you said Scotch Bonnet, a Scotch Bonnet chocolate, like really like a, because that's a spicy pepper.

Yeah. Yes. It's one of our most popular. So it has a bit of honey and a dark chocolate, and you have the kick from the Scotch Bonnet. It was a slow burn at first, but. It's now become one of our most popular. That's scotch bonnet. So tell me about, and so these are chocolate bars, or do you make, like, chocolate bonbons?

Tell me a little bit about the products you have. So we make chocolate bars, bonbons, hot chocolate, which was featured on Oprah's favorite things in 20203. It was our trio set. It was our white milk and our Jamaican hot chocolate. And then we have, you know, other seasonal products that we bring throughout the year. Canisha, tell me a little bit about how this started. Are you, were you in food or in pastry? Is that the world you come from?

No, I'm a trained counselor that went into travel insurance when COVID happened. So just as I got promoted to travel across Canada for my job, we were hit with COVID as I was booked in my first flight. And so while at home, I just wanted to do something that I was really passionate about. So chocolate is a big part of my life. I love it. I will eat it anytime, anywhere. I've had it for a whole day. That's it, breakfast, lunch, and dinner.

So I thought, why not chocolate? I taught myself how to... How did you teach yourself, like YouTube and stuff? YouTube, Google was my best friend scrolling through social media because there was not much to do during that time. And so I launched O'Ma Koko in the basement of my parents' house. Wow. Wow. Congrats on that. And tell me a little bit about how the business is doing now. I mean, I'm assuming it's mostly direct to consumer through your website. I just see she's got a retail store.

Yes. Do you have a retail store? Yes. It was a world win of a year. So we launched May 2021. Then we opened our store September 2021 because I outgrew my parents' basement really quickly. And we've been there now going on four years. Wow. So you have a store in Whitby. Yes, yes. So we'll start downtown Whitby. So we do our retail. We do online sales and we also do wholesale and a lot of corporate. So mostly corporate. Awesome. And do you cook there too? Yeah, we make everything on site. Yes. Wow. And tell me a little bit of how the business is doing. I mean, are you guys sustainable? Are you running into headwinds right now? Are things just seem pretty stable? You know, starting of this year was one of the best year for us. It's kind of strange with, you know, the chocolate industry, the way it's going.

But because prices are going way up, right? A 300% increase over the last eight months. But we've been very lucky. I think more Canadians just want to support more Canadian businesses. So we've seen our best sales so far. You know, usually after Christmas, we see a major dip. We haven't. So, you know, now it's just trying to build capacity.

You know, I am a one-man show, so I do everything. So I'm the cashier. I'm the chocolate maker. Sometimes I am the delivery person. Wow. You have no employees? No employees, just family and friends that help out. We are hiring this summer, finally.

So it's been, you know, it's been a roller coaster, but it's been a great roller coaster. That's amazing. All right. Before we get to Steve Holmes and bring him in, tell us what your question is or your pain point that you're trying to solve. So, you know, one of the issues that we had after being on Oprah's favorite things is how do we convert, you know, a viral high-profile moment into a sustainable marketing strategy? It's great to say I was on Oprah's favorite things, but what does that really mean for my business in the long term? How do I take this to convert those customers who only came that one time to keeping them as long-term customers who engage with our products? All right. So you were on Oprah's favorite things in 2023.

and, of course, there was a viral moment, but how do you sustain that or take that momentum and turn it into a long-term, more sustainable marketing strategy? Steve Holmes, I want to bring you in fellow Canadian here, Kenesha, making chocolates, not too far from you. Yeah, absolutely. Congratulations. I love chocolate. It's probably an impulse purchase. How are you finding your customers? And then I'll come back to that Oprah question.

But how are you finding your customers? So I'm very lucky in the community that I'm in. So, you know, mostly we buy our products forget. But we have those customers who come in every two weeks to buy just to have in our home. Wow. So, you know, we're starting to lean more into trying to really showcase how giftable our product is. And, you know, it's strange. We are on Oprah's everything in 2023, but we didn't see the traction until 2024, like late 2020.

24. That's when people found out, weirdly enough, almost a year later. Wow. Back in 2007, we were on the Ellen DeGeneres show, and I'm going to share with you, the number one thing you get out of a viral moment is joy. But you don't build your business off of it. You get joy and you get to always go back and look at it as a joyful moment, but you still got to stay really, really true to those roots and the foundation about how you're going to build, get your product, your chocolate, into the channels that you want, into the customers' hands that you want, rather through a direct relationship or whether it's through a channel partner.

Do you guys, when you sell, right, because a viral moment, as Steve said, is really ultimately, it's really just about the joy and the moment. And, you know, we've done stories where even big brands, like there's a brief spike, but it passes. My question to you is, do you have a way to capture email or telephone, cell phone numbers now when people buy the products? Yes. So we don't have paper receipts in our store. You could only get a receipt through email. So that's been helpful. And on our website, we do have an option to sign up for our newsletter.

So, but those are, those are, you've got to opt in. And I wonder if there's a way to make it almost automatic. So on the website, it's one thing because you're, you're going to put an email address. to get the order. But when you buy it in store, it's a little harder to get people to give their email addresses and phone numbers these days is because people are more wary of it. But could you incentivize them? Like, hey, get 5% off if you give your email address or your phone number. And the reason why I say that is because email and SMS capture is that's the long game. That's where you can send the newsletter, remind people, give people opportunities to try, you know, limited edition drops, join the insider community, early access to new flavors. You know, when you use platforms like TikTok or Instagram, that's your renting space, basically.

They kind of own your audience. But when you've got your own email or messages, phone numbers, you own it. You can communicate directly with your customers. Let me give you a quick observation. I'm looking at your packaging. It looks great. It's fabulous. One of the questions I would ask is, do you have any space in that packaging to be creative with, I'm going to say, a QR code for a moment?

Oh, yeah. Guy. And the only reason I say it is this. In Canada, we, guy, you may not know this, but you've been to Winnipeg with him. So you know this. There's a thing called roll up the rim to win. Yes. And I say to you, have a QR code that says, melt in your mouth to win or something.

You know, I think if you could figure out how to utilize the QR code in your packaging and tie it to a promotion that captured their SMS or captured their email, as guys suggested, using that way, I remember we rolled out QR codes in 2006 and they died kind of in America, but they didn't die in the rest of the world. And they're actually back, kind of back. I mean, they're back. They're back. They're back. They're back. That's an interesting idea because you could do whatever you want with that QR code. It could automatically launch your little – you know, you've got a video on your YouTube page, a video that tells a story about this chocolate.

Maybe you, you know, down the road, you invest a little bit and you show like the chocolate being harvested or the farm that you buy it from. If there is a story there. But, you know, with a QR code, it can say, you know, put your email in. We'll send you 10% off right away. and not everyone's going to use that 10%, but then you've got the email address. And then you're directly communicating with people. And you mentioned you have a newsletter.

Tell me a little bit about the newsletter. How often are you updating it or writing something? Usually it's around when we have a promotion happening or if there's a new product or any changes. We do the newsletter. The goal is to do them at least once a month because I'm one of those people who don't like newsletters. I get annoyed if I get too many of them.

So I thought, you know, once a month is more. more than enough. I know we have, we do see quite a bit of engagement when we do release a newsletter. So another comment I would make to you just to be careful. And here's Guy and I don't want you to think that we, we want you to become lint chocolate. I mean, love we to become lint chocolate. But I think you need to think about geo-targeting. You don't want chocolates to be shipped and go bad and you get a bad, and you get a bad review.

So I think it's really critical to find that market segment within you. You're talking about people. who come back to your store every two weeks to pick up chocolate. So there's a geo-targeting strategy that I think is really, really critical and how you can figure out. And maybe, to be honest, I know in your area there's lots of Caribbean restaurants, maybe that Scotch bonnet should be sitting on the checkout of a Caribbean restaurant. I don't know about you guys, but if I walk out of a Caribbean restaurant,

I'd probably buy a chocolate bar right away. Yeah, and to kind of double down that. I mean, a lot of businesses, especially in the early stages, focus too much on customer, well, not too much. They focus on customer acquisition, which is the right thing to do. But really, as your business begins to mature, right? And you're in a couple years in here now, right? You're about four years in. It's really the repeat customers.

It's doubling down on your existing customers where you're going to extract the most value. It's, you know, to get new customers, they're going to come into the store. And over time, you're going to need new customers, but making sure that your existing customers are, as Steve said, buying more. Could you create a club where every month, you know, not just a club, but these are you're going to be your, call them your brain trust. These are the people who are going to try your experiments. Maybe you come up with some super weird flavors, you know, like maybe you come up with like a, I mean, just plantains, all kinds of things right in there. Have one. You do plantains?

Cool. We do. We launched us soon. And we've done like a truffle oil, a chocolate bar. So, you know, I'm willing to throw anything in a chocolate bar and try to taste it. Have a club. Have a club that gets your newsletter that's committed to buying like a wine club where you're buying a case every quarter. They're committed to buying it.

But they also get first dibs on these new unusual flavors. Because, you know, for our bonbons, we're also rolling out our card where you could stamp. And after 12 purchases, you'll get a free box because most of time our reoccurring customers are coming in for our bonbons. So it's one of the things that we're rolling out. But I think they would really love a box of the quarter or month club and try all over new flavors because that's how I test everything. When they walk in a store, I'm like, do you want to try something? Yeah. Here's my last piece of advice.

Okay. So you're doing it all alone. So congratulations. Thank you. Take care of yourself. You know, one of the hardest parts about being an entrepreneur is, and it's about passion and it's about hard work and all of those things. But we've heard hundreds of guys' guests. And what I would say is make sure you don't forget to take care of yourself.

It's good advice. Great advice. Kenesha Lewis, one more Coco Inc. Congrats. Good luck. Thanks for calling in. Thank you so much. Bye.

Bye. Thanks. Steve, you mentioned something I thought was really important, which was to take care of yourself. And I would be remiss to say that you have your survivor of cancer. I mean, you've been battling it and living with it for over a decade and going strong. You look great. Tell me a little about how you're feeling and how your health is these days. Well, I live with cancer.

I have cancer. I have a number of active nodules. They are slow growing, but they seem to re-resistant to most other things. And occasionally they're in, they impede behaviors. And so recently I had to have my lobectomy and lost the top part of my right lung. But so, but otherwise, I feel great. I do. I feel great.

And I think I've shared with you many, many times, you know, today is the best day of the rest of my life. And this moment with these entrepreneurs has been a great, joy. It's been a really a good, fun time for me. And so when you live in those moments, hey, it is, we are all blessed. We can find reasons to complain, but we are all blessed. You've given some great advice today, a really great advice about purpose and about the why. And if you could go back and give the young Steve Holmes, young entrepreneur Steve Holmes, some advice now, knowing what would have been helpful for you to know? Well, I'm going to tell you two things.

One is it took me about 20 years before I started keeping this black book. And the reason is that what I'm going to tell you is you may think you can remember everything. You can't. Write everything you learned down. That's number one because you can't remember the things you've learned and things you've experienced. So write it down and keep it with you. But the most important thing I would say to my young self, be honest with yourself and honest with others, regardless of the consequences. you may perceive because most of the time you perceive consequences truthfully that never materialize.

And you should have actually just come clean to yourself and to others. Because in entrepreneurs, you know, we've got young guys who, you know, they got an inventory issue and they don't really want to tell somebody yet. But I'm just saying, you know, the reality is make sure you're honest with yourself because that's the only way you won't get yourself in trouble. I love it. I love it. That's Springfree Trampling founder. Chief Activity Officer, Steve Holmes. Steve, thanks so much for coming on the show. Always a pleasure to be with you, and thank you for all that you do for young entrepreneurs.

And by the way, if you haven't heard Steve's original how I built this episode with Dr. Keith Alexander, you've got to go back and check it out. We will put a link to it in the podcast show notes. And here is one of my favorite moments from that interview. I decided to invest in some fundamental research, and I wanted to ask myself one question. Did any retailer in America believe that trampolines were dangerous and so dangerous that they wouldn't sell them?

The answer was yes, and that was Costco. The CEO of Costco was a man named Jim Senegal, and Jim said, I will not sell trampolins. Wow. And so I met it my mission to try and sell Costco a trampoline. Hey, thanks so much for listening to the show this week. And by the way, please make sure to check out my newsletter. You can sign up for it for free at gairoze.com or on Substack. And of course, if you're working on a business and you like to be on this show,

send us a one minute message that tells us a little bit about your business and the questions or issues you are currently facing, because we would love to try and help you solve them. You can send us a voice memo at hibt at ID.wondry.com or call us at 1-800-433-1298. You can leave a message there and make sure to tell us how to reach you. And by the way, we'll put all of this in the podcast description as well. This episode was produced by Sam Paulson with music composed by Ramtin Arablewe.

It was edited by John Isabella and our audio engineer was Gilly Moon. Our production team at How I Built This also includes Alex Chung, Carla Estevez, Casey Herman, Chris Messini, Elaine Coates, J.C. Howard, Catherine Seifer, Carrie Thompson and Neva Grant. I'm Guy Raz, and you've been listening to The Advice Line. on how I built this lab.